In the matter of: Magnolia Fleet, LLC et al

Filing 142

ORDER AND REASONS denying 39 Motion to Dismiss for Failure to State a Claim; denying 97 Motion for Summary Judgment; denying 100 Motion for Summary Judgment. Signed by Judge Jane Triche Milazzo. (ecm)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
CIVIL ACTION
IN RE MAGNOLIA FLEET

NO: 16-12297
SECTION: “H”(1)

ORDER AND REASONS
Before the Court is Claimant Jeffrey Jenkins’s Motion to Dismiss (Doc.
39); Limitation Petitioners’ Motion for Summary Judgment on Claimant
Jeffrey Jenkins’s punitive damages claim (Doc. 100); and Claimant Jeffrey
Jenkins’s Motion for Summary Judgment on Limitation of Liability (Doc. 97).
For the following reasons, the Motions are DENIED.
BACKGROUND
This action arises out of an incident in which the M/V PINTAIL capsized,
allegedly causing the death of a River Construction Inc. (“River Construction”)
operator, James D. Swafford, and injuring a River Construction welder, Jeffrey
Jenkins. The incident occurred on December 30, 2015 when the PINTAIL’s
motor stalled while it was being operated on the Mississippi River by River
1

Construction employees. On June 30, 2016, Magnolia Fleet, L.L.C. (“Magnolia
Fleet”), as Owner, and River Construction, as Operator, of the M/V PINTAIL
(collectively, “Petitioners”) filed a Complaint for Exoneration or Limitation of
Liability. On July 12, 2016, this Court issued a stay of the prosecution of any
proceedings outside of the limitation action.

Claimants Carla Guileyardo,

Jeffrey Jenkins, American Longshore Mutual Association, Ltd., and Carl
Swafford answered with claims in this matter. The claims of Carla Guileyardo
have been settled, and the claims of Carl Swafford have been dismissed.
Now before the Court are three motions. In the first, Claimant Jeffrey
Jenkins has adopted a Motion by former Claimant Carla Guileyardo, arguing
that River Construction is not entitled to limitation of liability because it is not
an owner of the PINTAIL. In the second Motion, Petitioners seek dismissal of
Claimant Jenkins’s claim for punitive damages.

Petitioners allege that

notwithstanding Jenkins’s classification as a seaman or longshoreman, he
cannot succeed in his claim for punitive damages. In the third, Jenkins argues
that Petitioners are not entitled to limitation of liability.

This Court will

consider each Motion in turn.
LEGAL STANDARD
Summary judgment is appropriate “if the pleadings, depositions,
answers to interrogatories, and admissions on file, together with affidavits, if
any, show that there is no genuine issue as to any material fact and that the
moving party is entitled to a judgment as a matter of law.” 1 A genuine issue

1

Sherman v. Hallbauer, 455 F.2d 1236, 1241 (5th Cir. 1972).
2

of fact exists only “if the evidence is such that a reasonable jury could return a
verdict for the nonmoving party.” 2
In determining whether the movant is entitled to summary judgment,
the Court views facts in the light most favorable to the non-movant and draws
all reasonable inferences in his favor. 3 “If the moving party meets the initial
burden of showing that there is no genuine issue of material fact, the burden
shifts to the non-moving party to produce evidence or designate specific facts
showing the existence of a genuine issue for trial.” 4 Summary judgment is
appropriate if the non-movant “fails to make a showing sufficient to establish
the existence of an element essential to that party’s case.” 5 “In response to a
properly supported motion for summary judgment, the non-movant must
identify specific evidence in the record and articulate the manner in which that
evidence supports that party’s claim, and such evidence must be sufficient to
sustain a finding in favor of the non-movant on all issues as to which the nonmovant would bear the burden of proof at trial.” 6 “We do not . . . in the absence
of any proof, assume that the nonmoving party could or would prove the
necessary facts.” 7 Additionally, “[t]he mere argued existence of a factual
dispute will not defeat an otherwise properly supported motion.” 8

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
Coleman v. Houston Indep. Sch. Dist., 113 F.3d 528, 532 (5th Cir. 1997).
4 Engstrom v. First Nat’l Bank of Eagle Lake, 47 F.3d 1459, 1462 (5th Cir. 1995).
5 Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986).
6 John v. Deep E. Tex. Reg. Narcotics Trafficking Task Force, 379 F.3d 293, 301 (5th
Cir. 2004) (internal citations omitted).
7 Badon v. R J R Nabisco, Inc., 224 F.3d 382, 394 (5th Cir. 2000) (quoting Little v.
Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994)).
8 Boudreaux v. Banctec, Inc., 366 F. Supp. 2d 425, 430 (E.D. La. 2005).
3
2
3

LAW AND ANALYSIS
I.

