[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED U.S. COURT OF APPEALS ELEVENTH CIRCUIT ________________________ JULY 30, 2001 THOMAS K. KAHN No. 00-12002 CLERK ________________________
D. C. Docket No. 97-02510-CV-EBD
UNITED STATES OF AMERICA,
Plaintiff-Appellee- Cross-Appellant,
INTERNAL IMPROVEMENT TRUST FUND, et al,
Plaintiffs-Appellees,
versus
GREAT LAKES DREDGE & DOCK COMPANY,
Defendant-Appellant- Cross-Appellee.
________________________
Appeals from the United States District Court for the Southern District of Florida _________________________
(July 30, 2001)
Before ANDERSON, Chief Judge, RONEY and FAY, Circuit Judges. RONEY, Circuit Judge:
Defendant Great Lakes appeals the judgment against it in a suit for damages
brought by the United States under the National Marine Sanctuaries Act for damage
to the Florida Keys Marine Sanctuary caused by a grounded tugboat and dredge pipe.
The government’s cross-appeal concerns the district court’s ruling that no primary
restoration is required for the grounding site. We affirm the district court’s decision
on liability, but we vacate a portion of the damages award, specifically that no action
is the best alternative for addressing damage at the grounding site. We remand for
further factual findings regarding this question.
I. Facts
In May 1993, Great Lakes Dredge & Dock Company (Great Lakes) hired
Coastal Marine Towing (Coastal) to tow 500-foot lengths of dredge pipe and other
equipment from Boca Grande to Green Cove on the East Coast of Florida. Coastal
supplied two tugs, Captain Joe and Miss Necie and their crews. Great Lakes supplied
two assist tugs, Volunteer State and Cavalier State.
While proceeding through the Florida Keys National Marine Sanctuary, one of
the pipes in a raft towed by Miss Necie dragged the sea bottom creating a pipe scar
approximately 13 miles long.
2 The following facts caused grounding site damage which is the subject of this
appeal. Due to a navigational error by Miss Necie, the flotillas got off course and
Captain Joe ran aground in seven feet of water trying to pass Miss Necie. Great
Lakes’ assist tug, Cavalier State, was tied to the Captain Joe. Sanctuary and state
officials helped devise a plan to extricate Captain Joe. At high tide, Captain Joe was
powered off the bank by a combination of its own motor and the Cavalier State. The
grounding left behind a channel 120 meters long, eight to ten meters wide and two
meters deep. The grounding destroyed 7,495 square meters of sea bottom, consisting
of turtle grass, manatee grass and finger coral. The boats also created a large hole, or
“blowhole,” 120 meters long by nine meters wide.
The United States brought this action on behalf of the U.S. Department of
Commerce, National Oceanic and Atmospheric Administration (NOAA) under the
National Marine Sanctuaries Act (NMSA) of 1972, as amended, 16 U.S.C. § 1431-
1445, for the destruction caused by the grounding of the sanctuary resources,
primarily seagrasses, in the marine sanctuary. The State of Florida also filed a
complaint against defendants, which was consolidated with the federal case. The first
day of trial, Coastal settled its claims with the United States and the State of Florida
for $618,484. The settlement satisfied Florida’s claims against Great Lakes as well,
and Florida is not a party to this appeal. The State of Florida did file an amicus brief
3 in support of the United States’ positions concerning liability and damages, but argues
only liability.
After an eight-day bench trial in April 1999, the district court granted in part
and denied in part the relief sought by the government. The court ruled in favor of the
United States on liability, finding that Great Lakes was strictly liable under the NMSA
for all damages to the sanctuary. Regarding damages, the government sought
compensation for implementation of both its primary restoration plan and its
compensatory plan.
