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Rockin "D" Marine Services, LLC v. M/V Sea Endeavor

United States District Court, E.D. Louisiana

September 19, 2017


         SECTION “R” (4)



         Before the Court is plaintiff Rockin “D” Marine Services, LLC's motion for summary judgment on intervenor Allied Shipyard, Inc.'s claims against defendant M/V SEA ENDEAVOR.[1] For the following reasons, the Court grants plaintiff's motion.

         I. BACKGROUND

         Plaintiff and Allied Shipyard both have maritime liens against the M/V SEA ENDEAVOR. On September 15, 2014, Sea Endeavor, LLC executed a mortgage on the M/V SEA ENDEAVOR in the amount of $1, 500, 000 in favor of plaintiff.[2] Plaintiff filed this mortgage at the U.S. Coast Guard National Vessel Documentation Center on March 11, 2015.[3] A balance of $982, 347.11 remains unpaid on the mortgage.[4]

         Allied Shipyard provided materials, repair services, and machinery in the amount of $172, 411.56 to the M/V SEA ENDEAVOR.[5] Allied Shipyard filed a notice of claim of lien for these services on February 24, 2016.[6]According to that notice, the lien was established on December 16, 2015.[7] A balance of $118, 711.56 remains unpaid for Allied Shipyard's services.[8]

         On February 9, 2017, plaintiff filed this action to foreclose on its ship mortgage. The U.S. Marshals Service seized the vessel on February 13, 2017, pursuant to this Court's order.[9] Allied Shipyard then intervened to assert its maritime lien against the M/V SEA ENDEAVOR.[10] The Court granted plaintiff's motion to enter default against anyone who failed to appear and file a claim against the vessel, and directed the Marshals Service to sell the vessel at public auction.[11] After several auctions with no bids above the minimum starting bid, plaintiff purchased the vessel for $10, 000 on August 7, 2017.[12] The Court confirmed this sale on August 11.[13]

         Plaintiff now moves for summary judgment on Allied Shipyard's claims against the M/V SEA ENDEAVOR.[14] Allied Shipyard does not oppose plaintiff's motion. No other parties have come forth with competing claims.

         II. STANDARD

         Summary judgment is warranted when “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994). When assessing whether a dispute as to any material fact exists, the Court considers “all of the evidence in the record but refrain[s] from making credibility determinations or weighing the evidence.” Delta & Pine Land Co. v. Nationwide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 2008). All reasonable inferences are drawn in favor of the nonmoving party, but “unsupported allegations or affidavits setting forth ‘ultimate or conclusory facts and conclusions of law' are insufficient to either support or defeat a motion for summary judgment.” Galindo v. Precision Am. Corp., 754 F.2d 1212, 1216 (5th Cir. 1985); see also Little, 37 F.3d at 1075. “No genuine dispute of fact exists if the record taken as a whole could not lead a rational trier of fact to find for the non-moving party.” EEOC v. Simbaki, Ltd., 767 F.3d 475, 481 (5th Cir. 2014).

         If the dispositive issue is one on which the moving party will bear the burden of proof at trial, the moving party “must come forward with evidence which would entitle it to a directed verdict if the evidence went uncontroverted at trial.” Int'l Shortstop, Inc. v. Rally's, Inc., 939 F.2d 1257, 1264-65 (5th Cir. 1991). The nonmoving party can then defeat the motion by either countering with evidence sufficient to demonstrate the existence of a genuine dispute of material fact, or “showing that the moving party's evidence is so sheer that it may not persuade the reasonable fact-finder to return a verdict in favor of the moving party.” Id. at 1265.

         If the dispositive issue is one on which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by merely pointing out that the evidence in the record is insufficient with respect to an essential element of the nonmoving party's claim. See Celotex, 477 U.S. at 325. The burden then shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. See id. at 324. The nonmovant may not rest upon the pleadings, but must identify specific facts that establish a genuine issue for trial. See, e.g., id.; Little, 37 F.3d at 1075 (“Rule 56 mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.” (quoting Celotex, 477 U.S. at 322)).


         The Ship Mortgage Act, 46 U.S.C. § 31301, et seq., governs the priority of the claims asserted here. Specifically, when a vessel is sold at a judicial sale, all claims against the vessel are terminated and subsequently attach to the proceeds of the sale. When, as in this case, a “preferred ship mortgage” is asserted, the order of priorities is the following: (1) expenses of justice; (2) preferred maritime liens; (3) the preferred mortgage; and (4) other maritime liens. See 46 U.S.C. § 31326; Thomas J. Schoenbaum, Admiralty and Maritime Law § 9-6 (5th ed. 2011); see also Governor and Co. of Bank of Scotland v. Sabay, 211 F.3d 261, 270 (5th Cir. 2000) (“A preferred ship mortgage ‘has priority over all claims against the vessel (except for expenses and fees allowed by the court, costs imposed by the court, and preferred maritime liens).'” (quoting 46 U.S.C. § 31326(b)(1))). Under the statute, a “preferred maritime lien” is defined as a “maritime lien on a vessel (A) arising before a preferred ...

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