that some of the evidence sharing rulings the court made striking various affidavits and then finally i'd like to reach the separate issue of whether or not the claim in a particular walter of the defense an indemnity to her the function of five hundred and one is to deal with specifically allocation of risks between walter and hercules the titles section five hundred and one is the contractor in this case contractor means hercules contractor standard of performance and it basically says more over our section nine hundred and twelve of the contract specifically states which provisions are the exclusive provisions to this that address the allocation of risk and liability and it lists several sections in the six for and hold harmless and in and that's right it says it shall have no application to claims or causes of action asserted against operator or contractor so walter or hercules which arise solely by reason of any agreement  say cases arising soley out of contract it says claims are causes of action arising solely out of contract party we need to parse better we need to parse better than the district court but i certainly exxon suit against hercules is based on contractual obligations between hercules and acts on contained in the indemnity agreement so those two other claims may be out there but that's not what the judgment here before this court is based on the sole basis on which the court said held that walter owed indemnity to hercules was based soley on the fact that hercules had chosen of its own free will to give an indemnity axon and it was that contractual obligation so whether those other two claims may or may not trigger a duty to defend at least the dish important never addressed that issue is not part of the district court's judgment in other words i think what you're saying is that if nine hundred and eleven c breaks the circle  can't have passed there and done the deed alist the drilling contract expressly contemplates that the operator walter is going to indemnify the trailer for the drillers rd party obligations to others so even if i didn't i was going to ask you about so the yet the various paragraphs in the article of mine some of them are with respect to hercules only some of them are as back to hercules and sobs and suppliers and as i understand those paragraphs which are brad  and twelve and even if i didn't have nine hundred and eleven say this court's precedent on that when you can have passer and done a deal now as to so as i understand axons brief and they can correct me if i'm wrong they want to find they want to say no damages come under nine  blowout feyerick cetera et cetera they want to skip the pollution or contamination part and they were very open about this in the district court in their reply brief summary judgment the district court they specifically said that a five be just indemnifies for anything coming out of a covered by other provisions of the contract and that's what we have here actually i was trying to take nine o five b to say it's not just pollution or contamination is anything arising out of a polluting or contaminating  wild well as another word from blowout so the lessons of nine a six no longer has any meaning if they're reading if one of five b is right now in many cases it wouldn't matter at this bucket is she doesn't matter as much because a lot of day work drilling contracts here the parties negotiated for some a down that is to be limited to hercules and some of them is to extend beyond that and so here the bucket she becomes more important and i think the best way to handle that is  through the thousands of invoice that fill hundreds of pages of accounting schedules and go through that i don't think that's really the need for this court to do that the st place the final point i'd like to make on this issue before moving to the next addition to the toward issues is the district court axons invitation took the some support to be gospel truth which could not be questioned the district was very clear about this on the record he struck affidavits of plaintiff's witnesses on the ground that this comes this contradicts did or said st that report is not conclusive evidence that cannot be controverted it was a report made after the accident what about the point that witnesses themselves last the report so i think it's important understand what they're saying they stood by the work they did based on the information they had at the time but those same witnesses in particular mr burgoyne said look we specifically said in the report that the findings and opinions we were making were wright is asking about if you've identified the three affidavits and those are the ones talked about in the breeze help us understand the fact issues that are raised chuck given you know frankly this some highly technical stuff sure so burgling is quite the narrowest in what he does  experience i think this is an important paragraph but i'm a need to know why it's important it is my opinion that if the rig crew had believed that the blind here ramps and successfully sealed the wellbore that they failed to close this no steps would have been taken by the over says that in a soft shouted we would have gone to the rigs after closing the blowout preventer we would have gone to the rig floor closed everything off closed off the choke closed off the h c r wilson says me and two other people tried to get t little bit different he is a critical witness on design defect he's the person that says here's what their design their chamfer is too small he's why he says that should have been the same as that the chamfer needed to be a little bit bigger like in the camera block's explain in january we asked for reconsideration and the very least we asked for reasons we did not do that is frankly the dish according to january hearing made very clear what it was plain did the dish of courts that we're going to get to the answer sign of humility we're doing the best we can but we're not infallible i don't understand why that some kind of smoking gun i would invite the court to have one more nd your please answer the question after question why do clear what's happening moreover when you read that together with the court's subsequent rulings there were other opinion he issued opinions and in fact in the plenary order he said that my memoranda will say what the holding of the court is but it said  of the motion strike belmore but said nothing about bill so we don't know if it was based on qualifications it is based on methodology issues but the key issue this is