Jenkins’s Motion to Dismiss

Guileyardo filed a Motion to Dismiss, or alternatively for Summary
Judgment, arguing that River Construction is not the owner, owner pro hac
vice, or bareboat charterer of the M/V PINTAIL and therefore should not be
entitled to seek limitation of liability.

Jenkins subsequently adopted this

Motion as his own. Despite styling this Motion as a motion to dismiss, both
parties have attached evidence outside the pleadings, which this Court has
chosen not to exclude. Accordingly, the Motion is converted to a summary
judgment motion. 9 River Construction had ample opportunity to respond and
present evidence as demonstrated by the exhibits attached to its opposition.
In this Motion, Jenkins argues that River Construction did not have the
ownership or control over the M/V PINTAIL required under the Limitation of
Liability Act. He points out that River Construction’s Complaint for Limitation
alleges only that it was the operator of the PINTAIL. River Construction
argues that it was an owner pro hac vice of the PINTAIL and is therefore
entitled to limitation of liability.
The Limitation of Liability Act provides that “the liability of the owner
of a vessel for any claim, debt, or liability described in subsection (b) shall not
exceed the value of the vessel and pending freight.” 10 An “owner” is defined as
including “a charterer that mans, supplies, and navigates a vessel at the

9

See Fed. R. Civ. P. 12(d).
46 U.S.C. § 30505.

10

4

charterer’s own expense or by the charterer’s own procurement.” 11 “Courts
have expanded the definition of owner or charterer to encompass parties in
analogous situations who exercise dominion and control over a vessel and are
therefore owners pro hac vice even if not technically charterers.” 12 Courts have
held that:
[A]n “owner” for the purposes of limitation of liability is one who is
subjected to a shipowner’s liability because of his exercises of
dominion over [i.e., relationship to] the vessel. In other words, an
operator with significant management and operational control
over a vessel may seek exoneration from or limitation of liability
when it acts as a manager of the vessel or acquires work for and
dispatches the vessel. 13
The parties dispute whether River

Construction’s had the requisite

management and operational control over the M/V PINTAIL to claim
limitation of liability.
River Construction is wholly owned by its president, William Wiedner,
III. Magnolia Fleet is owned by William Wiedner, III; his father, William
Wiedner, IV; and John Stewart.

William Wiedner, IV is the president of

Magnolia Fleet. The M/V PINTAIL was typically moored on a dock owned by
Magnolia Fleet on the west bank of the Mississippi River. River Construction
kept several barges on the east bank of the river and used the Magnolia Fleet
facility to access those barges. River Construction employees frequently used
the PINTAIL to cross to the east bank of the river. The parties testified that
there was no written or oral agreement between Magnolia Fleet and River
Id. § 30501.
In re Am. Milling Co., Ltd., 409 F.3d 1005, 1014 (8th Cir. 2005).
13 In re Ingram Barge Co., No. 05-4419, 2007 WL 2088369, at *3 (E.D. La. July 19,
11
12

2007).

5

Construction regarding use of the PINTAIL, but the companies had an
informal, unspoken understanding regarding its use. River Construction had
unlimited access to the PINTAIL with no requirement that it ask permission
from Magnolia Fleet to use the vessel. Indeed, the keys were stored under the
seat.

An employee of River Construction testified that he operated the

PINTAIL on a daily basis. When it was operating the PINTAIL, River
Construction used its own crew and was often performing work for its own
customers. River Construction, however, did not make any formal payment
for its use of the PINTAIL.

