Justia U.S. 2nd Circuit Court of Appeals Opinion SummariesArticles Posted in Admiralty & Maritime Law
Bensch v. Estate of Umar
The Second Circuit held that maritime complaints seeking exoneration from or limitation of liability pursuant to the Limitation of Liability Act must contain sufficient factual matter to satisfy the plausibility standard applicable to pleadings under Federal Rule of Civil Procedure 8(a), as interpreted by the Supreme Court in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009). The court concluded, however, that petitioner's Second Proposed Amended Complaint met that standard, and thus the district court exceeded its discretion in denying the motion for leave to amend.In this case, petitioner sought exoneration from or limitation of liability pursuant to 46 U.S.C. 30511 et seq. in connection with a fatal boating accident. The district court dismissed the maritime complaint for failure to allege sufficient factual matter to state a plausible claim for exoneration or limitation, and denied his motion for leave to amend. The court affirmed the judgment to the extent that it dismissed the initial complaint and denied petitioner's first motion for leave to amend, but reversed the judgment to the extent it denied the second motion for leave to amend on grounds of futility and bad faith. The court remanded for further proceedings. View "Bensch v. Estate of Umar" on Justia Law
Panjiva, Inc. v. United States Customs and Border Protection
Plaintiff filed suit alleging that Section 431 of the Smoot-Hawley Tariff Act of 1930, which requires all vessels arriving in the United States to maintain a manifest on which is recorded information about the just-completed voyage and an account of what is on board, requires aircraft entering the United States to make available for public disclosure such manifests detailing the journey and cargo aboard.The Second Circuit affirmed the district court's dismissal in part of plaintiffs' complaint. The court considered the different tools of statutory interpretation and held that section 431(c)(1) continues to require the government to make available for public disclosure manifests only of vessels, meaning "water craft or other contrivance used, or capable of being used, as a means of transportation in water, but...not...aircraft." The court considered plaintiffs' remaining arguments on appeal and concluded that they are without merit. View "Panjiva, Inc. v. United States Customs and Border Protection" on Justia Law
United States v. Alarcon Sanchez
The Second Circuit affirmed defendant's convictions, after pleading guilty, of conspiring to engage in drug trafficking activity in violation of the Maritime Drug Law Enforcement Act (MDLEA). Defendants challenged the adequacy of their unconditional guilty pleas.The court held that the government has met its evidentiary burden in establishing that defendants' boat was a stateless vessel and thus subject to the jurisdiction of the United States; Section 70506(b) of the MDLEA encompasses land-based conspiratorial conduct, which Congress is authorized to proscribe under the Necessary and Proper Clause; although due process requires a sufficient nexus with the United States for those not on board a stateless vessel to be prosecuted under the MDLEA, in this instance, defendants' prosecutions satisfy due process; and Congress did not exceed its legislative authority in enacting the MDLEA pursuant to the Define and Punish Clause. View "United States v. Alarcon Sanchez" on Justia Law
Power Authority of the State of New York v. M/V Ellen S. Bouchard
The Authority appealed the district court's grant of summary judgment to defendants, two vessels and their corporate owners, in an action brought under the federal Oil Pollution Act (OPA) and state law. The claims arose from the release of thousands of gallons of oil from a submarine power-transmission cable into Long Island Sound, which the Authority alleges was caused by the defendant vessels dropping anchor.The Second Circuit vacated the district court's order and held that the submarine cable is indeed "used for" one of the enumerated "purposes" in the OPA's definition of "facility." Consequently, the panel found that the cable system is used for at least one of the enumerated purposes in the statute. Therefore, the district court erred in dismissing the Authority's OPA claims and in concluding that the Authority's New York Oil Spill Law claims had to be brought in the parallel proceeding on that basis. The court remanded for further proceedings. View "Power Authority of the State of New York v. M/V Ellen S. Bouchard" on Justia Law
Atlantic Specialty Insurance Co. v. Coastal Environmental Group Inc.
