This аppeal concerns lien rights on certain property associated with an oil drilling operation in the Gulf of Mexico. Because we find that Louisiana law applies to this controversy and that it provides for personal liability in this instance, we must reverse the district court’s grant of summary judgment in favor of the appellees and remand this case for further proceedings, including a determination of the value of the lien property.
I.
In 1977, the United States Departmеnt of the Interior, Minerals Management Service (“MMS”), entered into an oil, gas, and mineral lease with several companies, including Kerr-McGee Corp., Chevron USA, Inc., Phillips Petroleum Co., Sonat Exploration Co., Felmont Oil Corp., Cabot Oil & Gas Corp., and Case-Pomeroy Oñ Corp. (collectively the “Owners”). The lease encompassed an area entitled East Cameron Block 34 (“Block 34”), located on the Outer Continental Shelf off the coast of Cameron Parish, Louisiаna, in the Gulf of Mexico. When production from Block 34 began to diminish in the late 1980’s, the Owners decided to let others in on the lease. Accordingly, they entered into a farmout agreement in 1988 which transferred all lease operations to Senior G & A Operating Co. (“Senior”) but reserved a revenue interest in any production for the Owners. Senior contracted with U.S. Turnkey Exploration Co. (“U.S.Turnkey”) to drill another well on the lease. U.S. Turnkey, in turn, contracted with LAJFP Drilling Ltd., Gardes Directional Drilling, and sevеral other businesses to provide the necessary labor, equipment, and services in connection with the drilling activities alongside the fixed production platforms.
This new well proved unsuccessful, however, causing the contractor, U.S. Turnkey, to be unable to pay its subcontractors, including LAJFP and Gardes (collectively the “Providers”).
Unbeknownst to the Providers, these liens would become very important to their recovery. Both U.S. Turnkey and Senior filed for bankruptcy and did not fully satisfy the debt they owed. An attempt by the Providers to seize an arbitration award rendered in favor of U.S. Turnkey failed as well. The Providers eventually found that their only means of possibly effecting a recovery on the debt would be through their interests in the lien property.
The instant litigation came to a head during the period of May to August, 1991. In May 1991, the Owners filed an action in interpleader seeking to bring together all claims against the lien property. Immediately after the commencement of this suit, however, the Owners engaged in a series of maneuvers which form the focus of this appeal.
The MMS had, in 1989, ordered the Owners to remove all physical structures from Block 34 by July 1990, notwithstanding that the lease operations had been transferred to Senior. The Owners were able to obtain a one-year extension for compliance with the order, leaving the deadline at July 1991.
Rather than comply with this document request, the Owners, on the same day, apрroached Judge Richard J. Putnam of the Western District of Louisiana, the “on-duty” judge that day. Judge Putnam was completely unfamiliar with the facts or history of this litigation. The Owners presented him with an ex parte motion to release the Providers’ lien rights in exchange for the posting of bond in the amount of $ 43,000, the amount they asserted the lien property was worth based on the Teledyne bid. The Providers’ lien, however, was in the amount of $ 1.68 million. Judge Putnam, by order dated June 12 (but not filed until June 14), released the liеns and ordered the posting of the nominal bond.
By a letter dated June 13, the Owners advised the Providers that the material had been removed from Block 34 and was now onshore. The letter did not, however, inform them that their lien rights had been canceled or that the lien property was already being salvaged. Upon receipt of this letter, the Providers responded, objecting to the removal of the property and again requesting information about the property tо help facilitate an independent appraisal of the value of the property. The documents request was ignored.
The order accepting the bond and releasing the liens was not filed and mailed to the Providers until June 14, 1991, two days after entry by the judge. The Owners had enjoyed a two-day window in which they were able to remove the property and dispose of it free of the lien rights of the Providers. The Providers began proceedings to have their rights reinstated and, оn August 30, Judge Edwin F. Hunter invalidated the ex parte order. Judge Rebecca F. Doherty later amended Judge Putnam’s order to properly
Rathеr than post the cash bond, the Owners moved to dismiss the interpleader action they had brought. On May 27, 1992, Judge Doherty granted the Owners’ motion and dismissed the suit. Judge Doherty further ordered the return of the bond the Owners posted before Judge Putnam in June 1991. Before the Owners moved to dismiss, however, the various subcontractors involved filed numerous counterclaims against the Owners and filed cross claims amongst themselves in what a court at an earlier stage of this litigation described as “an apparent legal free-for-all.” Gardes Directional Drilling v. U.S. Turnkey Exploration,
The Providers’ claim asserted that the Owners were liable under Louisiana tort law and the Louisiana Unfair Trade Practices Act for damages from the Owners’ non-compliance with thе Lien Act in their disposal of the lien property. Because the lien property, the res, was gone, the Providers were forced to pursue the Owners on a theory of personal liability. On the Owners’ motion, the district court, per Judge Nauman S. Scott, granted summary judgment in their favor holding that Louisiana law made no provision for personal liability. It held that the sole remedy provided to lien claimants is in rem, via sequestration of the property. The court further held that whatever lien rights the Providers had previously held were waived by their failure to sequester the property while it was in the Gulf. The Providers appeal.
