Conti 11. Container Schiffahrts-GmbH & Co. KG M.S. MSC Flaminia et al v. New Orleans Terminal, LLC
ORDER & REASONS: granting in part and denying in part 8 Motion to Dismiss for Failure to State a Claim and 12(f) Motion to Strike as set forth in document ; denying as moot 16 Motion for Leave to File Reply. Signed by Judge Carl Barbier on 2/3/16. (sek)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
CONTI 11. CONTAINER SCHIFFAHRTSGMBH & CO. KG M.S. MSC FLAMINIA,
NEW ORLEANS TERMINAL, LLC
SECTION: “J” (3)
ORDER AND REASONS
Before the Court is a 12(b)(6) Motion to Dismiss for Failure
to State a Claim and 12(f) Motion to Strike (Rec. Doc. 8) filed by
Defendant, New Orleans Terminal, LLC (“NOT”), and an Opposition
thereto (Rec. Doc. 13) filed by Plaintiffs, Conti 11. Container
Schiffahrts-GmbH &. Co. KG “M.S. MSC FLAMINIA” (“Conti”) and NSB
Niederelbe Schiffahrtsgesellschalf MBH & Co. KG (“NSB”). Having
considered the motion and legal memoranda, the record, and the
applicable law, the Court finds that the motion should be GRANTED
in part and DENIED in part.
FACTS AND PROCEDURAL BACKGROUND
This litigation arises from an explosion and fire aboard the
vessel the M.S. MSC FLAMINIA (“the Vessel”) on July 14, 2012.
Plaintiff Conti is a German entity and the registered owner of the
Vessel. Plaintiff NSB, also a German entity, was the operator of
the Vessel and responsible for the manning, stores, maintenance,
and repairs of the Vessel. NOT is a Louisiana-based LLC that
provided stevedoring services to Plaintiffs. NOT also operates a
marine terminal at the Port of New Orleans.
In June 2012, NOT received, handled, and stored certain
chemical cargo, which it loaded onto the Vessel on July 1. The
explosion occurred two weeks later. Three crew members died in the
accident, and several were injured. In addition, the Vessel itself
suffered extensive damage, and many cargo containers were damaged
or lost. After several parties filed suit against Conti and NSB,
Plaintiffs filed a limitation action in the Southern District of
New York on December 7, 2012. NOT is not a party to the limitation
conducting discovery on liability for the explosion. As part of
this discovery, NOT produced documents on August 25, 2014. After
became aware that NOT may have been responsible for the accident.
According to Plaintiffs, NOT received chemical cargo consisting of
Divinylbenzene (“DVB”) on June 21, 2012. NOT also received Material
Safety Data Sheets concerning this chemical cargo, which contained
information about the dangerous nature of DVB. The sheets directed
sunlight, as the chemical was explosive and combustible at high
temperatures. Despite these instructions, Plaintiffs allege that
NOT stored and handled the cargo in direct sunlight and subjected
it to high ambient temperatures. Plaintiffs allege that NOT’s
improper storage and handling caused the explosion.
Plaintiffs filed suit against NOT in this Court on August 21,
2015, within one year of their receipt of the documents. Plaintiffs
alleged: (1) NOT was strictly liable for failing to warn Plaintiffs
of the hazardous nature of the cargo; (2) NOT was liable for
negligence; (4) NOT breached the implied warranty of workmanlike
contribution from NOT. NOT filed the instant motion on December
23. Plaintiffs filed an amended complaint on January 13, 2016,
omitting the strict liability cause of action. Plaintiffs opposed
the instant motion on January 19.
