Mardi Gras World, L.L.C. et al v. Marquette Transportation Company Gulf-Inland, LLC et al, No. 2:2018cv04745 - Document 50 (E.D. La. 2019)
Court Description: ORDER AND REASONS denying 32 Motion for Partial Summary Judgment. Signed by Judge Sarah S. Vance on 9/11/2019. (Reference: All Cases)(mm)
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Mardi Gras World, L.L.C. et al v. Marquette Transportation Company Gulf-Inland, LLC et al Doc. 50 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA MARDI GRAS WORLD, LLC, ET AL. VERSUS CIVIL ACTION NO. 18-4745 C/ W 18-5579 MARQUETTE TRANSPORTATION CO., ET AL. SECTION “R” (2) ORD ER AN D REASON S Before the Court is the m otion for partial sum m ary judgm ent from defendants Marquette Transportation Com pany Gulf-Inland, LLC, and Marquette Transportation Com pany, LLC (collectively, “Marquette”), on the claim s for econom ic loss dam ages from plaintiff Mardi Gras World, LLC (“Mardi Gras World”). 1 Because Mardi Gras World has a proprietary interest in the dam aged property, the defendants’ m otion is denied. I. BACKGROU N D This case arises from an allision on the Mississippi River. 2 On May 7, 20 18, the M/ V STEVE RICHOUX, the defendants’ towing vessel, allided with 1 2 R. Doc. 32 (Case No. 18-4745). See R. Doc. 1 at 3 ¶ 11 (Case No. 18-4745). Dockets.Justia.com the Robin Street Wharf on the Mississippi River’s left descending bank. 3 The m unicipal address for the wharf is 1380 Port of New Orleans Place, 4 and it is owned by the Board of Com m issioners for the Port of New Orleans (“the Board”). 5 Mardi Gras World did not actually own any physical property dam aged in the allision. 6 Rather, Mardi Gras World leases the Robin Street Wharf from the Board, 7 along with adjacent property from the Board and other lessors. 8 The parties entered into the lease in 20 0 8 9 and can extend it through 20 32. 10 The agreem ent provides Mardi Gras World with an interest in a large area of property along the Mississippi River. The lease includes the Robin Street Wharf, which covers approximately 125,0 0 0 square feet of interior space, including “built out office and shop space,” and approxim ately 25,0 0 0 square feet of exterior space “and underlying wharf substructure.”11 The leased prem ises also include approxim ately 270 ,0 0 0 square feet of the 3 R. Doc. 32-3 at 1 ¶ 1 (Case No. 18-4745). Mardi Gras World does not contest Marquette’s statem ent of facts. See R. Doc. 41 at 4 (Case No. 184745). 4 R. Doc. 32-3 at 1 ¶ 1 (Case No. 18 -4745). 5 Id. at 1 ¶ 2. 6 Id. at 2 ¶ 4. 7 Id. at 2 ¶ 3. 8 See, e.g., R. Doc. 32-6 at 27, 66-67 (Case No. 18-4745). 9 See id. at 51-52. 10 See id. at 15 ¶ 3(B). 11 See id. at 13 ¶ (c)1(A)(i). 2 Orange Street Wharf, 12 and over five acres of land next to the wharves. 13 Mardi Gras World can use these prem ises for a “Mardi Gras Museum, exhibition, office, catering, and m eeting facility(ies),” as well for “m inor construction . . . related to artistic and creative activities.”14 But it m ust m ake im provem ents to these prem ises, which “shall become the property of the Board.”15 It also m ust pay taxes associated with the property. 16 It m ust m aintain property insurance at its “sole cost and expense . . . in favor of Lessors.”17 And it m ust “at its own cost, risk and expense . . . repair, replace, or restore any and all of the Leased Prem ises which m ay becom e the subject of loss, dam age or destruction.”18 Following the dam age to these lease prem ises, Mardi Gras World 19 filed this action against Marquette. 20 Mardi Gras World alleges that the 12 See id. at 13-14 ¶ (c)1(A)(ii). See id. at 14 ¶ (c)1(B), 75-78. 14 R. Doc. 32-6 at 31 ¶ 5(A) (Case No. 18-4745). 15 Id. at 40 ¶ 12(D). 16 Id. at 45 ¶ 24. 17 Id. at 37 ¶ 10 (E)(i). 18 Id. at 34 ¶ 9(B). 19 This com plaint also included as plaintiffs Blaine Kern’s Mardi Gras World, Inc.; New Orleans Hotel Collection, L.L.C.; and Blaine Kern Artists, Inc. See R. Doc. 1 at 1 (Case No. 18-4745). Both Blaine Kern’s Mardi Gras World, Inc., and New Orleans Hotel Collection, L.L.C., have since voluntarily dism issed their claim s. See R. Doc. 30 (Case No. 18-4745); R. Doc. 31 (Case No. 18-4745). Marquette does not assert the instant m otion against Blaine Kern Artists, Inc. See R. Doc. 32-1 at 1 n.1 (Case No. 18-4745). 