Demette v. Falcon Drilling Co.

Revised January 31, 2002
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 00-30165
KERMIT DEMETTE,
Plaintiff,
versus
FALCON DRILLING COMPANY, INC.; ET AL.,
Defendants.
R & B FALCON DRILLING USA, INC.,
Defendant-Third Party
Plaintiff-Appellee,
versus
FRANK’S CASING CREW & RENTAL TOOLS, INC.,
Third Party Defendant-
Appellant.
Appeal from the United States District Court
for the Eastern District of Louisiana
January 16, 2002
Before HIGGINBOTHAM and DeMOSS, Circuit Judges, and FISH,* District
Judge.
PATRICK E. HIGGINBOTHAM, Circuit Judge:
*
District Judge of the Northern District of Texas, sitting by
designation.
Without prejudice to the Petition for Rehearing En Banc of
Third Party Defendant-Appellant Franks Casing Crew & Rental Tools,
Inc., we substitute the revised opinions that follow in place of
the prior opinions, reported at Demette v. Falcon Drilling Company,
Inc., 253 F.3d 840 (5th Cir. 2001). The parties may file on or
before January 30, 2002 any supplemental briefs in support of or
opposition to the petition for rehearing en banc in light of these
revised opinions.
Appellee R & B Falcon Drilling USA, Inc. sued appellant
Frank’s Casing & Crew Rental Tools, Inc. for indemnity when a
Frank’s employee sued Falcon under the Longshore and Harbor
Workers’ Compensation Act1 for injury sustained while working on a
Falcon jack-up rig in the Gulf of Mexico. Frank’s argued that the
indemnity agreement was voided by LHWCA or by Louisiana law. The
district court held that the indemnity agreement was valid.
Determining the validity of the indemnity agreement requires
a foray into the federal statutes defining the law applicable to
offshore drilling on jack-up rigs. We first consider the
application of the Outer Continental Shelf Lands Act (“OCSLA”)2 and
then construe the LHWCA. We conclude that the OCSLA applies to a
rig jacked-up over the outer continental shelf; that state law does
not apply to this case by operation of the OCSLA, but the LHWCA
1
33 U.S.C.A. § 901 et seq. (2000).
2
43 U.S.C.A. § 1331 et seq. (2000).
2
does; and that the LHWCA does not invalidate the indemnity
agreement. We affirm.
I
Frank’s Casing & Crew Rental Tools, Inc. and R & B Falcon
Drilling USA, Inc. are both contractors with Union Oil Company of
California for Unocal’s offshore drilling operations. Frank’s
provides casing services. “Casing” is an activity performed during
the drilling for oil, whether onshore or offshore; it involves the
“welding together and hammering of pipe into the subsurface of the
earth to create a permanent construction.”3
Frank’s and Unocal signed a “Services and Drilling Master
Contract.” Under the Master Contract, Frank’s provided casing
services to Unocal at offshore drilling sites. Under the Master
Contract, Unocal agreed to defend and indemnify Frank’s against any
liabilities Frank’s owes to Unocal, and Frank’s agreed to defend
and indemnify Unocal and all of its contractors and subcontractors
against liabilities they may owe to Frank’s. Falcon was a
contractor of Unocal.
Falcon provides movable rigs from which casing crews drill
offshore wells. Falcon has an “Offshore Daywork Drilling Contract”
with Unocal. This contract provided Unocal with access to all of
Falcon’s vessels for offshore drilling. Falcon provided Unocal
3
See Campbell v. Sonat Offshore Drilling, Inc., 979 F.2d
1115, 1118 n.2 (5th Cir. 1992).
3
the Fal-Rig #85, a jack-up drilling rig. A jack-up drilling rig is
a floating rig with legs that can be lowered into the seabed. Once
the legs are secured in the seabed, the rig can be “jacked-up” out
of the water to create a drilling platform. The process can be
reversed, and a jack-up rig can be towed to new sites.4
Pursuant to the Master Contract between Frank’s and Unocal,
plaintiff Kermit Demette, an employee of Frank’s, worked aboard the
Fal-Rig #85. Demette was injured while performing casing work as
a welder on the Fal-Rig #85. He was part of a “hammer job,” which
involves a casing crew welding together sections of pipe end-to-end
as the pipe is driven into the seabed by a large hammer. While
Demette was working at the base of the derrick where the pipe was
being driven, a metal retaining ring used to secure hoses fell from
the derrick, striking him on the head. At the time of Demette’s
injury, the Fal-Rig #85 was jacked up. Its legs rested on the
outer continental shelf of the United States beyond the territorial
waters of Louisiana.5
Demette sued Falcon for his injuries. Falcon, pursuant to the
Offshore Daywork Drilling Contract, filed a third-party complaint
against Unocal for defense and indemnity. Unocal voluntarily
assumed the defense of Falcon. Falcon then filed a third-party
4
Thomas J. Schoenbaum, 1 Admiralty and Maritime Law § 3-9,
100 n.8 (West 2d Ed. 1994), describes jack-up rigs and other rigs.
5
In this opinion, we define OCS to exclude lands lying
beneath the territorial waters of the states. See 43 U.S.C. §
1331(a).
4
complaint against Frank’s, seeking defense and indemnity pursuant
to the Master Contract.
The district court granted summary judgment to Falcon on the
issues of whether Frank’s owed defense and indemnity to Falcon.
Frank’s agreed to fund a settlement with Demette and to pay
Falcon’s defense costs, but made a full reservation of appeal
rights. A consent judgment was entered pursuant to this agreement.
Frank’s appeals the summary judgment ruling on indemnity and
defense.
II
The Outer Continental Shelf Lands Act6 provides comprehensive
choice-of-law rules and federal regulation to a wide range of
activity occurring beyond the territorial waters of the states on
the outer continental shelf of the United States. Relevant to this
case, it applies federal law to certain structures and devices on
the OCS, incorporates state law into federal law on the OCS, and
applies the LHWCA to certain injuries sustained by persons working
on the OCS.
In this case, the parties dispute whether Louisiana state law
governs the Master Contract and whether the OCSLA makes the
Longshore and Harbor Workers’ Compensation Act7 applicable to
6
43 U.S.C.A. § 1331 et seq. (2000).
7
33 U.S.C.A. § 901 et seq. (2000).
5
Demette’s injuries. First, we must determine whether the injury
occurred on an OCSLA situs; if so, we then have two inquiries: we
must determine whether OCSLA makes state law applicable; and we
must determine if the injured party’s status makes the LHWCA
applicable under OCSLA. We begin with a review of the three OCSLA
inquiries we must make in this case.
A. Section 1333(a)(1): Situs Test
Section 1333(a)(1) describes the reach of the OCSLA and
applies federal law within this scope. It states that the laws and
jurisdiction of the United States extend
to the subsoil and seabed of the [OCS] and to all artificial
islands, and all installations and other devices permanently
or temporarily attached to the seabed, which may be erected
thereon for the purpose of exporing [sic] for, developing, or
producing resources therefrom, or any such installation or
other device (other than a ship or vessel) for the purpose of
transporting such resources, to the same extent as if the
[OCS] were an area of exclusive Federal jurisdiction located
within a state.8
The Supreme Court and the Fifth Circuit have held that this section
creates a “situs” requirement for the application of other sections
of the OCSLA, including sections 1333(a)(2) and 1333(b).9 Neither
the Supreme Court nor this court has parsed the precise language of
8
43 U.S.C.A. § 1333(a)(1).
9
Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 217-20
& 220 n.2 (1986); Mills v. Director, OWCP, 877 F.2d 356, 361-62
(5th Cir. 1989) (en banc).
6
the statute to specify the exact contours of the situs test it
establishes.10 We are called upon to do so today.
We rely on the text of the statute. A close inspection of
section 1333(a)(1) reveals that it applies to two primary sets of
subjects: “to the subsoil and seabed of the [OCS]”; and “to all
artificial islands, and all installations and other devices
permanently or temporarily attached to the seabed.” This latter
category is further divided into two categories: those artificial
islands, installations, or devices “erected” on the OCS “for the
purpose of exploring for, developing, or producing resources” from
the OCS, and those “other than a ship or vessel” whose purpose is
“transporting such resources.”11
10
Mills interpreted section 1333(b) and held that it could not
apply to injuries that do not occur on or over the OCS. 877 F.2d
at 362.
11
43 U.S.C.A. § 1333(a)(1). The reference “any such
installation or other device” suggests that Congress treated
“installation or other device” as a unit separate from “artificial
islands.” In the context of the entire section, however, it is
clear that Congress used “artificial islands, installations, and
other devices” as a single category. See 43 U.S.C.A. § 1333(c)
(using the phrase “artificial island, installation, or other device
referred to in subsection (a) of this section”); 43 U.S.C.A. §
1333(d)(2) (same); 43 U.S.C.A. § 1333(d)(1) (using the phrase
“artificial islands, installations, and other devices referred to
in subsection (a) of this section”); 43 U.S.C.A. § 1333(e) (same);
43 U.S.C.A. § 1333(f) (same). Further, it is hard to imagine an
artificial island that is not subsumed into the category
“installations and other devices permanently or temporarily
attached to the seabed.” Making sense of text and context, we
conclude that “artificial islands, and all installations and other
devices” form a single category.
7
Thus, the OCSLA draws important distinctions between the two
categories of artificial islands, installations, and other devices.
Each category is defined by the purpose of the device—the former,
extraction of resources; the latter, transportation of resources.
The former also includes the phrase, “which may be erected [on the
OCS],” while the latter does not. Conversely, the latter contains
the phrase, “other than a ship or vessel,” while the former does
not.
We incorporate these distinctions into the following rule:
The OCSLA applies to all of the following locations:
(1) the subsoil and seabed of the OCS;
(2) any artificial island, installation, or other device if
(a) it is permanently or temporarily attached to the
seabed of the OCS, and
(b) it has been erected on the seabed of the OCS, and
(c) its presence on the OCS is to explore for, develop,
or produce resources from the OCS;
(3) any artificial island, installation, or other device if
(a) it is permanently or temporarily attached to the
seabed of the OCS, and
(b) it is not a ship or vessel, and
(c) its presence on the OCS is to transport resources
from the OCS.