A. NOT’s Arguments in Favor of Dismissal
First, NOT argues that all of Plaintiffs’ claims should be
dismissed due to laches. According to NOT, laches is an admiralty
doctrine used to determine if a complaint is time-barred. NOT
contends that a Rule 12(b)(6) motion is the proper vehicle for
asserting a laches argument. Because Louisiana imposes a one-year
statute of limitations in tort cases and this time period has
expired, NOT argues that Plaintiffs must prove that their delay in
filing suit was excusable or that NOT has not been prejudiced by
the delay. NOT contends that Plaintiffs knew at the time of the
accident that NOT had received the cargo and loaded it on the
vessel. Because Plaintiffs waited almost three years to file suit,
NOT claims that the delay was not excusable. Further, NOT asserts
that the United States Court of Appeals for the Fifth Circuit
presumes that the defendant is prejudiced by a late filing. NOT
also argues that it suffered prejudice because it was not able to
participate in the extensive discovery conducted in the limitation
Second, NOT argues that it is not strictly liable for failing
to warn Plaintiffs of the dangerous nature of the cargo. Plaintiffs
allege in their original complaint that this cause of action arises
under the Carriage of Goods by Sea Act (COGSA). However, NOT
contends that COGSA only applies to carriers and shippers of cargo.
Only shippers of dangerous cargo owe a duty under COGSA. NOT argues
that it acted as a receiver, bailee, or stevedore in this case.
Thus, it cannot be strictly liable for failure to warn under COGSA.
Third and fourth, NOT challenges Plaintiffs’ theories of
negligent failure to warn and general negligence. According to
NOT, Plaintiffs do not have any legal basis to assert that NOT
owed a duty to warn Plaintiffs about the nature of the cargo that
other parties owned and shipped. Likewise, as to Plaintiffs’
general negligence claim, NOT contends that Plaintiffs did not
cite any legal basis for asserting that NOT owed Plaintiffs a duty
to properly store and handle cargo. In the absence of a contract
between it and Plaintiffs, NOT argues that no such duty exists.
Fifth, NOT argues that it is not subject to an implied
warranty of workmanlike performance (“WWLP”). According to NOT,
terminal operators like itself do not owe a WWLP in the absence of
a contractual relationship. Further, NOT contends that indemnity
does not apply to vessel and cargo damage claims in which a vessel
owner sues a stevedore. Sixth, NOT argues that Plaintiffs are not
entitled to indemnity or contribution. Indemnity is not available
Plaintiffs did not enter into a contract providing for express
indemnity. NOT also claims that Plaintiffs are not entitled to
contribution because they cannot show that NOT owed and breached
a legal duty.
complaint. The original complaint states that it is being brought
under Rule F of the Supplemental Rules for Admiralty and Maritime
Claims. However, NOT points out that this case is not a limitation
action, rendering Rule F inapplicable. NOT asks the Court to strike
any reference to Rule F from the complaint.
B. Plaintiffs’ Arguments in Opposition
inapplicable in this case. Plaintiffs agree that the Louisiana
statute of limitations for tort claims is one year. However,
Plaintiffs argue that the prescriptive period commences when the
plaintiff acquires actual or constructive knowledge of the facts
giving rise to the suit. In this case, Plaintiffs claim that they
did not obtain actual or constructive knowledge of NOT’s role in
the accident until they received certain discovery responses from
NOT in August 2014. Before receiving this information, Plaintiffs
claim that they did not know that the cargo was temperaturesensitive or that NOT had improperly handled and stored the cargo,
thereby exposing it to excessive heat. Plaintiffs point out that
they filed suit within one year of this discovery. Plaintiffs also
assert that their claim for breach of the WWLP is subject to a
ten-year prescriptive period. Thus, Plaintiffs argue that their
underlying claims have not prescribed.
because their delay in filing suit was excusable and because NOT
has not suffered prejudice. Plaintiffs argue that filing suit after
prescription has accrued only gives rise to a presumption of
laches. Plaintiffs claim that they can rebut this presumption by
prejudiced by the delay. Plaintiffs assert that their delay was
excusable because they were unaware of NOT’s involvement in the
accident until August 2014. They claim that they did not know NOT
was a proper defendant until that time. Also, Plaintiffs argue
that NOT has the burden of showing actual prejudice, meaning that
NOT will be subjected to a disadvantage in establishing a claim or
defense. According to Plaintiffs, no prejudice occurs when the
defendant can protect its interests and prepare a case for trial.
