Notable Cases

Handled By Jeffrey R. Bale

  1. Successfully defended American Home Assurance Company in an alleged bad faith insurance and Texas Deceptive Trade Practices Act and Insurance Code violations lawsuit involving the partial sinking of a tugboat while moored at a dock. The M/V ROBYN S was purchased by Pelican Refining and maintained at its facility in Channelview, Texas. During the year in which Pelican Refining owned the tug, it operated the vessel on four separate occasions. The prior owner of the vessel had cut holes in the bulkheads of the void spaces below deck in order to run conduit and wire. The day prior to the sinking, the vessel was moved to another facility and the captain who navigated her to that location said she appeared to be watertight and seaworthy to him at the time. During the night, the unmanned vessel experienced a storm and was observed to have waves crashing over the stern. By morning, the vessel was partially sunk. Following presentment of the claim, underwriters assigned a surveyor to inspect the vessel and, upon review of his findings, denied coverage. Pelican Refining sued American Home Assurance Company and, prior to trial, demanded $1,500,000.00 in settlement. The case proceeded to trial in the United States District Court for the Southern District of Texas, Galveston Division, and was tried to a jury in hurricane-ravaged Galveston less than a year after Hurricane Ike. For this reason, and because AIG was a named defendant and was in the news daily in the midst of the TARP bailout controversy, the firm recommended the use of a jury consultant, which was agreed by the client. The case was tried for a week and the jury returned a verdict in favor of American Home Assurance Company finding that the loss was not due to a covered peril under the policy. During the evidentiary phase of the case, the firm’s attorneys were able to demonstrate that the vessel had been slowly sinking over a period of time through the testimony of the marine biologist who pointed to scientific evidence and photographs that showed the growth of barnacles and algae above the freeboard. Through the testimony of expert marine surveyors, the Defendant was able to establish that the watertight integrity of the vessel had been severely compromised and the vessel was neither seaworthy on the occasion in question nor at the inception of the policy. Following trial on the merits, and based upon the jury’s findings at the close of the evidence, judgment was entered that the Plaintiff take nothing.
    Bad Faith
  2. Successfully defended The Offshore Drilling Company, TODCO Management Services, Inc., Hercules Offshore, Inc., Hercules Offshore Corporation, Hercules Offshore Drilling Co. and Cliff’s Drilling Company (“Hercules Defendants”) in a Jones Act personal injury lawsuit filed by a crane operator, his wife and children in state district court in Galveston County, Texas. The crane operator suffered substantial injuries, including brain damage, when the crane he was operating on a jack-up rig detached from the pedestal and fell approximately 35 feet while the rig was dry-docked and being brought back into service. Though the plaintiff operated the crane in a manner that may have caused it to shock-load, liability experts opined that the actual cause of the fall was the poor condition of the nuts and bolts inside the slewing bearing. The crane had recently been subjected to an annual inspection by Defendant Offshore Equipment Solutions, which declared it to be in “great, safe running condition.” Based on Offshore Equipment Solutions’ own documents that were produced in discovery, it is likely that the inspector did not actually inspect the crane but instead made affirmative misrepresentations about its condition. As a result of a Master Service Agreement between the Hercules Defendants and Offshore Equipment Solutions, Hercules was required to indemnify Offshore Equipment Solutions for negligent and grossly negligent actions that caused personal injury to Hercules employees. Hercules challenged the indemnity obligation by alleging fraud and misrepresentation based on the fact that the crane inspection was likely not done as represented. This challenge survived summary judgment. Prior to trial, the Hercules Defendants entered into a high-low agreement with Plaintiffs guaranteeing that the Plaintiffs would receive a minimum of $750,000 and a maximum of $5,000,000 from Hercules. These numbers were based on an extensive review of the circumstances, potential liability and the severe injuries suffered by the Plaintiff-crane operator, which resulted in a life-care plan for the Plaintiffs’ expert of over $13 million. After six days of trial, the parties settled. Offshore Equipment Solutions dropped its claims for indemnity against the Hercules Defendants and the Plaintiffs accepted $1,250,000 from the Hercules Defendants, with an additional $3,750,000 being paid by Offshore Equipment Solutions.