B. Section 1333(a)(2): Incorporation of State Law
If the situs test is met, section 1333(a)(2) provides that
“[t]o the extent that they are applicable and not inconsistent with
this subchapter or with other Federal laws . . . the civil and
criminal laws of each adjacent State . . . are hereby declared to
be the law of the United States [on OCS situses as defined by
section 1333(a)(1)].” Sections 1333(a)(1) and 1333(a)(2) together
8
provide a rule for the incorporation of state law as surrogate
federal law governing claims arising out of activity on the OCS.
This court has articulated the rule in a three-part test announced
in Union Texas Petroleum Corp. v. PLT Engineering (“PLT”):12
[For state law to govern,] (1) The controversy must arise on
a situs covered by OCSLA (i.e., the subsoil, seabed, or
artificial structure permanently or temporarily attached
thereto). (2) Federal maritime law must not apply of its own
force. (3) The state law must not be inconsistent with Federal
law.13
For disputes arising out of contracts—including indemnity contracts
for offshore drilling—the courts of this circuit have held that if
the contract is a maritime contract, federal maritime law applies
of its own force, and state law does not apply.14
C. Section 1333(b): Status Test
Section 1333(b) extends the LHWCA to non-seamen employed on
the OCS. Specifically, it creates the following “status” test: the
LHWCA applies to injuries “occurring as a result of operations
conducted on the [OCS] for the purpose of exploring for,
developing, removing, or transporting by pipeline the natural
12
895 F.2d 1043 (5th Cir. 1990).
13
Id. at 1047.
14
See Hodgen v. Forest Oil Corp., 87 F.3d 1512, 1526 (5th Cir.
1996) (observing that the second factor in the PLT test is
identical to the determination that the contract is maritime);
Diamond Offshore Co. v. A&B Builders, Inc., 75 F. Supp. 2d 676, 681
(S.D. Tex. 1999) (applying Hodgen to an indemnity contract).
9
resources . . . of the [OCS].”15 In order for the LHWCA to apply
by virtue of section 1333(b), notwithstanding any application of
the LHWCA of its own force, the injured worker must satisfy the
“status” requirement of section 1333(b) as well as the situs
requirement of section 1333(a)(1).16
III
A. Situs Test
Here, the situs requirement of section 1333(a)(1) is met. The
Fal-Rig #85 was jacked-up over the OCS at the time of Demette’s
injury. It therefore falls into the second category of OCSLA
situses: it was a device temporarily attached to the seabed, which
was erected on the OCS for the purpose of drilling for oil.17
Frank’s argues that since the Fal-Rig #85 is a vessel,18 the
15
43 U.S.C.A. § 1333(b). Section 1333(b)(1) expressly excludes
masters and crew of vessels.
16
See Mills, 877 F.2d at 361-62.
17
43 U.S.C.A. § 1333(a)(1).
18
This is beyond dispute. This circuit has repeatedly held
that special-purpose movable drilling rigs, including jack-up rigs,
are vessels within the meaning of admiralty law. See, e.g., Smith,
960 F.2d at 460; Offshore Co. v. Robison, 266 F.2d 769, 776 (5th
Cir. 1959). The dissent’s challenge to the definition of vessel is
misplaced. The dissent argues that a jack-up rig stops being a
vessel when it jacks up. Tinkering with the maritime definition of
vessel would overturn a centuries-old understanding of what
constitutes a vessel. See The Robert W. Parsons, 191 U.S. 17, 28-
32 (1903) (reviewing authority). As long as a boat is able and
intended to return to navigation, it remains a vessel, even when in
dry dock, storage on land, or otherwise removed from the water.
10
OCSLA cannot apply to this case. Frank’s argument is that the
qualifier “other than a ship or vessel” in section 1333(a)(1)
precludes the application of the OCSLA. This argument has no
merit. As discussed above, the statute twice refers to artificial
islands, installations, and other devices permanently or
temporarily attached to the seabed. Once it inserts the qualifier
“other than a ship or vessel”; once it does not. We give effect to
the different wording of the two phrases by reading them
differently.19
See Thomas J. Schoenbaum, 1 Admiralty and Maritime Law 88-92 (West
2d ed. 1994). This circuit has repeatedly rejected the notion that
removing a vessel’s hull from the water divests it of vessel
status. See American Eastern Development Corp. v. Everglades
Marina, Inc., 608 F.2d 123, 124-25 (5th Cir. 1979) (contractual
action involving boat in dry storage); Delome v. Union Barge Line
Co., 444 F.2d 225, 228-32 (5th Cir. 1971) (unseaworthiness action
involving boat undergoing repairs on marine railway). Thus, the
dissent’s argument that a jack-up rig stops being a vessel when it
temporarily lifts out of the water implicates the treatment of any
boat, ship, barge, or special-purpose vessel that is temporarily
taken out of navigation. Further, the dissent’s definition of
vessel, which requires that the object “float on water,” would also
exclude submersible rigs and submarines (when submerged), and boats
employing hydrofoils (which displace less water than their mass).
19
See Rusello v. United States, 464 U.S. 16, 23 (1983) (“We
refrain from concluding here that the differing language in the two
subsections has the same meaning in each.”). Also, the use of the
term “temporarily” implies that devices that can detach from the
seabed and are capable of movement on the sea—i.e., vessels—can
fall within the scope of the OCSLA. The distinction the statute
draws between devices used to extract and devices used to transport
resources serves to exclude vessels that merely transport
resources: oil tankers and the like. The transport devices covered
by the OCSLA are pipelines, which are explicitly mentioned in
section 1333(b), and similar structures. A further indication that
the statute contemplates vessels being OCSLA situses is section
1333(b)’s exclusion of “a master or member of a crew of any vessel”
11
This result is consistent with the precedent of this circuit.
As we noted in Hodgen v. Forest Oil Corp.,20 our holding in Domingue
v. Ocean Drilling and Exploration Co.21 implicitly supports the
holding that a jacked-up rig is an OCSLA situs. Domingue applied
state law to an indemnity agreement regarding an injury on a
jacked-up drilling rig, but failed to explicitly address the situs
requirement of the OCSLA, focusing instead on the question of
whether state law applied.22 Since the incident occurred on the OCS
beyond the territorial waters of Louisiana, the only way state law
could have operated was by incorporation into federal law under
OCSLA.23
from LHWCA coverage on OCSLA situses. If OCSLA situses are never
vessels, this provision would be mere surplusage. The dissent’s
contention that an OCSLA situs cannot be a vessel ignores these
textual indications to the contrary.
20
87 F.3d 1512 (5th Cir. 1996).
21
923 F.2d 393 (5th Cir. 1991).
22
Id. at 395-98. Hodgen, 87 F.3d at 1525-26, notes that
Domingue failed to discuss the situs requirement.
23
Frank’s cites a number of cases challenging this conclusion,
none of which are apposite. Frank’s relies on Smith v. Penrod
Drilling Corp. 960 F.2d 456 (5th Cir. 1992), in arguing that a
vessel cannot be an OCSLA situs. The holding of Smith was that
maritime law, and not Louisiana law, applied to an indemnity
agreement regarding a jack-up rig. Id. at 461. This is a
straightforward application of the second prong of the PLT test and
has nothing to do with the question of whether jack-ups can be
OCSLA situses. Indeed, Smith explicitly found that since the
accident that implicated the indemnity agreement occurred on a
fixed, permanent platform, it need not address the question of
whether a jack-up is an OCSLA situs. Dupre v. Penrod Drilling
Corp., 993 F.2d 474, 476-77 (5th Cir. 1993), follows Smith in this
12
The amicus supporting Frank’s quotes Longmire v. Sea Drilling
Corp.,24 which states: “The OCSLA covers fixed platform workers,
while floating rig workers, even those whose tasks are essentially
identical to the tasks performed by fixed platform workers, are
treated differently.”25 This out-of-context statement cannot carry
Frank’s case. In the context of the facts of the case, this
statement addresses the fact that the employee was injured on a
tender working alongside a fixed platform.26 Tenders are vessels
(in Longmire it was a converted warship) that are often anchored
next to drilling platforms to service the platforms and ferry
workers to and from the shore. Longmire does not involve a
floating rig, let alone a jack-up rig; the “floating” rig the
opinion refers to is this tender, which was attached to the OCS
regard and is equally distinguishable. Frank’s also cites
Tennessee Gas Pipeline v. Houston Cas. Ins. Co., 87 F.3d 150, 155-
56 (5th Cir. 1996), for the proposition that vessels are not within
the OCSLA jurisdiction for removal purposes. This claim is
incorrect. Tennessee Gas Pipeline finds removal jurisdiction over
maritime claims involving a fixed platform that was within OCSLA
jurisdiction; it makes no claims about vessels. Frank’s claim
stems from its confusion of “vessels” with “maritime claims.”
While maritime claims cannot generally be removed to federal court,
claims arising under federal statute can be. While the presence of
a vessel in the facts of a case may allow a plaintiff to allege
claims under maritime law, the presence of a vessel does not
convert other, non-maritime claims into unremovable maritime
claims.
24
610 F.2d 1342 (5th Cir 1980).
25
Id. at 1348.
26
Id. at 1344-45.
13
only by an anchor. In Parks v. Dowell Division of Dow Chemical
Corp.,27 we explained Longmire, noting that tenders are not
extensions of drilling rigs fixed to the seabed, and the OCSLA does
not apply to them.28 Longmire’s conclusion that a tender is not an
OCSLA situs is not relevant to the facts of this case.29
In sum, this case arises out of an injury on an OCSLA situs.
Since the section 1333(a)(1) requirement is satisfied, the OCSLA
applies to this case.
B. Incorporation of State Law
The next logical step is to consider whether Louisiana law
applies as a surrogate to federal law under section 1333(a)(2). As
stated above, this circuit applies the PLT test to determine the
application of state law. The second prong of the PLT test is that
maritime law does not apply of its own force. Because maritime law
27
712 F.2d 154 (5th Cir. 1983).
28
See id. at 157. Although arguably an anchor “attache[s]”
a ship to the seabed, a tender, unlike a jack-up rig, is not
“erected” on the OCS.