II.
A. Standard of Review
We review the district court’s decision to grant summary judgment de novo, applying the same legal standard as the district court. Summary judgment is appropriate when there are no genuine issues of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). Our review of the district court’s interpretations of law, both state and federal, is plenary. Salve Regina College v. Russell,
B. Application of the OCSLA (and Louisiana) Law
The first contested issue on appeal concerns the very law we must interpret. At the time the Owners removed this action, they asserted that the Providers’ complaint raised a federal question, namely the Outer Continental Shelf Lands Act, 48 U.S.C. §§ 1331-1356 (“OCSLA”), which would incorporate Louisiana law. They changed their position at summary judgment, however, arguing that maritime law applied to the case rather than the OCSLA, As a consequence, the Lien Act would, rather than be adopted by federal law, be preempted by it. The district court disagreed with the Owners on this point finding the OCSLA to be applicable. The Owners raise this point in their brief as a basis for finding the Providers’ liens invalid. We concur with the district court on this point and therefore reject this argument.
The OCSLA provides as follows:
(1) The Constitution and laws and civil and political jurisdiction of the United States are hereby extended to the subsoil and seabed of the outer Continental Shelf 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 exploring for, developing, or producing resources there from ... to the same extent as if the outer Continental Shelf were an area of exclusive Federal jurisdiction located within a state....*865 (2)(A) To the extent they are applicable and not inconsistent with this subchapter or with other federal laws and regulations ... the civil laws of each adjacent State, now in effect and hereafter adopted ... are hereby declared to be the law of the United States for that portion of the subsoil 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....
43 U.S.C. § 1338(a). The OCSLA uses state law to fill gaps in federal law with regard to the law regulating, inter alia, the offshore production of oil. OCSLA operates to extend state law only under certain circumstances, however. In Union Texas Petroleum v. PUT Engineering,
(1) The controversy must arise on a situs covered by OCSLA (i.e. the subsoil, seabed, or artificial structures permanently or temporarily attached thereto). (2) Federal maritime law must not apply of its own force. (3) The state law must not bе inconsistent with Federal law.
Id. at 1047. The Owners argue that the second and third conditions are not met.
They first contend that federal maritime law applies “of its own force,” thus obviating the need for any gap filling with Louisiana law. In Rodrigue v. Aetna Casualty & Surety Co.,
The cases upon which the Owners rely are inapposite, centering on the application of maritime law because of the maritime aspects of an underlying contract. The Owners agree that there was no contract here between themsеlves and the Providers. Rather, they argue that the contract that existed between the Providers and U.S. Turnkey was governed by maritime law and that this law, therefore, governs these proceedings. We cannot accept this argument. The claim in this case is to enforce rights provided under the Lien Act, specifically the right to hold the owner of a lease hable to subcontractors for the debts of a contractor operating on the site. This claim arose from sеrvices the Providers gave to U.S. Turnkey; that there was a contract which detailed the working relationship between these entities is irrelevant. The cases cited by the Owners, such as Smith v. Penrod Drilling Corp.,
The Owners next contend that application of the Lien Act would be inconsistent with federal law. They argue that the MMS order, an order from a federal agency, directing them to remove the hen property from Block 34 runs counter to duties prescribed by the Lien Act. We reject this argument. The MMS ordered the Owners to remove the property from Block 34 by July 1991; it did not require the Owners to dispose of the property without providing notice to the Providers. It is plain that the action to which the Providers have objected is not the removal of the hen property from Block 34, but
We note that the first pre-condition enumerated in Union Texas Petroleum, jurisdiction under § 1338(a)(1), is satisfied given that this controversy concerns a drilling platform on the shelf. Because Block 34 sits off the coast of Cameron Parish, the “adjacent state” in this situation is Louisiana. Accordingly, under § 1333(a)(2)(A), the law of the state of Louisiana is adopted as surrogate federal law.
C. The Rights of the Providers
The Lien Act, La.Rev.Stat. Ann. § 9:4861 et seq., serves аs our starting point in applying Louisiana law. It provides that those who provide labor or other services in connection with the drilling of a well in search of gas or oil have a privilege on all well production and on all equipment involved in the drilling of the well. Moreover, it provides that the owners of a drilling site are liable to subcontractors for the unpaid debts of an insolvent contractor. The Providers asserted rights under this statute as they met the statutory language. Thеy, of course, only ■filed against the equipment since there was no production from the wells. They properly recorded the hens in the offices of Cameron Parish in 1989 and timely brought suit for recognition and enforcement of these hens.