Under the primary restoration component of damages, the government is
entitled to recover the cost of implementing its plan to restore or replace the injured
resource, or the cost of acquiring the equivalent of the sanctuary resource, if it cannot
be restored or replaced. See 16 U.S.C. § 1432(6)(A). Both the government and Great
Lakes agreed that the pipe scar recovered on its own in three years, so the damage
caused is not a part of this appeal. As for the grounding site, the government proposed
a plan to use imported sediment to fill and restore the grounding site, one of three
alternative primary restoration plans considered by the government. The district court
determined that another plan, the “no action” plan for the primary restoration of the
grounding site was appropriate, but that the U.S. should recover the cost of physical
and biological monitoring of the site.
4 The district court also held that the government was entitled to damages for
compensatory restoration, which is compensation for the interim lost use of the
resources at the pipe scar and grounding site during the period from destruction to
recovery. See 16 U.S.C. § 1432(6)(A). Recovery for lost interim services is in the
form of seagrass restoration projects at other suitable locations within the Sanctuary.
The district court determined that the Prop Scar Restoration Program developed by the
government is an appropriate compensatory restoration project that would provide
seagrass services equivalent to those lost due to the injuries caused by Great Lakes at
both the grounding site and the pipe scar. The court also held that the government’s
reliance on the Habitat Equivalency Analysis (HEA) was appropriate to scale the
compensatory seagrass restoration project. Based on these determinations, the district
court awarded to the government, its response and assessment costs; compensatory
and monitoring costs; and permitting and supervision costs. The district judge
required the government to recalculate the appropriate damages by simple
mathematical computations based on its findings of fact. On March 1, 2000, the
district court entered final judgment against Great Lakes in the amount of $368,796.
97,the figure after setting off the settlement amount paid by Coastal.
On appeal, Great Lakes argues the district court erred in finding Great lakes
liable to the United States because (1) suit by the United States not authorized under
5 common law; (2) Great Lakes was not vicariously liable for Coastal’s actions, and (3)
the method used to assess restoration was faulty. On cross-appeal, the United States
argues the district court erred in approving “no action” as the primary restoration plan
for the grounding site.
II. Applicable Statutory Provisions.
The National Marine Sanctuaries Act governs the designation and management
of federally protected marine areas of special significance. Congress enacted the
NMSA in response to the increasing degradation of marine habitats and in recognition
of the need to protect marine ecosystems. See S. Rep. No. 100-595,2d Sess. 1 (1998),
reprinted in 1988 U.S.C.C.A.N. 4387. The NMSA confers authority for the
designation and management of marine sanctuaries on the Secretary of Commerce, 16
U.S.C. § 1433,1434, who has delegated these responsibilities to the NOAA.
The NMSA imposes civil liability on “any person who destroys, causes the loss
of or injures any sanctuary resource. 16 U.S.C. § 1443.
The Attorney General, at the request of the Secretary, may commence an action
against any person or vessel who is liable for response costs and damages. 16 U.S.C.
§ 1443(c). “Response costs” include costs of actions taken to minimize the
destruction of sanctuary resources. § 1432(7). “Damages” include compensation for
(1) the cost of restoring, replacing, or acquiring the equivalent of a sanctuary resource
6 and the interim loss value of the resource pending restoration; (2) damage assessment
costs, and (3) reasonable monitoring costs. 16 U.S.C. § 1432(6).
III. Discussion.
1. Whether the National Marine Sanctuaries Act Authorizes Damages to the United States Government for Injuries to Sanctuary Resources.
At the outset, we reject Great Lakes’ argument that the government has no
claim for damages in this case because the property at issue is state-owned and the
United States therefore has no proprietary interest. See Robins Drydock & Repair Co.
v. Flint, 275 U.S. 303,308(1927). This argument belies the express language and
scheme of the relevant statutes. On November 6, 1990, Congress enacted the Florida
Keys National Marine Sanctuary Act (the “Sanctuary Act”), Pub. L. No. 101-605, 104
Stat. 3089 (1990), which designated 2800 nautical miles of coastal water in the Florida
Keys as the Florida Keys National Marine Sanctuary. The Sanctuary Act provides
that “[t]he Sanctuary shall be managed and regulations enforced under all applicable
provisions of [the NMSA] as if the Sanctuary had been designated” there under.
