Supreme Court Declares Punitive Damages Available for Maintenance
and Cure Claim
September 2009
In a 5 to 4 decision, the U.S.
Supreme Court affirmed an Eleventh Circuit holding that, as a matter
of general maritime law, punitive damages are available for the
willful and wanton withholding of maintenance and cure. Most courts
had held such damages were not available after the
Miles v. Apex Marine Corp., 498 U.S.
19 (1990) decision. Thus, this is a major shift in maritime law.
by
Michael A. Orlando
Meyer Orlando LLC
The Court's opinion does not address a number of other major
areas that will not be brought into consideration.
The Holding
The decision in Atlantic Sounding v.
Townsend, 129 S. Ct. 2561 (2009), operates on three premises.
First, punitive damages have long been available at common law as
a remedy for wanton, willful, or outrageous conduct. Second, the
general rule that punitive damages were available at common law
extends to claims arising under federal maritime law. Finally, nothing
in the Jones Act or general maritime law undermines the applicability
of the general punitive damages rule in the maintenance and cure
context.
The Court quickly established the first two premises using 18th
and early 19th century caselaw to show that punitive damages were
available for tortious actions, and 18th and 19th century admiralty
courts applied this remedy. The Court makes its final decision based
on the fact that no Congressional action, specifically the Jones
Act, has been taken to remove the common law award of punitive damages
from the list of available maritime remedies.
The Court states that the Jones Act is the only statute that
could serve as a basis for overturning the common law punitive damages
rule. While the Jones Act created a statutory cause of action for
employer negligence, it did not eliminate
preexisting remedies available to seamen for the separate common-law
cause of action based on a seaman's right to maintenance and cure.
By not eliminating previous causes of action, the Jones Act allows
plaintiffs the option of choosing which claims he or she will bring
against the employer. Essentially, Congress has done nothing in
the years following the Jones Act to limit its scope, or the scope
of general maritime claims for maintenance and cure. The Court reads
the Jones Act as enlarging the protection afforded to seamen, not
narrowing it, and concludes that there is no language in the Jones
Act barring the recovery of punitive damages for a general maritime
maintenance and cure claim.
Distinguishing Miles v. Apex
The Court distinguished this holding from its holding in
Miles v. Apex Marine Corp. In
Miles, the Court found that general
maritime law supported a cause of action for wrongful death due
to unseaworthiness. In Miles, the
Court also limited plaintiff's remedies to those outlined in the
Jones Act and the Death on the High Seas Act. The Court limited
those remedies because it reasoned that Congress had already pervasively
limited recovery of wrongful death claims at sea (in the language
of the Jones Act and Death on the High Seas Act), and the Court
was not going to add to an already legislated area. The
Atlantic Sounding decision distinguishes
the two cases by holding that Congress has not made any rules limiting
maintenance and cure claims, as opposed to the above-stated limits
on wrongful death claims. Because Congress has not acted in the
area of maintenance and cure limits, and because the Jones Act does
not address maintenance and cure or its remedy, the Court felt that
the old common law punitive damage remedy was still in place.
The Court concludes by stating that punitive damages have long
been an accepted remedy under general maritime law, and nothing
in the Jones Act alters this understanding, so plaintiff seamen
have the right to choose a punitive damages remedy for wanton and
willful disregard of the maintenance and cure obligation.
In the few months that Atlantic Sounding
has been on the books, only one federal district court has cited
it. See
In re Md. Marine, Inc., 2009 U.S.
Dist. LEXIS 58957 (E.D. La. July 9, 2009). This district court merely
acknowledged the Atlantic Sounding
holding, as opposed to actually applying it. No circuit court of
appeals has applied, or even cited, this case as of yet.
Unanswered Questions
The next battlefield will surely be whether punitive damages
will be an available remedy in a general maritime law claim for
unseaworthiness when it is merely a personal injury as opposed to
a death claim. While it is doubtful that such a remedy would be
available in a death claim subject to the Death on the High Seas
Act, one can easily see the plaintiffs' bar lining up the next case
to argue that it could be available in a personal injury matter.
The defense bar will take the position that as punitive damages
are not allowed under the Jones Act, and the unseaworthiness cause
of action overlaps the Jones Act action, it would be incongruous
to fashion a more expansive remedy than the federal statute itself
allows.
Just as importantly, the Atlantic Sounding
decision does not address at what ratio punitives-to-compensatory
damages might be allowed, nor was the question of insurance coverage
for punitive damages raised. For nearly 2 decades, most of the maritime
bar considered the issue of punitive damages under maritime law
to be a settled. That is no longer the case.
(The author gratefully acknowledges the assistance of his son,
Mike A. Orlando Jr., who is a newly minted attorney awaiting his
bar results.)
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