Supreme Court Declares Punitive Damages Available for Maintenance and Cure Claim*
Michael Orlando | September 12, 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.
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 case law 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.)
The author would like to thank and acknowledge the contributions to this Commentary by Michael A. Orlando Jr., an attorney with Meyer Orlando LLC in Houston.
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