Opinion ID: 702303
Heading Depth: 2
Heading Rank: 2

Heading: the lauritzen

Text: TRIAD AND SUBJECT MATTER JURISDICTION 25 Beginning with their initial answer in the district court, the defendants have argued that, pursuant to the multi-factored analysis developed in Lauritzen v. Larsen, 345 U.S. 571, 73 S.Ct. 921, 97 L.Ed. 1254 (1953), and Hellenic Lines, Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252 (1970), the district court lacked subject matter jurisdiction over plaintiff's Jones Act and general maritime law unseaworthiness claims. Because subject matter jurisdiction restrictions impose a limit on the power of the federal courts to entertain an action, we must first consider whether the district court had subject matter jurisdiction over plaintiff's suit. If the district court lacked such jurisdiction, it would be our duty to vacate the judgments in plaintiff's favor and direct the district court to dismiss her action. 26 We hold that the district court had subject matter jurisdiction over this suit. This ruling primarily reflects a disagreement with defendants' premise that the Lauritzen triad (composed of Lauritzen, Rhoditis, and Romero v. International Terminal Operating Co., 358 U.S. 354, 79 S.Ct. 468, 3 L.Ed.2d 368 (1959)) provides the framework for determining whether a district court has subject matter jurisdiction in Jones Act or general maritime law cases. 27
Choice-of-Law Analysis 28 In Lauritzen v. Larsen, 345 U.S. 571, 73 S.Ct. 921, 97 L.Ed. 1254 (1953), the Supreme Court enunciated a number of factors to be considered by courts evaluating whether a plaintiff may sue under the Jones Act. These factors include: 29
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36 See Lauritzen, 345 U.S. at 583-92, 73 S.Ct. at 928-33. The Court reiterated the relevance of these factors in Romero, see 358 U.S. at 383, 79 S.Ct. at 486, and in Hellenic Lines, Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252 (1970), it added the defendant's base of operations to this list, id. at 309, 90 S.Ct. at 1734. 37 Defendants believe that this inquiry determines whether the district court has subject matter jurisdiction. This view was not challenged in the district court, which considered the factors and found subject matter jurisdiction, or before the panel, which reconsidered them but found no jurisdiction. Moreover, a number of cases in various jurisdictions so hold. However, after granting rehearing in banc, we sua sponte directed the parties to prepare supplemental briefing on the question whether the Lauritzen-Romero- Rhoditis factors (henceforth referred to as the Lauritzen factors for simplicity) in fact go to subject matter jurisdiction. With the benefit of counsel's briefing and argument, and after studying the Supreme Court's opinions and numerous cases interpreting them, we conclude that the Lauritzen factors are not a test for subject matter jurisdiction, but rather constitute a non-exhaustive list of contacts for choice of law analysis in suits for maritime injuries with foreign connections. 38 In Lauritzen, the Supreme Court was called on to answer a question of the extraterritorial applicability of the Jones Act. While in New York, Larsen, a Danish seaman, had signed onto a ship of Danish flag and registry owned by Lauritzen, another Danish citizen. The ship's articles that Larsen signed were written in Danish and specified that Danish law would govern the crewmembers' rights. After being injured in the course of his employment while in Havana harbor, Larsen brought suit against Lauritzen in the District Court for the Southern District of New York, seeking to recover damages under the Jones Act. Over Lauritzen's objection that Danish law rather than American law governed, the district court allowed the case to go to the jury under the Jones Act, which rendered a verdict in Larsen's favor. The Court of Appeals for the Second Circuit affirmed, and the Supreme Court granted certiorari. 