Hanover Insurance Company v. Superior Labor Services, Inc. et al

Filing 321

ORDER AND REASONS granting Gray Insurance Company's 174 Motion to Dismiss Third-Party Demand of Masse Contracting, Inc., as stated herein. Signed by Judge Susie Morgan on 3/21/2016. (Reference: 14-1933) (tsf)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
HANOVER INSURANCE COMPANY,
Plaintiff

CIVIL ACTION
No. 11-2375 c/w
14-1930, 14-1933

VERSUS
SUPERIOR LABOR SERVICES,
INC., ET AL.,
Defendants

SECTION “E”

Applies to: 14-1933
ORDER AND REASONS
Before the Court is Third-Party Defendant Gray Insurance Company’s motion to
dismiss the amended third-party claim against it. 1 For the reasons below, the motion
is GRANTED.
BACKGROUND
A. State-Court Lawsuits
This is a consolidated action. The case originates from two personal-injury actions
(“State-Court Lawsuits”) filed in state court against Allied Shipyard, Inc. (“Allied”). The
plaintiffs in the State-Court Lawsuits allege Allied negligently performed sandblasting
activities, causing dangerous silica dust and other hazardous substances to permeate the
plaintiffs’ neighborhood. 2 The plaintiffs seek damages for physical pain and suffering,
medical expenses, property damage, and other damages as a result of their exposure to
the hazardous substances. 3

R. Doc. 130 (Third-Party Complaint); R. Doc. 169 (Amended Third Party Complaint); R. Doc. 174 (Motion
to Dismiss).
2 See R. Doc. 174-1 at 2; R. Doc. 1 at ¶¶ 11–12.
3 See R. Doc. 1 at ¶¶ 11–12.
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In both State-Court Lawsuits, Allied filed third-party demands against its
contractors who performed the sandblasting jobs, including Masse Contracting, Inc.
(“Masse”) 4 and Superior Labor Services, Inc. (“Superior”). 5 Specifically, Allied alleges that
Masse contracted with Allied to perform certain job responsibilities and to indemnify
Allied under a master work contract, and Allied seeks indemnity from Masse with respect
to the claims in the State-Court Lawsuits.6 Allied also alleges the right to additional
assured status and coverage on all policies of insurance issued to Masse for any liability
in the State-Court Lawsuits. 7 Allied also seeks indemnity from Superior and has alleged
the right to additional assured status and coverage on all insurance policies issued to
Superior for any liability in the State-Court Lawsuits. 8
Masse alleges that, after Allied filed a third-party demand against Masse in the
State-Court Lawsuits, many of the plaintiffs in the State-Court Lawsuits “have amended
their Petition to name Masse as a direct Defendant.” 9
The contractors against which Allied brought third-party demands “in turn sought
coverage, defense and/or indemnity from their various insurers for the periods of time
when these jobs were allegedly performed, which prompted the insurers to file lawsuits
in federal courts.” 10

R. Doc. 174-1 at 2; R. Doc. 130 at ¶ 14.
R. Doc. 1 at ¶¶ 14–17.
6 R. Doc. 169 at ¶¶ 17–18.
7 Id. at ¶ 19.
8 No. 14-1930, R. Doc. 1 at ¶¶ 12–13.
9 Id. at ¶¶ 14–18.
10 R. Doc. 174-1 at 2.
4
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B. Declaratory Actions in Federal Court
There are three federal actions related to the State-Court lawsuits pending in this
Court. The Court consolidated the three cases on November 21, 2014. 11
1. No. 11-2375
On September 21, 2011, Hanover Insurance Company (“Hanover”) filed a
complaint in this Court. 12 Hanover filed an amended complaint on September 27, 2012.13
Hanover alleges it has been participating in the defense of Superior against Allied’s thirdparty demands in the State-Court Lawsuits. 14 Hanover maintains the other insurers it
names in its federal suit “are not participating in Superior’s defense” in the State-Court
Lawsuits. 15 Hanover seeks judgment against Superior declaring that it has no duty to
defend or indemnify Superior in the State-Court Lawsuits. 16 If Hanover has a duty to
defend or indemnify Superior, Hanover seeks declaratory judgment that State National
Insurance Company (“State National”), Arch Insurance Company (“Arch”), and “other
unidentified insurance companies collectively named as ABC Insurance Company” are
liable “for their share of defense and indemnity to be paid on behalf of Superior” in the
State-Court Lawsuits. 17 Hanover also seeks reimbursement, contribution, and/or
damages from State National, Arch, and other unidentified insurance companies for
defense costs already incurred by Hanover on behalf of Superior in the State-Court
Lawsuits that, Hanover argues, should have been paid by those insurance companies. 18

