O'Neal Mills, Sr. v. Director, Office of Workers' Compensation Programs, United States Department of Labor, McDermott Inc., & Crawford and Company

877 F.2d 356, 1990 A.M.C. 218, 1989 U.S. App. LEXIS 10167, 1989 WL 69521

• Court: Court of Appeals for the Fifth Circuit
• Decided: July 14, 1989
• Docket: 87-4464
• Status: Published

Opinions

W. EUGENE DAVIS, Circuit Judge:

We granted rehearing en banc to determine whether appellant, O’Neal Mills, a land-based welder injured while building an offshore oil platform in Amelia, Louisiana, qualifies for benefits under the Longshore & Harbor Workers’ Compensation Act (LHWCA) as incorporated in the Outer Continental Shelf Lands Act (OCSLA). Because we conclude that OCSLA’s provision adopting LHWCA includes a situs of injury requirement that Mills did not satisfy, we affirm the order of the Benefits Review Board (BRB) rejecting Mills’ claim.

I.

McDermott, Inc., employed Mills as a welder in February 1982 when he suffered an injury during construction of an oil production platform destined for the outer Continental Shelf. The injury occurred in McDermott’s yard in Amelia, Louisiana, where Mills had been working on the platform for at least six months before the accident. Mills performed all of his welding work for McDermott on land.

The deputy commissioner of the Office of Workers’ Compensation Programs initially approved Mills’ application for LHWCA benefits under OCSLA, 43 U.S.C. § 1333(b). An administrative law judge reversed the deputy commissioner’s decision. The Benefits Review Board for the U.S. Department of Labor affirmed the AU’s denial of benefits, and Mills appealed to this court.

In Mills v. Director, OWCP, 846 F.2d 1013 (5th Cir.1988), a panel of this court reversed the BRB and remanded. The court granted McDermott’s petition for rehearing en banc on September 9,1988. We now affirm the BRB’s order and hold that Mills does not qualify for benefits under OCSLA because he does not satisfy its situs-of-injury requirement.

II.

Section 1333(b) of OCSLA extends the LHWCA’s benefits to employees disabled or killed “as the result of operations conducted on the outer Continental Shelf for the purposes of exploring for ... [or] developing ... the natural resources ... of the subsoil and seabed of the outer Continental Shelf.” As incorporated in OCSLA, § 933(i) of the LHWCA provides the exclusive remedy of an injured employee against his employer. See 33 U.S.C. § 933(i); Barger v. Petroleum Helicopters, Inc., 692 F.2d 337, 339 (5th Cir.1982).

McDermott argues that Mills falls outside the reach of § 1333(b) because his injury occurred on Louisiana soil rather than on the outer Continental Shelf. The panel interpreted § 1333(b) as extending LHWCA coverage to oilfield workers so long as their injury had the necessary connection with operations on the OCS, without regard to where the injury occurred. Mills, 846 F.2d at 1015. Thus, the panel concluded that Mills qualified for workers’ compensation benefits under OCSLA because (1) he would not have been injured but for operations on the OCS; and (2) his welding work during platform construction “ ‘furthered the operation of a fixed rig on the shelf and ... [occurred] in the regular course of extractive operations on the shelf.’” Id. (quoting Herb’s Welding, Inc. v. Gray, 766 F.2d 898, 900 (5th Cir.1985)).

III.

A.

In determining the Congressional intent behind § 1333(b) we follow the Supreme Court’s teaching to interpret the legislation “... in light of the language of the Act as a whole, the legislative history [and] the Congressional purposes underlying the Act....” Offshore Logistics v. Tallentire, 477 U.S. 207, 221, 106 S.Ct. 2485, 2494, 91 L.Ed.2d 174 (1986).