Sanctuary Act, § 5(a). In this case, the United States seeks damages from defendants
for a violation of § 1443 of the NMSA, which imposes strict liability for damage or
injury to any sanctuary resource. See, e.g., United States v. M/V Jacquelyn L., 100
F.3d 1520,1521 (11th Cir. `1996); 16 U.S.C. § 1443(a)(1). The NMSA plainly
authorized the United States to recover the damages it seeks for injuries to seagrass
7 resources. The NMSA explicitly provides, “Any person who destroys, causes the loss
of, or injures any sanctuary resources is liable to the United States for an amount equal
to the sum of ...the amount of response costs and damages resulting from the
destruction, loss, or injury....”42 U.S.C. § 1443(a)(1)(A).
2. Whether the District Court Erred in Awarding Damages Based on the Habitat Equivalency Analysis.
The United States sought damages under § 1432 of the NMSA for “the cost of
... acquiring the equivalent of a sanctuary resource,” and for the value of lost use of
the resource “pending acquisition of an equivalent” resource. In other words, to
compensate for damages sustained and for lost interim services at the blow hole and
pipe scar sites, equivalent sites were selected for restorative or replacement actions.
The Habitat Equivalency Analysis (“HEA”) was used to scale (quantify the size of)
the equivalent area to be restored, and therefore, to quantify the damages for lost
interim services and the acquisition of equivalent resources.
Great Lakes argues that the district court erred in accepting the HEA for two
reasons: first, use of an HEA is not appropriate under Daubert v. Merrill Dow
Pharmaceuticals, Inc., 509 U.S. 579, 590 (1993) as a methodology for determining
damages in this case; and second, the underlying “scientific data” plugged into the
mathematical equations as input parameters could not pass muster under Daubert.
8 The Supreme Court has interpreted the Federal Rules of Evidence to require
scientific evidence to be both relevant and reliable. See Daubert, 509 U.S. at 795. In
Daubert, the Supreme Court set forth four factors, among others, that a trial judge may
consider in determining the reliability of scientific testimony: (1) whether a theory or
technique can be and has been tested; (2) whether a theory or technique has been
subjected to peer review and publication; (3) the known or potential rate of error of
a particular scientific technique; and (4) whether a theory or technique has been
generally accepted. See Daubert, 509 us at 592-593. These factors do not constitute
a definitive checklist, and courts have ample discretion to assess “whether the
reasoning or methodology underlying the testimony is scientifically valid, and
whether that reasoning or methodology properly can be applied to the facts at issue.
See Daubert, 509 U.S. at 592-93.
The district court did not abuse its discretion when it determined that use of the
HEA was appropriate and that the underlying scientific data satisfied Daubert.
Our review of the evidence indicates, contrary to Great Lakes assertions, that the HEA
was peer reviewed and accepted for publication prior to trial. See e.g. R13-151,185-
87, in which Dr. Brian Julius, who introduced the HEA, discussed the peer review and
publication of the HEA.
9 Great Lakes remaining arguments address the quality of the data that went into
the HEA and differing interpretations of the underlying data, all of which were
adequately addressed by the district court. Specifically, Great Lakes challenges (1)the
calculation of compensatory restoration, that is the validity of the data used to
determine the recovery rates of the injured sites; (2) the feasibility of the
compensatory sites as equivalent sites; the “compressed succession” technique, which
is a planting technique that achieves a more rapid rate of seagrass recovery by
temporarily substituting a faster growing species, Halodule, for the slower growing
Thalassia, and then allows Thalassia to recolonize the stabilized area; and (3) the
HEA’s sensitivity to major changes in fundamental input parameters. The district
court addressed these objections in its July 28, 1999 Order, stating that evaluation of
the data put into the HEA and the arguments relating to data interpretation are relevant
when the court, as fact finder, weighs the evidence and determines how much weight
to give each experts’ opinion. Our thorough review of the record reveals no error in
the district court’s acceptance of the HEA. We note that necessary modifications to
the HEA were ordered by the court and complied with by the United States, arguably
rendering the HEA more reliable.
