Catalyst Old River Hydroelectric Ltd. Partnership v. Ingram Barge Co.
639 F.3d 207
| 5th Cir. | 2011Background
- Catalyst owns and operates a private hydroelectric facility with an intake channel feeding its turbines.
- On December 24, 2007, a collision caused Barge TILC-37 to drift into Catalyst's intake channel and become grounded.
- The grounded barge obstructed the intake channel, forcing Catalyst to reduce water flow and electricity generation to prevent sinking.
- Catalyst shut down six of eight turbines and reduced the remaining two to minimum power to allow removal of the barge.
- Removal of the barge and its cargo involved additional vessels and undermined normal channel operations, prompting restoration of full capacity later that day.
- Catalyst sued for economic damages to the value of lost electricity production, alleging physical damage to its proprietary interest.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether barge intrusion caused physical damage to Catalyst's proprietary interest allowing economic-loss recovery | Catalyst: yes, barge interfered with flow, injuring property. | ARTCO/Ingram: no physical harm to proprietary interest, no recovery. | Yes; physical harm to Catalyst's property occurred, supporting recoverable economic loss. |
| Whether mitigation actions to prevent further damage satisfy TESTBANK's physical-damage requirement | Catalyst: mitigation (reducing flow, shutting turbines) counts as damage. | Defendants: mitigation costs are not independently physical damage. | |
| Yes; mitigation efforts counted as physical damage under TESTBANK corpus Christi rationale. | |||
| Whether the record supports a Robins/TESTBANK-based recovery against the defendants | Catalyst: Robins/TESTBANK permit recovery when property damage exists. | Defendants: lack of physical injury bars recovery. | Record supports recovery; district court erred in grant of summary judgment. |
Key Cases Cited
- Robins Dry Dock & Repair Co. v. Flint, 275 U.S. 303 (Sup. Ct. 1927) (no recovery for economic loss absent physical damage to proprietary interest)
- TESTBANK, 752 F.2d 1019 (5th Cir. 1985) (robust articulation of rule restricting recovery for economic loss without physical harm)
- Kaiser Aluminum & Chemical Corp. v. Marshland Dredging Co., 455 F.2d 957 (5th Cir. 1972) (denied recovery for economic loss where gas service was interfered with)
- Dick Meyers Towing Service, Inc. v. United States, 577 F.2d 1023 (5th Cir. 1978) (denied economic damages when tow unable to deliver due to upstream issue)
- Vicksburg Towing Co. v. Mississippi Marine Transport Co., 609 F.2d 176 (5th Cir. 1980) (property damage allows recovery of economic losses)
- Consolidated Aluminum Corp. v. Bean Corp., 772 F.2d 1217 (5th Cir. 1985) (interruption of gas supply to facility supported recovery for economic loss)
- Corpus Christi Oil & Gas Co. v. Zapata Gulf Marine Corp., 71 F.3d 198 (5th Cir. 1995) (mitigation costs can satisfy physical-damage requirement under TESTBANK)
- In re: Taira Lynn Marine Ltd. No.5, LLC., 444 F.3d 371 (5th Cir. 2006) (discusses mitigation and TESTBANK considerations)
- Reserve Mooring, Inc. v. American Commercial Barge Line, LLC, 251 F.3d 1069 (5th Cir. 2001) (lost use revenue where no physical damage to mooring facility West)