Congress enacted OCSLA in 1953 to establish the law governing conduct on the Outer Continental Shelf, an area of intense activity that lacked an established legal system because it lies beyond state boundaries. Congress enacted OCSLA “to define a body of law applicable to the seabed, the subsoil, and the fixed structures ... on the Outer Continental Shelf.” Rodrigue v. Aetna Casualty & Surety Co., 395 U.S. 352, 355, 89 S.Ct. 1835, 1837, 23 L.Ed.2d 360 (1969); 43 U.S.C. § 1333(a). To that end Congress made non-maritime federal law applicable to the subsoil, seabed, and platforms. Id. at 355-56, 89 S.Ct. at 1837. In the event no federal law existed on a particular issue, Congress elected to borrow the adjacent state’s law as surrogate federal law. Id.; 43 U.S.C. § 1333(a)(2)(A).

One obvious void in the law governing the OCS was the lack of a workers’ compensation scheme for thousands of workers employed in the dangerous oilfield extraction industry. Congress filled that void in § 1333(b) when it adopted the LHWCA’s benefits provision to cover non-seamen employed in the oil patch on the OCS.

Consistent with our interpretation of § 1333(b), none of § 1333’s other subsections purport to apply beyond the OCS. Section 1333(a), which establishes the Shelf’s substantive law, applies only to activity that occurs on the OCS.¹ Subsection (c) applies the National Labor Relations Act to unfair labor practices on OCS platforms.² Subsection (d) delegates to the Coast Guard the duty of promoting safety on the artificial islands and adjacent waters on the outer Continental Shelf.³ Subsection (e) extends the Secretary of the Army’s authority to prevent obstruction of navigation to those artificial islands,⁴ while subsection (f) also focuses on certain legal provisions that apply to these same installations.⁵

These subsections demonstrate that Congress intended to regulate the OCS, not those areas that already were governed by state law. Neither Mills nor the Director of the Office of Workers’ Compensation identifies any legislative history suggesting that Congress intended to single out OCS-LA’s workers’ compensation scheme for different treatment. Nor do they suggest why Congress would have wanted to create another layer of compensation coverage for select shorebound employees — such as factory and shipyard laborers — who fortuitously work on equipment destined for offshore platforms.

Section 1333(b)’s bare language does not resolve the issue because the phrase “[injured] as the result of operations conducted on the outer Continental Shelf for the purpose of ... developing ... the natural resources ... of the [OCS]” is open to interpretation (emphasis added).

Mills and the Director read “operations” broadly to encompass work by employees— wherever located — provided their work furthers OCS mineral extraction activity in some significant way. But under an equally plausible reading of § 1333(b), coverage requires that the relevant “operations” out of which the injury arises occur on the OCS. We interpret § 1333(b) to require that covered operations be (1) related to OCS development; and (2) conducted on the OCS. Given the second requirement, activity conducted off the OCS, even though related to OCS mineral extraction, does not satisfy § 1333(b).

Legislative history from OCSLA and a related bill, the Submerged Lands Act, 43 U.S.C. § 1301 et seq., supports the narrower reading of § 1333(b). OCSLA vested control of the OCS beyond state territorial waters in the federal government; the Submerged Lands Act certified state control over the water and seabed within state boundaries. OCSLA originated as Sub-chapter III of the Submerged Lands Act; the act retained its focus on “only the area of the Outer Continental Shelf beyond State boundaries” when Congress enacted it as a separate bill. 99 Cong.Rec. 6962 (Daily ed. June 22,1953) (statement of Senator Cordon, acting chairman of the Senate Committee on Interior and Insular Affairs). The legislative history explains that these two bills were “legislatively joined” — even as they focused individually on separate areas of the ocean floor — by a Congress determined to draw a clear boundary between areas of federal and state control. See id.⁶

OCSLA’s separate legislative history confirms this exclusive focus. In one exchange involving S. 1901, the bill that became OCSLA, the senators concluded that state workers’ compensation would cover a worker in state waters drilling a slant hole into the OCS. Outer Continental Shelf: Hearings on S. 1901 before Senate Comm, on Interior and Insular Affairs, 83d Cong., 1st Sess., 12-16 (1953). The senators agreed that the place of injury controls the application of benefits. As the legislative history makes plain, Congress enacted OCSLA only as a vehicle to fill voids in the rules governing the federally managed territory of the OCS. No such void exists for disputes encompassing areas already governed by state law.

