In Re: In The Matter Of ( 2002 )

Opinions of the United
2002 Decisions States Court of Appeals
for the Third Circuit
8-21-2002
In Re: In The Matter Of
Precedential or Non-Precedential: Precedential
Docket No. 01-4144
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"In Re: In The Matter Of " (2002). 2002 Decisions. Paper 524.
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PRECEDENTIAL
Filed August 21, 2002
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 01-4144
IN THE MATTER OF THE COMPLAINT OF PMD
ENTERPRISES, INC., AS OWNER OF THE VESSEL BETH
DEE BOB, FOR EXONERATION FROM AND LIMITATION
OF LIABILITY
LISA MCLAUGHLIN,
as wife and Personal Representative of the
Estate of Edward J. McLaughlin, Deceased,
Appellant
v.
CAPE MAY FOODS, INC. and PETER A. LAMONICA
On Appeal from the United States District Court
for the District of New Jersey
(D.C. Civil No. 00-cv-00161)
District Judge: Hon. Garrett E. Brown, Jr.
Argued July 24, 2002
Before: SLOVITER, NYGAARD and BARRY, Circuit Judges
(Filed: August 21, 2002)
Marvin I. Barish (Argued)
Marvin I. Barish Law Offices
Philadelphia, PA 19106
Attorney for Appellant
David R. Hornig (Argued)
Julia M. Moore
Nicoletti, Hornig, Campise &
Sweeney
New York, NY 10005
Attorneys for Appellees
OPINION OF THE COURT
SLOVITER, Circuit Judge:
Lisa McLaughlin, widow of Captain Edward McLaughlin
and representative of his estate, appeals the denial of
summary judgment on a counterclaim asserted by
defendant PMD Enterprises, her late husband’s employer.
McLaughlin predicates our jurisdiction over the District
Court’s order denying her motion to dismiss the
counterclaim on 28 U.S.C. S 1292(a)(3) (2002), which allows
for interlocutory appeals in admiralty. Because we conclude
that S 1292(a)(3) does not permit an interlocutory appeal
under the facts of this case, we shall dismiss this appeal for
lack of jurisdiction.
I.
FACTS AND PROCEDURE
On January 6, 1999, the clamming vessel Beth Dee Bob
sunk off the coast of New Jersey. All four crew members
died, including Captain McLaughlin. At the time, the ship
was returning home fully loaded with seventy cages of
clams.
The Beth Dee Bob was owned by PMD Enterprises, the
employer of the crew members. Peter Lamonica owns fifty
percent of PMD and also owns fifty percent of Cape May
Foods.
On March 31, 1999, Lisa McLaughlin filed a wrongful
death suit against PMD under the Jones Act, 46 U.S.C.
S 688 (2002), in the United States District Court for the
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Eastern District of Pennsylvania. PMD filed a petition for
limitation of liability in the United States District Court for
the Eastern District of New York on May 7, 1999, which
was transferred to the Eastern District of Pennsylvania and
then consolidated with the wrongful death suit. McLaughlin
then filed essentially the same wrongful death action
against Cape May Foods in the Eastern District of
Pennsylvania. The district court in Pennsylvania dismissed
the complaint against PMD for lack of personal jurisdiction
and transferred the remaining actions to the United States
District Court for the District of New Jersey.
On December 1, 1999, McLaughlin filed a separate
wrongful death action against Peter Lamonica alleging that
his negligence was the cause of Captain McLaughlin’s
death. This action was consolidated with the limitation
action and the wrongful death action against Cape May
Foods. Thereafter, the case was assigned to a magistrate
judge.
In October 2000, PMD requested leave to file a
counterclaim against McLaughlin for property loss
sustained when the ship sank allegedly due to Captain
McLaughlin’s negligence. McLaughlin objected to the
request, claiming that shipowners were barred from suing
employees for negligence under the Jones Act and the
Federal Employers’ Liability Act, 45 U.S.C. S 55 (2002). The
Magistrate Judge granted PMD leave to file the
counterclaim. In re Complaint of PMD Enters., No. 00-0161
(D.N.J. Dec. 14, 2000) (Magistrate Judge’s decision).
McLaughlin did not attempt to appeal the decision to the
District Court. PMD filed the counterclaim asking that
McLaughlin compensate it for the loss of the ship.