29
Frank’s also cites legislative history stating that the
phrase “waters above the [OCS]” was deleted from the situs
requirement of what became section 1333(b) in order “to make more
definite the application of the [LHWCA] to workers other than those
employed on vessels.” Sen. Rep. No. 411, 83d Cong., 1st Sess. 16,
23 (1953). Unfortunately for Frank’s, the situs requirement that
this deletion left behind was later deleted, leaving no situs
requirement in the enacted version of that subsection. As noted
above, section 1333(b) contains only a status requirement.
14
applies of its own force, Louisiana law does not apply in this
case.30
Maritime law applies to the Master Contract between Unocal and
Frank’s if the contract is a maritime contract. The Master
Contract stated that Frank’s would “provide casing installation
services.” The parties indemnified each other against claims
brought by their employees. The contract does not explicitly
mention any vessels, and it is unclear whether it contemplated work
exclusively offshore or work both offshore and onshore.
Determining whether a contract relating to offshore drilling
is maritime is often a perplexing affair.31 This circuit utilizes
the two-step test of Davis & Sons, Inc. v. Gulf Oil Corp.,32 to
determine whether a contract is maritime. We consider, first, the
contract’s “historical treatment in the jurisprudence” and, second,
the specific facts of the case.33 For some categories of contracts,
30
Since Louisiana law does not apply, we need not decide
whether it is inconsistent with federal law in this case. If the
contract in this case were not maritime, we would then consider
whether Louisiana law is inconsistent with applicable federal law.
31
See Davis & Sons, Inc. v. Gulf Oil Corp., 919 F.2d 313, 315
(5th Cir. 1990) (“The attempt to determine whether a contract,
particularly one linked to offshore gas and oil production, is
governed by state or maritime law has led to much confusion.”).
32
919 F.2d 313, 315 (5th Cir. 1990).
33
Id. at 316; see also Campbell v. Sonat Offshore Drilling,
Inc., 979 F.2d 1115, 1121 (5th Cir. 1992) (describing two-step
character of the Davis test).
15
the historical treatment is sufficiently clear that the fact-
specific inquiry becomes unimportant.34 This is such a case.
This court has held that indemnity provisions in contracts to
provide offshore casing services are maritime.35 Even a contract
for offshore drilling services that does not mention any vessel is
maritime if its execution requires the use of vessels.36 This is
true for contracts that may also involve obligations performed on
land.37 Thus, circuit precedent virtually compels the conclusion
that this is a maritime contract.
The Davis factors confirm this result. Davis lists six
factors to consider in determining whether the facts of the case
34
An example of such a case is Smith, 960 F.2d at 459-60.
35
See Campbell v. Sonat Offshore Drilling, 979 F.2d at 1120-
21; see also Smith, 960 F.2d 456 (holding that contract to “work
over” a jack-up rig is maritime); Diamond Offshore Co. v. A&B
Builders, Inc., 75 F. Supp. 2d 676, 679-81 (S.D. Tex. 1999)
(holding that a contract for repair of a jack-up rig is maritime);
Gilbert v. Offshore Production & Salvage, Inc., 1997 WL 149959, at
*4 (E.D. La. March 21, 1997) (holding that a contract to provide
drilling supervision services is maritime); Campbell v. Offshore
Pipeline, Inc., 1993 WL 302623, at *3-4 (E.D. La. Aug. 5, 1993)
(holding that a contract for welding services of pipeline on the
OCS is maritime).
36
See Lewis v. Glendel Drilling Co., 898 F.2d 1083, 1086 (5th
Cir. 1990) (holding that a contract to provide offshore drilling
services is maritime even if it does not mention vessels).
Contracts involving vessels tend to be deemed maritime. See PLT,
895 F.2d at 1048 (describing an “oversimplified” test as “whether
the transaction relates to ships and vessels, masters and mariners,
as the agents of commerce”). Schoenbaum, 1 Admiralty and Maritime
Law § 3-10 provides an extensive list of contracts found to be
maritime and non-maritime.
37
See Davis, 919 F.2d at 315-16.
16
lend the contract a sufficiently “salty flavor”38 for a court to
deem it maritime:
1) what does the specific work order in effect at the time
of the injury provide?
2) what work did the crew assigned under the work order
actually do?
3) was the crew assigned to do work aboard a vessel in
navigable waters[?]
4) to what extent did the work being done relate to the
mission of the vessel?
5) what was the principal work of the injured worker? and
6) what work was the injured worker actually doing at the
time of the injury?39
In this case, Demette’s work order provided for a hammer operator,
a hammer mechanic, and four welders, including Demette, to drive
and weld 416 feet of pipe from the Fal-rig #85 while the rig was
jacked-up; this crew actually performed the hammer job the work
order described; Demette was working on a vessel over navigable
waters; casing is an integral part of drilling, which is the
primary purpose of the vessel; and Demette’s principal work was as
a welder performing casing work; and Demette was performing casing
services at the time of the accident. Thus, all six factors point
to the same conclusion: the contract and the injury that invoked it
were maritime in nature.
C. Status Test
38
See Kossick v. United Fruit Co., 365 U.S. 731, 742 (1962).
39
Davis, 919 F.2d at 316.
17
Having concluded that the OCSLA applies, but does not
incorporate state law, the only remaining issue under the OCSLA is
whether the LHWCA applies to Demette by virtue of section 1333(b)
of the OCSLA. It does. Demette was injured while doing casing
work. Casing work is the model case of injuries “occurring as a
result of operations conducted on the [OCS] for the purpose of
exploring for, developing, removing, or transporting by pipeline
the natural resources . . . of the [OCS].”40
We thus conclude that the injury occurred on an OCSLA situs,
that Louisiana law does not apply, and that the LHWCA applies to
this case by virtue of section 1333(b). We now address the
consequences of our conclusion that section 1333(b) applies the
LHWCA to this case.
IV
The LHWCA provides the exclusive remedies for injuries to
employees injured while subject to the LHWCA.41 It creates for such
employees an action against the vessel (including its owner) on
which the employee was working when injured.42 Section 905(b) of
the LHWCA bars employers from indemnifying the vessel from LHWCA
40
43 U.S.C.A. § 1333(b). That Demette may be a longshoreman
by operation of the LHWCA itself seems to be of little consequence;
the language of the OCSLA is clear. This point becomes important
in the analysis of 33 U.S.C.A. § 905(c) below.
41
See 33 U.S.C.A. § 905(a).
42
See 33 U.S.C.A. § 933.
18
liability.43 However, if the injured employee is entitled to the
benefits of the LHWCA “by virtue of” section 1333(b) of the OCSLA,
then section 905(c) of the LHWCA states that “any reciprocal
indemnity provision” between the vessel and the employer is
enforceable.44
Central to this case is the meaning of the phrase “by virtue
of.” Frank’s argues that Demette is directly covered by the
LHWCA,45 and therefore section 905(b) bars the indemnity agreement
between Falcon and Frank’s. Frank’s reads section 905(c) to apply
only to persons entitled to receive LHWCA benefits exclusively “by
virtue of” the OCSLA. We acknowledge that this interpretation
would not do violence to the text of the statute.
Ordinarily, however, we should give the words of statutes
their plain meaning. The most obvious meaning of “by virtue of
section 1333" is simply that the worker is covered by section 1333.
For example, it is perfectly sensible to say, “Demette is eligible
to receive LHWCA benefits by virtue of section 1333 and also by
virtue of the LHWCA itself.” This sentence makes sense because we
43
See 33 U.S.C.A. § 905(b).
44
See 33 U.S.C.A. § 905(c).
45
Both parties seem to agree that Demette is a longshoreman
by operation of the LHWCA itself. To qualify as a longshoreman
under the LHWCA, the employee must be engaged in maritime
employment over navigable water, but not a seaman. See 33 U.S.C.A.
§ 902(3); Director, OWCP v. Perini North River Assoc., 459 U.S. 297(1983).
19
understand that “by virtue of” does not imply exclusivity. The
adverbs “exclusively” or “solely” would have indicated the meaning
Frank’s advocates, but those words are absent from the statute.
We might question our plain meaning interpretation of “by
virtue of” if Frank’s identified something in the context of the
statute that indicated that those words have a narrower, more
technical meaning. But there is none. Further, what little
legislative history section 905(c) has supports our reading of the
text. Congress enacted section 905(c) as part of the Longshore and
Harbor Workers’ Compensation Act Amendments of 1984.46 The House
Conference Report47 discusses language in the Senate version of the
bill; this language became section 905(c). The Conference Report
stated that “the Senate bill provides an exemption to the Longshore
Act’s current proscription of indemnity agreements under section
[905(b)] of the Act. . . . The bill would legalize those indemnity
agreements insofar as they apply to the Outer Continental Shelf.”
Thus, the Conference Report treats section 905(c)’s limitation to
persons entitled to benefits “by virtue of section 1333" as
applying to all persons connected to the OCS, as defined by the
OCSLA, without any reference to any exception for persons
qualifying directly under the LHWCA.
46
Pub. L. No. 98-426, 98 Stat. 1639 (1984).
47
H. Conf. Rep. No. 98-1027 (1984), reprinted in 1984
U.S.C.C.A.N. 2771.
20
Frank’s argues that construing section 1333(b) to apply to
workers already directly covered by the LHWCA causes some
anomalies. While this may be so, this is a result of the existence
of section 905(c), not of any interpretation of section 905(c).
