United States District Court,

E.D. Pennsylvania.

SCOTTSDALE INS. CO., Plaintiff,

v.

Walter T. BROADDUS, et al., Defendants.

Civil Action No. 08-3241.

Feb. 11, 2009.

MEMORANDUM

DIAMOND, District Judge.

Plaintiff, Scottsdale Insurance Company, asks me to declare that it is not obligated to defend and indemnify its insured, Safecare Ambulance Services, in a pending state court negligence action. I decline to exercise jurisdiction over this matter.

I. BACKGROUND

On February 1, 2006, employees of Defendants Medical Transportation Management and Safecare allegedly dropped Eleanor Broaddus while carrying her down the front steps of her home in a wheelchair. (Doc. No. 1 ¶ 21; Ex. B. ¶ 9.) Mrs. Broaddus sustained severe injuries and died on February 6, 2006. (Doc. No. 1 ¶ 21; Ex. B ¶ 9.) On March 23, 2006, Scottsdale-Safecare’s commercial liability insurer-disclaimed coverage with respect to the Broaddus accident. (Doc. No. 1 ¶ 23.) On September 7, 2006, Scottsdale reconsidered, offering to defend Safecare under a reservation of rights. (Id. ¶ 26; Ex. D.) On June 2, 2008, Mrs. Broaddus’ husband, Walter, acting as administrator of her estate, brought a negligence action in the Philadelphia Common Pleas Court against Safecare and MTM. (Id.Ex. B.)

Invoking diversity jurisdiction, on July 10, 2008, Scottsdale filed the instant action under the Pennsylvania Declaratory Judgments Act, asking me to rule that it has no duty to defend or indemnify Safecare in the pending negligence case. Doc. No. 1; 28 U .S.C. § 1332(a); 42 Pa. Con. Stat. § 7531 et seq. Scottsdale named as Defendants Safecare, MTM, Walter Broaddus, and United States Fire Insurance Company (Safecare’s automobile liability carrier). After Safecare and MTM failed to plead or otherwise respond to the Complaint, the Clerk of Court entered defaults against them on October 27, 2008. Scottsdale moved for default judgment against Safecare and MTM on November 17, 2008. (Doc. Nos.14, 18.)

On December 2, 2008, I ordered the Parties to brief whether the Court should decline to exercise jurisdiction over this action. Doc. No. 21; see State Auto Ins. Co. v. Summy, 234 F.3d 131, 134 (3d Cir.2000) (district court abused its discretion when it exercised jurisdiction over a declaratory judgment action where a parallel declaratory action and a related tort action were pending in state court). I also denied Plaintiff’s Motions for Default Judgment without prejudice. Scottsdale and USF have submitted briefs in support of my exercising jurisdiction; Mr. Broaddus has submitted a brief in opposition. (Doc. Nos.22, 23, 24.)

II. LEGAL STANDARDS

As the Third Circuit has explained, “it is settled law that, as a procedural remedy, the federal rules respecting declaratory judgment apply in diversity cases.” Fed. Kemper Ins. Co. v. Rauscher, 807 F.2d 345, 352 (3d Cir.1986). Accordingly, my authority to exercise jurisdiction in this declaratory judgment action is governed by the federal Declaratory Judgment Act, which provides:

In a case of actual controversy within its jurisdiction, … any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration….

28 U.S.C. § 2201(a) (emphasis supplied). District courts have the discretion not to hear declaratory judgment actions brought under this provision. See, e.g., Wilton v. Seven Falls Co., 515 U.S. 277, 282, 287, 115 S.Ct. 2137, 132 L.Ed.2d 214 (1995) (the Declaratory Judgment Act “is an enabling act, which confers discretion on the courts rather than an absolute right on a litigant”) (quotations omitted). The Third Circuit has cautioned, however, that district courts do not have “open-ended discretion to decline jurisdiction over a declaratory action when the issues include[ ] federal statutory interpretation, the government’s choice of a federal forum, an issue of sovereign immunity, or inadequacy of the state proceeding.” State Auto Ins. Cos. v. Summy, 234 F.3d 131, 134 (3d Cir.2000) (citing United States v. Dep’t of Envtl. Res., 923 F.2d 1071, 1075 (3d Cir.1995)).

The Supreme Court has ruled that in the absence of these discretion-limiting factors, the district court should determine

whether the question in controversy between the parties to the federal suit … can better be settled in the proceedings pending in state court…. Naturally, this requires some inquiry into the scope of the state court proceeding, the nature of the defenses available there, and whether the claims of all parties of interest can satisfactorily be adjudicated in that proceeding.

Summy, 234 F.3d at 133 (citing Brillhart v. Excess Ins. Co. of America, 316 U.S. 491, 495, 62 S.Ct. 1173, 86 L.Ed. 1620 (1942)) (quotations and citations omitted).

The Third Circuit has set out additional criteria respecting the district court’s exercise of discretion:

(1) the likelihood that a federal court declaration will resolve the uncertainty of obligation which gave rise to the controversy; (2) the convenience of the parties; (3) the public interest in settlement of the uncertainty of the obligation; and (4) the availability and relative convenience of other remedies.

United States v. Dep’t. of Envtl. Res., 923 F.2d 1071, 1075 (3d Cir.1991).

In cases involving questions of insurance coverage, the Third Circuit has offered three additional considerations:

(1) A general policy of restraint when the same issues are pending in state court; (2) An inherent conflict of interest between an insurer’s duty to defend in state court and its attempt to characterize that suit in federal court as falling within the scope of a policy exclusion; (3) Avoidance of duplicative litigation.