20 R. Doc. 1 (Case No. 18-4745). 3 13 incident caused “increased and additional expenses, structural dam age, property damage, delayed production, lost production, increased overhead, interruption of business, stigm a, dam aged reputation, loss of use, lost profits, repair costs, and other physical and econom ic dam ages not yet realized.”21 Marquette subsequently filed a lim itation com plaint, 22 and the two com plaints were consolidated. 23 AGCS Marine Insurance Company, Mardi Gras World’s insurer, and the Board have separately intervened as claim ants. 24 Marquette now m oves for partial summ ary judgm ent on Mardi Gras World’s claims for econom ic dam ages. 25 Mardi Gras World opposes the m otion. 26 II. LEGAL STAN D ARD Sum m ary judgment is warranted when “the m ovant shows that there is no genuine dispute as to any m aterial fact and the m ovant is entitled to judgm ent as a m atter of law.” Fed. R. Civ. P. 56(a); see also Celotex Corp. v. 21 22 23 24 25 26 Id. at 3 ¶ 12. R. Doc. 1 (Case No. 18-5579). R. Doc. 5 (Case No. 18-4745); R. Doc. 4 (Case No. 18 -5579). See R. Doc. 8 (Case No. 18-4745); R. Doc. 21 (Case No. 18 -4745). R. Doc. 32 (Case No. 18-4745). R. Doc. 41 (Case No. 18-4745). 4 Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 10 69, 10 75 (5th Cir. 1994) (en banc) (per curiam ). “When assessing whether a dispute to any m aterial fact exists, [the Court] consider[s] all of the evidence in the record but refrain[s] from m aking credibility determ inations or weighing the evidence.” Delta & Pine Land Co. v. N ationw ide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 20 0 8). All reasonable inferences are drawn in favor of the nonm oving party, but “unsupported allegations or affidavits setting forth ‘ultim ate or conclusory facts and conclusions of law’ are insufficient to either support or defeat a m otion for summ ary judgm ent.” Galindo v. Precision Am . Corp., 754 F.2d 1212, 1216 (5th Cir. 1985) (quoting 10 A Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 2738 (2d ed. 1983)); see also Little, 37 F.3d at 10 75. “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 nonm oving party.” EEOC v. Sim baki, Ltd., 767 F.3d 475, 481 (5th Cir. 20 14). If the dispositive issue is one on which the m oving party will bear the burden of proof at trial, the m oving party “m ust 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) (quoting Golden Rule Ins. Co. v. Lease, 755 F. Supp. 5 948, 951 (D. Colo. 1991)). “[T]he nonmoving party can defeat the m otion” by either countering with evidence sufficient to dem onstrate the “existence of a genuine dispute of m aterial fact,” or by “showing that the m oving party’s evidence is so sheer that it m ay not persuade the reasonable fact-finder to return a verdict in favor of the m oving party.” Id. at 1265. If the dispositive issue is one on which the nonm oving party will bear the burden of proof at trial, the m oving party m ay satisfy its burden by pointing out that the evidence in the record is insufficient with respect to an essential element of the nonm oving party’s claim . See Celotex, 477 U.S. at 325. The burden then shifts to the nonm oving party, who m ust, by subm itting or referring to evidence, set out specific facts showing that a genuine issue exists. See id. at 324. The nonm ovant m ay not rest upon the pleadings, but m ust identify specific facts that establish a genuine issue for resolution. See, e.g., id.; Little, 37 F.3d at 10 75 (“Rule 56 ‘m andates the entry of sum m ary judgment, after adequate tim e for discovery and upon m otion, against a party who fails to m ake a showing sufficient to establish the existence of an elem ent 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 (em phasis added))). 