Plaintiffs argue that NOT did not suffer prejudice simply because
it was unable to participate in discovery in the limitation action.
According to Plaintiffs, the limitation action is a separate suit,
and NOT will be able to engage in discovery pertaining to this
arguments on this subject are moot. Third, Plaintiffs address NOT’s
challenges to their negligent failure to warn claim. Relying on
the Restatement definition of the tort, Plaintiffs claim that NOT
was a “supplier” with knowledge of the dangerous nature of the
cargo. Plaintiffs assert that NOT received this information from
instructions and warned of the flammable nature of the cargo.
Plaintiffs claim that NOT had a duty to deliver these documents to
the ship. According to Plaintiffs, NOT also had a duty to warn
them about any hazards associated with the cargo. They claim that
the danger was not open and obvious and that they should not have
known of the hazards without a warning.
Fourth, Plaintiffs defend their general negligence claims.
They state that they are not required to fully outline each element
of their claim in their complaint. Generally, Plaintiffs assert
shipowners against stevedores for damage to vessels and cargo.
According to Plaintiffs, they alleged sufficient facts to give
rise to the inference that NOT, acting as a stevedore, negligently
handled and stored the cargo.
Fifth, Plaintiffs argue that NOT breached the WWLP. They claim
that a stevedore owes an implied duty of workmanlike service to a
vessel owner. A breach of this duty gives rise to a claim for
indemnity. Plaintiffs contend that privity of contract between the
stevedore and the vessel owner is unnecessary according to Supreme
Court and Fifth Circuit precedent. According to Plaintiffs, the
implied warranty extends to cargo and vessel damage because the
Fifth Circuit cases questioning its application only did so in
dicta. Moreover, Plaintiffs cite cases from other federal courts
addition, this case involves personal injury claims as well as
vessel and cargo damage claims. Plaintiffs also aver that the
question of whether NOT was acting as a stevedore or as a terminal
operator is a question of fact that should not be resolved by a
Rule 12(b)(6) motion.
Sixth, Plaintiffs claim that they are entitled to indemnity
Plaintiffs argue that they are entitled to indemnity. Also, they
state that they are entitled to contribution due to NOT’s breaches
of several legal duties, as explained above. Finally, Plaintiffs
argue that NOT’s motion to strike is moot because Plaintiff removed
all references to Rule F in its amended complaint.
Under the Federal Rules of Civil Procedure, a complaint must
contain “a short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). The
complaint must “give the defendant fair notice of what the claim
is and the grounds upon which it rests.” Dura Pharm., Inc. v.
Broudo, 544 U.S. 336, 346 (2005). The allegations “must be simple,
concise, and direct.” Fed. R. Civ. P. 8(d)(1).
plaintiff fails to allege any set of facts in support of his claim
which would entitle him to relief.” Taylor v. Books A Million,
Inc., 296 F.3d 376, 378 (5th Cir. 2002) (citing McConathy v. Dr.
Pepper/Seven Up Corp., 131 F.3d 558, 561 (5th Cir. 1998)). To
survive a Rule 12(b)(6) motion to dismiss, the plaintiff must plead
enough facts to “state a claim to relief that is plausible on its
face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 547 (2007)). A claim is
facially plausible when the plaintiff pleads facts that allow the
court to “draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Id. A court must accept all
well-pleaded facts as true and must draw all reasonable inferences
in favor of the plaintiff. Lormand v. U.S. Unwired, Inc., 565 F.3d
228, 232-33 (5th Cir. 2009); Baker v. Putnal, 75 F.3d 190, 196
(5th Cir. 1996). The court is not, however, bound to accept as
true legal conclusions couched as factual allegations.
