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Kennedy v. Braskem America, Inc.

United States District Court, E.D. Louisiana

August 7, 2019

DANIEL KENNEDY, ET AL.
v.
BRASKEM AMERICA, INC., ET AL.

         SECTION "F"

          ORDER AND REASONS

          MARTIN (L C. FELDMAN UNITED STATES DISTRICT JUDGE

         Before the Court is the defendants' motion for summary judgment invoking an immunity defense under the Texas Workers' Compensation Act. For the reasons that follow, the motion is DENIED without prejudice.

         Background

         This lawsuit arises from a construction worker's claim that he was severely injured after being struck by a large piece of mud which caused him to fall. Daniel Kennedy, who lives in Mississippi, alleges that he was injured on December 2, 2017 while working on a construction site at a petrochemical facility, located in LaPorte, Texas. The site and facility are owned by Braskem America, Inc., which is incorporated in Delaware with its principal place of business in Pennsylvania. At the time of the incident, Linde Engineering North America, Inc., which is incorporated in Delaware with its principal place of business in Oklahoma, was the contractor on the project involving engineering, procuring, and constructing a polypropylene plant for Braskem. Kennedy worked on the site as an employee of an alleged project subcontractor, Cajun Deep Foundations, LLC.

         On June 1, 2017, Braskem contracted with LENA to act as the general contractor on the project. Several months later, the original Engineering, Procurement, and Construction Contract (EPC Contract), which is governed by Texas law, was amended on October 1, 2017. The amendment deleted the parties' prior agreement on insurance, and replaced it with an Owner Controlled Insurance Program (the “OCIP”). By the OCIP, Braskem provided workers' compensation insurance coverage for LENA, all tiers of subcontractors enrolled in the OCIP, and their employees for on-site work on the project. Article 18.1.1 of the Amended EPC Contract provides:

Owner has arranged for the Work to be performed under this Contract to be insured under its OCIP Program. The OCIP is an insurance program that insures Owner eligible and enrolled Contractor and its Subcontractors, and other Owner-designated parties for Work performed at the covered Project Site. Certain contractor and subcontractors are excluded from this OCIP and these parties are identified in Exhibit C-11, Schedule 001. Coverage under the OCIP includes Workers Compensation and Employers Liability, General Liability and Umbrella Liability (excluding automobile, rental equipment (owned or third party), aircraft, watercraft, professional, and environmental liability) and apply only to the operations of Contractor and its Subcontractor of any tier conducted at or emanating from the specified Project Site. Such OCIP insurance does not apply to manufacturing, fabrication, or other operations at Contractor's regular offsite main or branch office, warehouse, or similar places of business. Contractor shall enroll in OCIP provided by Owner. The provisions of this Article 18.1.1 shall apply to Contractor and any Subcontractors of any tier to the extent enrolled in and covered by the OCIP unless otherwise agreed upon by the Parties. It is the responsibility of the Contractor acting as Owner's Construction Manager and Prime Contractor to include the OCIP requirements in all subcontracts and to insure that any lower tier contracts include the OCIP requirements.

         (emphasis added). Liberty Mutual was the insurance carrier for the workers' compensation coverage provided under the OCIP.

         Shortly after Braskem established the OCIP, on October 17, 2017, Cajun Constructors, LLC, allegedly one of the subcontractors on the project, enrolled in the OCIP. On November 13, 2017, Liberty Mutual issued to LENA Policy Number WA2-65D-292072-037, which is governed by Texas Workers' Compensation law, providing LENA with workers' compensation coverage insurance from October 1, 2017 to April 30, 2020. Also, on November 13, 2017, Liberty Mutual issued to Cajun Constructors, LLC, Policy Number WA2-65D-292072-047 (the “Cajun Constructors Policy”) providing Cajun Constructors with workers' compensation coverage from October 17, 2017 to April 30, 2020.

         On December 2, 2017, it is alleged that a large piece of mud fell onto Kennedy's head while he was working for Cajun Deep at the project site. As a result, he fell to the ground, injuring his head, neck, thoracic and lumbar spine, ankle, and knee.

         Five days after the incident, on December 7, 2017, a claim was submitted to Liberty Mutual under the Cajun Constructors Policy in connection with Kennedy's alleged injury. In processing Kennedy's claim, it was discovered that Cajun Deep was not enrolled in the OCIP. Nevertheless, Liberty Mutual agreed to provide coverage under the Cajun Constructors Policy.[1] Liberty Mutual insured Cajun Deep under the Cajun Constructors Policy, effective November 20, 2017, which is allegedly the date on which Cajun Deep became a subcontractor on the project.[2]

         On November 5, 2018, Kennedy filed a “disputed claim” for workers' compensation in Louisiana.[3] Three weeks later, on November 21, 2018, Kennedy filed an Employee's Claim for Compensation for a Work-Related Injury or Occupational Disease with the Texas Department of Insurance, Division of Workers' Compensation. On November 30, 2018, Kennedy and his wife, Brandi Smith, sued Braskem America, Inc. and Linde Engineering North America, Inc. in this Court, alleging negligence and premises liability. The defendants now move for summary judgment that they are immune from suit.

         I.

         Federal Rule of Civil Procedure 56 instructs that summary judgment is proper if the record discloses no genuine dispute as to any material fact such that the moving party is entitled to judgment as a matter of law. 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. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). A genuine dispute of fact exists only "if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

         The Court emphasizes that the mere argued existence of a factual dispute does not defeat an otherwise properly supported motion. See id. Therefore, "[i]f the evidence is merely colorable, or is not significantly probative," summary judgment is appropriate. Id. at 249-50 (citations omitted). Summary judgment is also proper if the party opposing the motion fails to establish an essential element of his case. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). In this regard, the non-moving party must do more than simply deny the allegations raised by the moving party. See Donaghey v. Ocean Drilling & Exploration Co., 974 F.2d 646, 649 (5th Cir. 1992). Rather, he must come forward with competent evidence, such as affidavits or depositions, to buttress his claims. Id. Hearsay evidence and unsworn documents that cannot be presented in a form that would be admissible in evidence at trial do not qualify as competent opposing evidence. Martin v. John W. Stone Oil Distrib., Inc., 819 F.2d 547, 549 (5th Cir. 1987); Fed.R.Civ.P. 56(c)(2). "[T]he nonmoving party cannot defeat summary judgment with conclusory allegations, unsubstantiated assertions, or only a scintilla of evidence." Hathaway v. Bazany, 507 F.3d 312, 319 (5th Cir. 2007)(internal quotation marks and citation omitted). In deciding whether a fact issue exists, courts must view the facts and draw reasonable inferences in the light most favorable to the nonmoving party. Scott v. Harris, 550 U.S. 372, 378 (2007). Although the Court must "resolve factual controversies in favor of the nonmoving party," it must do so "only where there is an actual controversy, that is, when both parties have submitted evidence of contradictory facts." Antoine v. First Student, Inc., 713 F.3d 824, 830 (5th Cir. 2013)(internal quotation marks and citation omitted).

         II.

         A. “A federal court sitting in diversity jurisdiction must apply the choice of law rules of the forum state when a conflict of law exists.” Burdett v. Remington Arms Co., L.L.C., 854 F.3d 733, 735 (5th Cir. 2017) (quoting Ingalls Shipbuilding v. Federal Ins. Co., 410 F.3d 214, 230 (5th Cir. 2005)).[4] Neither side identifies an actual conflict between Texas and Louisiana law. Nevertheless, the defendants' motion is predicated on Texas law, the only ...


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