See Summy, 234 F.3d at 134 (citing Dep’t. of Envtl. Res., 923 F.2d at 1075).

Finally, the Summy Court cautioned against “exercising jurisdiction over declaratory judgment actions where the state law involved is close or unsettled.”Id. at 135.Rather, “district courts should give serious consideration to the fact that they do not establish state law, but are limited to predicting it. This is especially important in insurance coverage cases….” Id.(emphasis supplied).

III. DISCUSSION

A. The Court’s Discretion to Decline Jurisdiction

Scottsdale and USF argue first that I must exercise jurisdiction in the absence of a “true” parallel proceeding pending in state court. They note that they are not parties to the Broaddus state court suit, which, in any event, will result only in a determination of whether Safecare employees were negligent, not whether Scottsdale must afford coverage to Safecare. (Doc. No. 22 at 8; Doc. No. 23 at 7.) Scottsdale and USF thus argue that “[t]his case does not fall within the ambit of Summy as the state court action is not a parallel declaratory judgment action….” (Doc. No. 22 at 14; see also Doc. No. 23 at 2.)

I disagree. The Summy Court did not make the pendency of identical state and federal declaratory actions a prerequisite to declining federal jurisdiction. Indeed, certain of the Summy factors-such as the “inherent conflict of interest between an insurer’s duty to defend in state court and its attempt to characterize that suit in federal court as falling within the scope of a policy exclusion”-contemplate a related state tort action, not a declaratory judgment action. Summy, 234 F.3d at 134. Moreover, applying the Summy factors, a panel of the Third Circuit has affirmed the dismissal of a declaratory action respecting insurance coverage when only a related tort action was pending in state court-the circumstances presented here. See Atlantic Mut. Ins. Co. v. Gula, 84 Fed. Appx. 173, 175 (3d Cir.2003).

Several courts in this Circuit have also concluded that under Summy, they may decline jurisdiction over a declaratory action in the absence of a pending state court declaratory action. See, e.g., United Fin. Cas. Co. v. Fornataro, No. 08-1301, 2008 WL 4283347, at(W.D.Pa. Sept.18, 2008) (“A fair reading of Summy indicates that the existence of a parallel state proceeding, although present there, is not a prerequisite to the district court’s proper exercise of discretion to decline jurisdiction over the case. Rather, it is but one factor a district court should consider.”); see also Rickenbach v. State Auto Ins. Co., No. 07-870, 2007 WL 1314889,(E.D.Pa. May 4, 2007); The Hartford v. Keystone Auto. Ops., No. 06-465, 2007 WL 257915, at(M.D.Pa. Jan.29, 2007); Empire Fire & Marine Ins. Co. v. Bennett, No. 05-4097, 2006 WL 932176, at(D.N.J. Apr.10, 2006).

Other Circuits have similarly reasoned that requiring the exercise of federal jurisdiction over a declaratory action in the absence of an identical state proceeding is inconsistent with the broad discretion the Declaratory Judgment Act confers. Scottsdale Ins. Co. v. Detco Indus., Inc., 426 F.3d 994, 999 (8th Cir.2005); Sherwin-Williams Co. v. Holmes County, 343 F.3d 383, 394 (5th Cir.2003); United States v. City of Las Cruces, 289 F.3d 1170, 1182 (10th Cir.2002); Scottsdale Ins. Co. v. Roumph, 211 F.3d 964, 967 (6th Cir.2000); Aetna Cas. & Sur. Co. v. IndCom Elec. Co. ., 139 F.3d 419, 423 (4th Cir.1998); Golden Eagle Ins. Co. v. Travelers Cos., 103 F.3d 750, 754 (9th Cir.1996). As the Fifth Circuit has explained:

[A] per se rule requiring a district court to hear a declaratory judgment action is inconsistent with the discretionary Brillhart and Wilton standard…. The lack of a pending parallel state proceeding should not automatically require a district court to decide a declaratory judgment action, just as the presence of a related state proceeding does not automatically require a district court to dismiss a federal declaratory judgment action.

Sherwin-Williams, 343 F.3d at 394.

USF nonetheless argues that in the absence of a parallel state court proceeding, principles of abstention require me to exercise jurisdiction over this matter. Doc. No. 23 at 11-15; see, e.g., Coregis Ins. Co. v. Wheeler, No. 97-7941, 1998 WL 430129 (E.D.Pa. July 24, 1998); Certain Underwriters at Lloyds, London v. Ross, No. 98-1037, 1998 WL 372304 (E.D.Pa. June 17, 1998). USF has confused abstention with the discretion not to hear a declaratory judgment action.

In the absence of a parallel state proceeding or exceptional circumstances, the district court may not abstain from hearing a non-declaratory case. See Colo. River Water Conservation Dist. v. United States, 424 U.S. 800, 817, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976); Interconsult, AG v. Safeguard Intern. Partners, 438 F.3d 298, 306 (3d Cir.2006) (“The threshold requirement for a district court to even entertain abstention is a contemporaneous parallel judicial proceeding.”). The Third Circuit has explained, however, there is an “important distinction between cases in which a federal district judge stays a case because of parallel state court proceedings and declaratory judgment cases which, because of their purely remedial and equitable nature, vest the district court with discretion.” Terra Nova Ins. Co. v. 900 Bar, Inc., 887 F.2d 1213, 1229 (3d Cir.1989) (quotations omitted). Accordingly, both the Third Circuit and the Supreme Court have stressed that “Colorado River… [does] not limit the traditional discretion of district courts to decide whether to hear declaratory judgment cases.” Id. at 1223;see also Wilton, 515 U.S. at 288-290 (rejecting the Colorado River “exceptional circumstances” test as inappropriate in declaratory actions). Rather, “[i]n the declaratory judgment context, the normal principle that federal courts should adjudicate claims within their jurisdiction yields to considerations of practicality and wise judicial administration.” Wilton, 515 U.S. at 288.