See R. Doc. 108.
Hanover Ins. Co. v. Superior Labor Servs., Inc., et al., No. 11-2375.
13 R. Doc. 69.
14 Id. at ¶¶ 23–24.
15 Id. at ¶ 26.
16 Id. at 22–23.
17 Id. at ¶ 2.
18 Id. at ¶ 3.
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On January 14, 2015, Hanover filed a second supplemental and amending
complaint naming Allied as a defendant. 19 Hanover alleges that “Allied has tendered the
[State-Court Lawsuits] to Hanover for defense and indemnity in its capacity as an alleged
additional insured” under Superior’s policies, and Hanover has offered to participate in
Allied’s defense in the State-Court Lawsuits subject to a full reservation of rights. 20
Hanover alleges that Allied is not an additional assured under Hanover’s policies, and
Hanover seeks judgment against Allied declaring that it has no duty to defend or
indemnify Allied in the State-Court Lawsuits. 21 In the alternative, if the Court finds
Hanover has a duty to defend or indemnify Allied, Hanover seeks judgment declaring that
Arch, State National, other unidentified insurance companies are obligated to pay their
portions of defense costs and/or indemnity incurred by Hanover on behalf of Superior
and Allied in the State-Court Lawsuits. 22
2. No. 14-1930
On August 22, 2014, Arch Insurance Company brought an action for declaratory
judgment against Superior and Allied. Arch seeks a declaration of its rights and
responsibilities under “certain insurance policies issued by Arch to Superior,” with
respect to Superior’s request for defense and indemnity in the State-Court Lawsuits. 23
Arch also seeks a declaration of its rights and responsibilities with respect to Allied’s
request for additional assured status under the Superior policies and defense and
indemnity of Allied in the State-Court Lawsuits. 24 Arch seeks a declaration against

R. Doc. 125.
Id. at ¶ 79.
21 Id. at 9.
22 Id.
23 No. 14-1930, R. Doc. 1 at ¶ 3.
24 Id. at ¶ 4.
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Superior and Allied that Arch has no defense or indemnity obligation to Superior in the
State-Court Lawsuits and that Allied is not an additional assured under the Superior
policies. 25 Allied also seeks recovery of the portion of defense costs already incurred by
Arch on behalf of Superior. 26
3. No. 14-1933
On August 22, 2014, Arch also filed an action for declaratory judgment against
Masse and Allied. Arch provided insurance coverage to Masse for November 15, 2005, to
November 15, 2006, under policy number PML 0011399. 27 Arch seeks a declaration of the
rights and responsibilities of Arch under “certain insurance policies issued by Arch to
Masse,” with respect to Masse’s request for defense and indemnity in the State-Court
Lawsuits. 28 Arch also seeks a declaration of its rights and responsibilities with respect to
Allied’s request for additional assured status under the Masse policies and defense and
indemnity of Allied in the State-Court Lawsuits.. 29 Arch seeks a declaration against Masse
and Allied that Arch has no defense or indemnity obligation to Masse in the
State-Court Lawsuits. 30
C. Masse’s Third-Party Claims
Masse filed a third-party complaint in No. 14-1933 on January 14, 2015, against
several of its insurers from 1995 through 2008, including Gray Insurance Company
(“Gray”).31 Masse filed an amended and supplemental third-party complaint on April 8,