6 III. D ISCU SSION Marquette argues that, pursuant to Robins Dry Dock & Repair Co. v. Flint, 275 U.S. 30 3 (1927), Mardi Gras World cannot recover econom ic dam ages. 27 In Robins Dry Dock, the Supreme Court stated a rule lim iting tort liability: “[N]o authority need be cited to show that, as a general rule, at least, a tort to the person or property of one m an does not m ake the tortfeasor liable to another merely because the injured person was under a contract with that other unknown to the doer of the wrong.” 275 U.S. at 30 9. The Fifth Circuit has “interpreted Robins Dry Dock to m ean that there can be no recovery for econom ic losses caused by an unintentional m aritim e tort absent physical dam age to property in which the victim has a proprietary interest.” Am oco Transp. Co. v. S/ S MASON LYKES, 768 F.2d 659, 666 (5th Cir. 1985). 28 Here, Mardi Gras World seeks to recover, am ong other things, econom ic losses caused by an unintentional m aritim e tort. 29 To proceed, therefore, Mardi Gras World m ust have suffered (a) “physical dam age” to (b) 27 See, e.g., R. Doc. 32-1 at 13 (Case No. 18-4745). According to the Fifth Circuit, this rule serves as a “pragm atic lim itation im posed by the Court upon the tort doctrine of foreseeability.” State of La. ex rel. Guste v. M/ V TESTBAN K, 752 F.2d 10 19, 10 23 (5th Cir. 1985) (en banc). That is, under Robins Dry Dock, a harm m ay be foreseeable but nevertheless not cognizable. 29 See R. Doc. 1 at 3 ¶ 12 (Case No. 18-4745). 7 28 property in which it has a “proprietary interest.” The parties do not dispute that physical damage occurred. 30 The wharf that suffered physical damage, though, was owned by the Board and leased to Mardi Gras World. 31 At issue, therefore, is whether Mardi Gras World had a “proprietary interest” in this wharf. The Court finds that Mardi Gras World’s leasehold constitutes a sufficient proprietary interest to allow it to seek recovery under Robins Dry Dock for econom ic loss. A. Mard i Gras W o rld ’s “Pro p rie tary In te re s t” U n d e r Its Le as e A plaintiff need not own property outright to have a “proprietary interest” in it. See State of Veracruz v. BP, P.L.C. (In re Deepw ater Horizon), 784 F.3d 10 19, 10 26 (5th Cir. 20 15) (“The Robins Dry Dock Court itself, however, intim ated that something perhaps just shy of outright ownership m ight suffice to show the requisite proprietary interest.”). If the plaintiff is not the actual owner of the property, though, he m ust be “‘tantam ount’ to an owner” to recover. Plains Pipeline, L.P. v. Great Lakes Dredge & Dock Co., 620 Fed. App’x 281, 285 (5th Cir. 20 15) (quoting Veracruz, 784 F.3d at 10 26). 30 31 R. Doc. 32-3 at 1 ¶ 2 (Case No. 18-4745). Id. at 1 ¶¶ 1-2, 2 ¶ 3. 8 To identify whether a plaintiff’s interest in property is tantam ount to ownership, courts consider whether the plaintiff’s rights in the property exhibit “incidents of ownership.” See Veracruz, 784 F.3d at 10 26 (quoting Louisville & N ashville R.R. Co. v. M/ V Bay ou Lacom be, 597 F.2d 469, 474 (5th Cir.1979)). Specifically, the Fifth Circuit looks to three m ain factors: (1) “responsibility for repair,” (2) “responsibility for m aintenance,” and (3) “actual possession or control.” Tex. E. Transm ission Corp. v. McMoRan Offshore Expl. Co., 877 F.2d 1214, 1225 (5th Cir. 198 9) (citing Bay ou Lacom be, 597 F.2d at 474). Here, Mardi Gras World’s interest in the wharf, as established by its lease with the Board, exhibits all three factors. First, Mardi Gras World has responsibility for repair of the wharf. The lease agreement between Mardi Gras World and the Board states: “Lessee [Mardi Gras World] agrees that it shall at its own cost, risk and expense prom ptly and with due diligence repair, replace, or restore any and all of the Leased Prem ises [property including the Robin Street Wharf] which may becom e the subject of loss, dam age or destruction.”32 Marquette acknowledges that Mardi Gras World “has broad responsibility to repair 32 R. Doc. 32-6 at 34 ¶ 9(B) (Case No. 18-4745) (em phasis added). 