3. Whether the District Court Erred in Finding Great Lakes Vicariously Liable for the Actions of Coastal.
10 Great Lakes argues it was held vicariously liable for damage when “[t]here was
no proof at trial that Great Lakes’ conduct violated this statute with respect to the blow
hole,” and “ the trial court did not address whether the U.S. proved a prima facie
case.”
We hold that the district court’s factual findings support the determination that
Great Lakes’ conduct gave rise to strict liability under the NMSA. Specifically, the
court found Great Lakes was responsible for helping Coastal’s vessels maneuver the
tows, maneuver the 500-foot long pipe rafts, and assist with unanticipated problems.
Great Lakes was responsible for preparing the pipe rafts and ensuring they were safe
and seaworthy, and it failed to test the pipes before the trip. Great Lakes failed to send
a welder or crane operator with the flotilla who could have made any needed repairs.
Great Lakes failed to provide Coastal crews with any direction once notified about the
sinking pipes and instead arranged for a welder and crane operator to meet the flotilla
at Marathon. Great Lakes failed to notify the lead tugs that any pipes were dragging.
The dragging pipes caused a 13-mile pipe scar. The dragging pipes slowed down the
Miss Necie, which caused the Captain Joe to maneuver sharply to avoid a collision,
resulting in running aground. Some combination of the Captain Joe’s engines and the
efforts of Great Lakes’ tug, the Cavalier State , dragged the Captain Joe farther along
11 the bank. The grounding and attempts to extricate the Captain Joe from the site
resulted in injuries to sanctuary resources.
Contrary to Great Lakes assertions, these factual findings are supported by the
record evidence and are not clearly erroneous. These facts are sufficient to
demonstrate causation sufficient to impose liability under the NMSA.
Great Lakes argues that the district court improperly denied it the affirmative
third-party defense under § 1443. The Act provides three defenses, only one of which
is applicable to this case. Under the statute, a person is not liable if that person
establishes that the injury to sanctuary resources was “caused solely by...an act or
omission of a third party, and the person acted with due care.” § 1443(a)(3)(A). This
provision is substantively identical to those statutes upon which the NMSA was
modeled, the Federal Water Pollution Control Act Amendments of 1972 (Clean Water
Act) § 311(f)(1), 33 U.S.C. § 1321(f)(2); and the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980 (CERCLA), § 101 et seq., 42
U.S.C.A. § 9607(b)(3). The district court correctly determined that under no view of
the evidence could Great Lakes satisfy either of these elements of the defense.
The district court held Great Lakes was strictly liable, relying upon United
States v. LeBoeuf Brothers Towing Co., 621 F.2d 787 (5th Cir. 1980), a case in which
the Fifth Circuit, under a similar strict liability provision in the Clean Water Act,
12 rejected the argument that an independent contractor acting for and under the control
of a defendant employer is a “third party” for the purpose of absolving the defendant
employer of liability under the statute. In that case, the Fifth Circuit rejected a vessel
owner’s argument that it was not liable under the third-party defense provisions of the
Federal Water Pollution Control Act Amendments of 1972 (Clean Water Act) §
311(f)(1), 33 U.S.C. § 132, for the accidental discharge of oil by an independent
contractor tug crew hired by the defendant. The court concluded that the defendant
held ultimate control over hiring the contractor, specifying its itinerary, and retaining
the contractor throughout the job. LeBoeuf, 621 F.2d at 789-90. The court also
concluded that the third-party defense was not intended to protect a party from the acts
or omissions of those acting under its control or on its behalf. 621 F.2d at 790.