Id. at ¶¶ 21, 47.
Id. at ¶ 47.
27 R. Doc. 137 at 2.
28 No. 14-1933, R. Doc. 1 at ¶ 3.
29 Id. at ¶ 4.
30 Id. at ¶ 46.
31 R. Doc. 130 at ¶¶ 5–11.
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2015, to name additional insurers. 32 The amended third-party complaint alleges that Gray
provided insurance to Masse from 2002 until 2005 and thus has a duty to defend and/or
indemnify Masse in the State-Court Lawsuits. 33 Masse seeks declaratory relief and a
judgment against Gray and the other third-party defendant insurers “declaring that these
Third Party Defendants have a duty to defend and an obligation to indemnify Masse in
the [State-Court Lawsuits] and awarding all costs of these proceedings . . . .” 34
D. Gray’s Motion to Dismiss
Gray filed the instant motion to dismiss on May 13, 2015, under Rule 12(b)(1) and
Rule 12(b)(6) of the Federal Rules of Civil Procedure. 35 Gray argues Masse’s third-party
demand is improper under Rule 14 36 and that the Court lacks independent and
supplemental jurisdiction over Masse’s claim against Gray. 37 The Court will treat the
motion as a motion to strike pursuant to Rule 14(a)(4) 38 and need not address the other
grounds of Gray’s motion to dismiss. 39
Masse filed a memorandum in opposition on July 7, 2015. 40 Gray filed a reply in
support of its motion on July 15, 2015. 41

R. Doc. 169.
Id. at ¶ 12.
34 Id.at 7.
35 R. Doc. 174.
36 R. Doc. 174-1 at 6–9.
37 Id. at 9–13.
38 Rule 14(a)(4) states, “Any party may move to strike the third-party claim, to sever it, or to try it
separately.” FED. R. CIV. P. 14(a)(4). See Morris ex rel. Estate of Morris v. Trust Co. of Va., No. 12-1020,
2014 WL 4826829, at *4 n.11 (M.D. Ala. Sept. 26, 2014).
39 The Court notes that Gray is a Louisiana corporation, as is Masse. No independent basis for jurisdiction
exists. The Court lacks supplemental jurisdiction over Masse’s third-party claims, as Arch’s claim against
Masse and Masse’s third-party claim against Gray are not “so related . . . [such] that they form part of the
same case or controversy.” 28 U.S.C. § 1367(a). See also Martin v. Fid. Nat. Title Ins. Co., No. 09-4195, 2011
WL 4478432, at *3 (E.D. La. Sept. 26, 2011).
40 R. Doc. 214.
41 R. Doc. 219.
32
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STANDARD OF LAW
A motion to strike, sever, or try separately a third-party claim requires a
determination of whether the third-party claim is proper under Rule 14. 42 Rule 14
provides, “A defending party may, as third-party plaintiff, serve a summons and
complaint on a nonparty who is or may be liable to it for all or part of the claim against
it.” 43 A defending party may, but is not required to, file a third-party claim. 44 “Liability of
the third party must be ‘dependent’ or ‘in some way derivative’ of the outcome of the main
claim.” 45 Thus, “the third party must necessarily be liable over to the defendant for all or
part of the plaintiff’s recovery or . . . the defendant must attempt to pass on to the third
party all or part of the liability asserted against the defendant.” 46
DISCUSSION
Gray argues that Rule 14 does not authorize Masse’s third-party claim against it
because Gray’s potential liability to Masse is not dependent on the outcome of Arch’s
claim against Masse and Gray cannot be liable to Masse for any part of Arch’s claim. 47
Rule 14 aims to promote efficiency and reduce litigation “by having one lawsuit
do the work of two.” 48 The Fifth Circuit has explained, however, that “[a]n entirely
separate and independent claim cannot be maintained against a third party under Rule
42 FED. R. CIV. P. 14(a)(4). See United States v. Joe Grasso & Son, Inc., 380 F.2d 749 (5th Cir. 1967); U.S. ex
rel. Branch Consultants, L.L.C. v. Allstate Ins. Co., 265 F.R.D. 266, 272–73 (E.D. La. 2010).
43 FED. R. CIV. P. 14(a)(1).
44 Id. (“A defending party may, as third-party plaintiff, serve a summons and complaint on a nonparty who
is or may be liable to it for all or part of the claim against it.”). See also Branch Consultants, 265 F.R.D. at
272.
45 Id. See also Joe Grasso, 380 F.2d at 750–52 (“The question whether a defendant’s demand presents an
appropriate occasion for the use of impleader or else constitutes a separate claim has been resolved
consistently by permitting impleader only in cases where the third party’s liability was in some way
derivative of the outcome of the main claim. . . . [I]t is clear that impleader under Rule 14 requires that the
liability of the third party be dependent upon the outcome of the main claim.”); Se. Mortgage Co. v. Mullins,
514 F.2d 747, 749 (5th Cir. 1975).
46 Joe Grasso, 380 F.2d at 751 (citations omitted).
47 R. Doc. 174-1 at 6–9.
48 Mullins, 514 F.2d at 749 (citations omitted) (internal quotation marks omitted).