Instead, the companies “enjoyed a reciprocal

exchange of equipment and services for the mutual benefit of both
companies.” 14

River Construction did not pay for the vessel’s gas,

maintenance, or repairs. In addition, Magnolia Fleet still had access to and use
of the vessel, and it trained the River Construction employees on operation on
the vessel.
By all accounts, the relationship between River Construction, Magnolia
Fleet, and the PINTAIL is an unusual one. The relationship between the
parties for the use of the PINTAIL cannot be classified as a traditional charter
party agreement. 15 This Court finds the question of whether River
Doc. 63.
“There are three generally recognized types of charter parties: the first two, the
‘voyage charter’ and the ‘time charter,’ occur when the vessel is manned and navigated by
the owner. In the voyage charter the ship is engaged to carry a full cargo on a single voyage,
whereas in the time charter the charterer engages the ship to carry cargo over a fixed period
of time. The third charter is known as a ‘bareboat’ or ‘demise charter.’ In this arrangement,
the charterer operates the ship and is regarded as the owner of the ship pro hac vice.” Int’l
Marine Towing, Inc. v. S. Leasing Partners, Ltd., 722 F.2d 126, 130 (5th Cir. 1983). “To
create a demise the owner of the vessel must completely and exclusively relinquish
‘possession, command, and navigation’ thereof to the demisee.” Guzman v. Pichirilo, 369 U.S.
698, 699 (1962).
6
14
15

Construction had the requisite dominion over the PINTAIL to entitle it to
limitation of liability to be a difficult question of fact. In resolving such a
question, Courts consider a myriad of factors, including who mans, crews, and
navigates the vessel; who is responsible for maintenance and repairs; who is
responsible for training, selecting, and paying the crew; whether the borrowing
party provided insurance; who is in possession and control of the vessel; the
borrowing party’s autonomy from the actual owner; who has the ultimate
authority over decision making; and who makes daily navigational decisions. 16
This Court finds that there is insufficient information before it at this
summary judgment stage to conduct a full factual analysis.

Such a

determination is best made after a trial. Accordingly, Jenkins’s motion is
denied.
II.

Petitioners’ Motion for Summary Judgment

Next, Petitioners argue that notwithstanding whether Jenkins is
ultimately classified as a seaman or a longshoreman, he cannot succeed on a
claim for punitive damages under general maritime law. Jenkins concedes
that if he is classified as a seaman he cannot, as a matter of law, bring a claim
for punitive damages against his employer River Construction. Jenkins also
recognizes that pursuant to McBride v. Estis Well Services, LLC, he would not,
as a seaman, have a claim for punitive damages based on his unseaworthiness
claim against Magnolia Fleet. 17 Accordingly, Jenkins may only bring a punitive
See In re Am. Milling Co., Ltd., 409 F.3d at 1014; In re M/V Seaboard Spirit, No. 1123841, 2014 WL 3673323, at *2 (S.D. Fla. July 23, 2014).
17 McBride v. Estis Well Serv., L.L.C., 768 F.3d 382, 391 (5th Cir. 2014) (“[I]n a
wrongful death case under the Jones Act and the general maritime law, [the Supreme Court]
7
16

damages claim if he is ultimately classified as a longshoreman. Petitioners
argue though that even if Jenkins is a longshoreman, he cannot prove his claim
for punitive damages under general maritime law.
In order to succeed on a claim for punitive damages under the general
maritime law, Jenkins must show “that the defendant engaged in behavior
that is more than merely negligent.” 18 Indeed, the behavior must rise to the
level of gross negligence, “reckless or callous disregard for the rights of others,”
or “actual malice or criminal indifference.” 19 “[P]unitives are aimed not at
compensation but principally at retribution and deterring harmful conduct.”20
Petitioners assert that Jenkins cannot show that their conduct rose to this
level.
Petitioners allege that the evidence shows that they did not act
recklessly either in the maintenance of the M/V PINTAIL or in the training of
its crew. They show that the motor on the PINTAIL was serviced just two
weeks prior to the accident at issue and that no problems were noted. They
argue that there is no evidence that they had any prior knowledge of any motor
stalling issues. They point out that Jenkins and Swafford experienced the
motor of the PINTAIL stalling the day prior to the accident but failed to report
this to anyone. In addition, they note that another vessel was always available
for their use. They allege that the operators of the PINTAIL were experienced
has limited the survivor’s recovery to pecuniary losses.”); Melancon v. Gaubert Oil Co., Inc.,
No. CV 17-2905, 2017 WL 3438346, at *3 (E.D. La. Aug. 10, 2017) (and cases cited therein).
18 Hancock v. Higman Barge Lines, Inc., No. 16-14998, 2017 WL 3582433, at *4 (E.D.
La. Aug. 18, 2017).
19 Id.
20 Exxon Shipping Co. v. Baker, 554 U.S. 471, 492 (2008).
8