Any line we draw will leave some indemnity agreements valid and
others invalid. A line between LHWCA employees on permanent
platforms and all other LHWCA employees is not any more arbitrary
than a line between LHWCA employees on permanent or temporary
platforms and all other LHWCA employees. In fact, as Judge Sear
cogently argued in Campbell v. Offshore Pipeline, Inc.,48
interpreting section 905(c) to include employees who are covered by
virtue of both the LHWCA and OCSLA eliminates some anomalies.49
Given that section 1333(b) of the OCSLA applies to Demette,
the plain language of section 905(c) dictates that the indemnity
contract, if reciprocal, is valid, notwithstanding section 905(b).50
Since Frank’s and Unocal each indemnified the other, the
indemnification is reciprocal and therefore valid.51
48
1993 WL 302623 (E.D. La. Aug. 5, 1993).
49
See id. at *5 (noting that a contrary interpretation would
lead to different treatment of two indemnity agreements when two
workers are injured on the same platform, but one is not entitled
to benefits directly under the LHWCA).
50
Frank’s also argues that this interpretation of section
905(c) renders section 905(b) a nullity. This is nonsense.
Section 905(c) applies only on the OCS and only when the contract
is reciprocal.
51
That Falcon was not a signatory to the reciprocal Unocal-
Frank’s indemnity agreement does not alter this result. We have so
21
Frank’s finally argues that even if section 905(c) removes the
section 905(b) prohibition, Louisiana law invalidates the indemnity
agreement. As we have already concluded, however, Louisiana law
does not apply to this contract.
V
In sum, the OCSLA applies to this case; Louisiana law does not
apply as surrogate federal law under the OCSLA; and because Demette
is subject to the LHWCA by virtue of the OCSLA, the indemnity
agreement between Unocal and Frank’s is valid.
In reaching this conclusion, we acknowledge the dissent’s
puzzlement at the conclusion that a jack-up rig is a vessel and
that maritime law can apply on an OCSLA situs. But we disagree
that en banc reversal of established circuit precedent is in order.
Although current law suffers from the inconsistencies the dissent
complains of, changing the law of this circuit may not improve the
situation.52 Instead, the source of the dissent’s vexation is the
held in Campbell v. Sonat Offshore Drilling, Inc., 979 F.2d 1115,
1124 (5th Cir. 1992).
52
The dissent’s recourse to legislative history of the OCSLA
to argue that OCSLA situses cannot also be deemed vessels does not
grapple with the text of the OCSLA, which contemplates OCSLA
situses that are vessels. See Parts II.A and III.A. We also note
that even if we were to ignore the text of the OCSLA, examination
of the purposes of the OCSLA does not yield so clear an answer as
the dissent indicates. This circuit has noted that OCSLA was
originally designed as a gap-filling statute. Mills v. Director,
OWCP, 877 F.2d 356, 358 (5th Cir. 1989) (en banc). This was
because fixed platforms on the OCS were neither vessels nor within
the territorial jurisdiction of any state; thus, no law applied to
them. The OCSLA filled this gap by applying state law as surrogate
22
OCSLA itself, a statute that by introducing the law of terra firma
to a seaward realm requires unavoidably arbitrary line-drawing
between the application of terrestrial law and the law of the sea.53
We AFFIRM the district court’s grant of summary judgment
against Frank’s.
federal law to those platforms. Floating rigs, however, were
always subject to maritime law, and thus did not linger in the
lawless limbo occupied by drilling platforms prior to the enactment
of the OCSLA. Thus, applying the OCSLA’s choice-of-law provision
only when “maritime law [does] not apply of its own force,” PLT,
895 F.2d at 1047, is consistent with the gap-filling purpose of the
OCSLA.
53
By applying state law as surrogate federal law to offshore
situses, the OCSLA requires courts to draw lines between the zones
in which surrogate federal law applies and in which admiralty law
applies. No interpretation of the OCSLA can eliminate the
arbitrariness of such lines. Our circuit precedent essentially
draws a line between floating rigs and fixed platforms, which may
seem arbitrary in light of the purposes cited by the dissent. PLT,
895 F.2d at 1047. One alternative, treating jack-up rigs as
vessels but also applying to them surrogate federal law instead of
maritime law, would draw a strange line between rig operators who
are permanently assigned to floating rigs (who are crew members,
and thus would be excluded from LHWCA coverage by section
1333(b)(1), but would also lack seaman’s remedies because maritime
law would not apply) and rig operators temporarily assigned to
floating rigs or assigned to platforms (who are covered by the
LHWCA by section 1333(b)). Another alternative, proposed by the
dissent, would deem floating rigs no longer vessels when they jack-
up on the OCS. This draws an equally strange line between rigs
that lift out of the water to drill and rigs that do not, even when
both are OCSLA situses. Further, this creates the problem of
determining when a rig has been sufficiently jacked-up to switch
the applicable law from admiralty to surrogate federal law. This
in turn complicates questions of what law applies to incidents that
occur while a rig is jacking up or which law applies to contracts
governing the use of jack-up rigs.
23
DeMOSS, Circuit Judge, dissenting:
Because the panel majority arrives at their decision in this
case without consideration of three Supreme Court cases and two
statutory amendments which I think require a different conclusion,
I respectfully dissent.
Rodrigue -- The First Supreme Court Case
On August 7, 1953, the United States Congress passed the Outer
Continental Shelf Lands Act (hereinafter “OCSLA”), which extended
federal law (and adjacent state law) “to the sub-soil and seabed of
the Outer Continental Shelf and to all artificial islands and fixed
structures which may be erected thereon for the purpose of
exploring for, developing, removing, and transporting resources
therefrom.” See § 4(a)(1), 67 Stat. 642 (emphasis added).54 The
54
In 1953, there were no "jack-up rigs" operating in the
area defined as the Outer Continental Shelf. The engineering and
technological skills which produced the first "jack-up" rig were
not developed until in the late 1950s and early 1960s. The use of
the term "fixed structures" in the OCSLA was descriptive of the
type of devices actually being used on the OCS; and therefore
should probably not be read as restrictive to those structures
only. In its traditional usage, the term "fixed structure"
referred to a structure that’s components were manufactured on
shore, then floated out to a well site on barges, and then
assembled and erected on site in the water.
extension of federal law contemplated by this provision was to be
“to the same extent as if the Outer Continental Shelf were an area
of exclusive federal jurisdiction located within a state.” Id.The subsequent sub-paragraph of this same section provided that the
civil and criminal laws of each adjacent state “are hereby declared
to be the law of the United States for that portion of the sub-soil
and seabed of the Outer Continental Shelf, and artificial islands
and fixed structures erected thereon, which would be within the
area of the state if its boundaries were extended seaward to the
outer margin of the Outer Continental Shelf.”55
This Circuit considered the significance of these statutory
provisions in two cases, Dore v. Link Belt Co., 391 F.2d 671 (5th
Cir. 1968), and Rodrigue v. Aetna Casualty & Surety Co., 395 F.2d
216 (5th Cir. 1968). Each of these cases involved the death of a
worker which occurred on a drilling rig on a fixed platform on the
Outer Continental Shelf. In each case, the plaintiff sought relief
under Louisiana state law, which they contended was made applicable
55
The phrases "general admiralty law" and "maritime law" do
not appear anywhere in the OCSLA as originally passed in 1953; and
these phrases were not inserted by the 1978 Amendments to OCSLA
discussed later. Likewise, there is not now (and never has been)
any language in the OCSLA which "requires courts to draw lines
between the zones in which surrogate federal law applies and in
which admiralty law applies" as the majority asserts in footnote 53
of the opinion. Therefore, there is no statutory basis for the
majority's holding (based on the second prong of PLT) that we must
first determine whether admiralty and maritime law applies of their
own accord before applying these choice-of-law provisions of the
OCSLA.
25
by OCSLA. The defendants contended that relief could only be made
under the Death on the High Seas Act (“DOHSA”). In holding that
relief was available only under DOHSA, the Fifth Circuit stated:
We think that a consideration of both intrinsic and
extrinsic factors requires the conclusion that it
was the intention of Congress that (a) this
occurrence be governed by Federal, not State, law,
and (b) that the Federal law thereby promulgated
would be the pervasive maritime law of the United
States. In connection with the latter phase -- the
choice by Congress of maritime law -- it is again
important to keep in mind that we are in an area in
which Congress has an almost unlimited power to
determine what standards shall comprise the Federal
law.
Dore, 391 F.2d at 675 (quoting Pure Oil Co. v. Snipes, 293 F.2d 60,
64 (5th Cir. 1961)).
The Supreme Court granted certiorari in both cases, which were
argued together. In an opinion covering both cases, Rodrigue v.
Aetna Casualty & Surety Co., 89 S. Ct. 1835 (1969), the Supreme
Court in an unanimous decision written by Justice White, reversed
the decisions of the Fifth Circuit and stated:
In light of the principles of traditional admiralty
law, the Seas Act [DOHSA], and the Lands Act
[OCSLA], we hold that petitioner’s remedy is under
the Lands Act and Louisiana law. The Lands Act
makes it clear that federal law, supplemented by
state law of the adjacent State, is to be applied
to these artificial islands as though they were
federal enclaves in an upland State. This approach
was deliberately taken in lieu of treating the
structures as vessels, to which admiralty law
supplemented by the law of the jurisdiction of the
vessel’s owner would apply.... Since the Seas Act
does not apply of its own force under admiralty
principles, and since the Lands Act deliberately
eschewed the application of admiralty principles to
26
these novel structures, Louisiana law is not ousted
by the Seas Act, and under the Lands Act it is made
applicable.
Id. at 1837. In a very comprehensive discussion of the legislative
history of OCSLA, the Supreme Court went on to make the following
comments:
1. “Even if the admiralty law would have applied to the
deaths occurring in these cases under traditional principles,
the legislative history shows that Congress did not intend
that result. First, Congress assumed that the admiralty law
would not apply unless Congress made it apply, and then
Congress decided not to make it apply. The legislative
history of the Lands Act makes it clear that these structures
were to be treated as island or as federal enclaves within a
landlocked State, not as vessels.” Id. at 1840.
2. “Careful scrutiny of the hearings which were the
basis for eliminating from the Lands Act the treatment of
artificial islands as vessels convinces us that the motivation
for this change, together with the adoption of state law as
surrogate federal law, was the view that maritime law was
inapposite to these fixed structures.” Id. at 1841.