In May 2001, Lamonica and Cape May Foods moved in
the District Court for summary judgment against
McLaughlin, and McLaughlin in turn moved to dismiss
PMD’s counterclaim. In October 2001, the District Court
granted summary judgment to Lamonica and Cape May
Foods and, construing McLaughlin’s motion as one for
summary judgment, denied summary judgment to
McLaughlin on PMD’s counterclaim. In re Complaint of PMD
Enters., No. 00-0161, slip op. at 1 (D.N.J. Oct. 22, 2001).
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In denying McLaughlin’s motion for summary judgment,
the District Court found that there were genuine issues of
fact regarding the cause of the ship’s sinking, in particular,
whether Captain McLaughlin had left the hatches and
engine room doors open. Id. at 18. This appeal followed.1
II.
JURISDICTION
McLaughlin frames her appeal as an interlocutory appeal
in admiralty pursuant to 28 U.S.C. S 1292(a)(3). Denials of
summary judgment, like most other non-final orders of
district courts, are generally not appealable except as
interlocutory appeals under 28 U.S.C. S 1292. See, e.g.,
Chambers Dev. Co. v. Passaic County Utils. Auth., 62 F.3d
582, 584 (3d Cir. 1995) ("We will not review an order
denying a motion for summary judgment."). See also Thypin
Steel Co. v. Asoma Corp., 215 F.3d 273, 279 (2d Cir. 2000)
("Section 1292(a) is an exception to the general rule of
finality stated in S 1291 . . . ."). McLaughlin, however,
contends that because this is an interlocutory appeal in
admiralty, it can be brought under S 1292(a)(3), which
reads as follows:
(a) Except as provided in subsections (c) and (d) of
this section, the courts of appeals shall have
jurisdiction of appeals from:
_________________________________________________________________
1. Although it is evident that McLaughlin argues that PMD should not be
able to file a counterclaim against a seaman (living or deceased), it is
unclear whether McLaughlin is appealing (a) the Magistrate Judge’s
order allowing PMD’s counterclaim or (b) the District Court’s denial of
summary judgment. McLaughlin argues that under this court’s decision
in Henderson v. Carlson, 812 F.2d 874, 878 (3d Cir. 1987) (declining to
adopt the rule that a party waives the right to appeal a magistrate
judge’s report by failing to timely file objections to the report pursuant
to 28 U.S.C. S 636), she cannot be denied the right to appeal the order
of the Magistrate Judge allowing PMD’s counterclaim notwithstanding
her failure to object to the order. Whether McLaughlin is appealing the
Magistrate Judge’s order to allow the counterclaim or the District Court’s
decision to deny summary judgment, the result is the same as neither
qualifies as an interlocutory appeal under S 1292(a)(3).
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. . . .
(3) Interlocutory decrees of such district courts or
the judges thereof determining the rights and liabilities
of the parties to admiralty cases in which appeals from
final decrees are allowed.
28 U.S.C. S 1292(a).
We have interpreted this statute narrowly to allow"an
appeal in admiralty after a determination of liability but
before the assessment of damages." Burgbacher v. Univ. of
Pittsburgh, 860 F.2d 87, 88 (3d Cir. 1988). See also In re
Complaint of Nautilus Motor Tanker Co., 85 F.3d 105, 110
n.3 (3d Cir. 1996) ("The purpose of [S 1292(a)(3)] is to allow
a party found liable in an admiralty proceeding to take an
immediate appeal without submitting to a protracted trial of
the damage issues.") (citing 2 Thomas J. Schoenbaum,
Admiralty and Maritime Law S 21-13 (2d ed. 1994)); United
States v. The Lake George, 224 F.2d 117, 119 (3d Cir.
1955) ("[T]he statute [S 1292(3), current version at
S 1292(a)(3)] permits an appeal in avoidance of the expense
and delay of finding damages which may not be recovered
. . . [but i]t is settled . . . that the statute does not cover all
interlocutory orders . . . . The allowance of appeals under
the statute appears . . . to attend upon the final
determination of rights and liabilities, or at least upon the
determination of substantial rights of the parties,
particularly where there is an immediacy of prejudicial
effect.").
Our case law on interlocutory appeals in admiralty
establishes that the language of S 1292(a)(3) regarding a
final determination of rights and liabilities applies to
situations such as the dismissal of parties from the
litigation, grants of summary judgment (even if not to all
parties), and other cases where a claim has somehow been
terminated. "[T]he order appealed from must conclusively
determine the merits of a claim or defense." Kingstate Oil v.
