The Boundaries of the LHWCA/DBA: Fisher, et al. v. Halliburton, et al.

 By Stephen M. Vaughan, Esq., Tucker, Vaughan, Gardner & Barnes, Houston, Texas

Claimants and their attorneys have long tried to reach outside the Longshore and Harbor Workers' Compensation Act (33 U.S.C.S. § 901 et seq.) and its progeny to find additional causes of action against employers and their insurance carriers See, e.g.,  Hetzel v. Bethlehem Steel Corp., 50 F.3d 360, 364-367 (5th Cir. 1995) (Texas’ Deceptive Trade Practices Act claims not available to injured longshoreman); Johnson v. Odeco Oil & Gas Co., 864 F.2d 40, 44 (5th Cir. 1989) (LHWCA preempts negligence claim by worker injured during hurricane on offshore oil rig).  Claimants and their attorneys have generally only succeeded where they can show intentional tort or injury. See, e.g., Sample v. Johnson, 771 F.2d 1335, 1346-1347, 18 BRBS 1(CRT) (9th Cir. 1985), cert. den., 475 U.S. 1019, 89 L. Ed. 2d 319, 106 S. Ct. 1206 (1986); Austin v. Johns-Manville Sales Corp., 508 F. Supp. 313, 316 (D. Me 1981).  Such an effort has never been blessed by the Fifth Circuit where this case was reviewed.

Fisher arises out of an effort to bring claims not covered by the Defense Base Act (42 U.S.C.S. § 1651) based on a somewhat novel approach to “injury” as defined by the Longshore Act, 33 U.S.C. § 902(2).  See Fisher v. Halliburton, 667 F.3d 602, 45 BRBS 95(CRT) (5th Cir. 2012).

Claimants’ decedents were attacked and killed by insurgents in Iraq while working as drivers.  They were not told, although their employer KBR allegedly knew, that they were at increased risk of attack during a particular “Shia commemorative event.”  Moreover, KBR management allegedly sent them out on the fatal convoy despite its own misgivings.  Survivors alleged fraud and deceit, intentional concealment, intentional misrepresentation, and even intent to injure/assault, among other claims against their employer.

The Fifth Circuit reversed the district court’s denial of summary judgment and defendants’ Section 12(b)(6) motion, and remanded for dismissal of the state court counts (see Federal Rules of Civil Procedure, Rule 12(b)(6)).

The Fifth Circuit and the district court below focused their attention on whether the decedents had suffered injury, specifically, whether their injuries were “caused by the willful act of a third person directed against an employee because of his employment.”  Fisher, supra, at 611.

The Fifth Circuit judges concluded that the insurgents’ attacks were directed against the victims because of their employment.  Their test was sufficiently strained that they took some pains explaining their conclusion. Using an old New York case (New York’s compensation statute being the primary source of the original Longshore Act), they concluded that the LHWCA’s language followed its teaching that intentional injury must be “because of his employment” if it was not done for “purely personal reasons.”  After reviewing a couple of subsequent cases, the court inferred the “suggest[ion] that an injury caused by a third party occur[s] ‘because of’ the employee’s employment so long as there is a credible causal nexus between the employment and the third party’s act.”  Fisher, supra, at 614.

This “credible causal nexus” is necessary to the court’s reasoning, because the court next rejected the district court’s conclusion that there was “ample evidence” for the inference that the attacks occurred instead “because they were American on the first day of Arabeen, the one-year anniversary of the United States’ presence in Baghdad,” rather than because of their employment.  The United States’ amicus brief argued that determining an enemy attacker’s subjective intent was “unworkable” and “impossible to apply,” and suggested instead that the law was intended only to exclude those injuries that “obviously” have nothing to do with the employment.  The Fifth Circuit for its part worried that many civilian employees would have no remedy if injured because they were American.  In the end, the court concluded that the deaths did, indeed, fall within the LHWCA’s definition of injury; namely that they were injuries “caused by the willful act of a third person directed against an employee because of his employment.”  Fisher, supra, at 615.

Claimants did not dispute the district court’s holding that there was no evidence that KBR itself intended that decedents be harmed by insurgents.  They did make the argument orally before the Circuit, however, contending that KBR knew its actions were “substantially certain” to result in death or injury to its employees, thus bringing its actions within the Restatement (Second) of Torts’ definition of intent.  Fisher, supra, at 616.

The judges did not bite.  After restating the commonplace notion that Congressional intent should be respected, and quoting the exclusivity provision of the LHWCA, the court engaged in a discussion of the “probabilistic” nature of the concept of substantial certainty.  It clearly did not like the burdens it surmised such a concept would place on employers.  Fisher, supra, at 619-620.

In rejecting the argument, however, the court was careful to avoid any pronouncement on actual rather than inferred or presumed intent on the part of an employer to injure its employee.  It thus avoided any language that could be construed as direct agreement or disagreement with the Ninth Circuit’s holding in Sample v. Johnson, supra (intentional tort by employer).

Finally, the Fifth Circuit rejected the fraud-in-the-inducement claims regarding allegedly misleading information about noncombatant status given to decedents when they signed their employment contracts.  Having held the injury claims fell within the DBA’s coverage, the Circuit noted that most authorities agree that an employer’s deceit leading to injury is merged into the injury for purposes of compensation coverage, citing Larson’s Workers’ Compensation Law.  Again, the court circumscribed the ruling to allow for the possibility that an employer might be liable if he deceived his employee with the specific intent that he be injured.  Fisher, supra, at 621.

Claimants’ attorneys are not likely to see a new cause of action in the Fifth Circuit for egregious or malicious claims handling misbehavior in connection with an LHWCA claim, not anytime soon, at least.  The Fifth Circuit has, however, left the door open to consideration of a claim against an employer for behavior intended to result in injury. While it seems such a case is unlikely to arise, such a claim is at least still a theoretical possibility.

© Copyright 2012 Stephen M. Vaughan. All rights reserved. Reprinted by permission. This article was reprinted in the Benefits Review Board Service—Longshore Reporter (LexisNexis).

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