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Court bars Jones Act employer from countersuing deckhand for fraud

At 3:30 in the morning, the DAVID G SERT and her eighteen barge tow of empties collided with dredge pipe being towed by the LA BELLE and HELEN in Plaquemines Parish, Louisiana on the Lower Mississippi River. Collision allegedly damaged the dredge pipe and injured a deckhand sleeping on the LA BELLE. Lawsuits were filed.

The deckhand, a Jones Act seaman, alleged in his lawsuit that he was violently thrown from his bunk and sustained serious injuries to his neck, head, shoulder and arm. During litigation, it was discovered the deckhand received medical treatment (less than a week before the collision) for the same injuries he was suing for.

The vessel owners filed counterclaims against the deckhand for fraud and malicious prosecution. They claimed the deckhand fraudulently concealed his pre-collision treatment during several post-collision medical visits for injuries. They also claimed the deckhand made false representations to his post-collision physicians.

The deckhand filed a motion asking the court to dismiss the counterclaims against him. He asserted that a Jones Act employers cannot seek to recover money from seamen in personal injury cases as a matter of law. He argued allowing the counterclaims to proceed would improperly create new law and circumvent "long established rules" relating to maintenance and cure. The deckhand alternatively asserted the counterclaims did not comply with Federal Rule of Civil Procedure 9(b) which requires fraud claims to be plead with particularity.

The court first addressed the issue of whether Jones Act employers can sue seamen for fraud in personal injury cases. The court referenced a string of cases involving the Federal Employers’ Liability Act (“FELA”) for injured railroad workers and maintenance and cure cases for injured seamen. The court emphasized there is a “broad policy” of holding railroads and Jones Act employers responsible for their workers’ personal injuries resulting from their negligence. Further, the court cited a Fifth Circuit case holding an employer could only use a seaman’s failure to disclose pre-employment injuries as a shield to paying maintenance and cure and not as a sword to recover improperly paid maintenance and cure benefits. See Boudreaux v. TransOcean Deepwater, Inc., 721 F.3d 723, 726 (5th Cir. 2013).

While noting “the issue presented is a difficult one,” the court ultimately held that “a Jones Act employer cannot be allowed to maintain a cause of action for damages against its seamen based on fraud in retaliation or response to a seamen’s suit.” The court cited the following policy considerations it believed justified this rule:

  • Actual recovery of money against injured seamen would be unlikely due to the poor financial circumstances of the average seamen; so “the only purposes of allowing such a claim would be to serve as a threat to a seamen who files a claim.”

  • Allowing counterclaims for fraud against injured seamen “would likely open the floodgates of litigation to disgruntled vessel owners who take extreme umbrage over being sued by their own crew members.” The court emphasized that in “nearly every Jones Act case,” the employer disputes the seaman’s version of the incident and his/her claimed damages. So, allowing retaliatory counterclaims to proceed “would spawn counterclaims based on fraud in nearly every case.”

  • Under the present regime, the vessel owner can prevail at trial if there is no negligence/unseaworthiness and/or causation findings at trial.

  • Barring Jones Act employers from counter suing their seamen for fraud is “consistent” with the history and policy of the Jones Act and “best effectuates the statute’s broad aims of promoting maritime safety and, consequently, maritime commerce.”

  • To permit a counterclaim against a Jones Act seaman “would chip away at the [Jones] Act’s purpose.”

As to the non-employer vessel owner, the court dismissed its malicious prosecution claim as premature and gave it 10 days to supplement its fraud claim to add additional facts to meet the heightened pleading requirements of Federal Rule of Civil Procedure 9(b). So, this decision prevents Jones Act employers from suing their seamen for fraud but does not prevent third parties from doing so.

Here is a link to the publicly available decision:

The case citation for this decision is Ingram Barge Company, LLC v. Caillou Island Towing Company Inc., 2:21-cv-00261 (E.D.LA August. 8, 2022).

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