Shaw v. United States of America

Background

Damar Shaw alleged that he was injured on May 27, 2018, while working aboard the SS ALGOL, a vessel owned by the United States and operated by Ocean Duchess under a ship-management contract with the Maritime Administration. A mooring line snapped while the vessel was being returned to its mooring position, causing Shaw serious injuries.

Shaw’s amended complaint asserted claims against all defendants for negligence under the Jones Act, unseaworthiness, and failure to pay maintenance, cure, and wages under maritime law. He also asserted gross-negligence claims against Ocean Duchess and Ocean Shipholdings. The United States moved for summary judgment in favor of both companies.

Ocean Duchess

The court held that Ocean Duchess was an agent of the United States for purposes of the Suits in Admiralty Act. That law makes the United States the exclusive defendant for covered maritime claims involving a government-owned vessel or its agents. The court relied on the ship-management contract, which expressly treated Ocean Duchess as the United States’ agent for third-party maritime tort claims, including Jones Act and maintenance-and-cure claims.

Shaw conceded that Ocean Duchess was generally the United States’ agent but argued that its alleged gross negligence fell outside the agency relationship. He relied on the contract’s indemnification provision, which required Ocean Duchess to indemnify the United States for specified acts of gross negligence, willful misconduct, or violations of law or regulations.

The court rejected that argument. It found that the contract’s indemnification provision allocated financial responsibility and did not create an exception to Ocean Duchess’s agency status. The contract separately identified contract disputes and non-maritime actions as exceptions to agency status, but did not identify gross negligence as an exception. The court therefore held, as a matter of law, that Ocean Duchess was the United States’ agent for Shaw’s claims.

Ocean Shipholdings

The government did not continue to argue that Ocean Shipholdings was an agent of the United States. Instead, it argued that Ocean Shipholdings’s general agency agreement with the Maritime Administration did not cover Ready Reserve Fleet vessels such as the ALGOL, and that there was no evidence the company operated or managed the vessel or owed Shaw a duty of care.

Shaw did not dispute that Ocean Shipholdings was not a government agent for purposes of his claims. He argued instead that it was liable as a third party and said he would amend his Jones Act claim against that company into a general maritime negligence claim. He conceded that his unseaworthiness and maintenance-and-cure claims against Ocean Shipholdings should be dismissed.

The court concluded that the evidence did not show that Ocean Shipholdings managed, maintained, or operated the ALGOL. The companies’ affiliation, shared senior management, shared office address, use of Ocean Shipholdings-branded forms and safety protocols, and involvement in investigating the incident did not establish that Ocean Shipholdings itself operated or maintained the vessel. The court also found no evidence that Ocean Shipholdings caused the accident. The evidence concerning worn mooring lines, inspection practices, funding requests, reporting, and safety procedures was attributable to Ocean Duchess as the vessel’s operator, not to Ocean Shipholdings.

The court further rejected Shaw’s argument that Ocean Shipholdings may have owed him a duty as an auditor. The record did not show that Ocean Shipholdings conducted the audits, and Shaw was not a client or intended beneficiary of an audit report. Because Shaw could not show a triable issue—a genuine factual dispute requiring a trial—on duty or causation, Ocean Shipholdings was entitled to summary judgment.

Evidentiary objections

The court granted Shaw’s request for permission to file supplemental evidence and overruled the government’s objection that liability expert Thomas Crawford’s declaration was disclosed too late. The court sustained objections to Crawford’s opinions about the operation and funding of Maritime Administration vessels and the corporate relationship between Ocean Duchess and Ocean Shipholdings because it found that he lacked specialized knowledge on those subjects and that the opinions would not assist the court. The court did not sustain the government’s objections to Crawford’s opinions about the condition of the mooring line and the circumstances of the accident.

Disposition

Judge Phyllis J. Hamilton granted defendants’ motion for summary judgment on all claims against Ocean Duchess and Ocean Shipholdings. The case proceeded on three remaining claims against the United States: Jones Act negligence, unseaworthiness, and failure to pay maintenance, cure, and wages. The parties were directed to participate in a mandatory settlement conference before filing pretrial papers.