9 dam ages to the leased prem ises.”33 Indeed, Marquette explicitly “does not challenge” Mardi Gras World’s “claim for repair costs.”34 Second, Mardi Gras World has responsibility for m aintenance of the wharf. According to the term s of the lease, “Lessee shall be responsible for and shall at its own cost, risk and expense perform and pay all costs of m aintenance and repairs.”35 Indeed, “[d]uring the Term of the Lease, Lessors shall have no responsibility w hatsoever to perform any construction, m aintenance or repair work on the Leased Prem ises.”36 The lease does require Mardi Gras World to “obtain prior written approval from the Board for any m aintenance, repairs, [or] dredging.”37 But the adjacent provisions m ake clear that the Board’s m inisterial function does not divest Mardi Gras World of the responsibility for m aintaining the wharf. Indeed, the sam e requirement of approval for m aintenance also applies to repairs, which—as noted above—Marquette does not appear to challenge. Third, Mardi Gras World has actual possession or control of the wharf. Black’s Law Dictionary defines “actual possession” as “[p]hy sical occupancy or control over property. Cf. constructive possession.” Actual Possession, 33 34 35 36 37 R. Doc. 32-1 at 8 (Case No. 18-4745). Id. at 12. R. Doc. 32-6 at 33 ¶ 7(A) (Case No. 18-4745) (em phasis added). Id. (em phasis added). Id. 10 Black’s Law Dictionary (11th ed. 20 19) (first em phasis added); accord Tex. E., 877 F.2d at 1225 (when discussing three-part proprietary interest test, exam ining whether com pany had “functional possession or control” over property (em phasis added)). Mardi Gras World’s use of the property has both “an attraction com ponent and . . . an event venue component.”38 As an attraction, Mardi Gras World operates tours that allow the public “to see how the floats and props are constructed for Mardi Gras.”39 As an event venue, Mardi Gras World prim arily rents the prem ises for corporate functions. 40 Overall, these activities suggest that Mardi Gras World has physical occupancy of the property. Indeed, the lease describes Mardi Gras World as “occup[ying]” the wharf. 41 And Marquette’s stipulations also identify Mardi Gras World as an “occupant[] of the Robin Street Wharf.”42 Mardi Gras World, therefore, actually possesses the property. The Fifth Circuit has stated this elem ent of the test in the disjunctive— actual possession or control. Arguably a finding that Mardi Gras World 38 R. Doc. 41-3 at 2:11-12 (Case No. 18-4745). Id. at 2:12-15. 40 Id. at 2:15-19. 41 R. Doc. 32-6 at 33 ¶ 8(B) (Case No. 18-4745) (“Lessee, from the tim e of its occupancy and until the Leased Prem ises are vacated by Lessee, shall assume sole liability for the condition of the Leased Prem ises . . . .” (em phasis added)). As the contract establishes a lease of real property, any occupancy would be “physical.” 42 R. Doc. 32-7 at 1 (Case No. 18-4745). 11 39 actually possesses the wharf should satisfy this prong. Nevertheless, the Court finds that the level of control Mardi Gras World exercises over the property also satisfies a conjunctive test. 43 Specifically, the lease states that Mardi Gras World has “com plete control or ‘GARDE’ over the Leased Prem ises.”44 It “exercise[s] com plete control or ‘Garde’ over . . . access.”45 And it has “sole liability for the condition of the Leased Prem ises as well as of any constructions, utilities and other im provem ents.”46 Although lim its on use exist, the lim iting language broadly describes the purpose for which Mardi Gras World leases the property, rather than purporting to circum scribe how Mardi Gras World runs its business. For exam ple, the lease restricts Mardi Gras World’s use of the wharf to that of “a Mardi Gras Museum , exhibition, office, catering, and 43 Consequently, Mardi Gras World would also satisfy a conjunctive reading of the definition of “actual possession,” which itself already incorporates the concept of control. See Actual Possession, Black’s Law Dictionary (11th ed. 20 19) (defining “actual possession” as “[p]hysical occupancy or control” (em phasis added)). 44 R. Doc. 32-6 at 33 ¶ 8(B) (Case No. 18-4745). “The Louisiana Supreme Court’s definition of custody is based on the French legal concept of garde.” Roy er v. Citgo Petroleum Corp., 53 F.3d 116, 118-19 (5th Cir. 1995). Generally, “[t]he things in one’s garde are ‘those things to which one bears such a relationship as to have the right of direction and control over them , and to draw som e kind of benefit from them .’” Haas v. Atl. Richfield, 799 F.2d 10 11, 10 14 (5th Cir. 1986) (quoting Loescher v. Parr, 324 So. 2d 441, 449 n.7 (La. 1975)). 