Smithland Towing & Construction, LLC et al

Filing 187

MEMORANDUM OPINION AND ORDER signed by Senior Judge Thomas B. Russell on 3/23/2022 denying 176 Motion to Lift Stay. cc: Counsel(MNM)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF KENTUCKY
PADUCAH
IN THE MATTER OF THE COMPLAINT OF
SMITHLAND TOWING & CONSTRUCTION,
LLC, AS TITLE OWNER, AND WRBM, LCC
D/B/A WESTERN RIVERS BOAT
MANAGEMENT, INC. AS OPERATOR AND
OWNER PRO HAC VICE OF THE WILLIAM
E. STRAIT, OFFICIAL NO. 270550, FOR
EXONERATION FROM OR LIMITATION OF
LIABILITY

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Case No. 5:18-cv-00113 (TBR)

MEMORANDUM OPINION AND ORDER
This matter comes before the Court upon Alice Stewart’s Motion to Lift Stay, (Mot. to
Lift Stay), Dkt. 176. Limitation Petitioners, Smithland Towing & Construction LLC, as title
owner, and WRBM, LLC d/b/a Western Rivers Boat Management, Inc., as operator and owner
pro hac vice of the WILLIAM E. STRAIT, have responded, (Lim. Pet. Resp.), Dkt. 180. Hutco
has also responded, (Hutco Resp.), Dkt. 181. So have the state court claimants, (State Claimants
Resp.), Dkt. 182.1 Stewart has replied, (Reply), Dkt. 183.
As such, briefing is complete and this motion is ripe for adjudication. For the reasons
that follow, Alice Stewart’s Mot. to Lift Stay, Dkt. 176, is DENIED.
I.

FACTUAL BACKGROUND
The WILLIAM E. STRAIT was a steel inland river towboat owned and operated by

Smithland Towing & Construction, LLC and WRBM, LLC. See Compl., Dkt. 1, ¶ 5. On

Stewart argues that the Court should only consider the Limitation Petitioners’ response because “[o]nly WRBM
has standing to oppose this Motion.” Reply at 1. By that, Stewart means that Hutco, Quentin Stewart’s employer,
“has not been sued by Stewart” and the “state court plaintiffs have no standing because they filed suit in state court.”
Id. However, contrary to Stewart’s claim that neither Hutco nor the state claimants can show prejudice, lifting the
stay could impact the state court trials and thereby prejudice either Hutco or the state claimants. For instance, lifting
the stay could result in inconsistent findings and create duplicative work. The Court therefore considers both
Hutco’s and the state claimants’ responses.
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December 14, 2015, the WILLIAM E. STRAIT was proceeding southbound on the Mississippi
River when it was involved in a collision and sank. See id. ¶ 8. After this incident, the First
Marine Shipyard took possession of the boat and began rebuilding it. See id. ¶ 10. On January
19, 2018, a fatal explosion occurred at First Marine Shipyard during the rebuilding process. See
id. ¶¶ 10–11. Quentin Stewart, a welder working on the ship, was one of those individuals who
was killed in the explosion. See Mot. to Lift. Quentin’s widow, Alice Stewart, was appointed
Administratrix of Quentin’s estate. See id.
On July 24, 2018, Limitation Petitioners filed the current action seeking exoneration from
or limitation of liability in connection with the explosion pursuant to the Limitation of Liability
Act. See Compl. On October 3, 2019, the Court stayed proceedings within the Limitation Act
and coordinated discovery with the several state court cases filed in Marshall Circuit Court. See
Mem. Op., Dkt. 172. Alice Stewart now asks the Court to lift that stay. See Mot. to Lift Stay.
II.

DISCUSSION
District courts have jurisdiction over actions arising under the Limitation Act, and they

have “discretion to stay or dismiss Limitation Act proceedings to allow a suitor to pursue his
claims in state court.” Lewis v. Lewis & Clark Marine, Inc., 531 U.S. 438, 454 (2001).
Although a district court’s “decision is ‘one of discretion in every case,’ ” id. at 449 (quoting
Langes v. Green, 282 U.S. 531, 544 (1931)), the Supreme Court and the Sixth Circuit have
determined that there are two situations in which a district court is required to dissolve its stay
and permit claimants to litigate their claims in a forum of their choice. See id. at 442; see also S
& E Shipping Corp. v. Chesapeake & O. Ry. Co., 678 F.2d 636, 643 (6th Cir. 1982). Those two
situations are: (1) when a single claim is involved, and (2) when the aggregated claims total less
than the limitation fund. See ibid.. This case does not involve either of those situations, at least

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not at this time. There are multiple claimants, and the aggregate of all the claims does not
necessarily total less than the limitation fund. Therefore, the decision to lift the stay is within the
Court’s discretion. See ibid. What animates this decision is whether the Court is satisfied that
the vessel owner’s right to seek limitation will be protected. See Lewis, 531 U.S. at 454
The Court previously concluded that “staying the current proceeding will still afford
Limitation Petitioners the necessary protections under [the Limitation Act].” Mem Op. at 3–4.
In that decision, the Court concluded that Stewart would not be prejudiced by staying this
proceeding, as she would be able to conduct any additional discovery needed “when or if this
proceeding continues after the conclusion of the state litigation.” Id. at 4 (emphasis added).
Stewart provides three reasons as to why the Court should now lift the stay. First,
Stewart argues that the Court should lift the stay because of the “long delay” until the state trials
take place—the state trials are scheduled to begin in the spring of 2023. See Mot. to Lift Stay.
However, the usual hardships that go along with waiting for a trial do not give rise to the type of
prejudice that would merit lifting this stay. Stewart has not explained why waiting for the
conclusion of state trials would create any type of undue prejudice. See Mot. to Lift Stay.
Second, Stewart claims that there is a question as to the applicability of the Limitation
Act to these cases because the Court has not determined whether the WILLIAM E. STRAIT is a
“vessel” under the terms of the statute. See Reply at 2. Thus, Stewart believes that the Court
should try her case first. See id. However, judicial economy suggests that the stay should
remain in effect. Once all of the state cases are concluded, the parties will know whether the
aggregated claims total more than the limitation fund and therefore whether it will be necessary
for the Court to rule on the Limitation Petitioners’ claim to limit their liability to the value of the
fund. See Lim. Pet. Resp. at 5–6. Furthermore, it appears, as the state claimants note, that “the

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customs and practices that have been adopted and followed are working well for the benefit of all
of the parties,” and creating “a federal tract and a state tract” would “significantly disrupt” the
state proceedings. State Claimants Resp. at 2–3. This is especially true because it appears that
discovery in the state litigation is still ongoing. See Hutco Resp. at 2. After coordinating
discovery efforts, it makes little sense to reverse course now.
Third, Stewart contends that “extensive discovery has already been completed,” which
the Court can take judicial notice of. That may be so. But there are still unresolved issues that
the state court proceedings can resolve, e.g., whether the aggregated claims total more than the
limitation fund. And as discussed supra, it appears that discovery in the state litigation is still
ongoing. See id.
The Court therefore finds that the stay should remain in place. The Court originally
contemplated that this stay would remain in place until the state litigation concluded, and Stewart
has not provided any new information that warrants lifting that stay now.
Additionally, as part of her motion to lift the stay, Stewart requests a status conference in
order to prepare a scheduling order and a trial date. See Mot. to Lift Stay. However, because the
motion to lift stay is denied, a status conference is not needed at this time.
III.

CONCLUSION
For the above stated reasons, IT IS HEREBY ORDERED that Alice Stewart’s Mot. to

Lift Stay, Dkt. 176, is DENIED.
IT IS SO ORDERED

March 23, 2022

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