M/V Green Star, 815 F.2d 918, 921 (3d Cir. 1987). For
example, in Jones & Laughlin Steel, Inc. v. Mon River
Towing, Inc., 772 F.2d 62, 64 & n.1 (3d Cir. 1985), we
allowed an interlocutory appeal in admiralty after one of the
defendants was dismissed from the action for lack of
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subject matter jurisdiction. In Nautilus Motor , 85 F.3d at
109-10, we granted an appeal following the grant of
judgment for the counterclaim, even though the principal
claim had not been conclusively decided. As we have
previously stated, interlocutory appeals in admiralty apply
"to any order which finally determines the liability of a
party even if the order leaves unresolved an issue which
may ultimately preclude recovery by a particular plaintiff."
Bankers Trust Co. v. Bethlehem Steel Corp., 761 F.2d 943,
945 n.1 (3d Cir. 1985) (emphasis in original).
Applying this narrow interpretation of S 1292(a)(3), we
have on occasion rejected an interlocutory appeal in
admiralty. In Lake George, we rejected an interlocutory
appeal of an order that dismissed one of four grounds for
liability because the "liability of the vessel to forfeiture ha[d]
yet to be determined," and thus the order did not fix
liability or "determine or affect substantial rights." 224 F.2d
at 119. Similarly, in Burgbacher, we held an interlocutory
appeal of a decision denying summary judgment to the
defendants in an admiralty case did not meet the statutory
standard. 860 F.3d at 88. We explained that because the
ruling did not make a liability determination, S 1292(a)(3)
did not apply. Id.
Our interpretation of S 1292(a)(3) comports with the
interpretations of our sister courts of appeals. See, e.g., 29
James W. Moore, Moore’s Federal PracticeS 710.05, at 710-
16 to 17 (3d ed. 2002) (stating that most courts of appeal
construe S 1292(a)(3) "narrowly," interpreting it to "permit[ ]
interlocutory appeal[s] when rights and liabilities have been
determined between two of a number of parties,
notwithstanding that disputes remain between one of them
and others"); 2 Thomas J. Schoenbaum, Admiralty and
Maritime Law S 21-12, at 559 (3d ed. 2001) ("The purpose
of [S 1292(a)(3)] is to allow a party found liable in an
admiralty proceeding to take an immediate appeal without
submitting to a protracted trial of the damage issues, but
the procedure is also fully applicable when a claim against
one or more parties is dismissed on the merits.") (citations
omitted).
Here, McLaughlin is attempting to appeal a denial of
summary judgment that she sought in order to dismiss
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PMD’s counterclaim against her. The question then is
whether this denial of summary judgment "determin[es] the
rights and liabilities of the parties." S 1292(a)(3). In
Burgbacher, the parents of a student who died while
working for the University of Pittsburgh on a "semester at
sea" program, sued the university, the owner of the ship on
which he was working, and a physician onboard the ship.
The parents filed suit based in part on Pennsylvania’s
Survival Act and the Death on the High Seas Act. 860 F.2d
at 88. Some of the defendants moved for summary
judgment on the ground that the parents’ claims were
barred by state workers’ compensation laws and could not
be asserted under the Pennsylvania Survival Act. The
district court denied the motion. The moving defendants
appealed, contending this was the type of interlocutory
appeal in admiralty covered by S 1292(a)(3). We disagreed
and dismissed the appeal for lack of jurisdiction based on
the following reasoning:
The case law construing the statute does not take a
particularly expansive view of the subsection because
the traditional interpretation of the statute was that it
permitted an appeal in admiralty after a determination
of liability but before the assessment of damages. See
Petition of Bave, 314 F.2d 335 (3d Cir. 1963); Francis
v. Forest Oil Corp., 798 F.2d 147 (5th Cir. 1986). While
the case law has expanded the construction of the
statute in some respects, e.g., Kingstate Oil v. M/V
Ocean Star, 815 F.2d 918 (3d Cir. 1987), we are
satisfied that the subsection does not apply here
because a liability determination has not been made on
either claim.
To treat these rulings, though meaningful, as coming
within the statute would make every substantial legal
ruling in admiralty proceedings immediately appealable
even though liability remained undetermined. We
believe such a construction would read too much into
the statute, policy considerations aside.
Id. at 88 (footnote omitted).
In Burgbacher, we cited In re Bave, 314 F.2d 335 (3d Cir.
1963), in which, for similar reasons, we held there was no
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appellate jurisdiction over a denial of a motion to dismiss a
limitation action in an admiralty case. We concluded that
S 1292(a)(3) did not provide appellate jurisdiction because
"the rights and liabilities of the parties ha[d] not been
determined as required by the statute." Id. at 336.