A. Mooted Issues: Strict Liability and Motion to Strike
First, Plaintiffs’ amended complaint mooted NOT’s arguments on
strict liability and on its motion to strike. The amended complaint
omits any strict liability claims and any references to Rule F
limitation actions. Thus, the Court will not discuss these issues
NOT asserts that all of Plaintiffs’ claims are time-barred due
to laches. Laches is an equitable doctrine that looks to the
analogous state prescriptive period to determine if the plaintiff
filed suit timely. See Mecom v. Levingston Shipbuilding Co., 622
F.2d 1209, 1215 (5th Cir. 1980). If not, the plaintiff must prove
either (1) that the defendant was not prejudiced by the delay or
(2) that the plaintiff had an excuse for its delay. Watz v. Zapata
Off-Shore Co., 431 F.2d 100, 111 (5th Cir. 1970). In Louisiana, a
tort action is “subject to a liberative prescription of one year.
This prescription commences to run from the day injury or damage
is sustained.” La. Civ. Code art. 3492. Courts have found that the
plaintiff’s injury or damage is sustained when the plaintiff
obtains actual or constructive knowledge of the alleged tort.
Mistich v. Cordis Mfg. Co., 607 So. 2d 955 (La. Ct. App. 1992).
The plaintiff has constructive knowledge when he “has sufficient
inquiry.” Bell v. Demax Mgmt. Inc., 824 So. 2d 490, 493 (La. Ct.
Assuming arguendo that the applicable prescriptive period is
the one-year tort period, 1 Plaintiffs filed suit before the statute
of limitations prescribed. In the context of a Rule 12(b)(6)
Plaintiffs’ complaint as true. Lormand, 565 at 232-33. Here,
Plaintiffs contend that they were unaware of NOT’s role in the
accident until August 25, 2014. Plaintiffs received discovery
documents on this date that alerted them to the fact that NOT may
have improperly stored and handled the explosive chemical cargo.
Accepting these facts as true, Plaintiffs first gained actual or
constructive knowledge of NOT’s tortious behavior on August 25,
2014. Plaintiffs filed suit on August 21, 2015, just under one
Plaintiffs argue that their breach of WWLP claim is subject to a ten-year
statute of limitations. The Court will discuss Plaintiffs’ WWLP claim below in
year after this discovery. Drawing all inferences in Plaintiffs’
favor, the Court finds that the analogous state statutory period
had not expired when Plaintiffs filed suit.
Further, Plaintiffs may defend against a laches claim by showing
excusable. Watz, 431 F.2d at 112. Here, Plaintiffs’ late discovery
of NOT’s role in the accident justifies its late filing. As both
extensive, complicated lawsuit with many parties, claims, and
thorny legal issues. In this context, Plaintiffs’ late discovery
of NOT’s potential improper handling and storage is justifiable.
Considering prejudice to NOT is unnecessary.
C. Breach of Implied Warranty of Workmanlike Performance
NOT seeks dismissal of Plaintiffs’ WWLP claim on the grounds
that the Fifth Circuit no longer recognizes such a claim in this
factual scenario. The breach of WWLP claim is intertwined with a
legal concept known as Ryan indemnity. See Ryan Stevedoring Co. v.
Pan-Atlantic Steamship Corp., 350 U.S. 124 (1956). In Ryan, the
Supreme Court held that a vessel was entitled to indemnity from a
stevedore for breach of the WWLP when the stevedore’s improper
stowage of cargo caused a personal injury. Id. at 132-35. The
inescapable elements of the [stevedoring] service undertaken ....
It is of the essence of petitioner's stevedoring contract. It is
[stevedore’s] warranty of workmanlike service that is comparable
to a manufacturer's warranty of the soundness of its manufactured
product.” Id. at 133.
After this decision, courts began expanding Ryan principles. 2
For example, the Supreme Court held that the WWLP operated even in
the absence of contractual privity between the vessel owner and
the stevedore. See Crumady v. The JOACHIM HENDRIK FISSER, 358 U.S.
423, 428 (1959). The Fifth Circuit expanded Ryan indemnity beyond
personal injury to cargo damage claims. See F.J. Walker Ltd. v.
Motor Vessel LEMONCORE, 561 F.2d 1138, 1148 (5th Cir. 1977).