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14, even though it does rise out of the same general set of facts as the main claim.” 49 “[T]he
procedural device of impleader may only be used when the third party defendant’s
potential liability is dependent upon the outcome of the main claim.” 50 Impleader cannot
be used “as a vehicle for the trying together of separate and distinct causes of action, or
for the introduction, into the main action, of several parallel, but independent, actions, or
separate and independent claims.” 51 Thus, to be permissible under Rule 14, Masse’s thirdparty claim against Gray must be dependent on or derivative of the claim Plaintiff Arch
brings against Masse. 52
The third-party complaint alleges, “Gray provided insurance to Masse from
November 15, 2002 to November 15, 2005 under policy number GL072824. Gray has a
duty to defend and/or indemnify Masse in the Underlying Lawsuit[s].” 53 The “Underlying
Lawsuit[s]” Masse identifies in its complaint are the State-Court Lawsuits discussed
above and not the federal lawsuit brought by Arch against Masse. 54
Masse contends that its third-party demand against Gray should be allowed to
proceed because Gray may be liable for all or part of Arch’s claims against Masse. Masse
explains as follows:
If Arch is successful in its declaratory action against Masse, and the Court
determines that Allied is not an additional assured under Masse’s insurance policy
through Arch, then Allied will seek indemnity and defense directly from Masse
based upon alleged contractual indemnity. The purported Master Work Contract
between Masse and Allied is unenforceable and against public policy. Therefore,
Allied’s sole source for recovery of defense and indemnity costs is its insurer Gray
Insurance Company. Since Gray may be liable for all or part of Allied’s claim for
Id. (citing Joe Grasso, 380 F.2d at 751).
Am. Express Travel Related Servs. Co. v. Beaumont, No. 01-1869, 2002 WL 31298867, at *2 (N.D. Tex.
Oct. 9, 2002) (quoting Mullins, 514 F.2d at 749) (emphasis added).
51 Majors v. Am. Nat. Bank of Huntsville, 426 F.2d 566, 568 (5th Cir. 1970) (internal quotation marks
omitted).
52 When a Third-Party Action Is Proper, 6 FED. PRAC. & PROC. CIV. § 1446 (3d ed. 2010).
53 R. Doc. 169 at ¶ 12.
54 See id. at ¶¶ 14–20.
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defense and indemnity, which is the subject of Arch’s claims against Masse, Gray
Insurance Company is a proper third party defendant in this matter. 55
In response, Gray notes that, if Arch is successful in its claim against Masse, Arch will
have no duty to defend or indemnify Masse in the State-Court Lawsuits. 56 Gray argues,
“If there is no [insurance] coverage, then Arch owes no obligations or duties to Masse;
likewise, Masse would owe no obligations or duties to Arch. If that is the case, then Gray
cannot be liable to Masse because Masse will not be seeking to pass on to Gray any liability
it owes to Arch.” 57 Gray also argues that, even assuming “Allied’s sole source of recovery
of defense and indemnity costs is its insurer Gray Insurance Company,” as Masse
argues, 58 Masse still has not satisfied Rule 14 and shown that Gray would be liable to
Masse for all or part of Arch’s claim against it. 59
The Court finds that Masse’s third-party claim against Gray is not derivative of or
dependent on Arch’s claim against Masse. Arch’s policy and Gray’s policy are independent
and distinct policies. 60 In its third-party demand, Masse seeks declaratory relief and
judgment declaring that Gray and the other third-party defendants “have a duty to defend
and an obligation to indemnify Masse in the Underlying Lawsuits (the State-Court
Lawsuits) and awarding all costs of these proceedings . . . .” 61 Arch, however, seeks
declaratory relief and judgment against Masse declaring that Arch has no duty to defend
or indemnify Masse in the State-Court Lawsuits. 62 Arch’s claim against Masse is based on