39 The Court formulated the key issue as whether statutes of the United States should be applied to this claim of maritime tort. Lauritzen, 345 U.S. at 573, 73 S.Ct. at 923. As did the defendants herein, Lauritzen had framed his objection in terms of subject matter jurisdiction, but the Court quickly disposed of this argument: 40 The question of jurisdiction is shortly answered.... As frequently happens, a contention that there is some barrier to granting plaintiff's claim is cast in terms of an exception to jurisdiction of subject matter. A cause of action under our law was asserted here, and the court had power to determine whether it was or was not well founded in law and in fact. 41 Id. at 574, 73 S.Ct. at 924. Thus, the Court's later analysis introducing the now-famous Lauritzen factors was directed to choice of law, see id. at 583, 73 S.Ct. at 928, not subject matter jurisdiction, which the Court had already determined was present. 42 Similarly, in Romero v. International Terminal Operating Co., 358 U.S. 354, 79 S.Ct. 468, 3 L.Ed.2d 368 (1959), the Court faced a suit brought under American law by a foreign sailor. Romero, a Spanish seaman, had signed onto the crew of a vessel of Spanish registry that sailed under the Spanish flag and was owned by a Spanish corporation. After departing from a Spanish port, the ship made numerous stops, including one in Hoboken, where Romero was injured when struck by a cable on the ship's deck. He filed suit in the District Court for the Southern District of New York, contending inter alia that the shipowner (Compania) was liable to him under the Jones Act and under the general maritime law of the United States for unseaworthiness of the ship, maintenance and cure, and maritime tort. The alleged bases for jurisdiction were the Jones Act, federal question jurisdiction, and diversity jurisdiction. 43 The district court dismissed the complaint after a pre-trial hearing. It concluded that the Jones Act provided no right of action to an alien seaman under the circumstances involved, and thus that the court lacked jurisdiction over the Jones Act claim against Compania. The court dismissed the general maritime claim against the corporation because the company was not of diverse citizenship from Romero and because of its conclusion that the federal question statute did not embrace general maritime law claims. 44 The Court of Appeals affirmed the dismissal of the complaint, and the Supreme Court granted certiorari. In Part I of its opinion, entitled Jurisdiction, id. at 359, 79 S.Ct. at 473, the Court concluded that the district court possessed subject matter jurisdiction of the claims. With respect to the Jones Act claims, it noted: 45 [T]he question whether jurisdiction exists has been confused with the question whether the complaint states a cause of action. Petitioner asserts a substantial claim that the Jones Act affords him a right of recovery for the negligence of his employer. Such assertion alone is sufficient to empower the District Court to assume jurisdiction over the case and determine whether, in fact, the Act does provide the claimed rights. 46 Id. (internal quotation marks and citation omitted). The Court then affirmed Lauritzen's holding that the usual federal question approach to subject matter jurisdiction governs Jones Act suits. See id. 2 47 Importantly, the Romero Court turned to the Lauritzen factors (in Part II of its opinion, entitled The Claims Against Compania Transatlantica--The Choice-of-Law Problem, id. at 381, 79 S.Ct. at 485) only after concluding that the district court had erred in dismissing Romero's suit for lack of subject matter jurisdiction. Thus, the Court's decision in Romero confirms that the Lauritzen factors are not a test for subject matter jurisdiction but rather govern choice of law. The innovation in Romero was its pronouncement that the Lauritzen analysis should govern not only Jones Act claims but also claims under the general maritime law for personal injury damages. Id. at 382, 79 S.Ct. at 485. 