Mills and the Director seek support for their expansive reading of § 1333(b) in Congress’ deletion of a proviso to Section 4(c) of S. 1901, the section that ultimately became § 1333(b). Section 4(c) originally extended LHWCA benefits to workers killed or disabled as the result of operations conducted on the OCS “if recovery for such disability or death through workmen’s compensation proceedings is not provided by state law.” They reason that the proviso’s deletion signals Congress’ intention to extend LHWCA benefits without regard to whether state workers’ compensation schemes also applied.

Congress’ explanation of the deletion does not support this interpretation. As the Committee Report explains,

It was deemed inadvisable to have the Federal Longshoremen’s and Harbor Workers’ Compensation Act apply only if there is no applicable state law. By this amendment, all workers on the Outer Shelf not already protected under laws respecting seamen are protected by the Longshoremen’s and Harbor Workers’ Compensation Act.

S.Rep. No. 411, 83d Cong., 1st Sess. 16, 23 (1953) (emphasis added). Presumably, such a proviso would have foreclosed LHWCA benefits coverage for OCS platform employees when adjacent states extend their workers’ compensation schemes to those platforms. See, e.g., Thompson v. Teledyne Movible Offshore, Inc., 419 So.2d 822 (La.1982), appeal dismissed, 464 U.S. 802, 104 S.Ct. 48, 78 L.Ed.2d 69 (1983). The reference to OCS workers indicates that, at most, Congress was prepared to tolerate overlapping federal and state workers’ compensation coverage on the OCS itself. But the proviso's deletion does not justify overlapping coverage for employees whose feet are planted firmly on state soil. Such a reading ignores OCSLA’s gap-filling nature because it assumes that Congress legislated to provide law for an area already governed by state workers’ compensation law.

Nor does § 1331(1 )’s definition of “development” bolster the case for Mills' and the Director’s interpretation.⁷ Although the term as defined includes platform construction and onshore support facilities, the circumstances under which this definition emerged demonstrate that Congress did not intend to alter the scope of § 1333(b)’s coverage language.

Congress added § 1331(i) when it amended OCSLA in 1978 to revamp OCS leasing and development. In an effort to create a two-step process to separate (1) federal approval of offshore exploration and (2) federal approval for development of the discovered resources, Congress required lessees to submit detailed development and production plans to the Secretary of the Interior. 43 U.S.C. § 1351; see Report of the Senate Comm, on Energy and Natural Resources, 95th Cong., 1st Sess. 43, 82 (1977).

Lessees cannot begin “production” until the Department of the Interior and the affected states have approved the development and production plan. Id. Congress defined exploration, development and production “to identify the point, after exploration and before development, beyond which activity cannot proceed without an approved development and production plan, as described in [§ 1351].” H.R.Rep. No. 1984, 94th Cong., 2d Sess. 82 (1976); H.R. Rep. No. 590, 95th Cong., 1st Sess. 126 (1977), reprinted in 1978 U.S.Cong. & Admin.News 1450, at 1532.

Thus, in § 1331(i) Congress crafted a special meaning for a general word, “development,” as part of a comprehensive scheme to regulate OCS drilling. We reject Mills’ and the Director’s efforts to apply this definition in a workers’ compensation context that bears no relation to the purpose for which Congress defined the word. The essential message of OCSLA’s legislative history remains undiluted: Congress adopted § 1333(b) in the course of building a body of law for the OCS. This effort did not encompass already-regulated workers on state soil.

B.