A number of Circuits have limited the discretion to decline jurisdiction over a declaratory action in the absence of a parallel state proceeding. See, e.g., Scottsdale, 426 F.3d at 998. The factors these Circuits have applied, however, are quite similar to those adopted by the Third Circuit. For instance, the Fourth Circuit has held that in the absence of a parallel state court proceeding, district courts must consider the following factors before declining jurisdiction:

(1) whether the declaratory judgment sought “will serve a useful purpose in clarifying and settling the legal relations in issue”; (2) whether the declaratory judgment “will terminate and afford relief from the uncertainty, insecurity, and controversy giving rise to the [federal] proceeding”; (3) “the strength of the state’s interest in having the issues raised in the federal declaratory judgment action decided in the state courts”; (4) “whether the issues raised in the federal action can more efficiently be resolved in the court in which the state action is pending”; (5) “whether permitting the federal action to go forward would result in unnecessary ‘entanglement’ between the federal and state court systems”; and (6) “whether the declaratory judgment action is being used merely as a device for ‘procedural fencing[.]’ ”

Aetna Cas. & Sur. Co., 139 F.3d at 422-23. The Sixth Circuit has held similarly. See Scottsdale, 211 F.3d at 968 (requiring consideration of: (1) “whether the judgment would settle the controversy”; (2) “whether the declaratory judgment action would serve a useful purpose in clarifying the legal relations at issue”; (3) “whether the declaratory remedy is being used merely for the purpose of ‘procedural fencing’ or ‘to provide an arena for a race for res judicata’ “; (4) whether the action will “increase the friction between our federal and state courts and improperly encroach on state jurisdiction”; and (5) “whether there is an alternative remedy that is better or more effective”). Thus, district courts in the Fourth and Sixth Circuits retain discretion not to hear declaratory actions even in the absence of parallel state proceedings.

Plainly, I retain discretion under the Declaratory Judgment Act to decline jurisdiction over the instant case despite the absence of a parallel state court action. How I exercise that discretion will turn on my application of the criteria articulated by the Supreme Court and the Third Circuit.

B. Application of the Discretionary Factors

1. A General Policy of Restraint When the Same Issues are Pending in State Court

Scottsdale and USF argue that I may not apply this policy of restraint because coverage issues have not yet been raised in the negligence action. (Doc. No. 22 at 7; Doc. No. 23 at 6-7.) In similar circumstances, a panel of the Third Circuit rejected this argument, explaining that “even if the coverage issue is not currently pending, it will as a matter of logic necessarily arise before the matter is concluded in state court [garnishment proceedings].” Gula, 84 Fed. Appx. at 175;see also Golden Eagle Ins. Co. v. Travelers Cos., 103 F.3d 750, 754 (9th Cir.1996) (“[N]othing in the Declaratory Judgment Act requires a parallel state proceeding in order for the district court to exercise its discretion … the potential for such a proceeding may suffice.”).

Under Pennsylvania law, “garnishment is a well-settled, viable remedy available to a judgment creditor to collect on a judgment from the judgment debtor’s insurer.” Butterfield v. Giutoli, 448 Pa.Super. 1, 670 A.2d 646, 651 (Pa.Super.Ct.1995). Moreover, the Gula Court emphasized that under Pennsylvania law, an insurer is entitled to raise the same coverage defenses in both declaratory judgment and garnishment proceedings. 84 Fed. Appx. at 175;see also Summy, 234 F.3d at 133 (district courts should consider the scope of the state court proceeding and the defenses available).

In these circumstances, the great likelihood that coverage issues will arise before the state court matter is concluded compels me to exercise “a general policy of restraint” over the exercise of jurisdiction here. Summy, 234 F.3d at 134.

2. The Convenience of the Parties and the Availability and Relative Convenience of Other Remedies

Scottsdale argues that if I decline jurisdiction, it will be forced to choose between two “inconvenient” options: (1) deny coverage immediately and possibly face a lawsuit for breach of contract; or (2) provide a defense, await the resolution of the state court action, “and seek recovery of attorney’s fees in the event that it was concluded that [Safecare’s] conduct is not covered .”(Doc. No. 22 at 14.)

Any “inconvenience” to Scottsdale is of its own making. Scottsdale could have sought declaratory relief in state court three years ago, when it declined coverage. See Gen. Accident Ins. Co. of Am. v. Allen, 547 Pa. 693, 692 A.2d 1089, 1096 (Pa.1997) (“[T]he duty to defend and the duty to indemnify may be resolved in a declaratory judgment action [under the Pennsylvania Declaratory Judgments Act.]”) (emphasis in original); see also Harleysville Mut. Ins. Co. v. Madison, 415 Pa.Super. 361, 609 A.2d 564, 566 (Pa.Super.1992) (“[An insurance company] has [the] right to seek a judicial determination of its obligations to [its insured], including its duty to defend him, in advance of the conclusion of the negligence action.”). Indeed, it may seek such declaratory relief in state court now. Neither Scottsdale nor USF have explained why a declaratory judgment action in the Philadelphia Common Pleas Court would be less “convenient” than this federal action.

Accordingly, I conclude that the convenience of the Parties and the availability of another remedy weighs against exercising jurisdiction here.