3. “The committee was aware that it had the power to
treat activity on these artificial islands as though it
occurred aboard ship .... And the very decision to do so in
the initial bill recognized that if it were not adopted
explicitly, maritime simply would not apply to these
stationary structures....” Id. at 1841 (citations omitted).
4. “[T]he special relationship between the men working
on these artificial islands and the adjacent shore to which
they commute to visit their families was also recognized by
dropping the treatment of these structures as ‘vessels’ and
instead, over the objection of the administration that these
islands were not really located within a State, the bill was
amended to treat them ‘as if (they) were (in) an area of
exclusive Federal jurisdiction located within a State.’” Id.
at 1842.
In light of the Supreme Court decision in Rodrigue and the
absence of any later decision by the Supreme Court changing any of
27
its conclusions in Rodrigue, I would submit that the following
principles are applicable to the case now before us:
1. Structures placed on the Outer Continental Shelf “for
the purpose of exploring for, developing, removing, and
transmitting resources therefrom,” are not vessels;
2. Congress decided that maritime law does not apply to
these structures; and
3. The laws of the State of Louisiana will apply to
activities on these structures to the extent that such state
laws are not inconsistent with other federal laws.
The First Statutory Amendment
In 1978, Congress adopted comprehensive amendments to OCSLA.
See Pub. L. 95-372 (1978). Section 203(a) of this statutory
amendment reads as follows:
SEC. 203. (a) Section 4(a)(1) of the Outer
Continental Shelf Lands Act (43 U.S.C. 1333(a)(1)
is amended --
(1) by striking out “and fixed structures” and
inserting in lieu thereof “, and all installations
and other devices permanently or temporarily
attached to the seabed,”; and
(2) by striking out “removing, and
transporting resources therefrom” and inserting in
lieu thereof “or producing resources therefrom, or
any such installation or other device (other than a
ship or vessel) for the purpose of transporting
such resources.”
The report of the Conference Committee regarding the amendment
reads as follows:
Section 203 -- Laws Applicable to the Outer
Continental Shelf
28
Both the Senate bill and the House amendment
amend section 4(A)(1) of the OCS Act of 1953 by
changing the term “fixed structures” to “and all
installations and other devices permanently or
temporarily attached to the seabed” and making
other technical changes. The Conference Report
retains this language.
The intent of the managers in amending section
4(A) of the 1953 OCS Act is technical and
perfecting and is meant to restate and clarify and
not change existing law. Under the Conference
Report language, federal law is to be applicable to
all activities on all devices in contact with the
seabed for exploration, development, and
production.
H.R. Conf. Rep. No. 95-1474 (1978). The House Committee Report No.
95-590 on this legislation states the following in the section-by-
section analysis:
Section 203.--Laws Applicable to Outer Continental
Shelf
Section (a) amends section 4(a)(1) of the OCS
Act of 1953 by changing the term “fixed structures”
to “and all installations and other devices
permanently or temporarily attached to the seabed”
and making other technical changes. It is thus
made clear that Federal law is to be applicable to
all activities on all devices in contact with the
seabed for exploration, development, and
production. The committee intends that Federal law
is, therefore, to be applicable to activities on
drilling ships, semi-submersible drilling rigs, and
other watercraft, when they are connected to the
seabed by drillstring, pipes, or other
appurtenances, on the OCS for exploration,
development, or production purposes. Ships and
vessels are specifically not covered when they are
being used for the purpose of transporting OCS
mineral resources.
H.R. Rep. No. 95-590 (1978) (emphasis added).
29
I have found no Supreme Court decision and no Fifth Circuit
decision which expressly discuss or interpret the significance of
the statutory language change made by the 1978 Amendments to OCSLA
regarding deletion of “fixed structures” and insertion of “all
installations and other devices permanently or temporarily attached
to the seabed” in the definition of the situs to which OCSLA is to
apply. We must assume that when it was adopting the 1978
Amendments to OCSLA, Congress was aware of and considered the
Supreme Court holding in Rodrigue. Since there is nothing in the
text of the 1978 Amendments nor in any legislative history which
would indicate a desire or intention on Congress’ part to change
any of the Supreme Court’s holdings in Rodrigue, we have to assume
that Congress accepted those holdings as applicable to the 1978
Amendments. The deletion of the words “and fixed structures” and
the insertion of the words “and all installations and other devices
permanently or temporarily attached to the seabed” reflect a clear
intention on the part of Congress to broaden and clarify the
category of structures and facilities to which OCSLA would apply;
and the House Committee Report 95-590 expressly identifies
“drilling ships, semi-submersible drilling rigs, and other water
craft, when they are connected to the seabed by drill string,
pipes, or other appurtenances on the OCS for exploration
development or production purposes” as being the situs of
activities to which OCSLA would apply. In my view, there is
30
absolutely no question at all that these statutory language changes
eliminate the basis for any distinction which our case law may have
made in the past as between a “jack-up rig” being a vessel and “a
fixed platform” not being a vessel, insofar as activities on the
Outer Continental Shelf are concerned. Both our Circuit and the
Supreme Court have clearly indicated that Congress holds the
ultimate power in defining applicable law and categorizing the
facilities and operations to which it applies when dealing with
activities on the Outer Continental Shelf.
The controlling premise of the majority opinion in the case
before us is that Fal-Rig 85 is a vessel.56 Because it is a vessel,
the majority says admiralty and maritime law controls its
operations and activities. Because admiralty and maritime law
applies, that body of law prevents and preempts any application of
state law. If the majority’s original premise is incorrect, then
their house of cards collapses.
In my view, we are bound by the Supreme Court decision in
Rodrigue, and by Congress’ 1978 Amendments to OCSLA, to conclude
that when a jack-up rig is operating on the Outer Continental
Shelf, it cannot be construed as being a vessel because, in the
56
In footnote 18 of its opinion, the majority relies on
Offshore Co. v. Robison, 266 F.2d 769 (5th Cir. 1959), as being the
original source of its premise; but the casualty in Robison
occurred in the territorial waters of the State of Texas and there
was no contention nor need for discussion as to the applicability
of the OCSLA, which at that time referred to "artificial islands
and fixed structures" in its definition of OCSLA situs.
31
statutory language, it is “an installation temporarily attached to
the seabed for the purpose of exploring for, or producing oil and
gas” or, in the language of the House Committee Report (supra), it
is “a watercraft connected to the seabed by drillstring, pipes, or
other appurtenances for exploration or production purposes.” This
conclusion is mandated not only by the new language of OCSLA but
also by common sense and plain language interpretation of “what is
a vessel.”
The dictionary says that a vessel is “a craft for traveling on
water.” Webster’s Collegiate Dictionary (Random House 1991). The
quintessential characteristics of a vessel are that it floats on
water and that it is used for transporting cargo or passengers from
one place to another. In order to “float on water,” it must be
supported by the laws of buoyancy, i.e., it will float to the
extent that the volume of water which it displaces weighs more than
the vessel and its cargo. However, the mere fact that a structure
floats does not mean it is a vessel. A floating dock does float,
but it is permanently connected to land and never goes anywhere.
Likewise, a restaurant or gambling casino built on a barge is
floating, but if it is connected to land by permanent mooring lines
and utility lines (water, gas, sewage, electricity, telephones) and
never moves, it is not a vessel; it is simply a floating dock with
a restaurant on it, which earns money by selling food or games of
chance, not by transporting cargo or people. A pontoon bridge
32
floats, but it is not a vessel because it does not move once it is
in place. Using these concepts to assess the characteristics of a
jack-up drilling rig, I come to the easy conclusion that a jack-up
drilling rig is clearly not a vessel when it is “jacked up.”
Clearly, when it is jacked up, Fal-Rig 85 is not floating at all.
The process of jacking up lifts the hull and work decks of the Fal-
Rig 85 completely out of the water. The only parts of the Fal-Rig
85 which are in the water are its legs, which extend downward
through the water into the seabed where support for the entire
weight of Fal-Rig 85 is found in the sea bottom itself. In the
jacked-up position, the hull and work decks of the Fal-Rig 85 are
high enough out of the water that neither ocean currents nor wind
generated wave action impacts the work area. Finally, in the
jacked up position, the Fal-Rig 85 cannot move; its position in
terms of longitude and latitude is fixed; it is stationary. The
primary purpose for which the Fal-Rig 85 was built is to drill a
hole in the earth under water in order to locate oil and/or gas and
produce them if found. The Fal-Rig 85 earns its revenue for
cutting the hole and completing the well, and it performs these
tasks only when it is jacked up. In its jacked up position, the
Fal-Rig 85 is functionally indistinguishable from a drilling
platform which has been assembled on site in the water: (1) both
stand on legs resting on the bottom; (2) both have work decks and
platforms high enough above the water to avoid currents and waves;
and (3) both conduct drilling and completion activities for oil and
33
gas production. I can see no rational basis for distinguishing the
two platforms.
I recognize that our case law has labeled a jack-up drilling
rig as a “special purpose vessel;” but in my view that is a
mislabeling that confuses the realities involved and, in light of
the 1978 Amendments to OCSLA, should not be applicable to
operations on the Continental Shelf. The “special purpose” of a
jack-up rig, which is drilling for oil and gas, has nothing to do
with traditional maritime activities or interests. Drilling for
oil and gas does not create any buoys, channel markers, or other
aids to navigation. Drilling for oil and gas does not enhance or
improve the navigability of the waters in which it occurs.
Drilling for oil and gas does not facilitate the loading or
unloading of vessels. A jack-up drilling rig is a structure
designed and constructed (1) to contain and house in one structure
all of the work spaces, living spaces, machinery, and engines,
pumps, generators, hoists, pipe racks, derrick, cranes, and other
equipment required to conduct drilling operations into the earth
and (2) to float in water when required to move from one drill site
to another but then jack itself up out of the water to conduct
drilling operations. This unique combination of functions saves
time and expense by avoiding the dismantling and disassembly into
pieces and units and the reassembling process which inevitably
occurs in order to move a shore side drilling rig or a drilling
platform which was originally constructed at a site in the water.
