Baton Rouge firm owes indemity to California company for costs in asbestos exposure litigation

By Karen Kidd | Oct 22, 2018

NEW ORLEANS — A Baton Rouge engineering firm must help pay the litigation costs a California-based fuel and lubricant additives company incurred fighting an asbestos exposure lawsuit, a U.S. District Court judge said in a recent order.

Jacobs Field Services North America owes indeminifacation to Chevron Oronite Co., based in San Ramon, California, Judge Barry Ashe, on the bench in Louisiana's Eastern District, said in his 23-page order issued Oct. 10. Chevron Oronite had hired Jacobs to provide welding services during the period of alleged exposure and Jacobs can't escape liability in the asbestos exposure of the late Wayne Bourgeois even if Chevron Oronite's negligence contributed to Bourgeois' injury, Ashe said in his order.

"There is no allegation in the Bourgeois suit that the injurious conduct was solely that of Chevron Chemical," Ashe said in his order. "Moreover, under the express language of the applicable contracts, Jacobs' indemnity obligation adheres 'whether or not (Chevron Chemical) was or is claimed to be concurrently or contributorily negligent, and regardless of whether liability without fault is imposed or sought to be imposed on (Chevron Chemical).'"

Ashe issued his order in response to cross-motions for summary judgment filed by both companies.

The case stems ultimately from maintenance and welding contracts from 1989-93 between Chevron Chemical Co. and J.E. Merit Constructors, of which respectively Chevron Oronite and Jacobs Field Services are successor companies, according to the background portion of the order. Those contracts included provisions that requiring J.E. Merit to indemnify Chevron Chemical against loss, damage, injury, liability or death.

Bourgeois, a welder employed by J.E. Merit, was diagnosed with mesothelioma in 2016 and in March of the following year filed suit against various companies, alleging his illness had been caused by asbestos exposure. Bourgeois died July 25, 2017.

"Bourgeois alleged in relevant part that he was exposed to asbestos while working for J.E. Merit at Chevron Chemical's facility in Belle Chasse," the order said.  

Meanwhile, Chevron Oronite tried repeatedly to tender the lawsuit to Jacobs Field Services, which rejected the tender, arguing that Chevron Oronite had cited an inapplicable contract relating to warehouse workers. Later, "Jacobs had conversations with counsel for Chevron Oronite" about settlement negotiations, which concluded last with a settlement in January for $550,000.

In its subsequent motion, Chevron Oronite claimed that Jacobs should indeminfy it for money spent defending and settling the lawsuit, as well as for current litigation between the two companies, including pre- and post-judgment interest. "Because Bourgeois' alleged exposure to asbestos occurred while he was employed by J.E. Merit at a Chevron facility, Chevron Oronite argues that Jacobs must honor its contractual obligation to indemnify Chevron Oronite," the order said.

Jacobs maintained in its cross motion that actual, as opposed to potential, liability would have triggered indeminity. Jacobs, among other things, also disputed whether evidence in the case established Bourgeois' employment period, Chevron Oronite's liability and whether Chevron Oronite was entitled to attorney's fees and costs.

"As with the reasonableness of the settlement, Chevron Oronite agrees to leave for further litigation the 'exact amounts for fees and costs' it seeks to recover from Jacobs," the order said. "Thus, while the Court holds that Chevron Oronite is entitled to recover attorney's fees it incurred in defending and settling the Bourgeois suit and in prosecuting this action, the reasonableness and amount of such recovery is left to be determined."

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