judge hoyt told us what he was doing at every turn if somebody did anything that didn't match they please the court my name is juan garcia and i represent the hercules entities in my time before the court i'll address two particular issues st i'll address that walter breached the drilling contract with hercules offshore drilling when it f defend hercules with the claims against axel nd i'll address that the district court incorrectly applied the axon seahawk m s a rather than considering the axon hercules agreement in the claims between to lease but i want to make something clear from the very beginning should dischord agree with the district court that walter breached a drilling contract with hercules that resolves all other issues in the case is courtney not addressed none of the product liabilit because in this case we have an indemnity provision where walter has agreed to indemnify hercules for the exact type of situation that we find ourselves in this case or claims have been made against hercules for damages that walter has agreed to assume the risk and liabilities those are the types of drilling contracts between parties the parties understand and drilling in the gulf of mexico that there are risk alive bill and he's with loss of property bodily injury counsel for underwriters about the various clauses in the contract walk me through which clauses in the o t c are in your favor so we start with section five a one section five a one if we look at the very title of the drilling contract at the very beginning right underneath the title it says this contract contains provisions relative to indemnity release of liability and allocation of risk see paragraph five all one an article nine thousand five hundred and one then identifies  the relationship between hercules and and walter where in that case unless a risk is pacifically assumed by hercules walter undertakes that risk and it says that the outside of the one it was that bases and that the spirit of the contract that runs through the entire contract the argument is reading it that broadly renders article nine and those specific adjustments of ind hey five a one gets us there absolutely not your honor we need section nine hundred and one and walter absolutely agreed to the indemnity provisions that were in section one hundred and one in the line of cases walter also tries to make the distinction between what type of damages it asserted in regards to hercules position it doesn't matter what damages it asserted section nine a one which is one they can see are damages in this case yes your honor and  sixteen which is the removal and direct record rebuttal for the blowout in those damages walter has agreed to be responsible and hold harmless and indemnify hercules for any claims asserted against hercules party from and against all claims section nine hundred and eleven dollars a goes on to identify all of the types of claims that are included in that definition which includes which is alos us to read these cases differently any theory of tort and breach of contract claims and so it also what than a five the reason this case couldn't hear any judgments or orders by the underlying court it's all encompassing and that takes us so nine hundred and eleven a very broad i got it right otherwise provided here in that specific section tells us that in the case where nine hundred and eleven c comes into play is if nothing else is addressed in the drilling contract regarding that particular issue we can read earlier in section nine  nine in section nine that walter has agreed to indemnify and so the other language that the court was asking opposing counsel was soley we also have separate reasons for that not only was acts on making a breach of contract claim support the argument that nine hundred and eleven see is triggered in this case no your honor with all due respect st because we see the introductory language except as otherwise provided her in but the underlying court can make a ruling and decide on any of the arguments that were decided below the breach of contract claim which we agree is in section in section nine of the and in the provisions were included in that and that's one of the bases for its decision the dischord along with the district added any other reasons for example the contribution claims or the indemnity reasons for not even appliance or not even addressing or even considering section nine hundred and eleven dollars c which we think it did it looked at that and it's provisions then add the required language of sub contractor contractor and service provider that is not what that language is for if if that was the case then these are the  and the last one on the will control costs they would mean that for coolies would have to make a claim on itself it wouldn't address anybody else the line of cases with poor bit and diamond drilling and some or all identify the claims that are made in here these specific indemnity provisions in those cases the claims weren't addressed it was only theories of stewart and they said it didn't address breach of contract claims we we think we show in this ind brought it to duncan said that it's a broad includes a breach of contract claims and summerall says they were looking at what lanes were taken on by the indemnifying party and in this case water was taken on the breach of contract claims that would have been asserted against walter just like acts on did in this case and so when it took on those responsibilities then it indemnified for any claims including breach of contract claims and now we have any judgments against hercules that would have been made against hercules that's the circular indemnity what that other language does when you include sub contractor contractor that's vertical indemnity is if they know their contractor would have made a claim against a would then would have requested indemnity from hercules that's where walter would have been protected if those provisions of damages would have applied that is not what we have here a claim was made directly against hercules and walter has agreed not foreseen in this case an indemnity by definition is a rd party client it's just a claim made against that party it doesn't require it to then and no cases then tell us that we then have to go look at who is making that  party claim to identify if that isn't forcible or not and that's why we think in this case that this provision takes care of everything walter agreed to indemnify hercules for these claims there were no argument i think the water side that the claims