45 R. Doc. 32-6 at 19 ¶ 17(A) (Case No. 18-4745). 46 Id. at 33 ¶ 8(B). 12 m eeting facility(ies),” as well as to “m inor construction . . . related to artistic and creative activities.”47 The lease also establishes safety practices consistent with these very activities. For exam ple, “Lessee shall not use the Leased Prem ises for any heavy construction or any activity involving welding or use of an open flam e or toxic m aterial.”48 Such reasonable restrictions do not prevent Mardi Gras World from exercising control over the wharf. Even an outright owner could encounter analogous zoning or environm ental regulations circum scribing its use of property. And restrictions are not uncom m on in comm ercial leases in general, see, e.g., 5 Alan M. Weinberger, Thom pson on Real Property § 44.0 3 (Thomas ed. 20 19), or the Board’s leases in particular. 49 Overall, therefore, and when viewed in light of Mardi Gras World’s possession of the property, the Court finds the level of control accorded to Mardi Gras World in the lease sufficient to qualify as an incident of ownership. 47 Id. at 31 ¶ 5(A). Similarly, the lease qualifies Mardi Gras World’s ability to use the wharf as a berthing facility. See id. at 32 ¶ 5(D) (“Lessee shall not dock or berth any vessel at the Leased Prem ises without prior written approval of the Board. The Board reserves the right to levy and collect any and all charges for the berthing of any vessels at the Leased Prem ises.”). 48 Id. at 31 ¶ 5(A). 49 See R. Doc. 41-2 at 1 ¶ 5 (“The lim ited restrictions on use by Mardi Gras World of the Robin Street Wharf included in the Agreem ent are typical and custom ary in lease agreements between the Board and its lessees.”). 13 In addition to the Texas Eastern factors, som e courts have looked to the original distinction drawn in Robins Dry Dock—that between a time charterer of a ship and a dem ise charterer—to illustrate the concept of a proprietary interest. See, e.g., Veracruz, 784 F.3d at 10 31. Specifically, the Robins Dry Dock Court found that a tim e charter did not confer a sufficient property interest 50 to perm it recovery for econom ic loss. See 275 U.S. at 30 70 8. But “[t]he Court left open the possibility that a ‘dem ise’ agreem ent m ight satisfy the proprietary interest requirem ent even if the ‘tim e charter’ at issue in that case did not.” Veracruz, 784 F.3d at 10 26 (citing Robins Dry Dock, 275 U.S. at 30 8). The Fifth Circuit has elaborated on the distinction between a time charter and a dem ise charter. Under a tim e charter, “the owner’s people continue to navigate and m anage the vessel, but her carrying capacity is taken by the charterer for a fixed time for the carriage of goods.” Bay ou Lacom be, 597 F.2d at 473 n.3 (quoting G. Gilm ore & C. Black, The Law of Adm iralty § 4-1 (2d ed. 1975) [hereinafter Gilm ore & Black]). Under a dem ise charter, on the other hand, “the charterer takes over the ship, lock, stock and barrel, and m ans her with his own people.” 50 Id. (emphasis The Robins Dry Dock Court referred to “property right[s].” See 275 U.S. at 30 8. The “proprietary interest” test, the touchstone in this Circuit, satisfies the Suprem e Court requirement. See, e.g., Guste, 752 F.2d at 10 21. 14 rem oved) (quoting Gilm ore & Black § 4-1). Under this analogy, possessing a proprietary interest sufficient to satisfy the Robins Dry Dock rule requires having “the incidents of ownership attributable to the dem ise-charterer.” See Bay ou Lacom be, 597 F.2d at 474. Here, the nature of Mardi Gras World’s interest in the wharf resem bles that of a dem ise charterer’s interest in a ship. 51 Mardi Gras World has “take[n] over” the wharf and “m an[ned] her with [its] own people,” Bay ou Lacom be, 597 F.2d at 473 n.3 (emphasis rem oved) (quoting Gilm ore & Black § 4-1). Indeed, Mardi Gras World is liable for the damage caused to the wharf. 