However, courts soon began to whittle down the expansive Ryan
Congress marked the beginning of the end of Ryan in 1972 when
it amended the Longshore and Harbor Workers’ Compensation Act
indemnity in personal injury actions. See 33 U.S.C. § 905(b). Next,
the Supreme Court held that each negligent party in a maritime
tort case should be liable for its proportionate degree of fault.
United States v. Reliable Transfer Co., 421 U.S. 397, 411 (1975).
See generally Marie R. Yeates Phillip, Contribution and Indemnity in Maritime
Litigation, 30 S. Tex. L. Rev. 215, 228-29 (1989).
In doing so, the Court overruled the old rule of divided damages,
in which the damages were split equally between the negligent
parties. See The Schooner CATHARINE v. Dickinson, 58 U.S. 170,
177-78 (1854). Thus, the Reliable Transfer decision marked the
demise of indemnity and the rise of comparative fault principles. 3
Following these changes, the Fifth Circuit began to scale back
Ryan indemnity. See Gator Marine Serv. Towing, Inc. v. J. Ray
McDermott & Co., 651 F.2d 1096 (5th Cir. 1981). Gator involved a
claim for cargo destroyed when a tug capsized. Id. at 1097. The
vessel owner and the stevedore each claimed that the other’s
negligence caused the accident. Id. The district court found that
On appeal, the vessel owner argued that the stevedore owed it
indemnity because the stevedore breached the WWLP. Id. at 1099.
The Fifth Circuit stated that a vessel may claim indemnity against
a stevedore even when the vessel is partly negligent. Id. at 1100.
However, the Fifth Circuit found that the vessel’s negligence was
extreme enough to defeat its claim for Ryan indemnity. Id. Further,
the Fifth Circuit questioned the continued vitality of Ryan in
See Phillip, supra note 2, at 239.
stevedore. Id. Pointing to its historic reluctance to expand the
Ryan doctrine, the Fifth Circuit stated, “Disputes between vessels
and stevedores over damaged cargo are best accommodated by a
fault system.” Id.
The Fifth Circuit took a harder stance on Ryan five years later.
Bosnor, S.A. DE C.V. v. Tug L.A. Barrios, 796 F.2d 776 (5th Cir.
1986). Bosnor also concerned a cargo loss and negligence on the
stevedore’s part. Id. at 778. Relying on its decision in Gator,
the Fifth Circuit rejected the “all or nothing” Ryan approach in
favor of a comparative fault analysis. Id. at 786. While Gator
allowed for the possibility of Ryan indemnity when the vessel owner
entirely. Rejecting the argument that the vessel owner was not
negligent, the Fifth Circuit stated, “[W]e did not restrict the
application of the comparative fault principles in property damage
cases to only those circumstances where the shipowner’s negligence
is great enough to preclude his recovery of Ryan indemnity.” Id.
restricted “the Ryan doctrine to the narrow fact situation in which
it rose.” Id. at 786.
Based on its holding in Bosnor, the Fifth Circuit clearly does
not allow vessel owners to recover Ryan indemnity from stevedores
for vessel and cargo damage claims. Here, Plaintiffs, the vessel
owner and operator, are requesting Ryan indemnity from NOT, the
stevedore, on a cargo and vessel damage claim. The Fifth Circuit
no longer recognizes such a claim. Plaintiffs argue that this case
involves personal injuries, so Ryan indemnity is still available.
However, the 1972 LHWCA amendments eliminated Ryan indemnity in
personal injury cases. Drawing all reasonable inferences in their
favor, Plaintiffs have not stated a cause of action for Ryan
indemnity based on NOT’s breach of the WWLP.
D. Negligent Failure to Warn and General Negligence
NOT argues that Plaintiffs failed to allege a proper legal basis
for their negligent failure to warn and general negligence claims.
