Opinion
No. 5-850 / 04-1910
Filed February 1, 2006
Appeal from the Iowa District Court for Pottawattamie County, Gordon C. Abel, Judge.
Harvey's Casino and Ameristar Casinos Council Bluffs, Inc. appeal after the workers' compensation commissioner determined that the agency had subject matter jurisdiction to hear the employees' petitions. REVERSED.
Scott A. Lautenbaugh and William D. Gilner of Nolan, Olson, Hansen Lautenbaugh, LLP, Omaha, Nebraska, for appellant.
John B. Morrow and Tiernan T. Siems of Erickson Sederstrom, P.C., Omaha, Nebraska, for appellant.
Michael Obradovich, Omaha, Nebraska, for appellant.
Jacob J. Peters of Peters Law Firm, Council Bluffs, for appellees.
Considered by Sackett, C.J., and Vogel and Eisenhauer, JJ.
Harvey's Casino and Ameristar Casinos Council Bluffs, Inc. appeal after the workers' compensation commissioner found that certain employees were not "seamen" for purposes of the Jones Act, 46 U.S.C. app. § 688 (2001). The district court affirmed the agency. The agency concluded the employees were not seamen because the agency found that the riverboat casinos on which the employees worked were not "vessels in navigation." The result of the conclusion the employees were not seamen was that the workers' compensation commissioner had subject matter jurisdiction to hear the petitions of the employees. On appeal, Harvey's and Ameristar argue the agency erred in finding their riverboats were not vessels in navigation and that the agency had subject matter jurisdiction to hear the petitions. We reverse the agency decision and dismiss the employees' petitions for workers' compensation benefits for lack of subject matter jurisdiction.
I. BACKGROUND FACTS AND PROCEEDINGS.
This appeal results after the cases involving Beverly Isenhour, Amanda Davis, and Helen Falanga (collectively referred to as the "employees") were consolidated into one case for judicial review of the agency action and the district court affirmed the agency. In separate actions at the agency level, Harvey's and Ameristar contended the Iowa Workers' Compensation Commissioner did not have subject matter jurisdiction to hear the claims of the employees because they were "seamen" within the contemplation of the Jones Act and, therefore, the Jones Act provided the exclusive remedy for the employees.
On July 23, 2001, Isenhour filed a petition with the workers' compensation commissioner. She claimed to have sustained injuries while working on a riverboat casino owned by Harvey's, the Kanesville Queen. Davis filed a petition with the workers' compensation commissioner on March 5, 2001, alleging that she sustained injuries while working on a riverboat casino owned by Ameristar. Falanga filed a petition with the workers' compensation commissioner on August 3, 2001, alleging that she sustained injuries while working on a riverboat casino owned by Ameristar.
Harvey's and Ameristar filed motions to dismiss for lack of subject matter jurisdiction in the cases against them. Iowa Code section 85.1(6) (2001) provides that injured workers covered by a method of compensation established by the Congress of the United States are exempt from coverage by Iowa's workers' compensation law. Harvey's and Ameristar argued that the employees were covered by the Jones Act, and thus they were exempt from coverage by Iowa's workers' compensation law. Initially, the respective deputy assigned to each case granted the motions and dismissed the petitions for lack of subject matter jurisdiction. After a series of administrative appeals and evidentiary hearings, the agency reversed the decision on the issue of subject matter jurisdiction. On June 22, 2004, the workers' compensation commissioner held that the Ameristar riverboat casino was not a vessel in navigation and Davis and Falanga were not seamen within the meaning of the Jones Act. Therefore, the commissioner ruled that the Iowa Workers' Compensation Commission had jurisdiction and the cases were remanded to a deputy for a hearing. A week later, the commissioner handed down a similar decision in Isenhour's case. The commissioner then awarded Isenhour forty-five percent industrial disability.
The cases of Isenhour, Davis, and Falanga were consolidated into one action when judicial review was taken by the district court. The district court affirmed the agency. The district court concluded Harvey's and Ameristar did not prove "by a greater weight of the evidence" that the riverboat casinos were vessels in navigation and that the employees were seamen at the time of the various injuries. The district court agreed with the agency's assessment that the riverboats were merely platforms for gambling, that the riverboats spent ninety-eight percent of their time moored to the shore, and thus the riverboats were not vessels in navigation. Without an employment-related connection to a vessel in navigation, the district court concluded the employees were not seamen as contemplated by the Jones Act. Therefore, the Jones Act did not remove the agency's jurisdiction to hear these cases.