The Supreme Court has recognized the geographic boundaries to OCSLA’s coverage in two recent cases. In Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 106 S.Ct. 2485, 91 L.Ed.2d 174 (1986), the Court strictly construed § 1333(a)’s situs restriction and held that it did not extend state law to cover OCS platform workers who died in a helicopter crash on the high seas. In applying the Death on the High Seas Act rather than state law under OCSLA, the Court stressed that OCSLA “provides an essentially non-maritime remedy” and controls only on the OCS. Id. at 217, 106 S.Ct. at 2492. The Court continued, “Congress determined that the general scope of OCSLA’s coverage, like the operation of DOHSA’s remedies, would be determined principally by locale, not the status of the individual injured or killed." Id. at 219, 106 S.Ct. at 2493.

The Court followed this discussion of § 1333(a)’s coverage with a comparison to § 1333(b). The Court states, “Only [§ 1333(b)] ... superimposes a status requirement on the otherwise determinative OCSLA situs requirement_” Id. at 219 n. 2, 106 S.Ct. at 2493 n. 2 (emphasis added). We cannot accept the Director’s explanation that the Court meant to “replace” situs with status when it used “superimposes.” The Court could not have made it clearer that a worker must demonstrate status and situs to recover LHWCA benefits under § 1333(b).

Herb’s Welding, Inc. v. Gray, 470 U.S. 414, 427, 105 S.Ct. 1421, 1429, 84 L.Ed.2d 406 (1985) supports this conclusion. In that case the Court considered whether a worker injured on a production platform in Louisiana waters was entitled to recover LHWCA benefits. After concluding that the claimant’s failure to meet the LHWCA’s status test precluded direct LHWCA coverage, the Court remanded to the Fifth Circuit for a determination of whether OCSLA extended coverage to the claimant. In responding to an argument that denying LHWCA coverage would create "checkered coverage” the Court states,

[T]he inconsistent coverage here results primarily from the explicit geographical limitation to the Lands Act’s incorporation of the LHWCA_ Congress’ desire to make LHWCA coverage uniform reveals little about the position of those for whom partial coverage results from a separate statute. This is especially true because that statute draws a clear geographical boundary that will predictably result in workers moving in and out of coverage.

Id. at 427, 105 S.Ct. at 1429 (emphasis added).

The Director argues that we imposed no situs requirement for § 1333(b) coverage in Barger v. Petroleum Helicopters, Inc., 629 F.2d 337 (5th Cir.1982), and Stansbury v. Sikorski Aircraft, 681 F.2d 948 (5th Cir.), cert. denied sub nom. Stansbury v. Chevron U.S.A., Inc., 459 U.S. 1089, 103 S.Ct. 573, 74 L.Ed.2d 935 (1982). The Director’s reliance on those cases is misplaced.

Barger and Stansbury held that § 1333(b) extended the LHWCA as the sole remedy for survivors suing the employers of individuals who (1) satisfied the “but for” status test; and (2) died in helicopter crashes on the high seas above the OCS. Although some of the dicta in those opinions may be overly broad, we have no quarrel with those holdings to the extent they grant LHWCA benefits to oilfield workers injured on waters above the OCS. We do not interpret those cases to read § 1333(b) as extending LHWCA benefits to oilfield workers injured on land or state territorial waters. But cf. Curtis v. Schlumberger Offshore Service, Inc., 849 F.2d 805 (3d Cir.1988) (Section 1333(b) covers OCS platform worker injured in car accident on New Jersey Garden State Parkway while driving to meet helicopter that would have flown him to rig).

IV.

Given that Congress intended to establish a bright-line geographic boundary for § 1333(b) coverage, we now draw that line. We hold that LHWCA coverage as extended under § 1333(b) applies to employees who (1) suffer injury or death on an OCS platform or the waters above the OCS; and (2) satisfy the “but for” status test this court described in Herb’s Welding, Inc. v. Gray, 766 F.2d 898, 900 (5th Cir.1985). As a land-based worker injured on Louisiana soil, Mills must look to state compensation laws for his benefits.

