Seaman's Contract Doesn't Always Require Arbitration

In THOMAS HINES v. CARNIVAL CORPORATION, 23 Fla. L. Weekly Fed. D225a (S.D. Fla. Mar. 29, 2012), a United States crew member who was injured on board cruise ship sued his employer cruise line, alleging claims of Jones Act negligence, unseaworthiness, failure to provide maintenance and cure, failure to treat, and seeking wages and penalties. The seaman sued in Florida state court and Carnival removed the case to federal court.

Judge Martinez of the U.S. District Court for the Southern District of Florida found that the federal court lacked jurisdiction over the case because the fourth jurisdictional requirement under 9 U.S.C. section 202 of a commercial relationship that has some reasonable relationship with one or more foreign states is not met where employee's Seafarer's Agreement contains no reference to performance abroad or in any foreign country, choice of law clause was also neutral, the plaintiff has alleged that he has not performed any employment duties on foreign soil, terms of agreement and work performed is largely associated with United States, employment agreements in effect at time of crew member's personal injuries were executed within United States, and subject agreements require payment to plaintiff in United States dollars. The Court further found that the country corresponding with flagged vessel is not persuasive in determining a relationship to a foreign state. The Court reasoned that Section 202 instructs courts to disregard foreign corporate status of a U.S. based company in deciding whether the relationship is international. In addition, the Court found that activity in international waters does not satisfy a relationship with one or more foreign states and because the fourth jurisdictional requirement of Convention on the Recognition and Enforcement of Foreign Arbitral Awards was not met, case was not removable and had to be remanded to state court.

This case, along with Matabang v. Carnival Corp., 630 F. Supp. 2d 1361 (S.D. Fla. 2009), stands for the proposition that seaman's employment agreements do not create a “relationship involv[ing] property located abroad, or [having] some other reasonable relation with one or more foreign states”, Matabang, 630 F. Supp. 2d at 1367, when the performance contract between the parties contains no reference to performance abroad or in any foreign state apart from the arbitration clause. 

If you are interested in receiving a full copy of this decision, please feel free to contact me at miamipandi@comcast.net or mov@chaloslaw.com.