3. Close or Unsettled State Law Questions

Contrary to the suggestions of Scottsdale and USF, the Pennsylvania law governing this dispute is far from clear. (Doc. No. 22 at 11.) Scottsdale bases its coverage disclaimer on two provisions in Safecare’s insurance policy: (1) the exclusion for injuries “arising out of the ownership, maintenance, use or entrustment to others” of any automobile (which defines “use” to include “loading and unloading”) (Doc. No. 1 ¶ 36-37, Ex. A); and (2) a “Designated Operations Exclusion” schedule that applies to injuries that occur during “Passenger Loading/Unloading” (Doc. No. 1 ¶ 34, Ex. A). Both provisions present unsettled legal questions.

Scottsdale contends that under the first exclusion, settled Pennsylvania law provides that Scottsdale is not required to indemnify Safecare if Mrs. Broaddus’ injuries arose from the “use” of the ambulance-including the loading and unloading of the vehicle. Doc. No. 22 at 11; Doc. No. 1 at 9; Mfrs. Cas. Ins. Co. v. Goodville Mut. Cas. Co., 403 Pa. 603, 170 A.2d 571, 573 (1961) ( “ ‘But for’ causation … is enough to satisfy [the automobile “use” exclusion] of the policy.”).

USF disagrees, arguing that under Pennsylvania law, “[t]o bring the [Broaddus] accident within the ‘loading and unloading’ clause of the policy … [t]he [ambulance] must have been directly connected with the work of loading….” Presbyterian-Univ. of Penn. Med. Ctr. v. Keystone Ins. Co., 251 Pa.Super. 71, 380 A.2d 381, 382-83 (Pa.Super.1977) (citing Ferry v. Protective Indem. Co. of N.Y., 155 Pa.Super. 266, 38 A.2d 493, 494 (Pa.1944)); Doc. No. 23 at 7-11. Because Safecare’s ambulance apparently was not “directly connected” to the “loading” of Mrs. Broaddus, USF argues that under settled Pennsylvania law, Scottsdale is obligated to indemnify Safecare for the Broaddus accident. (Doc. No. 23 at 11.)

That Scottsdale and USF thus offer these absolutely contrary arguments respecting the policy’s “loading and unloading” clause eloquently underscores that state law governing the clause is far from settled.

Scottsdale also relies on a provision that excludes coverage for injuries arising out of the operation of “Passenger Loading/Unloading.” The policy does not define this operation as an extension of the “use” of an automobile, however. (Doc. No. 1 ¶ 34, Ex. A.) Pennsylvania courts apparently have never considered or interpreted a “loading and unloading” clause that is not an extension of an automobile “use” clause. Cf. Keystone, 380 A.2d at 382. Moreover, Pennsylvania courts have not chosen between the competing doctrines of causation-the “complete operations” doctrine or the “coming to rest” doctrine-that apply to such a clause. See Scottsdale Ins. Co. v. Travelers Ins. Co., No. 94-6710, 1995 WL 517631, at(E.D.Pa. Aug.29, 1995) (“Pennsylvania has not adopted the ‘complete operations’ doctrine … or the ‘coming to rest’ doctrine also offered by Plaintiff.”); Allstate Ins. Co. v. Sentry Ins., 563 F.Supp. 629, 634 (E.D.Pa.1983) (same); see also Fed. Ins. Co. v. Mich. Mut. Liab. Co., 277 F.2d 442, 445 (3d Cir.1960) (“there is no clear enunciation of which [of these doctrines] Pennsylvania would apply”). Under the “coming to rest” doctrine-which Scottsdale implicitly urges me to reject here-a “loading and unloading” exclusion applies only to “the actual removal or lifting of the cargo from the vehicle or its placement on it.” Scottsdale, 1995 WL 517631, atn. 2. Under the “complete operations” doctrine-which Scottsdale implicitly urges me to adopt-a “loading and unloading” exclusion applies to “the complete operation of transporting the goods between the vehicle and the place from or to which they are being delivered.”Id.

The causation doctrine I apply could well determine Scottsdale’s coverage obligations. I may not resolve open questions of Pennsylvania law so critical to this case simply because Scottsdale or USF urges me to do so. As the Third Circuit has cautioned, “the state’s interest in resolving its own law must not be given short shrift simply because one party or, indeed, both parties, perceive some advantage in the federal forum.” Summy, 234 F.3d at 136. Accordingly, these unsettled state law questions weigh strongly against exercising federal jurisdiction here. See id. at 135 (“[W]here the applicable state law is uncertain or undetermined, district courts should be particularly reluctant to entertain declaratory judgment actions.”).

4. Avoidance of Duplicative Litigation

My determination of Scottsdale’s coverage obligations-and my resolution of the attendant state law questions-would seem necessarily to require the Parties to try before me a version of the state court negligence case. Scottsdale disagrees, arguing that in resolving the instant coverage dispute, there will be no need for a trial of any kind; rather, I would rely exclusively on the factual allegations in the state court complaint. (Doc. No. 22 at 12.) Scottsdale has confused its duty to defend Safecare with its duty to indemnify Safecare.

Under Pennsylvania law, an insurer’s duty to defend is “fixed solely by the allegations in the underlying complaint.” Erie Ins. Exchange v. Muff, 851 A.2d 919, 926 (Pa.Super.Ct.2004). An insurer has a duty to defend an insured if the underlying Complaint sets forth a claim that “may potentially” fall within the coverage provided by the policy. Lucker Mfg., Inc. v. The Home Ins. Co., 23 F.3d 808, 813 (3d Cir.1994). Unlike the duty to defend, however,

the duty to indemnify cannot be determined merely on the basis of whether the factual allegations of the complaint potentially state a claim against the insured. Rather, there must be a determination that the insurer’s policy actually covers a claimed incident.

