Demette v. Falcon Drilling Co., Inc.

280 F.3d 492, 2002 A.M.C. 686, 2002 U.S. App. LEXIS 745, 2002 WL 58890
CourtCourt of Appeals for the Third Circuit
DecidedJanuary 16, 2002
Docket00-30165
StatusPublished
Cited by19 cases

This text of 280 F.3d 492 (Demette v. Falcon Drilling Co., Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Third Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Demette v. Falcon Drilling Co., Inc., 280 F.3d 492, 2002 A.M.C. 686, 2002 U.S. App. LEXIS 745, 2002 WL 58890 (3d Cir. 2002).

Opinion

280 F.3d 492

Kermit DEMETTE, Plaintiff,
v.
FALCON DRILLING COMPANY, INC.; et al., Defendants.
R&B Falcon Drilling USA, Inc., Defendant-Third Party Plaintiff-Appellee,
v.
Frank's Casing Crew & Rental Tools, Inc., Third Party Defendant-Appellant.

No. 00-30165.

United States Court of Appeals, Fifth Circuit.

January 16, 2002.

COPYRIGHT MATERIAL OMITTED Jennifer Elmer Michel (argued), Edwin G. Preis, Jr., Preis, Kraft & Roy, Lafayette, LA, for Frank's Casing Crew & Rental Tools, Inc.

Daniel E. Knowles, III, Brien J. Fricke (argued), Burke & Mayer, New Orleans, LA, for R & B Falcon Drilling USA, Inc.

Richard C. Rutledge, III, Drucker, Rutledge, Ward & Smith, The Woodlands, TX, Karen Ann Lister, Wetzel, Henri & Drucker, Houston, TX, for A & B Builders, Inc., Amicus Curiae.

Thomas T. Hutcheson, Locke Liddell & Sapp, Houston, TX, for Anadarko Petroleum Corp.

Kenneth Ross Citti, Citti & Associates, Houston, TX, for Diamond Offshore Co.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before HIGGINBOTHAM and DeMOSS, Circuit Judges, and FISH,* District Judge.

PATRICK E. HIGGINBOTHAM, Circuit Judge:

Without prejudice to the Petition for Rehearing En Banc of Third Party Defendant-Appellant Franks Casing Crew & Rental Tools, Inc., we substitute the revised opinions that follow in place of the prior opinions, reported at Demette v. Falcon Drilling Company, Inc., 253 F.3d 840 (5th Cir.2001). The parties may file on or before January 30, 2002 any supplemental briefs in support of or opposition to the petition for rehearing en banc in light of these revised opinions.

Appellee R&B Falcon Drilling USA, Inc. sued appellant Frank's Casing & Crew Rental Tools, Inc. for indemnity when a Frank's employee sued Falcon under the Longshore and Harbor Workers' Compensation Act1 for injury sustained while working on a Falcon jack-up rig in the Gulf of Mexico. Frank's argued that the indemnity agreement was voided by LHWCA or by Louisiana law. The district court held that the indemnity agreement was valid.

Determining the validity of the indemnity agreement requires a foray into the federal statutes defining the law applicable to offshore drilling on jack-up rigs. We first consider the application of the Outer Continental Shelf Lands Act ("OCSLA")2 and then construe the LHWCA. We conclude that the OCSLA applies to a rig jacked-up over the outer continental shelf; that state law does not apply to this case by operation of the OCSLA, but the LHWCA does; and that the LHWCA does not invalidate the indemnity agreement. We affirm.

* Frank's Casing & Crew Rental Tools, Inc. and R&B Falcon Drilling USA, Inc. are both contractors with Union Oil Company of California for Unocal's offshore drilling operations. Frank's provides casing services. "Casing" is an activity performed during the drilling for oil, whether onshore or offshore; it involves the "welding together and hammering of pipe into the subsurface of the earth to create a permanent construction."3

Frank's and Unocal signed a "Services and Drilling Master Contract." Under the Master Contract, Frank's provided casing services to Unocal at offshore drilling sites. Under the Master Contract, Unocal agreed to defend and indemnify Frank's against any liabilities Frank's owes to Unocal, and Frank's agreed to defend and indemnify Unocal and all of its contractors and subcontractors against liabilities they may owe to Frank's. Falcon was a contractor of Unocal.

Falcon provides movable rigs from which casing crews drill offshore wells. Falcon has an "Offshore Daywork Drilling Contract" with Unocal. This contract provided Unocal with access to all of Falcon's vessels for offshore drilling. Falcon provided Unocal the Fal-Rig # 85, a jack-up drilling rig. A jack-up drilling rig is a floating rig with legs that can be lowered into the seabed. Once the legs are secured in the seabed, the rig can be "jacked-up" out of the water to create a drilling platform. The process can be reversed, and a jack-up rig can be towed to new sites.4

Pursuant to the Master Contract between Frank's and Unocal, plaintiff Kermit Demette, an employee of Frank's, worked aboard the Fal-Rig # 85. Demette was injured while performing casing work as a welder on the Fal-Rig # 85. He was part of a "hammer job," which involves a casing crew welding together sections of pipe end-to-end as the pipe is driven into the seabed by a large hammer. While Demette was working at the base of the derrick where the pipe was being driven, a metal retaining ring used to secure hoses fell from the derrick, striking him on the head. At the time of Demette's injury, the Fal-Rig # 85 was jacked up. Its legs rested on the outer continental shelf of the United States beyond the territorial waters of Louisiana.5

Demette sued Falcon for his injuries. Falcon, pursuant to the Offshore Daywork Drilling Contract, filed a third-party complaint against Unocal for defense and indemnity. Unocal voluntarily assumed the defense of Falcon. Falcon then filed a third-party complaint against Frank's, seeking defense and indemnity pursuant to the Master Contract.

The district court granted summary judgment to Falcon on the issues of whether Frank's owed defense and indemnity to Falcon. Frank's agreed to fund a settlement with Demette and to pay Falcon's defense costs, but made a full reservation of appeal rights. A consent judgment was entered pursuant to this agreement.

Frank's appeals the summary judgment ruling on indemnity and defense.

II

The Outer Continental Shelf Lands Act6 provides comprehensive choice-of-law rules and federal regulation to a wide range of activity occurring beyond the territorial waters of the states on the outer continental shelf of the United States. Relevant to this case, it applies federal law to certain structures and devices on the OCS, incorporates state law into federal law on the OCS, and applies the LHWCA to certain injuries sustained by persons working on the OCS.

In this case, the parties dispute whether Louisiana state law governs the Master Contract and whether the OCSLA makes the Longshore and Harbor Workers' Compensation Act7 applicable to Demette's injuries. First, we must determine whether the injury occurred on an OCSLA situs; if so, we then have two inquiries: we must determine whether OCSLA makes state law applicable; and we must determine if the injured party's status makes the LHWCA applicable under OCSLA. We begin with a review of the three OCSLA inquiries we must make in this case.

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Bluebook (online)
280 F.3d 492, 2002 A.M.C. 686, 2002 U.S. App. LEXIS 745, 2002 WL 58890, Counsel Stack Legal Research, https://law.counselstack.com/opinion/demette-v-falcon-drilling-co-inc-ca3-2002.