    Jones Act
  1. Successfully defended Cementnatie, a Belgian stevedoring company in a personal injury lawsuit filed by the driver of the yard hustler during discharge operations. The case was tried to a jury in federal court in Galveston, Texas. Cementnatie was hired to stuff three containers with reels of coiled steel for shipment to the United States. The containers were delivered and loaded for transport to Houston, Texas from Antwerp. During the voyage, the vessel encountered a few days of near gale and gale force winds and seas (Force 7 and 8 on the Beaufort Wind Scale). Two of the containers were offloaded without incident. However, the Plaintiff had the third container discharged onto the chassis he was pulling behind his yard hustler. After driving it approximately 3,000 yards to the drop area, he found a slot into which to back the container. While backing in, the container flipped, causing the yard hustler to raise up into the air and slam down with such force that it caused the windshield to shatter. Plaintiff initially complained of hip, leg and arm pain, but several weeks after the incident he began to complain of low back pain. All Co-Defendants in the case settled with Plaintiff in the days preceding trial. Plaintiff claimed that the reels of steel tubing were inadequately secured and stowed, causing them to shift within the container, resulting in the chassis and container overturning while the Plaintiff was backing in at a safe and prudent speed. Through photographic evidence and expert testimony, the firm’s lawyers were able to show that the rolls had not moved laterally on the dunnage during transit across the Atlantic Ocean and the chassis did not lean when the container was loaded onto it, in addition to the fact that there were no problems moving the load from dockside to the drop point, even though the Plaintiff made 2 or 3 90-degree turns in route. One of Plaintiff’s expert marine surveyors when pressed on cross-examination admitted that, based on the physical evidence of the reels and packing materials inside the container following the turnover of the load, the reels were in the same position at the time the container was placed on the back of the Plaintiff’s chassis as they were in when the container left Antwerp. Defendant asserted that Plaintiff jackknifed the chassis while parking, thus causing the chassis and container to flip. Plaintiff made a settlement demand of $650,000.00 which was countered by Defendant with a $30,000.00 offer. Prior to jury selection, Plaintiff’s attorney reduced their settlement demand to $250,000.00. The case was presented to the jury in a three day trial and a verdict was rendered in favor of Defendant, resulting in a take nothing judgment.
    Personal Injury
  2. Successfully defended PGS Onshore, Inc. in a case alleging damage to ninety-nine homes as a result of work being done in connection with an urban vibrosies project in Hidalgo County, Texas. The case was filed by prominent plaintiffs’ attorneys in Hidalgo County, a notorious plaintiffs’ venue in the Rio Grande Valley. After taking GPS coordinates of each home and overlaying the vibrosies data and vibe points on the grid Successfully defended PGS Onshore, Inc. in a case alleging damage to ninety-nine homes as a result of work being done in connection with an urban vibrosies project in Hidalgo County, Texas. The case was filed by prominent plaintiffs’ attorneys in Hidalgo County, a notorious plaintiffs’ venue in the Rio Grande Valley. After taking GPS coordinates of each home and overlaying the vibrosies data and vibe points on the grid developed by the firm’s staff and expert witnesses, PGS was able to demonstrate to the Court that there was no reasonable scientific basis to the claim and obtained a summary judgment in its favor. As a result all of the Plaintiff-home owners’ claims were dismissed with prejudice. Additionally, PGS recovered one-half of the attorneys fees it expended in the case through a declaratory judgment action based on indemnity obligations and other contractual undertakings assumed by another party to the project, even though that party convinced the Plaintiffs’ attorney to dismiss it from the case at an early stage of the litigation.
    Urban Vibroseis Project
  3. Successfully defended Valero Refining Company of Texas in a refinery release/toxic exposure lawsuit involving more than 5,000 Plaintiffs, pending in Galveston, Texas. The firm obtained a summary judgment and dismissal in its entirety. The firm was able to contain the potentially overwhelming size of the case by filing a Lone Pine Motion, which sought to have the Plaintiffs come forward with proof on causation. The use of this tool at a very early stage of the case framed the issues for the trial judge and raised serious questions about the merits of the Plaintiffs’ case. The firm also eventually convinced the court to use a Bellwether Selection Process for the selection of trial plaintiffs, which necessitated a statistical analysis so that representative Plaintiffs would be selected for trial purposes. When 2200 Plaintiffs failed to respond to questionnaires, propounded by the Defendant under the auspices of the trial court, they were dismissed for want of prosecution. After a group of 20 “Trial Plaintiffs” was assembled, the firm worked up those cases. At the end of discovery, the firm filed a Daubert challenge to the Plaintiffs’ experts, which was presented to the court in a full-blown evidentiary hearing. This motion was granted in part and denied in part, and importantly, it set the table for Defendant’s motion for summary judgment. The trial court eventually granted Defendant’s motion dismissing the claims of the Trial Plaintiffs. It then subsequently granted Defendant’s no evidence motion for summary judgment as to all other Plaintiffs.