were not included in that indemnity provision and for those reasons we think that that's specific issue takes care of the entire case unless there's any other questions that any way from any of the conclusions that district court i mean i know the district court found that at some point you agree completely with the reasoning or you don't need to get into the areas where you disagree with the reasoning absolutely your honor i think we don't have to get into the reason well it could have been articulated differently certainly opinions in the judgments down below could have written and been more specific on specific clauses and issues i think the ultimate decision was correct but so if that walter has agreed to indemnify hercules for all the claims in damages that water exxon has asserted against hercules and of opinion the case is over and i think that would resolve the entirety of the issue introductory of that th of that section says except as otherwise provided here in earlier in section nine we do state and we do see that it is provided here in in the drilling contract even if we are going to ignore that introductory phase which obviously we should not then there isn't a sole basis for those claims there were other claims made by exxon against hercules that would be after the board here specifically the contribution claim and the ind outlaw claim that we're doing but even then soley could also refer back to earlier provisions of the drilling contract which would be sections earlier sections in section nine thousand nine hundred and one if we were assuming the damages that that water were claiming and section one o six but in either no matter how you read the drilling contract these are risk in liabilities that walter undertook that walter insured and gets that's why we have underwriters in this case they knew the risk and liabilities that they were undertaking in this day work drilling contract this isn't a opposing counsel mentioned clear where there were clear distinctions between that they were drilling contracts and those different type of food it contracts this was a drilling contract where walter benefited financially out of this type of contract and under took the risk because of this type of contract and so therefore that's why we think that resolve this matter fairly easily but again moving to my nd point is even if the court were to address the apps on claims or the planes hercules had against axon and which contract applied we think the court erred when it applied just and only looked at the agreement between axon and seahawk is it specifically because you agreement once we did but even if we didn't both contracts could come into play and they both could be applicable because there's earlier language in that contract that even they could be read together the issue in the motion for summary judgment though is which contract was with the understanding that it already had an agreement with hercules went on and and did work regarding this rig when it did the repair data repair but the very next day that in and of itself creates a fact weston that the parties knew which agreement they were operating under and the court disregarded that and it is for those reasons that i will ask the court to one up hold the district court's decision that walter breached the drilling contract and if necessary then address that axon there was a fact question regarding that particular issue irm or an even simpler and more straightforward reasons morning st of all walter directly owed exxon indemnity as a supplier of subcontractor under article nine of the drilling contract talking about the pollution contamination hercules and its suppliers contractors and subcontractors against quote all claims losses and liabilities of every kind in character including without limitation property damage and i think a freak a key phrase here control or remove all of the pollutant arising directly or indirectly from all pollution or contamination now importantly nine o five b applie notwithstanding any other provision in the contract it's a super charged provision so to summarize that language you can see that reading it that broadly overlaps with some other provisions of article such is not a six regaining the wild yes it absolutely overlaps but it does not render nine o six superfluous and let me at st explain why i think it's reasonable and unsurprising that it would overlap because when the plane taxed at nine o five b it covers control of the pollutant that's going to overlap substantially with the cost for controlling the wild well and that's not surprising because the parties are insuring different risks in different provisions nine dollars o five b covers all costs or losses ar ising even indirectly out of pollution that could be wild well that could be a hurricane strikes it and causes pollution nine o six be covered in one of six covers the cost of wrecks and debris that could be caused by a hurricane not by pollution the cost of a controllable wild well that could happen for any reason as well and let me just give one specific example where i think there were something would fall under control of the wild well but would not fall under nine o five b you could have a well control event and the early phase efforts to control that well it could result in costs or losses before the pollution escapes so that would be costs or losses arising from controlling the wild well but it couldn't be said to be cost arising out of the pollution because we don't have any pollution escaping the environment what we have here is just looking at the way walter describes its own claims all of them arise at least indirectly from the pollution here so let's take a look at the factual record on that four days after the blowout bessie orders that this uncontrolled well presented quote an eminent threat to the environment why because pollution is spewing out of it and required baltar to immediately misquote immediately control remove or otherwise correct any hazardous gas and pollution accumulation at the well that's a substantial amount of what they're to bessie they say we want to drill a relief well but why do they say they want to drill a relief well because that well was uncontrolled and polluting and the relief well it will stop the pollution from reoccurring coming out of it well that's certainly arises at least indirectly out of the pollution and there's a lot of other evidence in the record which we cite in our brief at pages five thousand eight hundred and fifty nine dollars i don't think we need to run