52 And although Mardi Gras World cannot use the wharf entirely without restriction, “restrictions on use” also “typically” occur in dem ise contracts. See 2 Thom as J . Schoenbaum , Adm iralty & Maritim e Law § 11:3 (6th ed. Oct. 20 18 update); see also, e.g., Lim on v. Berry co Barge Lines, L.L.C., No. G-0 7-0 274, 20 11 WL 835832, at *7 (S.D. Tex. Mar. 7, 20 11) (finding that a dem ise charter can have “restrictions on use” that are “not inconsistent with possession and control”). But see Bay ou Lacom be, 597 51 The Fifth Circuit has observed that the dem ise charter comparison may “perhaps [be] less onerous” than its subsequently developed tests. See Veracruz, 784 F.3d at 10 31. Consequently, an interest that exhibits all the Texas Eastern factors would also likely com plete the original Robins Dry Dock analogy. 52 See R. Doc. 32-6 at 34 ¶ 9(B) (Case No. 18-4745). 15 F.2d at 474 (noting that under a dem ise charter, “the shipowner retains m erely a right of reversion”). Indeed, “the dem ise charterer is analogous” to “the lessee of a house and lot.” Id. at 473 n.3 (emphasis removed) (quoting Gilm ore & Black § 41). “Put differently, if [the plaintiff] shows that it has interests in the [property] sim ilar to the interests it would acquire in a vessel from a dem ise charter or in real estate from a lease, then it can satisfy the requirements of Robins Dry Dock.” N exen Petroleum U.S.A., Inc. v. Sea Mar Div. of Pool W ell Servs. Co., 497 F. Supp. 2d 787, 796 (E.D. La. 20 0 7) (Vance, J .) (em phasis added). Here, Mardi Gras World has a lease on real estate. Consequently, to the extent such a lease m irrors the dem ise charter, it also should satisfy the Robins Dry Dock rule. Overall, therefore, whether viewed in term s of the three-factor Texas Eastern test, or in term s of the original Robins Dry Dock analogy that these factors attem pted to illustrate, Mardi Gras World has a proprietary interest that perm its it to sue for econom ic loss. Significantly, the facts of this case differ m aterially from those of other cases in which the Fifth Circuit found that a proprietary interest did not exist. In Texas Eastern itself, for instance, the plaintiff attem pted to recover econom ic dam ages following the rupture by an anchor of a pipeline carrying natural gas. See 877 F.2d at 1219, 1223. But there, in addition to not owning 16 the pipeline, the plaintiff neither “possess[ed] the exclusive right to use” the property, nor had “any responsibility to perform repairs” following its dam age. See id. at 1224-25. Rather, the plaintiff’s responsibility was largely lim ited to “routine m aintenance, consisting of the painting, cleaning, and inspecting” of som e of the pipeline’s “appurtenances.” See id. at 1225. Here, by contrast, Mardi Gras World’s rights and responsibilities under its lease are of an entirely different order. Mardi Gras World leases an expansive property53 for a variety of its own business functions, 54 over which it has extensive im provem ent, 55 insurance, 56 tax, 57 repair, 58 and m aintenance responsibilities. 59 Sim ilarly, in Bay ou Lacom be, which the Texas Eastern court analyzed, a railroad com pany with a “contractual right to use [a] bridge” could not recover econom ic dam ages after a vessel dam aged the bridge, preventing trains from crossing. See 597 F.2d at 470 . But the railroad never possessed or controlled the bridge, or contributed to its upkeep. See id. at 474. Again, by contrast, Mardi Gras World exhibits a wholly different relationship with 53 54 55 56 57 58 59 See R. Doc. 32-6 at 13-14 ¶ (c)1 (Case No. 18-4745). See id. at 31 ¶ 5(A). See id. at 40 ¶ 12(D). See id. at 37 ¶ 10 (E)(i). See id. at 45 ¶ 24. See id. at 34 ¶ 9(B). See R. Doc. 32-6 at 33 ¶ 7(A) (Case No. 18-4745). 