Here, no right or liability of the parties has been
"conclusively determine[d]." Kingstate Oil, 815 F.2d at 921.
Rather, the District Court has simply allowed the case to
proceed. If, at some point in the future, PMD is successful
at trial with respect to its counterclaim, McLaughlin could
then, on appeal, press her interesting argument that there
can be no counterclaim by an employer against an
employee under the Jones Act.2
Had the District Court denied PMD the right to file the
counterclaim or had it granted summary judgment to
McLaughlin on PMD’s counterclaim, the rights and
liabilities of the parties may well have been conclusively
determined, in which case the District Court’s decision
would have been appealable. See Nautilis Motor , 85 F.3d at109-10 & n.3 (finding appellate jurisdiction pursuant to
S 1292(a)(3) to consider a decision holding plaintiff liable on
defendant’s counterclaim that alleged plaintiff was solely
responsible for the grounding of its tanker, but leaving
plaintiff ’s limitation of liability claim pending); Bergeron v.
Elliot, 466 F.2d 514, 516 n.3 (5th Cir. 1972) (allowing
appeal of grant of summary judgment as to one of several
defendants). Cf. Jamaica Commodity Trading Co. v. Barge
Hercules, 992 F.2d 1162 (11th Cir. 1993) (per curiam)
(finding no jurisdiction to hear interlocutory appeal of grant
of summary judgment on one defendant’s cross-claim
against another for indemnification because plaintiff ’s
claims for liability as to any defendant had not been
determined). As the District Court did neither of these and
_________________________________________________________________
2. Alternatively, had McLaughlin convinced the District Court that the
denial of summary judgment "involve[d] a controlling question of law as
to which there is substantial ground for difference of opinion and that an
immediate appeal from the order may materially advance the ultimate
termination of the litigation," 28 U.S.C. S 1292(b), then we could have
had jurisdiction over this appeal if we had accepted the certification. See,
e.g., Yamaha Motor Corp., U.S.A. v. Calhoun , 516 U.S. 199, 204 (1996)
(finding S 1292(b) applicable to admiralty cases).
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did not otherwise determine the rights and liabilities of the
parties, McLaughlin’s appeal is not yet ripe for review and
cannot be heard by this court. Accord Francis v. Forest Oil
Corp., 798 F.2d 147, 149-50 (5th Cir. 1986) (holding that
an order denying summary judgment is not appealable
under S 1292(a)(3) even though it may have had"important
procedural consequences"); Upper Miss. Towing Corp. v.
West, 338 F.2d 823 (8th Cir. 1964) (per curiam) (holding
that denial of motion for summary judgment not appealable
because did not determine any rights and liabilities).3
III.
CONCLUSION
Because the District Court has not made a decision
establishing the rights and liabilities of the parties, 28
U.S.C. S 1292(a)(3) does not permit an interlocutory appeal
in this case. We therefore lack jurisdiction and will dismiss
this appeal.
_________________________________________________________________
3. McLaughlin also appeals the District Court’s refusal to require PMD to
show that Captain McLaughlin’s negligence was the sole cause of the
accident, as the Magistrate Judge had recommended. For the same
reasons stated above, this issue is not yet appealable. The District
Court’s decision did not conclusively determine McLaughlin’s liabilities,
if any, when it decided not to require PMD to show that the accident was
entirely Captain McLaughlin’s fault.
Additionally, PMD, in its brief, requests that McLaughlin be assessed
costs and damages pursuant to Federal Rule of Appellate Procedure 38.
We will deny this request. First, PMD has not filed a separate motion for
sanctions. According to the Advisory Committee’s Notes to the 1994
Amendments to Rule 38, "[a] statement inserted in a party’s brief that
the party moves for sanctions is not sufficient notice." Fed. R. App. P. 38
advisory committee’s note. Second, we do not find that McLaughlin’s
appeal is "wholly without merit," the standard that this court applies for
an award for a frivolous appeal pursuant to Rule 38. See, e.g., Huck ex
rel. Sea Air Shuttle Corp. v. Dawson, 106 F.3d 45, 52 (3d Cir. 1997);
Nagle v. Alspach, 8 F.3d 141, 145 (3d Cir. 1993). Although we hold that
we lack jurisdiction to hear McLaughlin’s appeal, McLaughlin’s reliance
on the language of S 1292(a)(3) to support her appeal was not "frivolous."
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A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
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