DEFENDANT COMPANY HAD TO INDEMNIFY CODEFENDANT LLC FOR 50% OF ITS SETTLEMENT COSTS BASED ON CONTRACTUAL AGREEMENT.
PHILLIP COMEAUX, II, ET AL., Plaintiffs, VERSUS COIL TUBING SERVICES, LLC, ET AL., Defendants, ELEVATING BOATS, LLC, Defendant-Counter Plaintiff-Appellee-Cross-Appellant, VERSUS ENERGY PARTNERS, LTD, Defendant-Counter Defendant-Appellant-Cross-Appellee.
05-30192
UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT
2006 U.S. App. LEXIS 7273
March 22, 2006, Filed
PROCEDURAL POSTURE: Plaintiff employee sued cross-appellant limited liability company (LLC) and cross appellee company for injuries he sustained. The employee dismissed the company and settled his claims against the LLC for $ 150,000, to be paid by the LLC or the company. The United States District Court for the Eastern District of Louisiana ruled that the company had to indemnify the LLC for 50 percent of its settlement costs. Both parties appealed.
OVERVIEW: The employee was injured when a flash fire occurred on the LLC's jack-up vessel, which was involved with work on the company's well pursuant to a Blanket Time Charter agreement between the LLC and the company. The district court found the employee's injuries attributable to the LLC in the following manner: 50 percent by the absence of a working fire extinguisher and 50 percent by the collision with the drums. Thus, the company had to indemnify the LLC for 50 percent of its settlement costs. The appellate court found that because the LLC sought indemnity from the company, that claim was governed by paragraph (B) of the agreement, under which the company had to indemnify the LLC for all "Claims" that arose from injury to any of the company's or any of its subcontractors' personnel, representatives, agents, or invitees, and the employee's claim fell under that provision because he was an employee of a subcontractor of the company. Moreover, under the express exclusion from its duty to indemnify, the company had no duty to indemnify the LLC for breach of the warranty of seaworthiness since "claims" was defined to exclude claims for breach of warranties made by the LLC in the charter.
OUTCOME: The judgment of the district court was affirmed.