Am. States Ins. Co. v. State Auto Ins. Co., 721 A.2d 56, 63 (Pa.Super.Ct.1998) (quotations omitted).

Accordingly, in determining Scottsdale’s duty to indemnify, I must consider evidence relating to the Broaddus incident itself. See State Farm Fire & Cas. Co. v. Cooper, No. 00-5538, 2001 WL 1287574, at(E.D.Pa. Oct.24, 2001) (citing Am. States, 721 A.2d at 63). Given that the Parties appear to dispute facts critical to the coverage questions-including where Mrs. Broaddus was dropped and whether she was leaving or returning to her home at the time-the evidentiary presentation could well be substantial. See Doc. No. 1, Ex. D at 2. In these circumstances, to determine whether Scottsdale has a duty to indemnify Safecare, I must engage in the same factual inquiry that is central to the state court negligence action. This is exactly the kind of duplicative litigation district courts are encouraged to avoid. See Nationwide Mut. Fire Co. v. Shank, 951 F.Supp. 68, 71-72 (E.D.Pa.1997) (“[T]he duty to indemnify need not, and sometimes should not be, be determined until the state court has evaluated the facts.”) (citing Youngman v. CNA Ins. Co., 401 Pa.Super. 381, 585 A.2d 511, 514 (Pa.Super.Ct.1991)). Indeed, as the Summy Court explained, had the district court declined jurisdiction,

the state court would have been able to develop a coordinated schedule of briefing and discovery that would have promoted the efficient resolution of both the declaratory judgment action and the underlying tort action, thereby conserving judicial resources as well as those of the parties.

Summy, 234 F.3d at 135-36.

In sum, I conclude that the interest in avoiding duplicative litigation weighs strongly against exercising jurisdiction over this action.

5. The Inherent Conflict of Interest Between An Insurer’s Duty to Defend in State Court and Its Attempt to Characterize that Suit in Federal Court as Falling Within the Scope of a Policy Exclusion

This kind of conflict inevitably arises when “the same factual question lies at the heart of both an insurance coverage dispute and the underlying tort action.” Terra Nova, 887 F.2d at 1225 (quotations omitted). Scottsdale argues that no conflict exists because there are no such overlapping factual questions. (Doc. No. 22 at 7-8.) As I have explained, however, the same factual questions respecting the Broaddus accident are critical to both the negligence action and this declaratory action. The resulting conflict that Scottsdale has imposed on itself is unseemly and weighs heavily against exercising jurisdiction over this matter. Summy, 234 F.3d at 134.

5. The Likelihood that a Federal Court Declaration Will Resolve the Uncertainty of Obligation Which Gave Rise to the Controversy, and the Public Interest in Settlement of the Uncertainty of that Obligation

Although my decision here will likely determine whether Scottsdale has a duty to defend and indemnify Safecare, that alone does not convince me to exercise jurisdiction. Moreover, I do not see how the public interest is served by a federal court (rather than a state court) resolving the coverage questions Scottsdale has raised. See Summy, 234 F.3d at 136 (“The desire of insurance companies and their insureds to receive declarations in federal court on matters of purely state law has no special call on the federal forum.”). Rather, this action presents “the all too common case of an insurance company coming to federal court, under diversity jurisdiction, to receive declarations on purely state law matters.” United Fin. Cas. Co. v. Fornataro, No. 08-1301, 2008 WL 4283347, at(W.D.Pa. Sept.18, 2008).

IV. CONCLUSION

None of the Summy Court’s discretion-limiting factors is present here. Moreover, virtually all the remaining criteria articulated by the Supreme Court and the Third Circuit weigh against my exercising jurisdiction here. Plainly, “the question in controversy between the parties to [this] suit … can better be settled in the proceedings pending in state court….” Summy, 234 F.3d at 133 (citing Brillhart, 316 U.S. at 495). Accordingly, I decline to exercise jurisdiction and will dismiss this case.

An appropriate Order follows.

United States District Court,

W.D. Louisiana,

Lafayette Division.

Peter C. SCHEXNAYDRE

v.

ARIES MARINE CORP.

Civil Action No. 06-0987.

Jan. 29, 2009.

Charles L. Dirks, III, Daniel L. Avant, Sherri L. Gregoire, Avant & Falcon, Baton Rouge, LA, for Peter C. Schexnaydre.

George C. Plauche’, Plauche’ & Plauche’, Lafayette, LA, for Aries Marine Corp.

RULING

REBECCA F. DOHERTY, District Judge.

The instant lawsuit arises out of the termination of plaintiff, an employee of Aries Marine Corporation (“Aries Marine”), allegedly in violation of the Family and Medical Leave Act (“FMLA”). This matter has been submitted to the Court for consideration on briefs. Additionally, the matter has been bifurcated at the request of the parties, that is, the issue of liability/applicability of the FMLA will be tried first, and, should the FMLA be found to apply, the issue of damages will then be tried.

Plaintiff contends he requested leave and did not appear for his crew change on June 23, 2005 in order to care for his wife, who was suffering from seizures and was under a doctor’s orders not to be alone.

Although the plaintiff does not identify exactly which provisions of the FMLA the defendant is alleged to have violated under the FMLA in his complaint, this Court notes the FMLA begins at 29 U.S.C. § 2601.

Aries Marine argues the plaintiff was assigned to the M/V Calvin Bayne on the date he requested leave, and that the M/V Calvin Bayne was assigned to the Port of Cameron. Louisiana on that date. Aries Marine contends the Port of Cameron is plaintiff’s “worksite” and that, because Aries Marine employs less than 50 people within 75 miles of the Port of Cameron, the plaintiff is not an eligible employee under the FMLA. As the FMLA provides this Court’s only jurisdictional basis for the lawsuit, Aries Marine argues plaintiff’s claims should be dismissed.

