Court Opinion

ID: 3063025
Source: CourtListenerOpinion
Date Created: 2015-10-14 20:55:32.077543+00
Date Added: 2024-06-11T07:38:19.523773
License: Public Domain

[DO NOT PUBLISH]

              IN THE UNITED STATES COURT OF APPEALS

                      FOR THE ELEVENTH CIRCUIT            FILED
                                                 U.S. COURT OF APPEALS
                        ________________________   ELEVENTH CIRCUIT
                                                       MAR 31, 2010
                              No. 09-13289              JOHN LEY
                        ________________________          CLERK

                     D. C. Docket No. 09-00206-CV-WS

MCDERMOTT GULF OPERATING COMPANY, INC.,
SECUNDA MARINE SERVICES,

                                                       Plaintiffs-Appellants,

                                      versus

CON-DIVE, LLC, in personam, et al.,

                                                                 Defendants,

OCEANOGRAFIA SOCIEDAD ANOMINA
de CAPITAL VARIABLE, in personam,

                                                         Defendant-Appellee.

                        ________________________

                              No. 09-13858
                        ________________________

                   D. C. Docket No. 09-00206-CV-1-WS-B

MCDERMOTT GULF OPERATING COMPANY, INC.,
SECUNDA MARINE SERVICES,

                                                       Plaintiffs-Appellants,
                                            versus

CON-DIVE, LLC,
in personam,
                                                                        Defendant-Appellee,

OCEANOGRAFIA SOCIEDAD ANOMINA
de CAPITAL VARIABLE, in personam, et al.,

                                                                                   Defendants.
                               ________________________

                      Appeals from the United States District Court
                         for the Southern District of Alabama
                            _________________________

                                      (March 31, 2010)

Before HULL, WILSON and FARRIS,* Circuit Judges.

PER CURIAM.

       In these consolidated appeals we review the district court’s vacatur of a

maritime attachment of ship-board equipment and the district court’s dismissal of

Appellee Con-Dive from the case for lack of personal jurisdiction. The appellants

contend that the district court abused its equitable discretion in vacating the

attachment and erred by concluding that Appellee Oceanografia Sociedad

Anomina de Capital Variable (“OSA”) owns the equipment and that the court

       *
         Honorable Jerome Farris, United States Circuit Judge for the Ninth Circuit, sitting by
designation.

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therefore had no personal jurisdiction over Con-Dive. After reviewing the briefs

and the record, and receiving the benefit of oral argument, we affirm the judgments

of the district court.

                                         I.

       Appellant McDermott owns the Bold Endurance, a “service support vessel.”

The ship provides support for extended underwater operations. In 2006,

McDermott’s predecessor-in-interest Secunda Global International leased the ship

to appellee Con-Dive, LLC. Con-Dive worked closely with affiliate/co-appellee

Oceanografia (OSA), which had a contract with the state-owned Mexican oil

company PEMEX to build a pipeline beneath the Gulf of Mexico. Con-Dive was a

start-up company founded by a former OSA manager. OSA paid McDermott $1.8

million as security for Con-Dive’s lease. The maritime lease, called a “charter

party,” provided the ship, captain, and vessel crew for $32,500 a day.

       Con-Dive purchased and installed on the ship saturation-diving equipment

currently worth upwards of $7 million. The equipment is a set of connected

decompression chambers that permits working divers to stay deep underwater for

days or weeks at a time, thus minimizing the delay and danger associated with

more frequent decompressions. Con-Dive claims that in late 2008 it transferred the

equipment to OSA.

                                          3
      Con-Dive fell behind on the lease payments, called “charter hire.” OSA

discussed the overdue hire with McDermott and, at one point, paid $900,000 in

back hire. In late March 2009, after concluding that no more money was

forthcoming, McDermott shut down the operation, claiming $5 million in unpaid

hire. OSA asked for its diving equipment back but McDermott refused, claiming

the equipment was security for the debt. OSA responded by filing a criminal

complaint of theft of the property by McDermott with the district attorney for the

state of Campeche, Mexico. The district attorney boarded the ship, then left the

ship with the equipment still on board. In their briefs, the parties do not dispute

that, while on board, the district attorney gave a verbal order that McDermott turn

over the equipment pending an investigation into the dispute. The parties dispute,

however, whether the district attorney’s verbal order impounding the equipment

was valid. At the time of the district attorney’s verbal order, the ship was floating

in the southern Gulf of Mexico. As the dispute between the parties continued, the

ship sailed first to another Mexican port, then to Mobile, Alabama, arriving there

on April 13, 2009.