Harvey's and Ameristar appeal, arguing that their riverboat casinos are vessels in navigation and the employees were seamen within the meaning of the Jones Act, and therefore the Jones Act supplied the exclusive remedy for the employees.
II. SCOPE OF REVIEW.
Our review of the agency's decision is on error. Gates v. John Deere Ottumwa Works, 587 N.W.2d 471, 474 (Iowa 1998). We are bound by factual findings made by the agency so long as those findings enjoy substantial support in the record made before the agency. Id. III. ANALYSIS.
Iowa Code section 85.1(6) provides that injured workers covered by a method of compensation established by the Congress of the United States are exempt from coverage by Iowa's workers' compensation law. Harvey's and Ameristar argued that the employees were covered by the Jones Act, 46 U.S.C. app. § 688, a method of compensation established by the Congress of the United States for maritime workers, and therefore the workers' compensation commission, pursuant to section 85.1(6), did not have subject matter jurisdiction to hear the employees' petitions.
As required, an evidentiary hearing was held on the jurisdictional issue at the agency level in each case. Hayden v. Ameristar Casino Council Bluffs, Inc., 641 N.W.2d 723, 724-25 (Iowa 2002). The agency concluded the employees were not seamen within the meaning of the Jones Act, and the federal statute did not preempt the agency's jurisdiction. The district court affirmed.
The Jones Act provides that any seaman who has suffered a personal injury in the course of employment may maintain an action for damages against the employer. 46 U.S.C. app. § 688(a). The focal issue in the present case is whether the employees were seamen as contemplated by the Jones Act. In order to be considered a seaman for purposes of the Jones Act, an employee must be a "master or member" of a crew of a "vessel in navigation". Stewart v. Dutra Construction Co., 543 U.S. 481, ___, 125 S. Ct. 1118, 1123-24, 160 L. Ed. 2d 932, 942-43 (2005). We are called upon to resolve whether the riverboat casinos involved in the present case were "vessels in navigation" at the time the employees were injured. The Supreme Court's Stewart opinion explains the term "vessel" as it is used in the Jones Act. Id. In defining the term the Court relied upon section three of the Revised Statutes of 1873, which was repealed and recodified as part of the Rules of Construction Act, 1 U.S.C. § 3. Id. Section 3 states: "The word 'vessel' includes every description of water-craft or other artificial contrivance used, or capable of being used, as a means of transportation on water." 1 U.S.C. § 3. Applying this definition, the Court held that a dredge that had only limited means of independent propulsion was a vessel because it was capable of being used as a means of transportation on water. Stewart, 543 U.S. at ___, 125 S. Ct. at 1129, 160 L. Ed. 2d at 947. In so holding, the Court expressly disavowed the test applied by the court below, which was essentially the same test applied by the agency and the district court in the present case. The Court held that a watercraft need not be primarily used for transportation purposes, as 1 U.S.C. § 3 only requires that the watercraft be "capable of being used, as a means of transportation on water" to qualify as a vessel. Id. at ___, 125 S. Ct. at 1128, 160 L. Ed. 2d at 946. Additionally, the Court held that it did not matter whether the watercraft was in motion in order for it to qualify as a vessel because "a watercraft does not pass in and out of Jones Act coverage depending on whether it was moving at the time of the accident." Id.
While the statute at issue in Stewart was the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. § 905, the Jones Act and the LHWCA are statutes that "work in tandem" and use and define the term "vessel" in the same manner. Stewart, 543 U.S. at ___, 125 S. Ct. at 1123, 160 L. Ed. 2d at 942.
As a final matter, the Court recognized it was possible that a watercraft that had once been a vessel could cease being a vessel. Id. at ___, 125 S. Ct. at 1127, 160 L. Ed. 2d at 945-46. This is where the necessity that the vessel be "in navigation" becomes important. Id. at ___, 125 S. Ct. at 1128, 160 L. Ed. 2d at 947. The Court stated that the "in navigation" requirement was "never meant to indicate that a structure's locomotion at any given moment matters. Rather, the point was that structures may lose their character as vessels if they have been withdrawn from the water for extended periods of time." Id. The Court asserted that "a watercraft is not 'capable of being used' for maritime transport in any meaningful sense if it has been permanently moored or otherwise rendered practically incapable of transportation or movement." Id. As examples of such instances the Court cited a case where a floating casino was moored to the shore in a semi-permanent or indefinite manner. Id. In that case the watercraft was moored to shore by lines tied to sunken steel pylons that were filled with concrete. The first level of the [watercraft] was connected to the pier by steel ramps, and the second level was joined to a shore-side building. In addition, numerous shore-side utility lines — telephone, electric, gas, sewer, domestic fire and water, cable TV, and computer — were connected permanently (or at least indefinitely) to the watercraft.