34
While it is true that during the time a jack-up rig is being moved
it floats and is moved by tug boats, like a barge, the percentage
of time involved in such moves represents only a tiny fraction of
the time that it is jacked up in a fixed position engaged in
drilling operations. It is better labeled, therefore, as a
“movable drilling platform” for it moves only for the purpose of
drilling in another location and while drilling it is a fixed and
stationary platform. To label the Fal-Rig 85 as a “vessel” when it
has a casing being driven into the sea floor in anticipation of
drilling with a drill stem for thousands of feet into the earth is
simply nonsense to me.
In addition to the changes made by Congress in the definition
of what constituted a “situs” for purposes of the Outer Continental
Shelf Lands Act, the 1978 Amendments to OCSLA also made changes
pertinent to our discussion here by (1) adding definitions for the
term “exploration,” the term “development,” and the term
“production” which had not previously been included in the 1953
Act; and by (2) deleting from old § 4(c) of the 1953 Act the phrase
“described in subsection (b)” and inserting in lieu thereof
“conducted on the Outer Continental Shelf for the purpose of
exploring for, developing, removing, or transporting by pipeline
the natural resources ... of the sub-soil and seabed of the Outer
Continental Shelf” as it appeared in old subsection (b) of § 4 of
the 1953 Act. While these amendments were more or less technical
in nature, they clearly demonstrate that Congress considered
35
changes needed in § 4(c) and wanted workman’s compensation benefits
extended to employees who sustain disability or death on the
broader definition of situs as contemplated by the amendments to §
4(a)(1) discussed earlier. In this regard, it should be noted that
the original 1953 Act contained a definition of “the term
‘employee’ which makes express that the term does not include “a
master or member of a crew of any vessel” and this phraseology was
retained in the 1978 amendments to the subsection dealing with the
extension of compensation benefits.57 Consequently, it seems clear
to me that as of the time of the 1978 amendments to OCSLA, Congress
intended that “employees” working on “all artificial islands and
all installations and other devices permanently or temporarily
attached to the seabed” would be entitled to receive compensation
benefits in accordance with the provisions of LHWCA, but “crew
members” of “any vessel” would not be entitled to receive
compensation benefits. And this necessarily means that “artificial
57
In footnote 19 of its opinion, the majority argues that
the language excluding "master or number of crew of any vessel"
from compensation benefits, indicates a contemplation on the part
of Congress that "a vessel can be a OCSLA site" as otherwise this
exclusion would be surplusage. But this same exclusionary language
was in the original 1953 OCSLA when the definition of a situs was
an "artificial island" or "fixed structure" neither of which would
have been deemed a "vessel." I suggest that a better reading of
this exclusionary language would be that Congress recognized in
both the 1953 Act and the 1978 Amendments that there would be
vessels (tugs and barges, crew boats, and tankers) transporting
personnel and goods, supplies, consumables, and equipment to and
from the "artificial islands" however defined; and that the crew
members of such vessels would not be entitled to compensation even
though they received an injury while actually on such "artificial
islands."
36
islands, etc.” and “vessels” are separate and distinct concepts,
and we make a mistake when we fail to distinguish them. I have
great difficulty, therefore, in understanding how the majority
opinion concludes that the Fal-Rig 85 can be both at the same time.
Herb’s Welding -- The Second Supreme Court Case
In resolving the interplay between the LHWCA and OCSLA, the
decision of the U.S. Supreme Court in Herb’s Welding, Inc. v. Gray,
105 S. Ct. 1421 (1985), is the second case I view as controlling.
Gray, a welder with Herb’s Welding, was employed to help repair and
maintain oil and gas pipelines and fixed platform production
structures in the Bay Marchand oil and gas field, which is located
both in Louisiana territorial waters and in the Outer Continental
Shelf. On July 11, 1975, Gray was welding a two-inch gas pipeline
on a platform in the navigable waters of Louisiana when an
explosion occurred. Gray, in trying to run away from the area,
twisted his knee. Gray received workman’s compensation benefits
under the Louisiana compensation law, but the carrier refused to
pay benefits under the LHWCA. An administrative law judge denied
Gray’s claim for LHWCA benefits because he was “not involved in
maritime employment.” The Benefits Review Board determined that
Gray was covered under the LHWCA and remanded the case for entry of
an award. The administrative law judge awarded $10,000 and
deducted the $3,000 already awarded under the state compensation
37
law. Herb’s Welding appealed the decision of the Benefits Review
Board to a panel of the Fifth Circuit, which in April 1983,
affirmed the decision of the Benefits Review Board by holding that
Gray “was clearly employed in maritime employment and therefore
was within the compensation coverage afforded by the LHWCA.”
Herb’s Welding v. Gray, 703 F.2d 176, 180 (5th Cir. 1983).
The Supreme Court granted certiorari and promptly reversed.
In so doing, the Supreme Court held:
The rationale of the Court of Appeals was that
offshore drilling is maritime commerce and that
anyone performing any task that is part and parcel
of that activity is in maritime employment for
LHWCA purposes. Since it is doubtful that an
offshore driller will pay and maintain a worker on
an offshore rig whose job is unnecessary to the
venture, this approach would extend coverage to
virtually everyone on the stationary platform. We
think this construction of the Act is untenable.
Herb’s Welding, 105 S. Ct. at 1426. The Supreme Court went on to
analyze its prior cases, particularly its decision in Rodrique v.
Aetna Casualty & Surety, supra, and to describe in some detail the
factual circumstances that determine the nature of the employment
that Gray was involved in:
[Gray] built and maintained pipelines and platforms
themselves. There is nothing inherently maritime
about those tasks. They are also performed on
land, and their nature is not significantly altered
by the marine environment, particularly since
exploration and development of the Continental
Shelf are not themselves maritime commerce.
38
Id. at 1428 (footnote omitted). In assessing the precedential
aspects of the Supreme Court decision in Herb’s Welding, we need
to remember that:
1. Gray’s injury occurred in 1975 at which time the
pertinent statutory provisions were the LHWCA as amended in
1972 and OCSLA as originally passed in 1953;
2. Gray’s injury occurred on a fixed platform in
Louisiana territorial waters;
3. The Supreme Court decision in Herb’s Welding was
issued prior to the effective date of the 1984 amendments to
LHWCA; and
4. The Supreme Court did not address in its decision
the applicability of § 1333(b) of OCSLA, either in its form as
it existed on the date of injury or as it was amended in 1978
during the course of appeals of Gray’s claim through the
Benefits Review Board.58
Nevertheless, the Supreme Court decision in Herb’s Welding is
especially controlling insofar as it deals with the meaning of the
term “maritime employment.” The Court in Herb’s Welding discussed
at great length the decision of the Supreme Court in Rodrique,
supra, and reconfirmed all of its essential holdings. In this
regard, the Supreme Court in Herb’s Welding stated:
We cannot assume that Congress was unfamiliar with
Rodrique and the Lands Act when it referred to
“maritime employment” in defining the term
58
On remand from the Supreme Court, the Fifth Circuit panel
quickly concluded that Gray was not entitled to recover under
§ 1333(b) because of the “geographical limitation imposed by the
OCSLA.”
39
“employee” in 1972. It would have been a
significant departure from prior understanding to
use that phrase to reach stationary drilling rigs
generally.
105 S. Ct. at 1427 (footnote omitted).
After categorizing the Fifth Circuit’s view of the term
“maritime employment” as “expansive,” the Court went on to state:
The Amendments [1972 amendments to LHWCA] were not
meant “to cover employees who are not engaged in
loading, unloading, repairing, or building a
vessel, just because they are injured in an area
adjoining navigable waters used for such activity.
H.R. Rep. 92-1441, p. 11 (1972); S. Rep. 92-1125,
p. 13 (1972); U.S. Code Cong. & Admin. News 1972,
p. 4708. We have never read “maritime employment”
to extend so far beyond those actually involved in
moving cargo between ship and land transportation.
Both Caputo and P.C. Pfeiffer Co. make this clear
and lead us to the conclusion that Gray was not
engaged in maritime employment for purposes of the
LHWCA.
Id. at 1427-28.
I have found no Supreme Court decision subsequent to Herb’s
Welding that purports to overrule in whole or in part the principal
core decision that the Supreme Court made in Herb’s Welding, i.e.,
that the term “maritime employment” does not include any of the
various activities which lessees, operators, contractors,
subcontractors, and their employees perform in connection with
exploring for, drilling for, producing, and transporting oil and
gas from the seabed beneath navigable waters.
40
1984 Amendments to LHWCA
The second statutory amendment made by Congress which the
panel majority did not consider in arriving at their conclusion is
found in a portion of the 1984 amendments to the Longshoreman and
Harbor Worker’s Compensation Act. These changes relate to the
inclusion of new subparagraph (c) in 33 U.S.C. § 905 as it now
exists. This change was initiated by a provision in Senate Bill 38
of the 98th Congress First Session set forth in § 4(c) of that
bill, which reads as follows:
(c) Section 5 [of LHWCA] is amended
by adding at the end thereof the following new
subsection:
“(c) In the event that the
negligence of a third party causes
injury to a person entitled to receive benefits
under this chapter by virtue of section 4 of the
Outer Continental Shelf Lands Act (43 U.S.C. 1333),
then such person, or anyone otherwise entitled to
recover damages by reason thereof, may bring an
action against such third person in accordance with
the provisions of section 33 of this Act. Nothing
contained in this chapter, or in any otherwise
applicable State law, shall preclude the
enforcement according to is terms of any written
agreement under which the employer has agreed to
indemnify such third party in whole or in part with
respect to such action.
S. 38, 98th Cong. § 4(c) (1984) (emphasis added). The House of
Representatives declined to go along with the changes contemplated
by this section of the Senate Bill and the Conference Committee
41
appointed to resolve this and other conflicts inserted the language
as it now appears in 33 U.S.C. § 905(c) which reads as follows:
(c) Outer Continental Shelf
In the event that the negligence of a vessel
causes injury to a person entitled to receive
benefits under this chapter by virtue of section
1333 of Title 43, then such person, or anyone
otherwise entitled to recover damages by reason
thereof, may bring an action against such vessel in
accordance with the provisions of subsection (b) of
this section. Nothing contained in subsection (b)
of this section shall preclude the enforcement
according to its terms of any reciprocal indemnity
provision whereby the employer of a person entitled
to receive benefits under this chapter by virtue of
section 1333 of Title 43 and the vessel agree to
defend and indemnify the other for cost of defense
and loss or liability for damages arising out of or
resulting from death or bodily injury to their
employees.