    Toxic Exposure
  1. Successfully defended Odfjell Terminals (Baytank), Inc. in a toxic exposure case in which the Plaintiff alleged an exacerbation to a pre-existing lung condition which required treatment with massive doses of steroids. Plaintiff also alleged that he became steroid dependent because of the decline in his lung function, which resulted in severe myopathy and osteoporosis. As a result of his osteoporosis, the Plaintiff suffered a T-6 vertebral fracture, causing him to be paralyzed from the chest down. The Plaintiff incurred $900,000 in medical bills and demanded $5 million to settle the case. When that demand was rejected, the Plaintiff increased his settlement demand to $20 million, which was also the amount of the award sought from the jury at trial. Due to the magnitude of the uninsured exposure in the case, the firm recommended and implemented a jury focus group to validate and refine its defensive theories in the case. The case was tried to a jury for two weeks in Harris County. After 11 hours of deliberation, the jury returned a verdict in favor of the Defendant, finding the Plaintiff 70% at fault for his own injuries, thus precluding any recovery under Texas’ modified comparative negligence statute. In response to an unpredicated damages question, the jury awarded damages of $150,000, which were not assessed against the Defendant because of the jury’s other findings. The mock jury affirmed the theories that the firm had developed in its defense of the case.
    Toxic Exposure
  2. Defended PGS Exploration (U.S.), Inc., Velodyne Shipping and Seabird Ship Management in a Jones Act case filed in the United States District Court for the Southern District of Texas, Galveston Division. The Plaintiff, a 36 year old seaman, alleged injury during a regularly scheduled fire drill. Shortly after the drill, he reported having a pain in his left shoulder. He was treated by the vessel’s medic and was placed on light duty. After leaving the vessel, the Plaintiff sought medical care ashore. During the course of his treatment, his doctors identified a labral tear and a multi-lobulated cyst in the glenohumeral notch that compressed the nerves in the infraspinatus distribution. The Plaintiff underwent two surgeries to repair these conditions. After the Plaintiff filed suit, he claimed that he had run out of fire hose during the drill, which stressed his shoulder thereby causing the injuries sued upon. At trial, it was undisputed that the Plaintiff had a permanent injury to his left shoulder that caused weakness limiting him to “light duty” work. Prior to trial, the Plaintiff demanded $850,000 to settle the case. After a two day trial, the Honorable Samuel B. Kent found negligence on both PGS and the Plaintiff and awarded $154,000 to the Plaintiff, following a reduction in damages due to the Court’s finding that the Plaintiff was 50% at fault for his own injuries. Seabird was dismissed for lack of personal jurisdiction. Velodyne was dismissed due to a finding of no unseaworthiness and lack of personal jurisdiction.
    Jones Act
  3. Successfully defended Basis Petroleum in an alleged retaliatory discharge case where the Plaintiff claimed that he was fired for filing a workers’ compensation claim. The Plaintiff and a co-worker were physically injured in Basis Petroleum’s Texas City Refinery naphtha unit when a valve ruptured when they were trying to close it. The Plaintiff escaped the unit but could not locate his co-worker. At risk to his own life, the Plaintiff went back into the unit that was being flooded with highly flammable liquid naphtha and located his co-worker who had suffered major injuries to both arms such that he could not get up and get out of the unit. The Plaintiff then carried his co-worker to safety. Thereafter, the Plaintiff underwent orthopedic treatment for injuries sustained in the incident, as well as psychological counseling for post-traumatic stress disorder. He also filed for workers’ compensation benefits. After being released from the care of his doctors, the company insisted that the Plaintiff return to work. The Plaintiff did not respond to the company’s job offer and was terminated. Upon receipt of the termination notice, the Plaintiff immediately responded to the job offer and asked the company to reconsider his termination. That request was declined. The Plaintiff filed suit in Galveston County. The case was tried for six days. During trial the Plaintiff demanded $275,000 in settlement. After deliberating for an hour and a half, the jury returned a verdict in favor of the Defendant. Judgment was entered that the Plaintiff take nothing. The judgment was later affirmed on appeal.