Plaintiff acknowledges he was scheduled for a crew change on the M/V Calvin Bayne on June 23, 2005-the date after he requested leave-but argues his worksite was Aries Marine’s corporate office in Youngsville, Louisiana, because that is the place from which his work was assigned. Plaintiff argues ports changed as the needs of defendant’s customers changed, but the Youngsville office was always the office that assigned plaintiff’s work.

The issue is critical, because the location of plaintiff’s worksite determines whether he is an eligible employee under the FMLA, As noted below, the parties have stipulated fewer than fifty employees worked within a seventy-file mile radius of the Port of Cameron, but more than fifty employees worked within a seventy-five mile radius of the Youngsville office. Thus, if this Court determines the plaintiff’s worksite is the Port of Cameron, this Court must find plaintiff is not an eligible employee under the FMLA. If the Court so finds, this Court will not have subject matter jurisdiction over this case, and the case must be dismissed.

I. Facts

The parties have stipulated to the following facts:

1. The Plaintiff was hired on December 6, 1999 as an able-bodied seaman and assigned to the M/V Ram Charger, working 28 and 14;

2. On August 27, 2001, after receiving his mate’s license, the Plaintiff was promoted to mate and assigned to the M/V Challenger working 28 and 14;

3. On February 20, 2002, after requesting to transfer to a boat with a 14 and 14 crew schedule, the Plaintiff was transferred to the M/V Allison where he remained as mate through May 2005;

4. On June 23, 2005 Plaintiff was scheduled for crew change on the M/V Calvin Bayne, an Aries Marine supply boat which had been under charter and working out of the port of Cameron, Louisiana for several months:

5. Aries Marine crew member’s boat assignments are generally permanent. A crew member’s boat assignment may be changed only if the crew member is promoted, he exhibits poor work performance, he becomes unable to get along with the rest of the crew, or he requests reassignment;

6. In excess of fifty employees worked within a seventy-five mile radius of the Aries Marine Corporation office located in Youngsville, Louisiana;

7. Less than fifty employees worked within a seventy-five mile radius of the Port of Cameron, Louisiana;

8. All mates, including Peter Schexnaydre, employed by Aries Marine were required to call the Youngsville, Louisiana office prior to the beginning of their 14 day workshift in order to learn the location of their assigned vessel;

9. In June 2005, Plaintiff worked 14 and 14 for Aries Marine as a supply boat mate.

10. In June 2005, Aries Marine owned and operated nine offshore supply boats under time charter to oil and gas industry customers to supply offshore platforms located in the Gulf of Mexico. Each time charter was for an unspecified period of time and would last anywhere from a few days to more than a year, depending on the needs of the customer;

11. While under charter, each Aries Marine supply boat operated out of the port nearest to the customer’s offshore platform. Each boat was re-supplied, refueled, and loaded with supplies for the platform at the port and under the customer’s direction;

12. Aries Marine supply boat crew members began and ended each hitch at the port out of which the supply boat to which they were assigned operated;

13. Each supply boat’s day-to-day duties and assignments were directed by a dispatcher located in an office at the port;

14. Each boat crew member received his day-to-day assignments from his next in command on the boat. The next in command also supervised and evaluated that crew member’s work; and

15. As mate, Plaintiff was under the captain’s direct supervision.

II. Applicable Law

The FMLA entitles eligible employees of covered employers to take up to twelve weeks of unpaid, job-protected leave each year due to, inter alia, the birth or adoption of a child, to care for a family member, or because of a serious health condition. 29 U.S.C. § 2612(a)(1). The term “eligible employee” does not include:

any employee of any employer who is employed at a worksite at which the employer employs less than 50 employees if the total number of employees employed by that employer within 75 miles of that worksite is less than 50.

29 U.S.C. § 2611(2)(B)(ii). The foregoing provision is called the “50-75” rule.

29 U.S.C. 2611(2)(B)(ii) states the following:

(B) Exclusions

The term “eligible employee” does not include-

(ii) any employee of an employer who is employed at a worksite at which such employer employs less than 50 employees if the total number of employees employed by that employer within 75 miles of that worksite is less than 50.

See also Bellum v. PCE Constructors, 407 F.3d 734, 739-740 (5th Cir.2005)(holding that the 75 miles is measured in surface miles, not as the crow flies,).

Pursuant to the provisions of the FMLA, the Department of Labor has prescribed such regulations as are necessary to carry out the FMLA. 29 U.S.C. § 2654. Pursuant to the regulations, where a worker has no fixed worksite, the regulations define the worksite as the site assigned as the worker’s home base, the site from which his or her work is assigned, or the site to which he or she reports. See29 C.F.R. § 825.111(a)(2). The CFR goes on to discuss the concept of “worksite” as follows:

(2) For employees with no fixed worksite, e.g., construction workers, transportation workers (e.g., truck drivers, seamen, pilots), salespersons, etc., the “worksite” is the site to which they are assigned as their home base, from which their work is assigned, or to which they report. For example, if a construction company headquartered in New Jersey opened a construction site in Ohio, and set up a mobile trailer on the construction site as the company’s on-site office, the construction site in Ohio would be the worksite for any employees hired locally who report to the mobile trailer/company office daily for work assignments, etc. If that construction company also sent personnel such as job superintendents, foremen, engineers, an office manager, etc., from New Jersey to the job site in Ohio, those workers sent from New Jersey continue to have the headquarters in New Jersey as their “worksite.” The workers who have New Jersey as their worksite would not be counted in determining eligibility of employees whose home base is the Ohio worksite, but would be counted in determining eligibility of employees whose home base is New Jersey. For transportation employees, their worksite is the terminal to which they are assigned, report for work, depart, and return after completion of a work assignment. For example, an airline pilot may work for an airline with headquarters in New York, but the pilot regularly reports for duty and originates or begins flights from the company’s facilities located in an airport in Chicago and returns to Chicago at the completion of one or more flights to go off duty. The pilot’s worksite is the facility in Chicago.An employee’s personal residence is not a worksite in the case of employees such as salespersons who travel a sales territory and who generally leave to work and return from work to their personal residence, or employees who work at home, as under the new concept of flexiplace. Rather, their worksite is the office to which the report and from which assignments are made.