operators who were submitted to a “reasonable training program.” In addition,
the PINTAIL was 22 feet long and therefore not required to be operated
exclusively by a licensed vessel captain according to Coast Guard regulations.
By contrast, Jenkins alleges that Petitioners failed to train the operators
of the PINTAIL, failed to create written policies or procedures for safe
operations, and knew the PINTAIL had experienced motor problems. Jenkins
puts forth testimony from Magnolia Fleet’s President that the only training
given to operators of the PINTAIL was a five to ten minute “little rundown.”
He also points out that while Miller was a boat owner and experienced in
operating vessels, he unequivocally testified that he had never operated his
personal boats in the Mississippi River. It is undisputed that the river was
high and fast moving on the day of the accident.
Jenkins also puts forth maintenance and repair records indicating that
the PINTAIL did in fact have trouble with and work performed on the engine.
A repair record from November 1, 2015 states that “Engine/Boat Sank.”
Shortly thereafter on December 11, 2015, a repair record indicates that the
“Engine Will Not Spin Over.” Jenkins argues that despite this knowledge (and
the motor failures of other vessels in their fleets), Petitioners did nothing to
train their crews on what to do if they experienced a motor failure while on the
river.
Petitioners do much to dispute the facts set forth by Jenkins, but these
arguments only further establish the issues of fact that abound in this motion.
Accepting Jenkins facts as true, this Court does not find it implausible that
Petitioners may have acted recklessly. Petitioners allowed a 22-foot vessel
with prior engine problems to be operated in high river conditions by an
9

operator with minimal training. This Court is not prepared to rule that such
conduct cannot rise to the level of gross negligence. Such a finding is best left
to trial. 21 Accordingly, Petitioners’ Motion is denied.
III.

Jenkins’s Motion for Summary Judgment

Finally, Jenkins has moved for summary judgment arguing that
Petitioners should be precluded from exoneration or limitation of liability. He
argues that Petitioners “were negligent, the M/V PINTAIL was unseaworthy,
said negligence and unseaworthiness legally and proximately caused personal
injuries to Claimant as well as the death of Mr. James Swafford, and River
Construction, Inc. and Magnolia Fleet, LLC both had privity and knowledge of
their respective negligence and/or unseaworthiness of the M/V PINTAIL.”
The determination of entitlement to limitation of liability is a two-step
process. “First, the court must determine what acts of negligence or conditions
of unseaworthiness caused the accident. Second, the court must determine
whether the shipowner had knowledge or privity of those same acts of
negligence of conditions of unseaworthiness.” 22
As to the first prong, Jenkins argues that Petitioners were negligent in
failing to properly train the PINTAIL’s operators or provide any safety policies
pertaining to the operation of the PINTAIL and that this negligence caused
the accident. Petitioners disagree, arguing that the training program provided
to their operators was reasonable and that Jenkins caused the accident by
failing to report issues encountered in the operation of the PINTAIL on the day
See Shore Expl. & Prod. Corp. v. Exxon Corp., No. 3-95-CV-1228-R, 1998 WL
641811, at *1 (N.D. Tex. Sept. 15, 1998) (“Gross negligence is typically a question of fact
and therefore not well-suited for summary judgment.”).
22 Farrell Lines Inc. v. Jones, 530 F.2d 7, 10 (5th Cir. 1976).
10
21

prior to the accident. “‘[Q]uestions of adequacy and competency are questions
of fact,’ which cannot be resolved on summary judgment.” 23 In addition,
causation is a question of fact, which is generally decided at a trial on the
merits. 24 Genuine issues of material fact regarding the adequacy of training,
the causation of the accident, and even Jenkins’s seaman status abound in this
Motion. Accordingly, resolution of these issues on summary judgment would
be inappropriate. Jenkins’s Motion is denied.

CONCLUSION
For the foregoing reasons, the Motions are DENIED.

New Orleans, Louisiana this 19th day of October, 2017.

____________________________________
JANE TRICHE MILAZZO
UNITED STATES DISTRICT JUDGE

Howard v. Offshore Liftboats, LLC, No. 13-4811, 2016 WL 74448, at *2 (E.D. La.
Jan. 6, 2016) (quoting Dillon v. M. S. Oriental Inventor, 426 F.2d 977, 979 (5th Cir. 1970)).
24 Skipper v. United States, 1 F.3d 349, 352 (5th Cir. 1993); Arceneaux v. State Farm
Fire & Cas. Co., No. 07-3830, 2009 WL 1393711, at *3 (E.D. La. May 18, 2009).
11
23