through all of it but underwriter's own corporate rep admitted quote a large amount of the dollars that were paid to walter were associated with stopping the blowout they obviously that's arising indirectly out of pollution and finally they they asked for costs for removing the wreck in the debris the platform and the well that could collapse and they asked for cost for destruction of the platform i think there still has it that it's not clear to the reply brief that arise indirectly out of pollution as well because what you had was a gas cloud which was pollution just talked about in the record that are out of walter's own mouth and out of bessie's report and you can tell that all of that arises at least indirectly out of the pollution and i thought i would also urge the court that indemnity issues are often the type that are resolved on summary judgment you just read the contract to determine what it means to be lighted up with the damages that are being claimed i haven't heard from my friend on the other side either in his brief or his argument this morning what he thinks nine o five b actually means and how that lines get into the circular indemnity issue correct so d no i'm not necessarily but i do want to address that issue briefly i don't why would we not have if we don't agree with you or not in five b because th addressed a threshold element of their claims which is whether the blowout preventer was being used in a recently anticipated use we talked a lot about causation i'll get to that later yes i understand your honor and so st of all something hercules touched on at the very end of their argument i think would come st in the analysis and that is whether hercules of those indemnity to axon for the claims and we think there is no fact issue there whatsoever but the course correctly rams that exxon manufactured those were provided to seahawk seahawk is listed as the customer on those purchase orders that's undisputed it's also undisputed that all of the work specific ones that are alleged to us yes that's correct they were provided to sea hawk they were put on a sea hawk rig a year later hercules buys all the assets they get the seahawk rig they get the blowout preventer you're saying it's undisputed that that work was done for seahawk prior to whatever the date was in two thousand and eleven that hercules acquired direct that is under spewed at the latest date of work that they identified as july two thousand and ten when they were installed because the m a c says it will supersede all agreements quote between hercules and exxon where you have an agreement between sea hawk and exxon there's no reason to think when hercules and exxon signed that agreement they were superseding it agreement with a completely different company because remember her pleas didn't buy that seebach until much later and now the nd argument that they make is that there was some work there's some evidence in the record that work was performed for hercules and the only evidence noted this morning in the brief is this revised data repair book so let's talk about what that is the revised data repair book is simply the exact same purchase orders that axon perform for seahawk that were recopied and retitled verbatim and then handed over to hercules when hercules bought all those assets it wasn't some additional work performed you can look at that data book and it says purchase order to see whop seahawk is the customer blind share ams blowup preventer so there's no evidence in the record that because it was given over to her achilles the exact same documents reflecting assets that they acquired that there would be any  circular and an hour to the circular in them and so i think there is there's a lot of moving parts and we're all taking a different order of staff here that's why i think the simplest way is to look at nine o five b and that ends the case of the court holds that accent that's not a threat break the circle because the claim by axon against hercules is based on contractual indemnity and the judge and underwriters counsel would say in the district court's judgment found want to fill out a little bit on that argument is that section five hundred and one as part of what is otherwise provided here it and section five hundred and one is an extremely broad risk shifting provision and it shifts yes but they allow that to be put in you when you have treated as another say operators do not let this provision get into your contract and that's half it this way if if axons claims with respect to hercules only with behalf of of hercules in addition it has to arise solely as a result and i would say i think what mr garcia was was arguing as part of his argument is that if you had some down the line rd party in and eleven c doesn't aren't right and i want to make one final point just flipping back to my st started under nine o five b and i think it's important to look at the economic realities of this contract which were hinted at by my by friends and that is it made economic sense for the parties to force the operator to insure for the risk of a cap catastrophic pollution event after all the operators the one that stands to make millions of dollars from actually drilling the well hercules is just making a day rate exxon made two hundred and thirty six thousand dollars to selling these blow up avengers there's no way they're going to be the ones assuming the risk for all these pollution caused damages so i get i think that's the most direct easiest way the case is over if you look at nine o five feet now if i could turn to the merits most of the previous aspects of the argument this morning has focused on a causation and alleged fact issues related to cars ation i want to go to the issue that is before causation under the louisiana products liability act and that is the plaintiffs have to establish as an essential element of their claim that the use here was a reasonably anticipated use and they have failed to produce a shred of evidence on that point and therefore their argument fails under this court's on bond decision and camp and by judge doing this court doesn't need to get into any of the court was exactly right to say the crude negligence overwhelmed any other cause here that was the that was the evidence put forward by the independent governmental report and that also shows why do we discount everything if just because the report is so great and that's not the normal way you do summary judgment so let me try to address causation in one minute because i really think on the record before