Fifth Circuit reverses ruling for Transocean in favor of injured employee

NEW ORLEANS– Transocean lost an appeal in the U.S. Fifth Circuit Court of Appeals in which a former employee sought compensation for injuries arising from the Deepwater Horizon oil rig explosion.

The appeal stems from an earlier suit filed by Wallace Boudreaux against Transocean Deepwater Inc. in which he sought maintenance, cure and punitive damages for Transocean’s alleged mishandling of past claims for his back injury.

During trial, Transocean discovered that Boudreaux had existing back problems that he failed to disclose in a pre-employment medical questionnaire, according to background information in the case.

Transocean filed a partial motion for summary judgment which was granted, due to Boudreaux’s failure to disclose. Transocean then filed a counterclaim that sought to recover the maintenance and cure payments already paid to Boudreaux.

The company claimed that the success of its previous defense entitled it restitution under general maritime law and moved for a summary judgment on the counterclaim.

Transocean and Boudreaux reached a settlement before the district court ruled on the counterclaim. The settlement states that “Boudreaux is entitled to a lesser sum of money if Transocean succeeds on its counterclaim.”

The district court awarded summary judgment to Transocean and Boudreaux appealed.

Judge Patrick Higginbotham, writing the majority opinion on behalf of himself and Judge Catharina Haynes, wrote that a “maritime employer’s obligation to pay an injured seaman maintenance and cure is an essential part of the employment relationship” and that Transocean’s claim that its previous defense entitled it to restitution is unprecedented in maritime law.

The opinion further stated that Boudreaux’s misrepresentation of his health history does not terminate his employment relationship to Transocean, nor does it negate Transocean’s obligations as an employer.

Judge Edith Brown Clement dissented from the majority opinion, saying that Transocean is entitled to restitution. She wrote that in its original defense Transocean established that Boudreaux relied on a misrepresentation to receive benefits to which he was not entitled and that he “deprived himself” of the protection of his employment relationship with Transocean.

The panel reversed the summary judgment in favor of Transocean and rendered a judgment in favor of Boudreaux.