R. Doc. 214 at 8.
R. Doc. 219 at 4.
57 Id.
58 R. Doc. 214 at 8.
59 R. Doc. 219 at 4–5.
60 The policies don’t even cover the same time period. Compare R. Doc. 169 at ¶ 12 with R. Doc. 253 at 6–7
and R. Doc. 137 at 2.
61 R. Doc. 169 at 7.
62 No. 14-1933, R. Doc. 1 at 13–19.
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the policy of liability insurance Arch issued to Masse, 63 whereas Masse’s claim against
Gray is based the policy Gray issued to Masse. 64
If Arch succeeds in its claim against Masse, Masse will not owe Arch anything;
rather, Arch will be awarded declaratory judgment acknowledging that Arch owes no duty
to defend or indemnify Masse in the State-Court Lawsuits. 65 Masse will have no liability
to pass on to Gray; Gray thus cannot be secondarily liable to Masse for Arch’s claim
against Masse under that scenario. 66 If Arch does not succeed in its claim against Masse
and the Court determines Arch has a duty to defend or indemnify Masse in the StateCourt Lawsuits, Gray still will not be secondarily liable to Masse for Arch’s claims. Clearly,
the outcome of Arch’s claim against Masse has no bearing on whether Gray has a duty to
indemnify or defend Masse in the State-Court Lawsuits. It is true that both Arch’s claim
against Masse and Masse’s third-party claim against Gray arise from some of the same
underlying facts, namely, the State-Court Lawsuits, but Masse’s third-party claim against
Gray does not depend on or derive from Arch’s claim against Masse in any way. “It is not
enough that the suit between [the defendant/third-party plaintiff] and the third-party
defendants would somehow be related to the suit between [the plaintiff] and [the
defendant/third-party plaintiff].” 67 Because “an entirely separate and independent claim
cannot be maintained against a third party under Rule 14, even though it does arise out

See id. at ¶¶ 3, 15
R. Doc. 169 at 5–7.
65 See id.
66 Evert v. Finn, No. 98-3293, 1999 WL 397401, at *2 (E.D. La. June 15, 1999) (“The crucial characteristic
of a Rule 14 claim is that defendant is attempting to transfer to the third-party defendant the liability
asserted against defendant by the original plaintiff.”); When a Third-Party Action is Proper, 6 FED. PRAC.
& PROC. CIV. § 1446 (same).
67 Branch Consultants, 265 F.R.D. at 273.
63

