Shaw v. United States of America
436 F.Supp.3d 1315
N.D. Cal.2020Background
- On May 27, 2018 Damar Shaw, a deckhand/engineer on the SS ALGOL, was struck and severely injured when a mooring line snapped while the ALGOL was being moved during a "turbo activation."
- The ALGOL is government‑owned (MARAD) and managed/operated under a ship manager contract by Ocean Duchess; Ocean Shipholdings is an affiliated parent/umbrella company.
- Ocean Duchess’s business plans had identified aged, worn mooring lines for replacement; funding was approved shortly before/after the incident but replacement lines were not delivered until after Shaw’s injury. The Coast Guard found worn lines and issued No Sail Orders.
- Shaw sued the United States, Ocean Duchess, and Ocean Shipholdings asserting Jones Act negligence, unseaworthiness, failure to pay maintenance/cure/wages, and gross negligence; the United States moved for summary judgment for Ocean Duchess and Ocean Shipholdings.
- The ship manager contract expressly states Ocean Duchess is the United States’ agent for admiralty torts, provides that admiralty claims must be brought exclusively against the United States, requires the United States to defend/ control litigation, and contains an indemnity clause for certain gross negligence by senior management.
- The court granted summary judgment for Ocean Duchess and Ocean Shipholdings, holding Ocean Duchess was an agent covered by the SIAA exclusivity provisions and Ocean Shipholdings had no role giving rise to maritime duties; Shaw’s remaining claims proceed only against the United States.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Ocean Duchess is an agent of the U.S. such that SIAA exclusivity bars suit against it | Shaw: acts (including gross negligence) fell outside contractual agency scope, so he can sue Ocean Duchess directly | U.S.: Ship Manager Contract makes Ocean Duchess the U.S. agent for admiralty torts and SIAA exclusivity applies | Ocean Duchess is an agent; SIAA exclusivity bars direct suit against Ocean Duchess (claims must proceed against U.S.) |
| Whether the contract’s indemnification for gross negligence negates agency for those claims | Shaw: indemnity clause shows parties intended gross negligence to be carved out of agency | U.S.: indemnification allocates financial responsibility but does not revoke agency or exclusivity; contract explicitly limits only contract disputes and non‑admiralty actions | Indemnification does not carve out gross negligence from agency; no triable issue — agency stands as matter of law |
| Whether Ocean Shipholdings is independently liable as a non‑agent third party | Shaw: Shipholdings participated via shared management, branding, audits, safety systems and thus owed duties | U.S.: Shipholdings is a separate entity with no contract/operational role for the ALGOL and owed no maritime duty to Shaw | No evidence Shipholdings managed/operated ALGOL or caused injury; summary judgment for Shipholdings |
| Admissibility / expert disclosure (Thomas Crawford) | Shaw: Crawford timely disclosed and his investigation supports causation and corporate involvement | U.S.: untimely disclosure and many opinions beyond Crawford’s expertise (funding, agency, corporate law) | Court overruled untimely disclosure objection but excluded Crawford’s opinions outside his mooring/operation expertise; allowed technical opinions on line condition and incident circumstances |
Key Cases Cited
- Ali v. Rogers, 780 F.3d 1229 (9th Cir. 2015) (SIAA exclusivity bars suits against agents when admiralty remedy lies against United States)
- Dearborn v. Mar Ship Operations, Inc., 113 F.3d 995 (9th Cir. 1997) (contract terms and government control support finding of agency; indemnity provisions do not necessarily negate agency)
- Celotex Corp. v. Catrett, 477 U.S. 317 (1986) (summary judgment movant’s initial burden and shifting burden to nonmoving party)
- Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986) (nonmoving party must show more than metaphysical doubt to create triable issue)
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (standard for materiality and genuine dispute at summary judgment)
- T.W. Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626 (9th Cir. 1987) (nonmoving party’s burden to identify specific facts creating genuine issue)
- United States v. Tug Manzanillo, 310 F.2d 220 (9th Cir. 1962) (government may seek indemnity from contractor for payments made on behalf of injured crew)
- Royal Ins. Co. of Am. v. Sw. Marine, Inc., 194 F.3d 1009 (9th Cir. 1999) (definition and standard for gross negligence)