ISSUE: Periodic Update on Recent Events

Jack_crop 72dpiThis is an update regarding recent significant events involving the Longshore Act.

The good news is that, considering “recent” to be from January 1, 2013, to the present, there hasn’t been too much new of national significance. The exception has been some personnel changes and new administrative procedures implemented by the U.S. Department of Labor, which administers the Longshore Act.

The Division of Longshore and Harbor Workers’ Compensation is under new management at the National Office in Washington, DC. The new Longshore Director is Antonio Rios. The new Chief, Branch of Insurance, Financial Management, and Assessments is Rich Stanton, and the new Chief, Branch of Policies, Procedures, and Regulations is Jennifer Valdivieso.

Also, the DOL issued Industry Notice No. 144 on November 14, 2013. It contained important new instructions for mailing injury reports, claims forms, and correspondence in Longshore cases effective December 2, 2013. The New York Longshore District Office is designated the “Central Case Create” site. All new reports of injury and claim forms are to be mailed to: U.S. Department of Labor, OWCP, Division of Longshore and Harbor Workers’ Compensation, 201 Varick Street, Room 740, P. O. Box 249, New York, NY 10014-0249.

After a case has been created, the Jacksonville, FL district office is designated as the “Central Mail Receipt” site. All case specific mail is to go to the following address: U.S. Department of Labor, OWCP, Division of Longshore and Harbor Workers’ Compensation, 400 West Bay Street, Suite 63A, Box 28, Jacksonville, FL 32202.

All checks (for deposit to the Special Fund or in response to penalties), as well as inquiries, forms, and other documents concerning self-insurance authorization, security deposits, and Special Fund assessments are to go to the following address: U.S. Department of Labor, OWCP, Division of Longshore and Harbor Workers’ Compensation, Branch of Financial Management, Insurance, and Assessments, 200 Constitution Avenue, NW, Room C-4319, Washington, DC 20210.

There have been no Longshore cases decided at the U.S. Supreme Court since January 2013.

There have been some interesting cases at the various federal circuit courts of appeals and at the DOL’s Benefits Review Board.

In the federal Fifth Circuit (states of TX, LA, MS), the case of New Orleans Depot Services, Inc. v. Director, Office of Workers’ Compensation Programs, et al. (Zepeda), (April 2013) was a major event. The en banc Fifth Circuit reinterpreted language in section 903(a) of the Longshore Act with regard to situs. Now in the Fifth Circuit, “adjoining”, as in “other adjoining area customarily used by an employer in loading, unloading, repairing, dismantling, or building a vessel” no longer means “neighboring” or “in the vicinity of” navigable waters. Now in the Fifth Circuit, the interpretation of “adjoining” means, “to lie next to” or “to be in contact with”. The Fifth Circuit has thus adopted the interpretation of “adjoining” as used in the Fourth Circuit (states of MD, VA, WV, NC, SC). The Fourth and Fifth Circuits are the only two federal circuits so far that interpret “adjoining” in this restrictive way.

The Fifth Circuit, in Gary Chenevert v. Travelers Indemnity Company, (March 2014) confirmed that an insurance company which makes voluntary LHWCA payments to an injured worker on behalf of the employer acquires a subrogation lien on any recovery by the worker in a Jones Act suit against the employer based on the injuries for which the LHWCA benefits were paid. The key is that the Longshore insurance company was not the same insurance company that insured the employer for Jones Act liability, so it was not a case of the employer subrogating against itself.

Back on December 30, 2011, the DOL issued Industry Notice No. 137 regarding the DOL’s new regulations for Recreational Vessels. The new Regulations (20 C.F.R. 701.301-701.505) were effective January 30, 2012. The Regulations implement the February 17, 2009 amendment to section 2(3)(F) (33 U.S.C. 902(3)(F)) which removed the sixty five foot limitation for the exclusion from Longshore Act coverage for workers employed to repair or dismantle in connection with repair any recreational vessel. Under the amendment, all workers employed to repair recreational vessels are excluded from Longshore Act coverage.

A primary issue is the interpretation of what is meant by “recreational vessel”. The case law so far has been sparse by way of interpretation, but on January 28, 2014, the Benefits Review Board issued its decision in Luis E. DeJesus v. Viking Yacht Company, Inc. and SeaBright Insurance Company, and Director, Office of Workers’ Compensation Programs, BRB No. 12-0581. The Administrative Law Judge had found that the claimant was covered by the Longshore Act because some of the boats that he worked on were company owned “stock vessels”, used for boat shows, sales demos, and sea trials for prospective buyers, and so in his opinion the boats were commercial rather that recreational. The Benefits Review Board reversed the decision and excluded the claimant from Longshore Act coverage under the recreational vessel exclusion and implementing regulations.

The Board focused on the type of work that the claimant was performing and the use of the vessels at the time of the repair, and it found that the use of the stock vessels for sales demos and sea trials did not convert the vessels to commercial use under the Regulations.

More litigation will be necessary before we can be confident as to how the courts will interpret the section 2(3)(F) recreational vessel exclusion.

The Fifth Circuit again, in the case of Larry Naquin, Sr. v. Elevating Boats, L.L.C., (March 2014) issued a surprising (to me) decision affirming a district court’s jury based finding that a vessel repair supervisor was a Jones Act seaman. There was a strong dissent in the case to the effect that the plaintiff was a land based worker not entitled to the Jones Act negligence remedy, but nevertheless this case is another example of the chronic uncertainty in determining coverage issues between the Jones Act and the Longshore Act.

The Benefits Review Board issued a coverage decision in the case of Anne M. Smith v. Huntington Ingalls Industries, Inc. – Newport News Shipbuilding, BRB No. 13-0331, March 19, 2014) in which it analyzed the duties of a mail room worker. The claimant worked in the mail services department of Newport News Shipbuilding and the issue was whether the Longshore Act’s clerical exclusion (section 2(3)(A)) applied. The Board held that the claimant meets Longshore Act status and that the clerical exclusion did not apply. In addition to paper documents and mail the claimant also regularly handled parts and tools, both incoming and outgoing, and thus her duties were integral to the employer’s shipbuilding operations.

The federal Ninth Circuit Court of Appeals (states of WA, OR, MT, ID, CA, NV, AZ, AK, HI) issued two decisions regarding claims for survivor’s benefits under circumstances involving a suicide and an attempted suicide (Schwirse and Kealoha). The court indicated that the “irresistible suicidal impulse” analysis was incorrect, and instead the analysis should be focused on a test for a direct chain of causation between working conditions, a workplace injury, and the suicide. The court also indicated that section 3(c) of the Act did not place the burden of proving willful intent on the employer as an affirmative defense, but rather that the claimant had to prove compensability based on a preponderance of the evidence on the record as a whole.

The Fifth Circuit issued a situs decision involving a multi-use facility in the case of BPU Management, Inc./Sherwin Alumina Co. v. Director, OWCP (Martin), 732 F.3d 457 (5th Cir. 2013). The court traced the movement of ore as it was unloaded and moved through several stages and locations at the employer’s facility from the dock to the manufacturing processes. The case offers a good discussion of how to fix the point at which maritime cargo handling ends and manufacturing begins in this type of facility.

I was going to mention that the Fifth Circuit held that a modification under section 22 of the Longshore Act based on a mistake of fact does not require that the mistake involve new or previously unknown facts.   This was the case of Island Operating Co., Inc. v. Director, OWCP, but the Fifth Circuit has already monopolized this list.

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