This interpretation is compelling in light of Congress’ objective: filling voids in the law governing mineral extraction on the OCS. Moreover, we find it difficult to imagine that Congress intended to create the enormous problems that an expansive definition of § 1333(b)’s scope would entail.

Mills’ interpretation of § 1333(b) requires us to assume that Congress intended to impose an additional layer of compensation coverage for shoreside workers employed by manufacturers and suppliers of equipment destined for offshore oil platform. Under such a scheme, an employee injured while working on equipment destined for the OCS receives more generous benefits than the employee next to him who suffers an injury building similar equipment destined for land-based uses. To cover this exposure, employers who assign even a small percentage of their employees to constructing, servicing or repairing equipment destined for offshore platforms would have no choice but to purchase insurance coverage for liability under both the state and federal compensation acts. Mills points to no evidence indicating that Congress intended to create such a cumbersome and uncertain compensation scheme or that it intended to intrude in a significant way on established state workers’ compensation programs.

The plain words of § 1333(b), when read in light of the legislative history of OCSLA and the Congressional purpose underlying its enactment, impose a situs requirement for LHWCA coverage. The Benefit Review Board’s order rejecting Mills’ claim is therefore

AFFIRMED.

1 . “The Constitution and laws ... of the United States are hereby extended to the subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all installations and other devices permanently or temporarily attached to the seabed ... for the purpose of ... developing resources therefrom.” 43 U.S.C. § 1333(a)(1); Rodrigue v. Aetna Casualty & Surety Co., 395 U.S. 352, 89 S.Ct. 1835.

2 . "[A]ny unfair labor practice, as defined in [the NLRA], occurring upon any artificial island, installation, or other device referred to in subsection (a) ... shall be deemed to have occurred within the judicial district of the State_” 43 U.S.C. § 1333(c).

3 .“The Secretary of the Department in which the Coast Guard is operating shall have authority to promulgate and enforce such reasonable regulations ... relating to the promotion of safety of life and property on the artificial islands ... referred to in subsection (a) ... or on the waters adjacent thereto_” 43 U.S.C. § 1333(d)(1).

4 . ‘The authority of the Secretary of the Army ... is hereby extended to the artificial islands, installations, and other devices referred to in subsection (a)_” 43 U.S.C. § 1333(e).

5 . The specific application by this section of certain provisions of law to the subsoil and seabed of the outer Continental Shelf and the artificial islands, installations, and other devices referred to in subsection (a) ... shall not give rise to any inference that the application ... of any other provision of law is not intended.” 43 U.S.C. § 1333(f).

6 ."Thus, S. 1901 is legislatively joined with the Submerged Lands Act, just as the areas with which each measure deals are joined geographically and geologically. Politically they are, of course, properly separated, since the Submerged Lands Act deals with lands within State boundaries, while [S. 1901] ... concerns itself with the areas seaward of such boundaries.” 99 Cong. Rec. 6962 (Daily ed. June 22,1953) (statement of Senator Cordon, acting chairman of the Senate Committee on Interior and Insular Affairs).

7 . Although nominally a respondent in this action, the Director supports Mills' contention and argued on his behalf at oral argument. We note, however, that the Director’s interpretation of § 1333(b) is not conclusive. As this court noted in reference to agency interpretation of an enabling statute, ”[D]eference to an agency’s interpretation of its statute is limited by the court’s obligation 'to honor the clear meaning of the statute, as revealed by its language, purpose and history,’ ... and by the requirement that the agency interpretation not be clearly wrong or unreasonable." Coca-Cola Co. v. Atcheson, Topeka & Santa Fe Ry. Co., 608 F.2d 213, 222 (5th Cir.1979) quoting International Brotherhood of Teamsters, Chauffeurs, Warehousemen & Helpers of America v. Daniel, 439 U.S. 551, 566 n. 20, 99 S.Ct. 790, 880 n. 20, 58 L.Ed.2d 808 (1979). As explained in the text, we find the Director’s interpretation of § 1333(b) erroneous.