      In federal court in Mobile, McDermott filed an in rem claim against the

equipment, seeking arrest of the equipment under Rule C of the Supplemental

Rules for Admiralty or Maritime Claims. McDermott also filed in personam

                                           4
claims against Con-Dive, OSA, and OSA’s manager, seeking attachment of the

equipment under Supplemental Rule B. The motions for attachment and arrest

were ex parte and the magistrate judge granted them within twenty-four hours. In

its ex parte applications, McDermott did not mention the verbal order from the

Mexican district attorney. OSA claimed ownership of the equipment and moved

for a Rule E(4)(f) hearing to vacate the attachment and arrest.

       The district court accepted extensive briefing and declarations from both

parties on the issue of whether Con-Dive or OSA owned the equipment. At the

Rule E(4)(f) hearing, the court also heard live testimony from OSA’s expert on

Mexican law. The district court subsequently granted the motion to vacate the

attachment after concluding that (1) OSA owned the equipment, (2) the Mexican

district attorney’s verbal order to surrender the equipment was valid, (3) that

McDermott was aware of the order, and (4) that McDermott had violated the order

by refusing to turn over the equipment and leaving Mexican waters with the

equipment still on board. The district court concluded it had the equitable power to

vacate the attachment.1 McDermott timely appealed, creating our appeal No. 09-

       1
        In the same order, the district court also vacated the arrest of the equipment after
concluding that McDermott had no maritime lien on the equipment to support the arrest of the
equipment for purposes of an in rem action pursuant to Supplemental Rule C. McDermott has
raised no argument on appeal in connection with the district court’s vacatur of the arrest of the
equipment under Rule C.
        The charter party provides that it shall be governed and construed in accordance with the
laws of Nova Scotia and the federal laws of Canada. It also requires that any disputes be

                                                5
13289. Con-Dive then filed a motion to dismiss for lack of personal jurisdiction

and improper venue, citing the finding of the district court that OSA owned the

equipment. Con-Dive argued there was no longer any basis for personal

jurisdiction over it. The district court agreed and dismissed Con-Dive from the

action.2 McDermott timely appealed, creating our appeal No. 09-13858.

                                                 II.

       We review the district court’s exercise of its equitable power in a maritime

case for an abuse of discretion. Dresdner Bank AG v. M/V Olympia Voyager, 465

F.3d 1267, 1273 (11th Cir. 2006). We review for clear error factual findings made

by the district court sitting in admiralty jurisdiction without a jury. Marine Transp.

Servs. Sea-Barge Group, Inc. v. Python High Performance Marine Corp., 16 F.3d

1133, 1138 (11th Cir. 1994). Under this relatively deferential standard, we affirm

the district court’s vacatur of the attachment. The appellants have not shown (1)

that the district court clearly erred in its fact findings or (2) that the district court

abused its discretion in concluding that the totality of the facts, as found in the

district court’s order, warrant an equitable exception to the general rule upholding

resolved in the Supreme Court of Nova Scotia or the Federal Court of Canada in Halifax.
Litigation is currently pending in Nova Scotia between McDermott, OSA and Con-Dive to
resolve McDermott’s claim for the unpaid charter hire.
       2
         Based on the forum selection clause in the charter party, the district court also dismissed
all aspects of the case against Con-Dive other than maritime attachment due to improper venue.
McDermott has not argued on appeal that this aspect of the district court’s order was erroneous.

                                                 6
maritime attachments. See Aqua Stoli Shipping Ltd. v. Gardner Smith Pty Ltd., 460

F.3d 434, 444–45 (2d Cir. 2006).

                                          III.

        We review de novo the district court’s dismissal for lack of personal

jurisdiction. Stubbs v. Wyndham Nassau Resort & Crystal Palace Casino, 447

F.3d 1357, 1360 (11th Cir. 2006). We conclude that the district court did not err in

dismissing the case against appellee Con-Dive and we affirm that judgment as

well.

        AFFIRMED.

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