Atlantic sought a declaratory judgment that the insurance policy it had issued to Coastal was void ab initio or, in the alternative, that there was no coverage for the loss of the barge or damage to an adjacent pier. District Court Judge Wexler passed away prior to issuing his findings of fact and conclusions of law. The case was transferred to Judge Azrack, who, after no party requested the recall of any witness under Federal Rule of Civil Procedure 63, issued findings of fact and conclusions of law in her role as successor judge and entered judgment finding Atlantic liable to Coastal under the terms of the policy.Under Federal Rule of Civil Procedure 52(a)(6), factual findings of successor judges who have certified their familiarity with the record are subject to the "clearly erroneous" standard of review. The Second Circuit also held that, under Federal Rule of Civil Procedure 63, a successor judge is under no independent obligation to recall witnesses unless requested by one of the parties. In this case, the court found no reversible error in Judge Azrack's findings of fact and conclusions of law, including findings that Coastal did not breach its duty of uberrimae fidei, and thus the policy was not void; Atlantic failed to prove that the vessel was unseaworthy; the loss of the vessel was due to a "peril of the sea" and was covered by the policy; Coastal was entitled to damages for contractual payments withheld by its contractor for repairs to a pier; and Coastal proved its damages using only a summary spreadsheet of invoices, as evidence. View "Atlantic Specialty Insurance Co. v. Coastal Environmental Group Inc." on Justia Law
United States v. Van Der End
The Second Circuit affirmed defendant's conviction for engaging in drug trafficking activity, and conspiring to do so, in violation of the Maritime Drug Law Enforcement Act. The court held that defendant waived his Confrontation Clause and jury trial right challenges to his conviction by pleading guilty.The court also held that the Due Process Clause did not require a nexus between the United States and the MDLEA violations that transpire on a vessel without nationality. The court explained that such prosecutions are not arbitrary, since any nation may exercise jurisdiction over stateless vessels, and they are not unfair, since persons who traffic drugs may be charged with knowledge that such activity is illegal and may be prosecuted somewhere. The court considered defendant's remaining arguments and found them meritless. View "United States v. Van Der End" on Justia Law
United States v. Prado
Defendants pleaded guilty to conspiracy to distribute cocaine, and to possess cocaine with intent to distribute, while on board a stateless vessel subject to the jurisdiction of the United States, in violation of the Maritime Drug Law Enforcement Act, 46 U.S.C. 70501 et seq.The Second Circuit dismissed the indictment, because the government failed to demonstrate, as required by section 70504, that the vessel was subject to the jurisdiction of the United States. In this case, the indictment should have been dismissed upon the government's failure to demonstrate at the pretrial hearing that the vessel was subject to the jurisdiction of the United States. Furthermore, the error was not cured by defendants' subsequent defective guilty pleas. Accordingly, the court vacated the convictions. View "United States v. Prado" on Justia Law
Clearlake Shipping PTE Ltd. v. NuStar Energy Services, Inc.
An interpleader defendant, NuStar, appealed the district court's partial final judgment rejecting its claims of entitlement to maritime liens against two chartered vessels. The district court ruled that NuStar was not entitled to maritime liens under the Commercial Instruments and Maritime Liens Act (CIMLA).The Second Circuit affirmed and held that the district court did not err in interpreting the CIMLA or ruling that maritime liens may not properly be granted based on principles of equity. The court held that NuStar's contentions as to the proper interpretation of the CIMLA was foreclosed by the court's recent decision in ING Bank N.V. v. M/V TEMARA, 892 F.3d 511 (2d Cir. 2018). Furthermore, the district court did not err by concluding that the exception to the general rule against a subcontractor's entitlement to a maritime lien did not apply to NuStar. View "Clearlake Shipping PTE Ltd. v. NuStar Energy Services, Inc." on Justia Law
U.S. Oil Trading LLC v. M/V VIENNA EXPRESS
USOT appealed the district court's orders and partial final judgments rejecting USOT's claims that it was entitled to assert maritime liens against vessels owned or chartered by Hapag. The district court ruled that USOT's claims were governed by the Commercial Instruments and Maritime Liens Act and that physical suppliers who were subcontractors were not entitled to maritime liens.The Second Circuit affirmed the district court's judgment insofar as it concluded that USOT did not adduce evidence that it was ordered to provide the bunkers by Hapag or by an agent authorized by Hapag to order bunkers; affirmed the district court's conclusion that maritime liens cannot properly be conferred on the basis of equitable principles such as unjust enrichment; and vacated and remanded the district court judgment on the issue of whether Hapag directed that USOT be the physical supplier pursuant to the exception to the subcontractor rule. View "U.S. Oil Trading LLC v. M/V VIENNA EXPRESS" on Justia Law
Leopard Marine & Trading, Ltd. v. Easy Street Ltd.
Leopard Marine sought a declaratory judgment that a maritime lien held by Easy Street, a Cypriot fuel supply company, has been extinguished by laches. The Second Circuit affirmed the district court's decision to decline to abstain on grounds of international comity and issued a declaration that laches barred exercise of the lien. The court held that the federal courts have jurisdiction to declare a maritime lien unenforceable, even where the vessel was not present in the district, so long as its owner consents to adjudication of rights in the lien. In this case, the court held that abstention on the basis of international comity was not required and thus the district court did not abuse its discretion in ruling that laches barred exercise of the lien. View "Leopard Marine & Trading, Ltd. v. Easy Street Ltd." on Justia Law