Id. (emphasis added).

Both parties acknowledge there are no published opinions in the Fifth Circuit discussing the definition of “worksite” under the FMLA as applied to a worker with no fixed worksite.In the Senate Report issued in connection with the passage of the FMLA, the Senate wrote:

In an unpublished decision. Hill v. Research Institute of America Group, 209 F.3d 719 (5th Cir.2000), the court held a salesperson’s worksite was Dallas because that was the residence of her supervisor from whom she received her assignments, to whom she reported her sales, and who monitored her sales and probationary employment periods.

The term “worksite” is intended to be construed in the same manner as the term “single site of employment” under the Worker Adjustment and Retraining Notification Act (“WARN”), 29 U.S.C. 2101(a)(3)(B), and regulations under that Act (20 CFR Part 639).Where employees have no fixed worksite, as is the case for many construction workers, transportation workers, and salespersons, such employees’ “worksite” should be construed to mean the single site of employment to which they are assigned as their home base, from which their work is assigned, or to which they report.

Sen. Rep. No. 103-3, at 23 (1993), reprinted in 1993 U.S.C.C.A .N. 3, 25 (emphasis added).

Considering the foregoing, in this matter, plaintiff’s “worksite” will be either his home base. the place from which his work was assigned, or the place to which he reported. In the absence of Fifth Circuit caselaw addressing the issue, this Court will review the decisions of other circuits interpreting the WARN Act for guidance in determining the plaintiff’s worksite in this matter.

1. Home Base

“An employee’s home base is the place from which he leaves at the start of the work period and/or returns to at the end of the work period, or at the very least, where he is physically present at some point during a typical work period.” Bader v. Northern Line Layers, Inc., 503 F.3d 813, 819-20 (9th Cir.2007) (interpreting the WARN Act), citing Ciarlante v. Brown & Williamson Tobacco Corp ., 143 F.3d 139, 146 (3rd Cir.1998) (in case interpreting WARN Act, court held home base refers not to the physical base of the employer’s operations, but rather to the physical base of the employee; “a traveling employee’s ‘home base’ must at a minimum be a location at which the employee is physically present at some point during a typical business trip.”); Teamsters Local Union 413 v. Driver’s, Inc., 101 F.3d 1107, 1110 (6th Cir.1996) (in case interpreting WARN Act, court held each truck base terminal provided the plaintiffs’ home base because it was the physical location where “each trucker starts and ends his or her workweek.”).

2. Place Where Assignments are Made

The courts interpreting this factor have focused on the place from which day-to-day instructions and assignments are given to employees and the location of day-to-day management of workers. See, e.g., Bader, 503 F.3d at 820-21 (worksite was remote construction location-rather than corporate headquarters-where day to day instructions and management occurred on-site).See also Driver’s, Inc., 101 F.3d at 1111 (holding that trucking terminals constituted various sites of employment because day-to-day operations were run out of these terminals, even though route assignments were made from a centralized location elsewhere).

3. Place to Which Employee Reports

“The site to which an employee at a remote location reports is the site at which management issues work orders, and directly reviews a remote employee’s job performance and work product in order to evaluate progress and set goals.” Bader, 503 F.3d at 821,citing Ciarlante, 143 F.3d at 148 (the place to which traveling salespeople reported was “the location of the personnel who were primarily responsible for reviewing sales reports and other information sent by the sales representatives, in order to record sales, assess employee performance, develop new sales strategies, and the like”). In Bader, the court held that “reporting” to corporate headquarters for the purposes of payroll and other centralized administrative functions is insufficient, standing alone, to qualify corporate headquarters as the single site of employment. See also Driver’s, Inc., 101 F.3d at 1110-11 (fact that corporate headquarters had some “operational” control is not dispositive; centralized payroll and certain other centralized managerial or personnel functions are not enough to deem the location a “single site” for purposes of worksite).

III. Analysis

After review of the briefs of the parties, the relevant facts, and the applicable law, this Court concludes the plaintiff’s worksite is the Port of Cameron, Louisiana. First, this Court notes the plaintiff had been given a work assignment, a vessel; the plaintiff worked aboard the vessel to which he was assigned, and the parties have stipulated the Aries Marine crew members’ boat assignments were generally permanent and an assignment was only changed if the crew member was promoted, exhibited poor work performance, was unable to get along with the rest of the crew, or requested reassignment. In this case, prior to being assigned to the M/V Calvin Bayne, the plaintiff had been assigned to the M/V Allison from February 20, 2002 through May 2005, a period of more than three years. In its trial brief, Aries Marine alleges plaintiff was assigned to the M/V Calvin Bayne because of alleged poor work performance and inability to get along with the crew of the M/V Allison, and the plaintiff does not dispute these facts. Therefore, plaintiff’s work record reflects crew members were generally semi-permanently attached to a vessel rather than loosely assigned to various vessels in the fleet at any given time.