48 Our understanding of these precedents is confirmed by a leading admiralty treatise. See GRANT GILMORE & CHARLES L. BLACK, JR., THE LAW OF ADMIRALTY Sec. 6-63 (2d ed. 1975) [hereinafter LAW OF ADMIRALTY]. Discussing Choice of Law in Actions Brought in the United States by Seamen Injured on Foreign-Flag Ships, the authors explain that when a seaman brings an action to recover for personal injuries, the court must initially decide whether it has jurisdiction and, if it has, whether United States law or the law of a foreign nation is applicable. Id. at 471. They go on to discuss Lauritzen and Romero as follows: 49 The majority of the Court concluded that neither the situs of the injury nor Romero's treatment in this country made a case, under the Lauritzen criteria, for application of American law in Romero's action against his employer, the Spanish Line. Justice Frankfurter's opinion emphasized that the issue was one of choice of law and not of subject matter jurisdiction. That is, the District Court, having decided that Romero's action against his employer was not governed by American law, could have retained jurisdiction of the action and decided it under Spanish law. Id. at 473 (emphasis supplied). 3 50 The Supreme Court's third and latest pronouncement on the role of the Lauritzen factors came in 1970. While the Court's opinion in Hellenic Lines, Ltd. v. Rhoditis, 398 U.S. 306, 90 S.Ct. 1731, 26 L.Ed.2d 252 (1970), is partially opaque, it does not signal a change in the purpose and use of the Lauritzen analysis. Rhoditis concerned a suit under the Jones Act by a Greek seaman for injuries he suffered aboard a ship in the Port of New Orleans. Because the Supreme Court agreed with the trial and appellate courts that the Jones Act applied, the Court did not need to differentiate between subject matter jurisdiction and the plaintiff's entitlement to proceed under the Jones Act--both were present. But the opinion's description of the Lauritzen analysis makes clear that the Court viewed the factors as bearing on applicability of the Act, rather than subject matter jurisdiction. 51 The Court explicitly endorsed the description of the Lauritzen analysis offered by Judge Medina, who in Bartholomew v. Universe Tankships, Inc., 263 F.2d 437 (2d Cir.1959), had written: 52 [T]he decisional process of arriving at a conclusion on the subject of the application of the Jones Act involves the ascertainment of the facts or groups of facts which constitute contacts between the transaction involved in the case and the United States, and then deciding whether or not they are substantial. 53 Id. at 441 (quoted in Rhoditis, 398 U.S. at 309 n. 4, 90 S.Ct. at 1734 n. 4) (emphasis supplied here). Furthermore, in adding the shipowner's base of operations to the analysis, the Court characterized it as another factor of importance in determining whether the Jones Act is applicable. Rhoditis, 398 U.S. at 309, 90 S.Ct. at 1734 (emphases supplied). 54 It is true that the Court's opinion in Rhoditis twice used the word jurisdiction. 4 However, the presence of two occurrences of the word jurisdiction is too ambiguous to mandate a change in the jurisprudence, 5 particularly since the Court likely meant to refer to legislative jurisdiction, see id. at 314 & n. 2, 90 S.Ct. at 1736-37 & n. 2 (Harlan, J., dissenting) (which is also known as prescriptive jurisdiction, see RESTATEMENT (THIRD) OF FOREIGN RELATIONS LAW Pt. IV, at 230 (1987)). Moreover, subject matter jurisdiction was not presented in the Questions for Review in the petition for certiorari. See Petition for Writ of Cert. at 2-3, Hellenic Lines Ltd. v. Rhoditis, 412 F.2d 919 (5th Cir.1969) (No. 661), cert. granted, 396 U.S. 1000, 90 S.Ct. 554, 24 L.Ed.2d 492 (1970). Rather, the first Question, which is characteristic, was: 55 Were the lower courts correct in applying the Jones Act to an action by a Greek seaman, himself a resident of Greece, against a Greek corporate owner for injury occurring aboard a Greek flag vessel, solely on the ground that the majority stock holder of the corporate ship owner, although himself a Greek citizen, resided in the United States as a representative of Greece to the United Nations. 56 Id. (emphasis supplied). 57 Moreover, treating the Lauritzen analysis as going to subject matter jurisdiction would be out of keeping with the approach of most jurisdictional inquiries, which tend to be straightforward threshold questions. The dangers of a totality-of-the-circumstances approach to jurisdiction would be obvious. An undefined test requires courts and litigants to devote substantial resources to determine whether a federal court may hear a specific case. Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., --- U.S. ----, ----, 115 S.Ct. 1043, 1057, 130 L.Ed.2d 1024 (1995) (Thomas, J., concurring in the judgment). The federal judiciary pursues clarity and efficiency in other areas of federal subject-matter jurisdiction, and it should demand no less in admiralty and maritime law. Id. at ----, 115 S.Ct. at 1059. 58 Thus, we conclude that the multi-factored analysis of Lauritzen, Romero, and Rhoditis is not to be used to determine whether a district court has subject matter jurisdiction over suits brought under the Jones Act or the general maritime law. Insofar as Matute v. Procoast Navigation, Ltd., 928 F.2d 627 (3d Cir.1991), holds that the Lauritzen factors govern subject matter jurisdiction over Jones Act or general maritime law claims, it is overruled. In so ruling, we agree with the cases from other circuits that have used the Lauritzen analysis to determine choice of law, not subject matter jurisdiction. See, e.g., Schexnider v. McDermott Int'l, Inc., 817 F.2d 1159 (5th Cir.1987) (affirming district court's determination that Lauritzen dictated applicability of Australian law but requiring that district court retain jurisdiction and try the case); cf. also supra note 5 (citing concurring and dissenting opinions that correctly apprehend the issue). Concomitantly, we necessarily disagree with those cases from other circuits holding (without addressing the clear force of Romero ) that the Lauritzen analysis may be used to dismiss a Jones Act claim for lack of subject matter jurisdiction. See, e.g., Gutierrez v. Diana Investments Corp., 946 F.2d 455, 456-57 (6th Cir.1991) (per curiam) (affirming dismissal of suit for lack of subject matter jurisdiction flowing from non-applicability of American law under Lauritzen analysis); Dracos v. Hellenic Lines, Ltd., 762 F.2d 348, 349-50 (4th Cir.1985) (en banc) (same); 6 Rodriguez v. Flota Mercante Grancolombiana, S.A., 703 F.2d 1069, 1071-72 (9th Cir.1983) (same). 59
60 Although we have demonstrated that the Lauritzen inquiry is non-jurisdictional in nature, there remains the question whether the district court had subject matter jurisdiction over plaintiff's claims, which the defendants have contested throughout this litigation. We conclude that it did, under both the federal question and the admiralty jurisdiction statutes. 61
62 In its first Jones Act case, the Supreme Court held that the Jones Act, as a federal statute providing remedies for injured seamen, is subject to the usual rule for arising-under jurisdiction. See Panama R.R. Co. v. Johnson, 264 U.S. 375, 383-84, 44 S.Ct. 391, 392, 68 L.Ed. 748 (1924) (This case arose under a law of the United States [i.e., the Jones Act] and involved the requisite amount, if any was requisite; so there can be no doubt that the case was within the general jurisdiction conferred on the district courts by [the federal question statute]....); see also Hartford Fire Ins. Co. v. California, --- U.S. ----, ----, 113 S.Ct. 2891, 2917, 125 L.Ed.2d 612 (1993) (Scalia, J., dissenting in part) (discussing Lauritzen and distinguishing subject matter jurisdiction from applicability of American law). 63 Section 1331 provides that the federal district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States. 28 U.S.C. Sec. 1331 (1988). The question of whether the district court had subject matter jurisdiction pursuant to [the Jones Act] is not whether [plaintiff] had a valid cause of action against the [defendants] under federal ... law. Rather, the subject matter jurisdiction analysis is one of whether the determination of the existence vel non of that cause of action is a question 'arising under the ... laws ... of the United States.'  Airco Indus. Gases, Inc. v. Teamsters Health & Welfare Pension Fund, 850 F.2d 1028, 1032 (3d Cir.1988). Plaintiff clearly meets that standard, for whether she could assert claims under the Jones Act and general maritime law is a question of federal law. The district court clearly had jurisdiction over plaintiff's Jones Act claims. 7 64