Otherwise, “the statute’s comprehensive scheme for preventing and cleaning up oil
spills would be undermined if barge owners like [defendant] could escape strict
liability merely by hiring out their operations to tugs.” 621 F.2d at 789. In this case,
the district court correctly reasoned that the remedial purpose of the NMSA and the
need to encourage oversight with independent contractors requires an equally strict
reading of the NMSA’s third-party defense.
Great Lakes has simply failed to prove that the injury was solely the result of
Coastal’s actions and that Great Lakes acted with due care. Great Lakes contends that
13 even if it is liable, it should only pay for a proportional share of damages. Where, as
in this case, however, each defendant is a legal cause of the damage and the damage
is indivisible between the two, the district court correctly held that liability under the
NMSA is joint and several. This holding is consistent with cases finding joint and
several liability under the CWA and CERCLA. See e.g., United States v. M/V Big
Sam, 681 F.2d 432,438-39(5th Cir. 1982)(CWA); Redwing Carriers v. Saraland
Apartment, 94 F.3d 1489,1512,1513(11th Cir. 1996)(CERCLA). The evidence
supports the district court’s findings of facts regarding joint and several liability. The
court’s factual findings indicate that Great Lakes caused damage at both the pipe scar
and the blowhole. Although the district court did not expressly address the divisibility
of the injuries, it is clear from the evidence Great Lakes’ actions during the entire
incident were inextricably tied with Coastal’s actions. The resulting injuries cannot
be attributed to any one defendant. Although the district court concluded that Great
Lakes was jointly and severally liable, it did in fact reduce Great Lakes’ liability by
$618,484,86, or approximately two-thirds of the judgment, in recognition of Coastal’s
payment of that amount.
A review of Great Lakes challenges to the court’s evidentiary rulings regarding
the admission of affidavits with attached summaries and supporting documentation
14 of two experts, Wiley Wright and Michelle McQuillan, reveal there to be no abuse of
discretion in the various rulings.
4. The United States’ Cross Appeal.
The United States’ cross-appeal concerns the district court’s ruling that “no
action” is the appropriate plan for the grounding site. The government alleges that the
district court erred in relying on the hearsay report of a non-testifying government
consultant and clearly erred in certain factual determinations, including that natural
recovery would occur in 70 years. It argues that approval of a “no action” plan is
contrary to the NMSA and the agency’s expert judgment.
As contemplated by the NMSA, the NOAA developed a restoration plan for
the injured resources and the grounding site and the pipe scar. Under the NMSA,
damages include: (1) the cost of replacing, restoring, or acquiring the equivalent of an
injured sanctuary resource (“primary restoration”); (2) compensation for the interim
loss of resources and services from the time of injury until resources recover to
baseline (“compensatory restoration”); (3) damage assessment costs; and (4)
reasonable monitoring costs. 16 U.S.C. § 1432(6). The agency recommended
compensatory restoration for both the pipe scar and the grounding site. The agency
did not recommend primary restoration for the pipe scar because it was recovering
15 naturally in a timely manner, but it did recommend primary restoration for the
grounding site.
The agency narrowed down to three the viable alternative plans for primary
restoration of the grounding site: (1) a “no action” plan; (2) a site regrading plan ; and
(3) the “imported fill” plan. The government recommended the third option, the
imported fill plan, but the district chose the no action alternative.
The court made the following findings: (1) it was not convinced the plan would
restore the bank to its original condition; (2) it concluded the grounding site would be
expected to fully recover on its own in roughly 70 years and (3) it raised concerns
about potential construction risks. In reaching this conclusion, the court
misinterpreted the evidence and testimony before it, and certain of these findings are
not based on the evidence.