    Retaliatory Discharge
  1. Successfully defended U.S. Liquids of LA., L.P. and Oilfields GP Holdings, Inc. in a maritime wrongful death case filed in the United States District Court for the Southern District of Texas, Galveston Division. The decedent was a deckhand working in Port Fourchon, Louisiana when he was crushed between a rinse rack placed on top of a chemical disposal barge and his vessel during mooring operations preparatory to discharging pent fluids from offshore facilities. The barge was owned and operated by Defendants. Plaintiffs alleged that the rinse rack sitting atop Defendants’ barge was improperly placed, as it created a dangerous pinch point between the rack and vessels being moored to it. Decedent’s widow and children brought a lawsuit against the Defendants. Plaintiffs were able to establish through deposition and trial testimony that the rinse rack could have easily been rotated thereby alleviating the pinch point, while maintaining its functionality. Plaintiffs’ economist offered a damage model totaling $347,441.00 in past and future economic losses (the Plaintiffs’ Decedent was approaching retirement at the time of death). Plaintiffs sought additional money for Decedent’s conscious pain and suffering. Plaintiffs’ initial demand was $500,000.00, which was reduced to $350,000.00 immediately prior to trial. Defendants chose to try the lawsuit to the bench, in front of the Honorable Samuel B. Kent. Defendants were able to prove through documents obtained through third parties that the Decedent had been demoted approximately 28 weeks prior to his death, thereby minimizing the future earning capacity opined by Plaintiffs’ economist. Further evidence was developed through an exhaustive search of medical records and emergency medical technician reports which showed that the Decedent was coherent, alert and in no apparent distress until the last few minutes prior to suffering cardiac arrest as a result of a ruptured aorta, thereby negating Plaintiffs’ claims that the Decedent suffered excruciating pain for approximately one hour prior to his death. During trial the parties engaged in a settlement conference with the Court and Plaintiffs accepted Defendants’ offer of settlement in the amount of $95,000.00, with the Decedent’s widow receiving $75,000.00, and Decedent’s two children receiving $10,000.00 each. Defendant had offered $75,000.00 prior to trial.
    Maritime Wrongful Death
  2. Successfully defended Smith Maritime in the arrest of its vessel, the ELSBETH II. Smith Maritime had been hired by a shipbreaker in Brownsville, Texas, to transport two aged U.S. Navy destroyers from Pearl Harbor, Hawaii, to Brownsville, Texas, to be scrapped at its facility. The vessels were owned by the United States Navy and the shipyard was hired by the United States Government to scrap the vessels. During transit, one of the destroyers started taking on water and began to sink while attached to the Elsbeth II’s tow line. In the face of this exigency, the crew of the Elsbeth II went aboard the floundering destroyer and prepared it for scuttling and sinking so that it could be detached from the tow line and sunk so that it would not pose a hazard to navigation. Upon arrival in Brownsville, Texas, the shipyard seized the Elsbeth II and demanded security in the amount of $1 million, alleging that Smith Maritime had wrongfully scuttled the vessel and had deprived the shipyard of its opportunity to earn its contractually-stipulated income for breaking the vessel. The firm’s attorneys filed an answer to the lawsuit, posted a bond, obtained release of the Elsbeth II, filed a counterclaim and demand for counter-security for the Elsbeth II’s tow hire and for wrongful seizure. At the evidentiary hearing on Smith Maritime’s request for counter-security, one of the officers of the shipyard admitted on the witness stand that the shipyard did not own the vessel that was sunk and that its claim related solely to its claim for economic loss associated with the sinking. The firm’s lawyers argued that the claim was precluded under the economic loss rule established in Robins Dry Dock. Thereafter, the firm’s lawyers obtained summary judgment decreeing that the Plaintiff take nothing on its original complaint and obtained findings that eventually forced the Plaintiff to pay $365,000.00 to Smith Maritime on its counterclaim for wrongful arrest and tow hire. The trial court’s findings dismissing the shipyard’s claims and entering judgment on liability in favor of Smith Maritime, were affirmed by the United States Court of Appeals for the Fifth Circuit in an interlocutory appeal and led to the eventual resolution of the case.
    Wrongful Vessel Arrest