Conception judge ruling gives early look into navigation of maritime injury, death cases

Conception passengers couldn't have expected to die in a fiery boat crash during a diving trip, nor could their heirs be barred from seeking punitive damages from it under maritime law, a U.S. judge ruled.

On Wednesday, U.S. District Judge Percy Anderson of Los Angeles made his first preliminary rulings in a complex maritime and admiralty case arising from 34 deaths over Labor Day weekend. Conception's owners Glen and Dana Fritzler invoked a maritime liability limitation defense just three days after the boat caught fire and sank off the Santa Barbara Island channel. Thirty-three passengers and one crew member died. Five crew members survived. In the matter of Complaint of Truth Aquatics, Inc. et al., 2:19-cv-07693 (C.D. Cal., filed Sept. 5, 2019).

In his ruling, Anderson struck down the Fritzlers' assumption of risk affirmative defense and also disagreed that victims can't pursue punitive damages. Although the origin and cause of the fire remain unknown, Anderson wrote "the Court cannot ignore the clear plethora of case law dictating that assumption of risk is not a valid defense under maritime/admiralty jurisdiction."

Punitive damages are also available under general maritime law, Anderson wrote.

"California law has a higher standard and burden of proof for punitive damages that conflicts with the standard under general maritime law," his ruling states. "State law may supplement maritime law when maritime law is silent, or where a local matter is at issue, but state law may not be applied where it would conflict with federal maritime law."

The judge deferred his decision on the Fritzlers' affirmative defense, invoking the Death on High Seas Act and the Miles uniformity principle, which could deprive Conception victims of a major avenue for recovery. There isn't enough information regarding the exact location of the boat when the fire broke out, which the judge said he needs to determine whether the incident took place on the high seas beyond three nautical miles from U.S. shore in light of DOHSA, Anderson ruled.

Victims have until July to file claims against the Fritzlers' limitation action, and no discovery will commence until then.

John R. Hillsman, partner at the Law offices of McGuinn Hillsman & Palefsky, and the Fritzlers' lawyer, James F. Kuhne Jr. of Gordon Rees Scully Mansukhani LLP, have battled for weeks over which defenses would be pursued in litigation, which included the assumption of risk and recovery limits in maritime cases.

Hillsman said Wednesday Anderson made the right decision, pointing out the primary and secondary assumptions of risk have no place in admiralty law, as it birthed the doctrine of comparative negligence.

Hillsman also said it was important to attack as many defenses as possible and resolve legal issues at the outset, which he said he hopes would lay groundwork for future claimants.

Kuhne could not be reached for comment Wednesday.

Martin Davies, an admiralty law professor at Tulane University who is uninvolved in the case, agreed Anderson was correct in all of his decisions.

"Striking defenses about assumption of risk is clearly correct. As the judge points out, this defense has never been part of general maritime law, and attorneys for Truth Aquatics surely know it. I can't think of why they put it in there in the first place," Davies said.

However, the availability of punitive damages in passenger claims is a more contested question, and it is understandable why the Fritzlers' argued those would be available only in cases of malicious or willful misconduct, Davies observed.

The judge clearly stuck with the view of the 9th U.S. Circuit Court of Appeals, which has been consistent with U.S. Supreme Court authority that requires a lesser but still egregious standard of misconduct and would include gross negligence. Davies said that might be significant in this case.

The battle over punitive damages would be pointless if the Fritzlers succeed in their quest to limit liability. The limitation amount would be less than the amount of compensatory damages and much less than punitive damages, Davies said.

Punitive damages would only come into question if the limit is defeated which both claimants and the Fritzlers obviously think is a real possibility, Davies said.