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of the same general set of facts as the main claim,” 68 Masse’s third-party claim is improper
under Rule 14.
Masse argues Gray “completely fails to address” the factors courts have applied
when deciding whether to allow impleader. 69 Several courts have enumerated factors to
consider when determining whether to allow a third-party complaint: (1) the prejudice
placed on the other parties; (2) undue delay caused by adding the third-party
plaintiff; (3) lack of substance to the third-party claim; and (4) whether the third-party
claim advances the purposes of Rule 14, such as avoiding duplicative suits on closely
related issues. 70 The Court need not address these factors, however, because the Court
finds Masse’s third-party claims are procedurally improper under Rule 14(a). “The court’s
discretion may be exercised only when the proposed third-party claim is within the scope
of impleader established by Rule 14(a).” 71
Masse argues that “many courts have permitted third-party claims to proceed in
declaratory judgment actions despite a lack of derivative liability.” 72 Masse cites several
cases in which, Masse argues, the court applies a “declaratory judgment exception” to

Joe Grasso, 380 F.2d at 751. See also Martin v. Lafon Nursing Facility of the Holy Family, Inc., No. 065108, 2007 WL 4163678, at *2 (E.D. La. Nov. 20, 2007) (“Impleader is . . . only permitted in those cases in
which a third party is derivatively or secondarily liable to the defendant, i.e., ‘the third party’s liability [is]
in some way derivative of the outcome of the main claim.’” (quoting Joe Grasso, 380 F.2d at 751)); When a
Third-Party Action Is Proper, 6 FED. PRAC. & PROC. CIV. § 1446 (“The mere fact that the alleged third-party
claim arises from the same transaction or set of facts as the original claim is not enough.”); Vinmar
Overseas, Ltd. v. OceanConnect, LLC, No. 11-4311, 2012 WL 5989206, at *4 (S.D. Tex. Nov. 29, 2012) (“The
secondary or derivative liability notion is central to impleader. . . . Impleader is proper only when the thirdparty defendant’s potential liability is dependent upon the outcome of the main claim.” (citations omitted)
(internal quotation marks omitted)); Martco Ltd. P’ship v. Bruks Inc., 430 F. App’x 332, 334–35 (5th Cir.
2011) (per curiam).
69 R. Doc. 214 at 6.
70 Cedar Ridge, LLC v. Landmark Am. Ins. Co., No. 13-672, 2014 WL 68792, at *2 (E.D. La. Jan. 8, 2014);
Vinmar, 2012 WL 5989206, at *3; Briones v. Smith Dairy Queens, Ltd., No. 08-48, 2008 WL 4200931, at
*2 (S.D. Tex. Sept. 9, 2008).
71 Vinmar, 2012 WL 5989206, at *3 (emphasis added). See also McCain v. Clearview Dodge Sales, Inc.,
574 F.2d 848, 849–50 (5th Cir. 1978) (per curiam) (“[A] third-party complaint is not proper under Rule 14
if the defendant cannot show a basis for the third-party defendant’s liability to the defendant.”).
72 R. Doc. 214 at 6.
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Rule 14. 73 The Court does not agree that a declaratory-judgment exception to Rule 14
exists and, in any event, finds the cases cited by Masse to be distinguishable from the
matter before it. 74
Masse cites Old Republic Insurance Company v. Concast, Inc., a case in which
the Southern District of New York relied in part on the Fifth Circuit’s decision in
American Fidelity and Casualty Company v. Greyhound Corporation. 75 In American
Fidelity, the Fifth Circuit concluded that the district court did not abuse its discretion in
allowing a third-party complaint in a declaratory judgment action. 76 The Fifth Circuit
explained that while there were distinctly separate questions involved in the main claim
and the third-party claim, the underlying issues in both “turn[ed] on substantially the
same facts” and “were so closely intertwined that consistent results probably depended
upon their being decided at one time.” 77 The Fifth Circuit did not adopt a “declaratory
judgment exception” as Masse implies in its opposition. 78 Instead, the Fifth Circuit
affirmed the district court’s determination that the third-party demand fit within the
scope of Rule 14 given the similarity between the facts and issues underlying the main
claim and the third-party claim. In the case now before this Court, the main claim and the
third-party claims do not turn on “substantially the same facts,” and consistent results
will not depend on their being decided simultaneously. Assessing both claims will require
independent review of Arch’s insurance policy and Gray’s insurance policy—two separate
Id. at 6–7.
For example, in the first case Masse cites to support its contention that courts apply a “declaratory
judgment action exception,” the court refused to allow impleader because the court determined that the
third-party plaintiff sought to implead a separate insurance company that issued a different type of policy
as that involved in the main claim. Nat’l Fire Ins. Co. of Hartford v. Nat’l Cable Television Coop., Inc., No.
10-2532, 2011 WL 1430331, at *2 (D. Kan. Apr. 14, 2011).
75 Old Republic Ins. Co. v. Concast, Inc., 99 F.R.D. 566, 568–69 (S.D.N.Y. 1983).
76 Am. Fid. & Cas. Co. v. Greyhound Corp., 232 F.2d 89, 92 (5th Cir. 1956).
77 Id.
78 See R. Doc. 214 at 7–8.
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policies issued by two different insurers covering two different time periods. The evidence
required to prove Arch’s claim against Masse and the evidence required to prove Masse’s
third-party claim against Gray are distinct. The result in one analysis will not affect the
result in the other. 79
CONCLUSION
In light of the Court’s analysis above, the Court strikes Masse’s third-party
demand against Gray from the amended third-party complaint, 80 as Masse’s claim
against Gray is not derivative of or dependent on Arch’s claim against Masse.
Accordingly;
IT IS ORDERED that Gray’s motion to strike is GRANTED. That portion of
Masse’s amended third-party demand asserting a claim against Gray is STRICKEN and
the third-party demand against Gray is DISMISSED WITHOUT PREJUDICE.
IT IS FURTHER ORDERED that Masse has until Thursday, March 24,
2016, at 5:00 p.m. to file a memorandum stating why the additional third-party