33 U.S.C. § 905(c) (emphasis added).
The legislative history regarding this change indicates that
the Senate Report stated:
Finally, the Senate Bill provides an exemption
to the Longshore Act’s current proscription of
indemnity agreements under Section 5(b) of the Act.
That section is made applicable currently to
situations on the Outer Continental Shelf by virtue
of Section 4 of the Outer Continental Shelf Lands
Act (43 U.S.C. 1333). The bill would legalize
those indemnity agreements insofar as they apply to
the Outer Continental Shelf and would further
preempt the application of state laws prohibiting
such indemnity agreements.
S. Rep. No. 98-81 (1983), reprinted in 1984 U.S.C.C.A.N. 2771, 2773
(emphasis added).
The report of the Conference Committee states:
42
Second, the substitute removes the current
proscription with respect to mutual indemnity
agreements between employers and vessels as applied
to the Outer Continental Shelf by virtue of the
Outer Continental Shelf Lands Act.
H.R. Conf. Rep. No. 98-1027 (1984), reprinted in 1984 U.S.C.C.A.N.
2771, 2774 (emphasis added).
In my view, it is extremely significant that, as indicated by
the underlining in the text of the Senate Bill and the statute as
finally passed, the word “third person” in the Senate Bill was
changed to the word “vessel” in the statute as finally passed; the
internal cross-reference as to the section under which “an action”
may be brought was changed from “the provisions of section 33 of
this Act” to “the provisions of subsection (b) of this section;”
the opening phrase in the last sentence of the Senate Bill which
stated “nothing contained in this chapter or in any otherwise
applicable state law” was changed to read “nothing contained in
subsection (b) of this section” in the statute as passed; and
finally, the language at the end of the second sentence referring
to “any written agreement under which the employer has agreed to
indemnify such third party” was changed to refer to “any reciprocal
indemnity provision whereby the employer of a person entitled to
receive benefits under this chapter by virtue of section 1333 of
Title 43 and the vessel agree to defend and indemnify the other.”
From these textual changes and legislative history I draw the
following conclusions fairly easily:
43
1. Senate Bill 38 intended to effect a preemption of
“otherwise applicable state law,” but the final statute as
passed says absolutely nothing about that subject;
2. The change from “third party” to “vessel”
considerably narrows the category of parties (1) whose
negligence may be the cause of injury to an oil field worker
on the Outer Continental Shelf and (2) who would be entitled
to be the beneficiary of an indemnity agreement from the
employer; and
3. The term “vessel” as consciously inserted by
Congress in § 905(c) must be construed consistently as that
same term is used in OCSLA and, therefore, the term “vessel”
cannot be taken to mean a situs of offshore oil and gas
activity as defined in OCSLA.
The Third Supreme Court Case -- Tallentire
The final Supreme Court case which I look to in assessing the
issues in this case is the case of Offshore Logistics, Inc. v.
Tallentire, 106 S. Ct. 2485 (1986). In Tallentire, two offshore
drilling platform workers were killed when the helicopter in which
they were riding crashed in the high seas some 35 miles off the
Louisiana coast while transporting them from the offshore drilling
platform where they worked to their home base in Louisiana. The
issue in the case revolved essentially around the provisions of §
7 of the Death on the High Seas Act (DOHSA) and the effect, if any,
of OCSLA. Survivors of the deceased workers contended that they
were entitled to damages based on the Louisiana Wrongful Death
Statute, which was made applicable either by its own terms or by
the applicability of OCSLA. The federal district court determined
that the survivors were entitled to benefits only under DOHSA. In
44
a very long and scholarly opinion, a panel of our Court concluded
that § 7 of DOHSA was broad enough on its face to permit the
applicability of the Louisiana Wrongful Death Statute and that, as
a matter of law, Louisiana has the authority to apply its Death Act
to its own citizens on the high seas adjacent to its shores and
that, therefore, the survivors may assert a claim under the
Louisiana Death Act. Tallentire v. Offshore Logistics, Inc., 754
F.2d 1274 (5th Cir. 1985). On the issue as to whether the
Louisiana Wrongful Death Statute applied by way of § 1333 of OCSLA,
the Fifth Circuit panel waffled. It assumed that OCSLA does apply
but the Louisiana statute would then be in conflict with DOHSA “so
Louisiana law could be adopted only to the extent it is not
inconsistent with DOHSA.”59 Id. at 1279.
On appeal to the Supreme Court, the Supreme Court held “that
neither OCSLA nor DOHSA requires or permits the application of
Louisiana law in this case,” and accordingly the Court reversed and
remanded the decision of the Fifth Circuit. As was the case in the
Fifth Circuit opinion, the larger part of the Supreme Court
decision related to the interpretation of § 7 of DOSHA, but the
Court did address in clear and expressive language the interplay
between DOHSA and OCSLA. See 106 S. Ct. at 2491-93. The Supreme
59
Curiously, the text of 43 U.S.C. § 1333 cited in footnote
7 of the Fifth Circuit opinion is the text of subsection (a)(1) as
passed in 1953 even though the helicopter crash in Tallentire
occurred in August 1980, well after the 1978 amendments to OCSLA
which broadened the definition of a “situs” as discussed above.
45
Court determined that because the helicopter crash and ensuing
death of the platform workers in this case occurred “miles away
from the platform and on the high seas,” it would not be proper to
extend OCSLA to the casualties in this case. In reviewing the
history and applicability of OCSLA, the Supreme Court in Tallentire
stated:
The intent behind OCSLA was to treat the
artificial structures covered by the Act as upland
islands or as federal enclaves within a landlocked
State, and not as vessels, for purposes of defining
the applicable law because maritime law was deemed
inapposite to these fixed structures. See Rodrigue
v. Aetna Casualty & Surety Co., 395 U.S. 352, 361-
366, 89 S. Ct. 1835, 1840-1842, 23 L.Ed.2d 360(1969). This Court endorsed the congressional
assumption that admiralty law generally would not
apply to the lands and structures covered by OCSLA
in Rodrigue, noting that accidents on the
artificial islands covered by OCSLA “had no more
connection with the ordinary stuff of admiralty
than do accidents on piers.” Id., at 360, 89 S.
Ct., at 1839-1840. See also Herb’s Welding, Inc.
v. Gray, 470 U.S. 414, 422, 105 S. Ct. 1421, 1426,
84 L.Ed.2d 406 (1985). Thus, in Rodrigue, the
Court held that an admiralty action under DOHSA
does not apply to accidents “actually occurring” on
these artificial islands, and that DOHSA therefore
does not preclude the application of state law as
adopted federal law through OCSLA to wrongful death
actions arising from accidents on offshore
platforms. Rodrigue v. Aetna Casualty Co., supra,
395 U.S., at 366, 89 S. Ct., at 1842.
Id. at 2491-92. While I recognize that the issue of what
constitutes a “situs” as defined in OCSLA was not directly before
the court in Tallentire, I think this quoted paragraph from
Tallentire is very instructive as indicating that as of 1986 the
46
Supreme Court was clearly following the jurisprudential analysis of
Rodrigue and Herb’s Welding as to whether the “artificial islands”
involved in oil and gas production should be considered as
“vessels” and that the place where an injury or death occurs is
more determinative of the applicability of the Outer Continental
Shelf Lands Act than the status of the injured worker as being
employed in operations relating to production of oil and gas from
the Outer Continental Shelf.
Undisputed Facts
At the time of his injury, Demette was employed by Frank’s
Casing as a welder who welded together the segments of casing as
they are installed in an oil and gas well. At the time of his
injury, Demette was on the derrick floor of the Fal-Rig 85 and he
was struck on the head by some object which fell from the derrick
tower above him. At the time of Demette’s injury, the process of
hammering the casing down into the sea floor was going on which
means that the casing pipe extended from the derrick floor down
into the seabed beneath the water. At the time of Demette’s
injury, Fal-Rig 85 was in a jacked-up position and was located on
the Outer Continental Shelf adjacent to the State of Louisiana. A
blanket service agreement was signed between Union Oil of
California (Unocal) and Frank’s Casing Crew and Rental, Inc.
(Frank’s), under the terms of which Frank’s was to provide casing
47
installation services as specified in subsequent work orders. The
blanket service agreement would cover work orders issued for casing
services both onshore and offshore. Frank’s would be paid for its
services by Unocal. Unocal also had a blanket service agreement
with R&B Falcon Drilling USA, Inc. (Falcon). This contract
provided Unocal with access to all of Falcon’s jack-up drilling
rigs for offshore drilling, but it did not specify use of Fal-Rig
85. Each of the Unocal/Falcon and Unocal/Frank’s blanket
agreements contains indemnity agreements, but there is no
contractual agreement of any kind directly between Falcon and
Frank’s.
Given these undisputed facts, I can easily concur with the
majority holding that on the occasion of Demette’s injury, Fal-Rig
85 was a situs as defined in OCSLA because it was jacked up out of
the water, supported by its legs resting on the sea bottom, and was
connected to the sea bottom by the casing being driven into the
floor of the ocean for the purpose of exploring for oil and gas.
I, likewise, concur with the finding that the majority
inferentially makes that at the time of his injury Demette was
employed by an employer engaged in operations relating to
exploration for and production of oil and gas from the Outer
Continental Shelf and that, therefore, he would be entitled to
compensation benefits for his injury from his employer under the
provisions of § 1333(b) of OCSLA.
48
I have to abandon ship, however, from the rest of the
majority’s conclusions. Specifically, I dissent from the following
majority conclusions:
1. “Because maritime law applies of its own force,
Louisiana law does not apply in this case.” Majority Opinion
at 847.