However, Plaintiff’s amended complaint states, “Defendant NOT had
a duty to warn Plaintiffs Conti and NSB” of the dangerous nature
of the cargo. (Rec. Doc. 12, at 7.) The amended complaint further
alleges, “Defendant NOT . . . was obligated and duty-bound to
properly store and handle the DVB cargo . . . .” These statements
clearly allege the existence of legal duties owed by NOT to
Plaintiffs. Plaintiffs’ failure to provide legal citations is not
fatal to their claims. Rule 8(a) only requires plaintiffs to
provide “a short and plain statement of the claim showing that the
pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). The Rules
do not require extensive legal citations.
Further, even after the Fifth Circuit limited Ryan indemnity in
Bosnor, courts of this district have found that stevedores owe
certain duties to vessel owners. Stevedores owe the duty to perform
in a “proper, safe, and workmanlike manner. Failure of a stevedore
Pincoffs Co. v. Dravo Mechling Corp., 697 F. Supp. 244, 249-50
(E.D. La. 1987), aff'd sub nom. Maurice Pincoffs v. Dravo Mechling,
880 F.2d 411 (5th Cir. 1989) (citations omitted). Courts of this
district have also recognized that a stevedore owes a duty to
inform a vessel owner of a condition that could potentially damage
the vessel. See id. In these cases, the courts apply comparative
fault principles and apportion the damages among the negligent
parties. See Agrico Chemical Company v. M/V BEN W. MARTIN, 664
F.2d 85, 94 (5th Cir. 1981); Gator, 651 F.2d at 1099; Maurice
Pincoffs Co., 697 F. Supp. at 251. Thus, a stevedore’s duty to a
vessel owner exists independently of the Ryan indemnity doctrine. 4
alleged the existence and breach of these duties.
indemnity or contribution. As discussed above, Plaintiffs are not
In a pre-Gator case, the Fifth Circuit held that a stevedore owes a duty to a
vessel regardless of whether privity of contract exists. Whisenant v. BrewsterBartle Offshore Co., 446 F.2d 394, 401 (5th Cir. 1971). Even though it later
limited the Ryan doctrine, the Circuit has not overruled this holding.
entitled to Ryan indemnity. However, “[u]nder general maritime
law, an alleged tortfeasor may seek contribution . . . from one
who may be comparatively negligent or a joint tortfeasor. Maritime
contribution law provides for apportionment of joint tortfeasors'
liability according to principles of comparative fault.” Ondimar
Transportes Maritimos, LTDA v. Beatty St. Properties, Inc., No.
07-1223, 2008 WL 45793, at *3 (S.D. Tex. Jan. 2, 2008), aff'd sub
nom. Ondimar Transportes Maritimos v. Beatty St. Properties, Inc.,
555 F.3d 184 (5th Cir. 2009). To state a claim for contribution,
a potential tortfeasor must establish a breach of duty on the part
of its potential joint tortfeasor. Nat'l Marine Serv., Inc. v.
Gulf Oil Co., 433 F. Supp. 913, 920 (E.D. La. 1977), aff'd, 608
F.2d 522 (5th Cir. 1979).
Here, NOT argues that Plaintiffs failed to establish a legal
duty owed by NOT to Plaintiffs. As explained above, courts have
recognized that a stevedore owes a duty to exercise reasonable
care. The allegations in Plaintiffs’ complaint, accepted as true,
establish that NOT failed to properly handle and store temperaturesensitive, potentially explosive cargo and that NOT failed to warn
Plaintiffs of the dangerous nature of the cargo. These allegations
are sufficient to state a claim for a breach of the duty to exercise
Plaintiffs’ claims for breach of the WWLP and for Ryan indemnity
will be dismissed for failure to state a claim pursuant to Rule
12(b)(6). NOT’s Motion to Dismiss is denied in all other respects.
IT IS HEREBY ORDERED that NOT’s 12(b)(6) Motion to Dismiss and
12(f) Motion to Strike is GRANTED in part and DENIED in part.
IT IS FURTHER ORDERED that NOT's Motion for Leave to File Reply
(Rec. Doc. 16) is DENIED as moot.
New Orleans, Louisiana this 3rd day of February, 2016.
CARL J. BARBIER
UNITED STATES DISTRICT JUDGE
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