In Joe Grasso, the Fifth Circuit affirmed the district court’s dismissal of the defendant’s third-party
complaint. The court also suggested in dicta that there is a circumstance that might fit within the scope of
Rule 14 but is different from the “usual situation where impleader is used, i.e., where the third impleader is
secondarily liable for the judgment against the original defendant.” Joe Grasso, 380 F.2d at 752. In Joe
Grasso, the plaintiffs were boat owners who brought suit against the United States for a refund of
employment taxes they paid on a group of crewmembers. Id. at 750. The United States brought a thirdparty complaint against the boat captains who could be alternatively liable for the taxes on the same group
of crewmembers. Id. The Fifth Circuit affirmed dismissal but noted that, “in order for the government to be
able to implead the captains as third party defendants in this tax refund suit, it must appear that the liability
of the two taxpayers is an either/or proposition as a result of the law or the facts.” Id. at 752. The Fifth
Circuit found that the United States failed to show that the tax liability “necessarily will fall upon either [the
boatowners] or the captains.” Id. The court concluded that, although “allowing impleader of the captains
would expedite administratively the entire controversy,” the third-party complaint against the captains was
“a separate claim for taxes, and as such must be denied.” Id. The instant case is not like the situation
discussed in dicta by the Fifth Circuit in Joe Grasso. The determination of whether one insurer or another
owes Masse a duty to indemnify or defend it in the State-Court Lawsuits is not “an either/or proposition”
between Plaintiff Arch and Third-Party Defendant Gray. Id. Like the third-party claim in Joe Grasso,
Masse’s third-party claims are separate and distinct from Arch’s claim against Masse. The third-party claim
against Gray may not be brought under Rule 14.
80 R. Doc. 169.
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demands made against the remaining third-party defendants 81 should not be stricken and
dismissed without prejudice for failure to comply with Rule 14.
New Orleans, Louisiana, this 21st day of March, 2016.
____________ ________ _______
SUSIE MORGAN
UNITED STATES DISTRICT JUDGE

81

See R. Doc. 169.

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