the court i can easily affirm with no fact is she's on recently anticipated use on causation we're not arguing that the report overwhelms anything but what we're arguing is that the report has to be given great w create a genuine material fact issue the plaintiffs have to do more than just say the blowup preventer was a cause they have to look at the causes identified by the report crew negligence waiting too long to detect the tic valve open and show some fact issue that those were not in fact the real causes and what you've heard this morning is i think reference to the sons in the book going evidence in the record and there their evidence says if the blind shear rams had sealed we could have gotten to the floor and manually closed the h c r valve that doesn't create a material fact issue for two simple reasons st of all there is nothing that actually it testimony it and then when they went to the rigs or there is not a shred of evidence from anyone on the crew that says we went to the rig floor to try to manually close the h c r valve they said we thought we closed the h c r about we were going back to the floor to kill the and that's why the crew negligence was already overwhelming any other potential causes and that also goes to why there's no recently anticipated use here because a blowout preventer all of the experts agree in this case the evidence or the record of discounting things throwing them out in those seem a little difficult in terms of summary judgment procedure and so can you help us well i can i can help you because i respectfully disagree with that characterization which is that there is no competent evidence disputing the crew's negligence here there's no competent evidence disputing that the gas and fluid was a skating at a sonic velocity in a way that prevented the blind share rams from closing so there's no fact issue created on that alternative cause that the united states government hasn't divorced now if you think that is a close issue and perhaps there are fact issues there that's why we're urging the court to look at the recently anticipated use threshold issue where there is not even an attempt to create a fact issue on that point you don't have an expert say sure blowout preventers are used like this all the time because they're not clear what you're asking us to it is to pass over the district courts the grounds for summary judgment passover striking of the burgoyne soames affidavit the bill maher report and go to evidence that was excluded it still does not change this determine that is absolutely correct your honor and i think that that is why i say it's the simplest way to do it and of course we're not abandoning any of our other arguments we think it was clearly within the district court's discretion to strike belum our way and that cuts out their defect aspect of their claim if i could take one minute to address what i think is going to be addressed on rebuttal with respect to what they're going to claim as the evidence on recently anticipated of all that is absolutely conclusory evidence when you look at it lined up against the testimony of bessie in the sims report and by the way the sims report was somewhat filament area but the bessie report says this is not eliminated we've interviewed all the brake employees and take into account evidence but even if you were to consider whether the cruise actions were reasonable let's just assume they were in some sense that's not the key question on reasonably anticipated use the question is whether the use however we got to that point whether negligence or not could have been anticipated by the manufacturer so for example take take the analogy to a fire extinguisher manufacturer to anticipate that fire extinguishers can put out small places like say a stove on fire if somebody shows up and a house is already burning down the roof is collapsing picks up a fire extinguisher and fails to put out the fire can't sue the manufacturer because that's not a reason anticipated use regardless of whether it was any fault of the person in that case says when it was flowing at this low velocity a few one thousand barrels a day but there is no evidence that blowout preventers work in the situation we undisputedly have here where it's viewing out at sonic velocity we block opinion in camp and and this court's opinion in hunter both of those involved claims that there was expert testimony that this is common this is reasonable and the court said that did not create a material issue because it has to be something that is actually a common use in the industry it's not enough to say i've seen it once i've seen it half a dozen times so that's exactly the type of evidence that i think they'll hear from my good friend nor is the best the report moreover plaintiff's experts of the axons expert mr brightman specifically said any delay by the crew and activating the blind share rams did not prevent them from stealing and did not he talks of measurements of say one of the ramp locks it's too small and says that the insufficient chamfer the insufficient height of the ram block let the rotation created the interlock and i don't like the interface that cause them to hang up and never fully seal is because the they never sealed up flow kept coming out and that prevented the crew from getting the rig floor to close off the choke and is undisputed here mr all over who's a hercules crew member who specializes in well control court in iverson's trans ocean decided earlier this year analyze that exact same provision in a different drilling project and of this court made clear that definition is not a broad indemnity or a narrow dempsey it's simply a definition of that phrase and the scope of that clause has to be you have to put it basically the definition into the different indemnities and not eighty one million twenty nine thousand and thirty two see what scope it has the definition itself doesn't do anything if you want to say that the except as otherwise stated frankly that's just not how it works when you have a kid or something that starts the process you got minutes or maybe a couple hours of using about it you know coming into your own a relief well of or doing anything like that and here the fact of the matter is the last sentence of nine o if you do just do it a limited remember one thing i would suggest is the court need some guidance this report and some guidance here judge all right as we've discussed here today as in as you point out the some support just because our great that evidence says it's not the end