17 the wharf: Mardi Gras World’s rights are far m ore sweeping than the “right of [a] user in the nature of an easem ent.” Id. at 473. Other cases likewise reveal that Mardi Gras World’s interest in the wharf is dissim ilar to circum stances where the Fifth Circuit has barred recovery of economic losses under Robins Dry Dock. See, e.g., In re Bertucci Contracting Co., L.L.C., 712 F.3d 245, 246 (5th Cir. 20 13) (disallowing econom ic dam ages to residents of com m unity affected by bridge closure following vessel allision); Dick Mey ers Tow ing Serv., Inc. v. United States, 577 F.2d 10 23, 10 24 (5th Cir. 1978) (per curiam ) (disallowing econom ic dam ages to boat operator following delays caused by lock failure). Indeed, the Court has found no case where Robins Dry Dock barred the econom ic loss claim s of a plaintiff with interests of the sam e character as Mardi Gras World’s. When other courts have analyzed facts sim ilar to those here, though, they have reached the same conclusion as this Court. Specifically, the weight of the district court authority supports finding a proprietary interest arising from such a lease. See Dixie Marine, Inc. v. Q Jake M/ V, No. 16-12415, 20 17 WL 360 0 574, at *1, *8 (E.D. La. Aug. 22, 20 17) (concluding that a plaintiff operating under a sim ilar lease with the Board m et all three factors and 18 therefore had a proprietary interest in a wharf); 60 Diversified Grp., LLC v. La. Carriers, Inc., No. 12-1161, 20 13 WL 2147547, at *4 (E.D. La. May 15, 20 13) (concluding that “Dixie Marine has a proprietary interest in the wharf”); In re Com plaint of Clearsky Shipping Corp., No. 96-40 99, 1999 WL 70 5553, at *4-5, *7-8 (E.D. La. Sept. 8, 1999) (finding evidence of retailers’ proprietary interest in spaces leased at the Riverwalk m ade sum m ary judgm ent improper); N ew Orleans Steam boat Co. v. M/ V JAMES E. W RIGHT, Nos. 87-4437, 88-1236, 1990 WL 128212, at *1, *8, *10 (E.D. La. Aug. 23, 1990 ) (finding “excursion boat enterprise” had proprietary interest in wharf based on a “Preferential Assignm ent Agreement” with the Board). B. Th e Effe ct o f Lo u is ian a Statu te s o n Mard i Gras W o rld ’s “Pro p rie tary In te re s t” Marquette contends that, in addition to the restrictions created by Mardi Gras World’s lease, restrictions created by the Louisiana statutes that govern riparian property rights also prevent Mardi Gras World from having a sufficient interest to recover. The lease, though, references these statutes, 61 and does not transfer a greater interest than they perm it. Consequently, 60 See also R. Doc. 41-1 (Case No. 18-4745). See R. Doc. 32-6 at 28 (Case No. 18-4745) (“[T]he Parties acknowledge that this Lease is m ade pursuant to the authority granted in Louisiana Revised Statutes 9:110 2.1 and 9:110 2.2.”). 19 61 consideration of these laws does not alter the Court’s finding that Mardi Gras World has a proprietary interest in the wharf. Louisiana’s statutory provisions do not prevent the lease at issue from satisfying the Texas Eastern test. First, the statutes do not rem ove Mardi Gras World’s responsibility for repairing the dock. Indeed, the statutes m ake no reference to “repair.” See La. R.S. 9:110 2.1, 110 2.2. Second, the statutes do not divest Mardi Gras World of responsibility for m aintaining the wharf. They do provide that “wharves . . . shall rem ain subject to the adm inistration and control of the governing authorities with respect to their m aintenance.” La. R.S. 9:110 2.1(A); see also id. 9:110 2.2(A)(1)(e), 34:22. The lease, though, specifies the nature of this adm inistration and control: the Board m ust provide written approval for Mardi Gras World’s m aintenance. 62 Written approval by the Board does not reduce Mardi Gras World’s responsibility to finance and carry out the m aintenance. Finally, the lim its im posed by statute do not substantively alter the nature of Mardi Gras World’s actual possession or control under the lease. With regard to actual possession, the statutes do emphasize the state’s right to retake possession of the property. See La. R.S. 9:110 2.1, 9:110 2.2. This right, however, does not dispossess Mardi Gras World of its actual 62 See R. Doc. 32-6 at 33 ¶ 7(A) (Case No. 18-4745). 