United States District Court, E.D. Louisiana
IN RE TK BOAT RENTALS, LLC as owner and operator of the M/V MISS IDA, for exoneration from or limitation of liability.
SECTION
“R” (4)
ORDER AND REASONS
SARAH
S. VANCE UNITED STATES DISTRICT JUDGE.
Before
the Court are two motions for partial summary judgment. Troy
Wetzel and Extreme Fishing, LLC move for summary judgment as
to Wetzel's individual liability.[1] TK Boat Rentals, LLC moves
for summary judgment with regard to Andre Boudreau's
status as an employee or an independent
contractor.[2] For the following reasons, the Court
grants summary judgment as to Wetzel's individual
liability. The Court denies summary judgment on the
independent contractor issue.
I.
BACKGROUND
This
consolidated action arises out of a boat collision on
February 12, 2017.[3] Plaintiffs Tracy Edwards, Charles
“Nick” Siria, Justin McCarthy, Michael Harrell,
Patrick Beck, and Beck's minor son, C.D.B., allegedly
entered into an agreement with Defendants Troy Wetzel and
Extreme Fishing to charter a vessel for a fishing
trip.[4] According to plaintiffs, Wetzel or someone
acting on his behalf then entered into an agreement with
Defendant Chase St. Clair to use one of St. Clair's
vessels for the fishing trip.[5]
On
February 12, 2017, plaintiffs departed as passengers on the
M/V SUPER STRIKE, a fishing vessel owned by St. Clair and
operated by Defendant Andre Boudreau.[6] The M/V SUPER STRIKE, with
plaintiffs aboard, was crossing the Mississippi River when it
collided with the M/V MISS IDA, a vessel owned by Defendant
TK Boat Rentals.[7] Plaintiffs allegedly suffered physical and
emotional injuries as a result of the accident.[8]On March 24, 2017,
plaintiffs filed suit for damages against multiple
defendants, including Wetzel in his individual
capacity.[9]
The
owners of the M/V MISS IDA and of the M/V SUPER STRIKE each
filed limitation of liability actions relating to the
February 12, 2017 collision.[10] Plaintiffs filed claims in
these limitation actions.[11] TK Boat Rentals filed a
cross-claim against the other defendants, including Wetzel
and Extreme Fishing.[12] The two limitation actions and
plaintiffs' suit for damages were consolidated in this
action.[13]
Wetzel
and Extreme Fishing now move for summary judgment as to
Wetzel's individual liability.[14] TK Boat Rentals moves for
summary judgment as to Boudreau's status as an employee
of Wetzel and Extreme Fishing.[15]
II.
LEGAL 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) (internal
citation omitted). 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 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)).
III.
DISCUSSION
A.
Wetzel's Individual Liability
Wetzel
is the sole member of a limited liability company, Extreme
Fishing LLC.[16] Wetzel testified that the business of
Extreme Fishing is to organize charter fishing trips out of
Venice, Louisiana.[17] Wetzel further testified that he
personally owns three vessels, and he leases them to Extreme
Fishing under a written lease agreement.[18] Extreme
Fishing does not own any property, but it has a bank
account.[19] Wetzel argues that he has no personal
liability in this matter because plaintiffs arranged their
fishing trip with Extreme Fishing, not with Wetzel in his
individual capacity.[20]
Plaintiffs
contend that Wetzel can be held personally liable as the
alter ego of Extreme Fishing.[21] Plaintiffs assert that Extreme
Fishing's fleet of vessels is owned by Wetzel in his
individual capacity, that the insurance on these vessels is
in Wetzel's name, and that Extreme Fishing may not have
sufficient funds to cover plaintiffs' injuries in the
absence of these insurance policies.[22] Plaintiffs further note
that Wetzel often captains the fishing vessels himself, and
he has sole discretion to contract with other captains and to
charter the vessels to third parties.[23] TK Boat
Rentals adopts plaintiffs' arguments in opposition to
summary judgment.[24]
The
parties dispute the applicable legal standard. Because the
Court exercises admiralty jurisdiction over this matter,
general maritime law applies. See East River S.S. Corp.
v. Transamerica Delaval, Inc., 476 U.S. 858, 864 (1986).
But the “Fifth Circuit has repeatedly declined to
address whether, as a matter of federal common law, courts in
this Circuit should apply federal or state law when
adjudicating a veil piercing claim.” Port of South
La. v. Tri-Parish Indus., Inc., No. 11-3065, 2013 WL
2394859, at *3 (E.D. La. 2013); see also In re Sims,
994 F.2d 210, 218 n.11 (5th Cir. 1993) (finding it
unnecessary to decide whether state law or a uniform federal
alter ego rule applies); United States v. Jon-T
Chemicals, Inc., 768 F.2d 686, 690 n.6 (5th Cir. 1985)
(“Our non-diversity alter ego cases have rarely stated
whether they were applying a federal or state standard, and
have cited federal and state cases interchangeably”).
The
Court need not decide whether federal or state law provides
the rule of decision on the alter ego issue because
plaintiffs fall far short of demonstrating the exceptional
circumstances required to pierce the corporate veil under
either federal or Louisiana law. See Bridas S.A.P.I.C. v.
Gov't of Turkmenistan, 447 F.3d 411, 416 (5th Cir.
2006); Ogea v. Merritt, 130 So.3d 888, 895 n.4 (La.
2013). It is well established that sole ownership of a
company “does not alone show an alter ego
relationship.” In reMultiponics,
Inc., 622 F.2d 709, 725 (5th Cir. 1980). Applying
federal common law, the Fifth Circuit has explained that the
alter ego doctrine “applies only if (1) the owner
exercised complete control over the corporation with respect
to the ...