Case Law Alerts
Since an injured longshoremen’s exclusive remedy is the LHWCA, employer cannot be liable to other defendants.
The plaintiff, employed as a longshoreman by Beacon Stevedoring Corporation (Beacon), was injured while helping to unload freight aboard a cargo vessel owned and/or operated by Mos Shipping Co., Ltd. (Mos) while the vessel was moored at a pier located in a marina terminal owned and operated by Rukert. Rukert and Beacon are related companies, owned by the same two families and sharing a board of directors. While they maintain separate bank accounts and financial statements, they operate out of the same offices in Baltimore, Maryland and share the same post office box and fax number. They are both insured for Longshore and Harbor Workers’ Compensation Act (LHWCA) and Maryland Workers’ Compensation Act claims under the same policy. The plaintiff filed a complaint against Mos under Section 905(b) of the LHWCA, which permits a longshoreman to seek damages in a third-party negligence action against the vessel owner even though he has received benefits from his employer pursuant to the LHWCA. In turn, Mos filed a third-party complaint against Rukert, seeking indemnity and contribution. Rukert argued that it and Beacon operated as a single entity/single employer, thereby precluding Mos’s indemnity and contribution claims against Rukert. To operate as a single entity under the LHWCA, companies must have “interrelation of operations, common management, centralized control of labor relations and common ownership.” Claudio v. U.S., 907 F. Supp. 581, 588 (E.D.N.Y. 1995) (applying criteria from the National Labor Relations Act to single entity analysis under the LHWCA). After conducting the fact-intensive, totality-of-the-circumstances analysis, the United States District Court for the District of Maryland ultimately held, inter alia, that Rukert and Beacon were two corporations operating as a single entity. Since an injured longshoreman’s exclusive remedy against an employer is the LHWCA, the employer cannot be liable for indemnity or contribution to other defendants. 33 U.S.C. § 905(b). Therefore, because the plaintiff was barred from filing suit against Beacon, Mos was, likewise, barred from pursuing claims of indemnity or contribution against Rukert.
Case Law Alerts, 4th Quarter, October 2017 Case Law Alerts is prepared by Marshall Dennehey Warner Coleman & Goggin to provide information on recent developments of interest to our readers. This publication is not intended to provide legal advice for a specific situation or to create an attorney-client relationship. Copyright © 2017 Marshall Dennehey Warner Coleman & Goggin, all rights reserved. This article may not be reprinted without the express written permission of our firm.