Pavone v. Mississippi Riverboat Amusement Corp., 52 F.3d 560, 564 (5th Cir. 1995). Additionally, the Court noted that a watercraft that had a large opening cut into its hull, rendering it incapable of moving over water, would not meet the Jones Act definition of a vessel in navigation. Stewart, 543 U.S. at ___, 125 S. Ct. at 1127, 160 L. Ed. 2d at 946 (citing Kathriner v. UNISEA, Inc., 975 F.2d 657, 660 (9th Cir. 1992)).
Applying the definition of a vessel, as found in 1 U.S.C. § 3 and explained in Stewart, we conclude Harvey's riverboat casino, the Kanesville Queen, and Ameristar's riverboat casino were vessels at the time of the respective employees' injuries. The relevant facts are not in dispute. As to the Kanesville Queen, the only conclusion that can be drawn from the facts is that the Kanesville Queen is "capable of being used, as a means of transportation on water." The riverboat is not moored to the shore in a semi-permanent or indefinite manner. The evidence indicates that at all times relevant to these proceedings the Kanesville Queen was either moored to the dock or in navigation on the Missouri River. The agency found "the boat was fully equipped and capable of being used as a vessel engaged in navigation." Additionally, the riverboat does in fact leave the dock and navigate the Missouri River one hundred times a year for a minimum of two hours each time out in order to comply with Iowa's gaming laws. See Iowa Admin. Code r. 491-5.6 (2001).
As to Ameristar's riverboat casino, the only conclusion that can be drawn from the facts is that it is "capable of being used, as a means of transportation on water." A full marine crew is on duty at all times, including a captain, chief engineer, mate, engine room technician, and assistant engineer. The riverboat is capable of cruising on the river within five-to-fifteen minutes throughout the year. The riverboat is regularly inspected by the Coast Guard for compliance with Coast Guard regulations. The boat does in fact leave the dock and navigate the Missouri River one hundred times a year for a minimum of two hours each time out in order to comply with Iowa's gaming laws. See id. Even in the winter months when the riverboat does not make regular excursions onto the river, it is never permanently moored or dry docked and is capable of cruising on the river.
In addition to finding the employees were working on a "vessel," we must also find that the employees were "master[s] or member[s]" of their respective vessel's crew in order to conclude that the employees were seamen, for purposes of the Jones Act, at the time of their injuries. Stewart, 543 U.S. at ___, 125 S. Ct. at 1127, 160 L. Ed. 2d at 946 (citing Chandris, Inc. v. Latsis, 515 U.S. 347, 376, 115 S. Ct. 2172, 2194, 132 L. Ed. 2d 314, 347 (1995)). In order to be considered a master or member of a vessel's crew, an employee must contribute to the function of the vessel or to the accomplishment of its mission and that connection must be shown to be substantial both in nature and duration. Id. That the employees were members of the crews of their respective riverboats does not appear to be in dispute in this case. The mission of each riverboat was to operate as a gambling venue. In her position as a floor host on the Kanesville Queen, Isenhour contributed to the accomplishment of the riverboat's mission. Isenhour had been employed by Harvey's and worked on the Kanesville Queen for several years prior to her injury and she performed all of her job duties onboard the Kanesville Queen. In her job as a slot attendant on Ameristar's riverboat, Davis contributed to the accomplishment of the riverboat's mission. Davis had worked on the Ameristar riverboat for approximately two years before her injury and she performed all of her job duties aboard the riverboat. In her job as a teller on Ameristar's riverboat, Falanga contributed to the accomplishment of the riverboat's mission. Falanga had worked on the Ameristar riverboat for several years before her injury and she performed all of her job duties aboard the riverboat.
Each of the employees were members of the crews of the vessels on which they were employed; therefore, we conclude they were seamen as contemplated by the Jones Act at the time of their injuries. Because the employees are covered by a method of compensation established by the Congress of the United States, they are exempt from coverage by Iowa's workers' compensation law. Iowa Code § 85.1(6). The workers' compensation commissioner was without subject matter jurisdiction to hear the employees' petitions. We reverse the decision of the agency and the district court and dismiss the petitions of the employees.