One of the more significant factual errors was the court’s finding that natural
recovery without any interference would take approximately 70 years. The evidence
clearly indicated that this seventy-year period upon which the district court relies is
in fact the amount of time the grounding site is expected to achieve full biological
recovery after implementing the United States’ primary restoration plan. The Report
from J. Harold Hudson, Regional Biologist, Key Largo National Marine Sanctuary,
Exh. 18 states in the “PROGNOSIS FOR RECOVERY”:
16 Complete recovery of this site to pregrounding conditions is not expected to occur without human intervention...Infilling of channelized areas of the grounding site is an essential first step toward site recovery. If no other remedial action is taken it is anticipated that complete overgrowth of the site by seagrasses and corals to pregrounding levels could occur in 75 to 100 years.
The government’s biologist, Judson Kenworthy, testified that the recovery
horizon for the slower growing Thalassia grass was seventy-one years for an area the
size of the injury at the grounding site. R-12-79,81. Government expert Brian Julius,
elaborated that the seventy-one-year recovery rate was based on the assumption that
the government’s primary restoration plan would be completed. R13-155-156,170.
There is evidence in the record that natural recovery without human
intervention would take much longer, as much as hundreds of years. Government
expert Dr. Joseph Zieman testified that if the bank were left alone, recovery “would
take a long, long time. Many, many decades to possibly hundreds of years.” R-13-
116.
Thus, the court’s finding that the government’s primary restoration plan will not
decrease the recovery period is clearly erroneous.
The court also relies on report of Dr. Kevin R. Bodge, to support its statement
that “the morphological signature of the injury will be visible for many years to come
irrespective of what plan is implemented.” As an initial matter, the government
17 challenges the district court’s reliance on the Bodge report at all, because Bodge was
a non-testifying government consultant and his report was admitted into evidence for
the limited purpose of explaining other experts’ testimony. Assuming for purposes
of this argument that the Bodge report was properly considered, the district court
relied on it for evidence unsupported in either the report itself or other record
evidence. The report only compared the no action alternative to a berm-transfer
alternative, not the government’s infill plan. The report therefore provided no opinion
on the government’s plan’s potential effect on the sited morphology.
We must also note that the Bodge report’s recommendation of “no action” was
a qualified one based on several critical assumptions: that the banks are stable, the
sediment is not chronically disturbed and the rubble is not susceptible to erosion. The
court made no findings as to whether these underlying assumptions were met.
The evidence in the record indicates that biological recovery of the site’s
resources would eventually occur only after the site had been stabilized. Kenworthy
testified that the site would remain unstable “[u]ntil the physical topography of that
site is brought back to as near as it was prior to the grounding event.” R-12-113. See
also McCabe’s testimony, R-13-57-58(“[i]f you do not fill it you are still going to be
continually subject to hurricane wave impact...It is never going to stabilize.”); and
Zieman’s testimony regarding the infill R-13-114(“[M]y paramount recommendation
18 is no matter what happened that [it tried] to fill in that crater in there and get it back
to some type of near conforming bank top surface.”)
The statutory scheme under the NMSA explicitly authorized the Secretary of
Commerce, acting as trustee for sanctuary resources, to take “all necessary actions”
to prevent or minimize the destruction or loss of, or injury to, the resources. 16 U.S.C.
§ 1443(b)(1). Under these circumstances, where several key findings made by the
district court were based on misinterpretations of the record, we deem it necessary to
remand for further consideration, with particular attention paid to the question whether
the fact that it is the government’s plan rather than the “no action” plan that provides
for recovery in approximately seventy years, and how the other factors weigh in
against that element. Recognizing that part of the court’s order assumes the
government will continue to monitor the effects of the no-action alternative, we
assume the government will take this opportunity to update the court on any new
information that would aid in the district court’s decision.
By this decision, we do not intend to indicate that a “no-action” plan would not
ultimately be the option of choice. But the choice, in which some discretionary
judgment may be involved, should rest on correct findings of fact supported by
evidence in the record.
AFFIRMED IN PART, VACATED IN PART AND REMANDED.