20 possession of the wharf—that is, its “functional possession,” Tex. E., 877 F.2d at 1225, or “[p]hysical occupancy,” Actual Possession, Black’s Law Dictionary (11th ed. 20 19). Nor do these statutory provisions add substantively to the lim itations on control already outlined in the lease. Indeed, the existence of these statutory provisions has not foreclosed recovery under Robins Dry Dock in the district court decisions rendered after their enactment. See Dixie Marine, 20 17 WL 360 0 574, at *8; Diversified Grp., 20 13 WL 2147547, at *4; Clearsky , 1999 WL 70 5553, at *45, *7-8; N ew Orleans Steam boat Co., 1990 WL 128212, at *8, *10 . Marquette argues that the Fifth Circuit’s holding in Veracruz suggests that these statutes prevent Mardi Gras World from having a proprietary interest. But Veracruz does not change the fundam entals of the Robins Dry Dock analysis. In Veracruz, the Fifth Circuit had to determ ine whether, under Robins Dry Dock, Mexican states could bring a claim for econom ic loss attributable to property allegedly dam aged in the BP oil spill. See 784 F.3d at 10 22-23. Specifically, the court had to decide whether the group of Mexican states or the Mexican federal government was the “true owner” of the Mexican property. See 784 F.3d at 10 22, 10 27. The court concluded that while the states had a “role . . . in m anaging some of the country’s property,” 21 they did not have the “crucial proprietary interest for purposes of Robins Dry Dock.” Id. at 10 31. The Mexican states do not present a close analogy to Mardi Gras World. As an initial m atter, the Fifth Circuit in Veracruz had to adjudicate between two governm ents that both claim ed ownership of national assets. See, e.g., id. at 10 27-28. Indeed, the court prefaced its reasoning by “recogniz[ing] that the Robins Dry Dock analytical fram ework does not easily m ap on to an intragovernmental relationship.” Id. at 10 30 . Here, by contrast, the nature of Mardi Gras World’s interest in the wharf m ore clearly m aps onto that of an “owner pro hac vice,” id. at 10 31 (quoting Bay ou Lacom be, 597 F.2d at 473 n.3), a proprietary interest countenanced by Robins Dry Dock. Furtherm ore, the Veracruz court found “essentially decisive,” id. at 10 27, a constitutional provision interpreted to m ean that “Mexico’s public dom ain over these assets is inalienable and cannot be taken away from the federal governm ent by adverse possession, by either Mexican nationals or foreigners,” id. (quoting J orge A. Vargas, Mexican Law : A Treatise for Legal Practitioners and International Investors § 34.4 (20 0 1) (em phasis added)). Here, by contrast, the statutes do not purport to endow the Board with a sim ilar level of supremacy. Rather, the statutes envision a m ore lim ited 22 sphere of power where, for exam ple, “wharves . . . shall remain subject to the adm inistration and control of the governing authorities with respect to their m aintenance and to the fees and charges to be exacted for their use by the public,” La. R.S. 9:110 2.1(A). Sim ilarly, when looking outside the Mexican constitution, the Veracruz court concluded that “[Mexican] federal law places the bulk of the power . . . in the hands of the federal government.” 784 F.3d at 10 31. Here, though, the Texas Eastern analysis suggests that Mardi Gras World wields sufficient power with respect to the wharf to have a proprietary interest in it. And, while the Veracruz court confirm ed that Texas Eastern did not “sanction[] recovery for som ething less than ownership,” it at no point repudiated the Texas Eastern factors. See id. at 10 26. Indeed, J udge Barbier—who authored the district court opinion affirm ed in Veracruz— subsequently applied the Texas Eastern test to find that a com pany leasing a wharf from the Port of New Orleans had “a sufficient proprietary interest to recover econom ic loss.” Dixie Marine, 20 17 WL 360 0 574, at *8. That lease is substantially sim ilar to the one at issue here. 63 Thus, neither Louisiana statute nor the holding of Veracruz requires the Court to find that 63 See R. Doc. 41-1 (Case No. 18-4745). 23 Louisiana law prevents Mardi Gras World from having a proprietary interest in the wharf. IV. CON CLU SION For the foregoing reasons, the Court DENIES Marquette’s m otion for partial sum m ary judgm ent. New Orleans, Louisiana, this _ 11th _ _ _ _ day of Septem ber, 20 19. _____________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE 24
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