65 Plaintiff's remaining claims against the defendants allege violations of the general maritime law duty to provide a seaworthy vessel. Again, although the Lauritzen factors are to be used in determining the applicability of substantive American maritime law, they do not go to subject matter jurisdiction. Rather, for non-statutory causes of action, we apply the customary admiralty jurisdiction analysis of Executive Jet Aviation, Inc. v. City of Cleveland, 409 U.S. 249, 93 S.Ct. 493, 34 L.Ed.2d 454 (1972), Foremost Insurance Co. v. Richardson, 457 U.S. 668, 102 S.Ct. 2654, 73 L.Ed.2d 300 (1982), and Sisson v. Ruby, 497 U.S. 358, 110 S.Ct. 2892, 111 L.Ed.2d 292 (1990), as recently reaffirmed in Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., --- U.S. ----, 115 S.Ct. 1043, 130 L.Ed.2d 1024 (1995). 66 [A] party seeking to invoke federal admiralty jurisdiction pursuant to 28 U.S.C. Sec. 1333(1) over a tort claim must satisfy conditions both of location and of connection with maritime activity. Id. at ----, 115 S.Ct. at 1048. For tort claims, the locality test requires that the tort occurred on navigable water or ... injury suffered on land was caused by a vessel on navigable water. Id. Here, the locality test is readily satisfied, id. at ----, 115 S.Ct. at 1049, for plaintiff's injuries occurred in navigable waters and were caused there by a vessel, see id. at ----, 115 S.Ct. at 1048. 67 The maritime connection inquiry is two-fold. First, we assess the general features of the type of incident involved to determine whether the incident has a potentially disrupting impact on maritime commerce. Id. (internal citations and quotation marks omitted). Second, we determine whether the general character of the activity giving rise to the incident shows a substantial relationship to traditional maritime activity. Id. (internal citations and quotation marks omitted). 68 With respect to the potential disruption prong, we describe the incident at an intermediate level of possible generality. Id. at ----, 115 S.Ct. at 1051. Following the Supreme Court's lead, the general features of the incident at issue here may be described as damage by a vessel in navigable water to [a seaman]. Id. 8 So characterized, ... this is the kind of incident that has a potentially disruptive impact on maritime commerce. Id. Injury to a seaman in navigable waters could lead to restrictions on the navigational use of the waterway, id., during necessary investigations into the accident, which could be especially lengthy in a case where the seaman's injuries proved fatal. Additionally, a vessel's need to replace an incapacitated seaman could lead to delays in commercial shipping. Although this case involves a pleasure boat rather than a vessel engaged in commercial shipping, that fact does not affect the jurisdictional result. In Sisson v. Ruby, the features of the incident were described as a fire on a vessel docked at a marina on navigable waters, 497 U.S. at 363, 110 S.Ct. at 2896, even though the vessel was a pleasure boat. 69 The second prong of the maritime connection test is also easily met here. In the second Sisson enquiry, we look to whether the general character of the activity giving rise to the incident shows a substantial relationship to traditional maritime activity. Jerome B. Grubart, Inc., --- U.S. at ----, 115 S.Ct. at 1051. Navigation of boats in navigable waters clearly falls within the substantial relationship.... Id. Thus, the travels of the Long John qualify despite the short distances involved in its voyages. Cf. Sinclair v. Soniform, Inc., 935 F.2d 599, 600 (3d Cir.1991) (upholding admiralty jurisdiction over claim arising from failure of crew of vessel that transported plaintiff to detect symptoms of and administer proper care for decompression sickness suffered during scuba diving investigation in navigable waters); see also 1 STEVEN F. FREIDELL, BENEDICT ON ADMIRALTY Sec. 171, at 11-22 to -23 nn. 54-56 (7th ed. rev. 1995) (citing cases finding admiralty jurisdiction over claims that navigation errors or negligent operation of vessel injured others) [hereinafter BENEDICT ON ADMIRALTY]. Since the locality and maritime connection tests were clearly met, the district court had admiralty jurisdiction over plaintiff's claims. 9 70