2. “Thus all six factors [Davis case] point to the same
conclusion: the contract and the injury that invoked it were
maritime in nature.” Majority Opinion at 848. While the
majority opinion does not specifically say, I have to assume
that it is referring to the contract between Unocal and
Frank’s because that is the only contract in which Frank’s
agreed to indemnify anybody from anything; and
3. Section 905(c) of LHWCA validates the indemnity
agreement between Unocal and Frank’s, a conclusion which I
find both unnecessary and incorrect.
Concluding Comments
In Rodrigue, the Supreme Court held that Congress made an
explicit decision that maritime law would not apply to the
“artificial islands placed or erected on the Outer Continental
Shelf for the purpose of exploration, production, and development
of oil and gas resources” when it passed the original OCSLA in
1953. After the Supreme Court decision in Rodrigue, Congress made
substantial amendments to OCSLA in 1978, the most significant of
which was the elimination of the term “fixed structures” and the
insertion of the words “all installations and other devices
permanently or temporarily attached to the seabed.” The
legislative history of this change contains an express statement
49
that: “The committee intends that federal law is, therefore, to be
applicable to activities on drilling ships, semi-submersible
drilling rigs, and other watercraft when they are connected to the
seabed by drillstring, pipes, or other appurtenances.” H.R. Rep.
No. 95-590. The key phrase in this new definition is “when they
are connected to the seabed by drillstring, pipes, or other
appurtenances” because these circumstances result in these
“installations and other devices” being “permanently or temporarily
attached to the seabed.” In this broader definition, Congress drew
no distinctions as to whether the attachment was between the seabed
and a fixed platform, a movable platform, a semi-submersible
platform, or a drilling ship platform. I have to conclude,
therefore, that from and after the 1978 Amendments to OCSLA all of
our Circuit case law purporting to draw tortuous and complicated
distinctions as to what is and is not a “vessel” are just “so much
sound and fury signifying nothing” insofar as activities on the
Outer Continental Shelf are concerned. Congress spoke originally
in 1953, the Supreme Court interpreted in 1969, and Congress spoke
again in 1978 without changing or correcting in any way the
principles established by the Supreme Court that the artificial
islands, structures, installations, and devices temporarily or
permanently placed on the Outer Continental Shelf for the purpose
of producing oil and gas are not “vessels” and that “maritime law”
does not apply to them.
50
As to the conclusion that the contract between Unocal and
Frank’s was maritime in nature, I think the panel majority’s
conclusion is in direct conflict with the language of the Supreme
Court in Herb’s Welding. The installation of casing at various
stages in the drilling for and producing of an oil and gas well is
normal and routine regardless of whether the oil well is producing
from dry land on shore or from the seabed. The installation of
casing in an oil and gas well has absolutely nothing to do with
improving the navigability of the waters in which the well may be
drilled, nor does it have anything to do with the placement of an
aid to navigation in those waters, nor does it have anything to do
with loading or unloading of a vessel. If, as the Supreme Court
held in Herb’s Welding, a welder who repairs gathering pipelines
and well production structures is not engaged in “maritime
employment” because “there is nothing inherently maritime about
those tasks,” then in my view the task of welding together segments
of casing pipe as they are driven into the seabed, as Demette was
doing here in this case, surely should not be deemed a maritime
employment. Therefore, the contract between Unocal and Frank’s to
provide such casing services should not be a maritime contract.
Like a ship without an engine or rudder, our Fifth Circuit case law
on the subject of “maritime employment” and “maritime contracts”
has floated from one side of the Gulf of Mexico to the other
depending upon the vagaries of wind and current in each individual
51
case. I regret to say that our Circuit case law on “what is a
vessel” and “what is a maritime contract” and what is “maritime
employment” have taken on a Humpty-Dumpty60 approach -- they are
whatever a particular panel says they are. That’s a tragic
circumstance because it destroys uniformity and predictability of
the law; and the only ones who benefit from unpredictability and
confusion are lawyers.
In regard to § 905(c) of LHWCA, I have great difficulty in
understanding the rather convoluted argument which the majority
opinion puts forth as to the applicability of this subsection. If
the majority is correct that Fal-Rig 85 is a vessel whose special
purpose was to drill an oil and gas well and Demette’s assignment
of welding together segments of casing pipe was an essential aspect
of that special purpose, then Demette was a member of the crew of
a vessel and both § 1333(b) of OCSLA and § 902(3)(G) of LHWCA would
exclude Demette from any right to compensation benefits under the
LHWCA. Even if Demette were determined not to be a member of the
crew of the Fal-Rig 85, he would not be entitled to benefits
directly under LHWCA because Herb’s Welding specifically held that
activities related to oil and gas production are not maritime
60
“There is glory for you,” [said Humpty-Dumpty]. “I don’t
know what you mean by ‘glory,’” Alice said. “I meant ‘there is a
nice knock-down argument for you,” [said Humpty-Dumpty]. “But
‘glory’ doesn’t mean a nice knock-down argument,” Alice objected.
“When I use a word,” Humpty-Dumpty said in a rather scornful tone,
“it means just what I choose it to mean, neither more nor less.”
Lewis Carroll, Through the Looking Glass ch. 6.
52
employment. Likewise, if the majority opinion is correct that the
Fal-Rig 85 is a vessel, then Demette would not be entitled to
compensation benefits indirectly by way of § 1333(b) of OCSLA
because the Fal-Rig 85 would not be a situs to which § 1333(b)
could have extended those compensation benefits. In short, just as
I believe that the Fal-Rig 85 cannot be a vessel and an OCSLA situs
at the same time, I believe an injured employee cannot be an
offshore oil production worker under § 1333(b) and a maritime
worker under § 902(3) of the LHWCA at the same time. On the other
hand, if I am correct that when it is jacked up and driving casing
into the seabed, the Fal-Rig 85 is not a vessel but an OCSLA situs,
then Demette is an oil field worker right where he should be on an
OCSLA situs when he is injured and, therefore, is entitled to
compensation benefits under § 1333(b). Of course, this discussion
about compensation benefits is somewhat academic because Demette
settled all of his personal injury claims and whether or not he
received the compensation benefits he should have gotten is not an
issue before us on appeal.
But the same conundrum arises in analyzing the applicability
of § 905(c). A full understanding of the relevance of § 905(c) is
much clearer when you look at the legislative history of that
provision. As indicated earlier in this dissent, the first
statutory iteration of the provisions which ultimately became §
905(c) was in Senate Bill 38 which used the term “third party” in
place of the term “vessel” in identifying the negligent tortfeasor
53
and in identifying the indemnitee of the indemnity agreement
referred to therein.61 Likewise, Senate Bill 38 had an express
provision contemplating that this new language would preempt and
override “any otherwise applicable state law.” The House of
Representatives was not agreeable to this change, and the
Conference Committee eliminated the idea of preemption of state law
altogether and inserted the word “vessel” in place of the words
“third party.” It is uncontroverted that Demette’s injury occurred
on the Fal-Rig 85, and there is nothing in the briefs or record
excerpts to indicate that any other tug boat, crew boat, supply
boat, barge, or other water craft was involved and could be the
source of a “vessel negligence” claim. Therefore, if the Fal-Rig
85 in its jacked-up position is not a vessel (as I have argued
earlier in this dissent), then there is no vessel negligence upon
which Demette (the injured worker) could have sued and no vessel to
be sued as defendant. If, on the other hand, the majority is right
and the jacked-up Fal-Rig 85 is actually a vessel, then, because he
61
An earlier iteration of the amendment was proposed by the
International Association of Drilling Contractors (“IADC”) during
oversight hearings on the LHWCA in 1978. Oversight Hearings on the
Longshoremen’s and Harbor Workers’ Compensation Act Before the
House Subcommittee on Compensation, Health and Safety, Committee on
Education and Labor, 95th Cong. (May 3, 1978) (statement of Jon
Bednerik, Director, Government Affairs, IADC). It is interesting
to note that in this early version proposed by the IADC, the term
“third party” is used instead of “vessel” and this version also
makes no mention of state law preemption. Id. The IADC version
also creates a definition for a “Marine Petroleum Worker” and makes
the amendment only applicable to such workers. Id. This
definition never made it into the proposed amendments of 1984.
54
is a member of the crew of the vessel, Demette (the injured worker)
loses his status as an employee entitled to compensation under
§ 1333(b), which is an essential condition to the applicability of
§ 905(c).
Conclusion
I recognize, of course, that no single panel of our Court can
overrule any prior panel decisions and that the changes and
reconsiderations that I suggest herein can only be effected by an
en banc reconsideration by our Court. In my view, that is
precisely what we should do, and I have written at length in this
dissent in order to put the parties to this appeal, the amicus in
this appeal, and other interested agencies on notice that I will
call for a ballot for en banc reconsideration, if strong
suggestions for such course of action from the parties and other
interests are forthcoming. In my opinion, the seabed of the Outer
Continental Shelf adjacent to the States of Texas, Louisiana, and
Mississippi contains the largest volume of both discovered and
undiscovered oil and gas resources of all of the areas of the Outer
Continental Shelf. It is also my opinion that the largest number
of workers involved in the development of these oil and gas
resources on the Outer Continental Shelf come from the States of
Texas, Louisiana, and Mississippi and that most of the operators,
contractors, and subcontractors who engage in the business of
55
drilling and producing oil and gas from the Outer Continental Shelf
are either headquartered in or have major facilities in the States
of Texas, Louisiana, and Mississippi. We are also blessed to have
within the States of Texas, Louisiana, and Mississippi an enormous
concentration of legal talent (private practitioners, corporate
counsel, and law school professors) who are familiar with (1) the
history of the development of the oil and gas resources on the
Outer Continental Shelf, (2) the statutory enactments by Congress,
(3) the Supreme Court decisions interpreting the statutes, (4) the
statutes and interests of the adjacent states, and (5) that
historic, traditional, judge-made body of amorphous law
affectionately known as “admiralty and maritime law.” An en banc
reconsideration of the enigmas raised here in this case, informed
by briefs of counsel for the parties and interested amici, would be
a first step in bringing greater uniformity and predictability to
the law applicable to the development of these increasingly
critical natural resources.
56