The Providers concede that, in the typical case, a henholder only has recourse against the encumbered property. But they argue that this is not the typical case and that Louisiana law affords them an in personam remedy here. Twо questions must be answered in connection with our analysis, the first being whether the Lien Act itself precludes an in personam remedy. If not, we must decide whether other provisions of Louisiana law serve as a vehicle for recovering damages. These issues are addressed in turn.
1. Limitation of Remedy
It is undisputed that the Providers had the right to levy on the property under the Lien Act. The general remedy for a lienholder when it discovers that the owner of encumbered property seeks to “conceal, dispose of, or waste the property” is to have the property seized via a writ of sequestration. La.Code Civ. Proc. Ann. art. 3571. The Providers did not proceed via this writ.
The Lien Act appears silent on this point. It states only that a lienholder “may” proceed via sequestration; it does not, by its own words, limit a lienholder to this remedy. Our interpretation of the Lien Act is greatly assisted by the Supreme Court of Louisiana’s recent decision in Guichard Drilling Co. v. Alpine Energy Services,
We are ultimately convinced that the Lien Act does not prohibit an action for damages here. The Lien Act prohibits the actions undertaken by the Owners but would, under the Owners’ reading of it, leave the Providers withоut remedy. For us to follow the Owners’ argument would run counter to the legislature’s intent in enacting the statute.
2. Personal Liability under Louisiana Law
Under the Lien Act, the Owners were obliged to obtain written consent from the lienholders before disposing of the hen property as they did. La.Rev.Stat. Ann. § 9:4861.2(A). The Lien Act allows for the owner of property subject to a hen to bond or secure such claims by depositing a bond in an amount equal to the hen claim, attorney’s fees, plus one-fourth. La.Rev.Stat. Ann. § 9:4867(A). While this option was available to the Owners, they elected not to avail themselves of it, leaving us with the task of deciding what Louisiana law provides as a remedy in this unique circumstance.
That the Lien Act does not preclude personal liability does not mean that Louisiana law otherwise provides for it. The Providers set forth alternative bases for liability: article 2315 of the Civil Code and the Louisiana Unfair Trade Practices Act, La.Rev.Stat. Ann. §§ 51:1401, et seq.
Article 2315 of the Civil Code establishes that civil wrongs are compensable in the form of money damages. In Mart v. Hitt,
First, the resulting harm here was the inability of the Providers to realize damages from the sale of the lien property. It is clear that the Owners’ аctions in disposing of the property caused this harm. Second, the Owners clearly owed the Providers a duty under Louisiana law not to dispose of the property as they did; the Lien Act specifically makes it illegal to do so. La.Rev.Stat. Ann. § 9:4861.2. Third, the Owners breached this duty by disposing of the property while posting a bond in an amount far below that required by the Lien Act. Finally, the Lien Act clearly contemplates the situation where an owner wants to take action with respect to an encumbered item. Section 9: 4867 spells out a procedure — not, of course, followed here — for an owner to follow in posting bond. We conclude that the Providers properly make out a claim here for money damages under article 2315 to the extent of the injury caused to them by the Owners’ non-compliance with the Lien Act.
The Louisiana Unfair Trade Practices Act creates a cause of action available to “[a]ny person whо suffers any ascertainable loss of money or movable property, ... as a result of the use or employment by another person of an unfair or deceptive method, act or practice_” La.Rev.Stat. Ann. § 51:1409. The Act defines “person” broadly as a “natural person, corporation, trust, partnership, incorporated or unincorporated association, and any other legal entity.” La.
This court has, however, previously interpreted this part of the Act. In Delta Truck & Tractor v. J.I. Case Co.,
III.
For the foregoing reasons, the district court’s grant of summary judgment is reversed and the case is remanded for further proceedings consistent with this opinion, such proceedings to include a determination of the value of the lien property.
REVERSED and REMANDED.
Notes
. At the beginning of this protracted litigation there were 25 lien claimants; as of now, only three remain. Of these, only LAJFP and Gardes are parties to this appeal.
. The Owners claimed jurisdiction under the Outer Continental Shelf Lands Act, 43 U.S.C. §§ 1331-1356 (OCSLA). See further discussion in Part II.B.
. No party contests the validity of this order.
. We address briefly the district court's alternative holding that no cause of action could be pursued here because the Providers’ claims were barred by laches. In Picone v. Lyons,
. The Owners assert that the Providers should have proceeded to sequester the property if they were concerned that the Owners would ultimately act unfairly with respect to it. The Providers, however, state that they attempted to have the property seized but were told by the Louisiana authorities that they would not go into federal waters to seize it. Their attempt to have the U.S. Marshal’s office seize it apparently failed as well.
. The Providers list an additional potential basis of liability in the form of American Bank & Trust Co. v. Shet-Boze, Inc.,
. As the events occurred in Cameron Parish, the decisions of this court would be binding for state law purposes. La.Rev.Stat. Ann. § 13:312.