This Court could envision a circumstance where a mate might service a fleet rather than a single vessel and be randomly and temporarily sent to several different vessels among the whole fleet to “fill in” where and as needed and thus might not be considered to be permanently or semi-permanently attached to any single vessel. Under these circumstances, the result reached today could, potentially, be different.

The parties have also stipulated the M/V Calvin Bayne had been assigned to the Port of Cameron “for several months” on June 23, 2005, the date plaintiff was scheduled for a crew change aboard the vessel. Additionally, the parties stipulated each time charter lasted for an unspecified period of time, from a few days to more than a year, depending on the customer’s needs. Thus, at the time in question, the M/V Calvin Bayne was operating out of the Port of Cameron, Louisiana for some time and was operating out of that port site for re-supplying, re-fueling, and crew changes for the duration of that time charter.

The parties further stipulated that while under charter, each Aries Marine supply boat operated out of the port nearest to the customer’s offshore platform. Each boat was re-supplied, refueled, and loaded with supplies for the platform at the port and under the customer’s direction. Furthermore, boat crew members began and ended each hitch at the port out of which the supply boat to which they were assigned operated, and each supply boat’s day-to-day duties and assignments were directed by a dispatcher located in an office at the port. Each boat crew member received his day-to-day assignments from his next in command on the boat, who also supervised and evaluated that crew member’s work each day. As mate, the plaintiff was under the captain’s direct supervision. A crew member was not considered to have made crew change until he reported for duty aboard the vessel at the port site.

In the instant case, the Port of Cameron was the port site to which the plaintiff would have reported at the beginning of his hitch; he would have returned to that port at the end of his hitch, and he was considered not have made crew change when he failed to report to that port site. Significantly, however, the plaintiff did contact the Youunsgille office the day before his crew-change, however, contacting the Youngsville office did not satisfy crew change. Therefore, the Port of Cameron was plaintiff’s home base while working aboard this vessel.

Additionally, this Court concludes the Port of Cameron was the place where plaintiffs assignments were made. Although plaintiff argues crew members were required to contact the Youngsville office the night before a hitch to “receive [their assignments],” actually, the purpose of contacting the Youngsville office was to “learn the location of their assigned vessel,” as the parties stipulated in their Stipulations. Once on the vessel at the port site, crew members received their actual day-to-day assignments from their next-in-command. Therefore, the crew members did not receive their assignments from Youngsville. Rather, they learned the location of their vessel from Youngsville. Once on the vessel, the crew members received their day-to-day assignments, as well as day-to-day management and supervision by their superiors. Therefore, the place where the plaintiff’s assignments were made-for purposes of this case-was the Port of Cameron.

Finally, the third factor-the place to which the employee reports-this Court finds also to be the Port of Cameron. Here, Aries Marine crew members received their work orders from the port dispatcher and directly from their next-in-command on the boat. Each crew member was supervised on the vessel, and each crew member’s job performance was reviewed and evaluated by the boat captain. Therefore, the site to which the plaintiff reported-for purposes of this case-was the Port of Cameron, not the Youngsville office.

The record shows two functions of the Youngsville office that are relevant to our present inquiry: (1) crew members were required to contact the Youngsville office the night before a crew change to learn the location of their assigned vessel; and (2) a crew member could be transported from the Youngsville office to his port site if he lived further from his port site than Youngsville. Neither function requires physical presence in or contact with Youngsville, a factor the courts have focused on in determining at least the home base of an employee. See, e.g., Ciarlante, 143 F .3d at 146 (“a traveling employee’s ‘home base’ must at a minimum be a location at which the employee is physically present at some point during a typical business trip”). Furthermore, based on this Court’s understanding of the cases interpreting the WARN Act, that Youngsville might have some “operational” or other centralized managerial or personnel control over the outlying ports is not sufficient to designate Youngsville as plaintiff’s worksite in this case.

For the foregoing reasons, this Court concludes the evidence weighs in favor of a finding that the Port of Cameron, Louisiana is the plaintiff’s worksite in this case.

Burden of Proof

Finally, this Court notes defendant filed a well-reasoned and well-supported brief, setting forth caselaw interpreting the “worksite” factors as those factors are interpreted by courts in other circuits interpreting the WARN Act and evidence to support its argument. Aries Marine evaluated each of the worksite “factors” and presented evidence and set forth a cogent argument for why each factor militates in favor of this Court’s finding that the Port of Cameron is the plaintiff’s worksite.

On the other hand, plaintiff’s trial brief consists of less than one full page of actual legal analysis and little evidence, if any, beyond that already addressed. Specifically, the entirety of plaintiff’s argument is that because Aries Marine crew members were required to contact the Youngsville office the night before a hitch to determine the location of their assigned vessel, such fact should render the Youngsville office the plaintiff’s worksite.

This Court notes this matter has been submitted to the Court on the merits and by way of briefs. Plaintiff has the burden of proving his status as an eligible employee under the FMLA; based on the trial brief filed by the plaintiff, this Court concludes plaintiff has failed to carry that burden.

IV. Conclusion

For the foregoing reasons, this Court concludes the evidence shows the plaintiff’s worksite for purposes of the Family and Medical Leave Act is the Port of Cameron, Louisiana. The Court further concludes the plaintiff has failed to carry his burden of showing he is an eligible employee under the Family and Medical leave Act. As such, the plaintiff is not an eligible employee under the FMLA, Therefore, this Court lacks subject matter jurisdiction over this case, and plaintiff’s claims against Aries Marine are DISMISSED WITH PREJUDICE.

W.D.La.,2009.

Schexnaydre v. Aries Marine Corp.

Slip Copy, 2009 WL 222958 (W.D.La.)

END OF DOCUMENT