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WATTERS v. HARRAH'S ILLINOIS CORP.

April 14, 1998

PEGGY S. WATTERS, Plaintiff,
v.
HARRAH'S ILLINOIS CORP., d/b/a HARRAH'S CASINO--JOLIET, Defendant.



The opinion of the court was delivered by: ALESIA

 Before the court is defendant Harrah's Illinois Corporation's motion to dismiss Count III of plaintiff Peggy Watters' complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). For the following reasons, the court grants defendant's motion.

 I. BACKGROUND

 The complaint alleges the following facts which, for the purposes of ruling on this motion, are taken as true. Hishon v. King & Spalding, 467 U.S. 69, 73, 81 L. Ed. 2d 59, 104 S. Ct. 2229 (1984). On July 6, 1996, plaintiff Peggy Watters ("Watters") was working as a crew member for the Southern Star, a vessel owned, operated, and maintained by defendant Harrah's Illinois Corporation ("Harrah's"). While working on the boat on that day, Watters sustained injuries to her back and body.

 On January 5, 1998, Watters filed a three-count complaint in this court. Count I is a claim for personal injury under the Jones Act, 46 U.S.C. App. § 688. Count II is a claim under general maritime law for unseaworthiness. Count III is a claim under general maritime law for maintenance and cure. Among other remedies, Count III seeks an award of "$ 100,000.00 for [Harrah's] arbitrary and capricious refusal to pay maintenance and cure."

 In response to Watters' complaint, Harrah's filed an answer to Counts I and II and a motion to dismiss Count III. Harrah's motion to dismiss Count III is premised on Harrah's argument that a plaintiff should not be allowed to recover punitive damages in a maintenance and cure action.

 II. DISCUSSION

 A. Standard for deciding a Rule 12(b)(6) motion to dismiss

 When deciding a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the court must accept all factual allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. Cromley v. Board of Educ. of Lockport, 699 F. Supp. 1283, 1285 (N.D. Ill. 1988). If, when viewed in the light most favorable to the plaintiff, the complaint fails to state a claim upon which relief can be granted, the court must dismiss the case. See FED. R. CIV. P. 12(b)(6); Gomez v. Illinois State Bd. of Educ., 811 F.2d 1030, 1039 (7th Cir. 1987). However, the court may dismiss the complaint only if it appears beyond a doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46, 2 L. Ed. 2d 80, 78 S. Ct. 99 (1957).

 Punitive damages in a maintenance and cure action

 The precise issue before the court is whether a plaintiff who sues a private party under general maritime law for willful failure to pay maintenance and cure can recover punitive damages. Neither the Supreme Court nor the Seventh Circuit has ever directly addressed this issue. Similarly, the parties did not cite and the court could not find a case from the Northern District of Illinois which directly addresses this issue. Thus, this is a case of first impression in this district.

 Although there exists no precedent binding on this court, there are several sources which provide guidance in deciding the issue. First, there are three Supreme Court cases which are particularly relevant to this court's decision. In addition, there are cases in other circuits which directly address the issue. The court will address these cases after a brief discussion on maintenance and cure liability in general.

 1. Maintenance and cure liability

 Under general maritime law, when a seaman becomes ill or injured during the period of his service, the shipowner is liable to the seaman for maintenance and cure. Aguilar v. Standard Oil Co. of N.J., 318 U.S. 724, 730, 87 L. Ed. 1107, 63 S. Ct. 930 (1943). "Maintenance" is "the payment by a shipowner to a seaman for the seaman's food or lodging expenses incurred while he is ashore as a result of illness or accident." Barnes v. Andover Co., 900 F.2d 630, 631 (3d Cir. 1990). "Cure" is "the right to necessary medical services." Guevara v. Maritime Overseas Corp., 59 F.3d 1496, 1499 (5th Cir. 1995) (en banc).

 The liability for maintenance and cure "extends during the period when [the seaman] is incapacitated until he reaches the maximum medical recovery." Vaughan v. Atkinson, 369 U.S. 527, 531, 8 L. Ed. 2d 88, 82 S. Ct. 997 (1962). This liability is not predicated on the fault or negligence of the shipowner; rather, it is an incident of the marine employer-employee relationship. Aguilar, 318 U.S. at 730. The rationale for imposing such liability was summarized in Calmar S.S. Corp. v. Taylor as follows:

 
The reasons underlying the rule, to which reference must be made in defining it, are those enumerated in the classic passage by Mr. Justice Story in Harden v. Gordon, C.C., Fed. Cas. No. 6047: The protection of seamen, who, as a class, are poor, friendless and improvident from the hazards of illness and abandonment while ill in foreign ports; the inducement to masters and owners to protect the safety and health of seamen while in service; the maintenance of a merchant marine for commercial service and maritime defense of the nation by inducing men to accept employment in arduous and perilous service.

 Calmar S.S. Corp. v. Taylor, 303 U.S. 525, 528, 82 L. Ed. 993, 58 S. Ct. 651 (1938).

 2. Relevant Supreme Court decisions

 The essential starting point in analyzing the issue of whether punitive damages are recoverable in a maintenance and cure action is an examination of relevant Supreme Court decisions. There are three, Cortes v. Baltimore Insular Line, Inc., 287 U.S. 367, 77 L. Ed. 368, 53 S. Ct. 173 (1932), Vaughan v. Atkinson, 369 U.S. 527, 8 L. Ed. 2d 88, 82 S. Ct. 997 (1962), and Miles v. Apex Marine Corp., 498 U.S. 19, 112 L. Ed. 2d 275, 111 S. Ct. 317 (1990), which affect this court's ultimate decision. The court addresses each of these cases in turn.

 a. Cortes v. Baltimore Insular Line, Inc.

 The first Supreme Court decision pertinent to this court's discussion is Cortes v. Baltimore Insular Line, Inc., The Cortes opinion is important because it establishes that there are two distinct types of maintenance and cure actions: a tort-like type and a contract-like type. For the sake of clarity, the court will discuss Cortes in two parts. The first part discusses the opinion itself, while the second part summarizes the impact of Cortes on this court's decision.

 1. The Cortes opinion

 In Cortes, the plaintiff was the administrator of the estate of seaman who had died of pneumonia. Cortes, 287 U.S. at 370. The seaman had contracted pneumonia while working aboard the defendant's ship. Id. The plaintiff sued the defendant to recover damages for the seaman's death, which the plaintiff alleged was caused by the failure of the master of the ship to give the seaman proper care. Id. The district court entered judgment in favor of the plaintiff. Id. The Second Circuit reversed, holding that the seaman's cause of action for negligent care or cure was ended by his death and did not accrue to the administrator. Id.

 In an opinion written by Justice Cardozo, the Court held that a seaman does have a cause of action under the Jones Act where the seaman's injury was caused by the shipowner's negligent failure to pay maintenance and cure. Id. at 374-76. The Court further held that if death results from such injury, the Jones Act provides a cause of action to the seaman's personal representative. Id. at 376. The Court provided the following reasons for this holding:

 
The failure to provide maintenance and cure may be a personal injury or something else according to the consequences. If the seaman has been able to procure his maintenance and cure out of his own or his friends' money, his remedy is for the outlay, but personal injury there is none. If the default of the vessel and its officers has impaired his bodily or mental health, the damage to mind or body is none the less a personal injury because he may be free at his election to plead it in a different count. ... While the seaman was still alive, his cause of action may have overlapped his cause of action for breach of the maritime duty of maintenance and cure, just as it may have overlapped his cause of action for injury caused through an unseaworthy ship. ... In such circumstances it was his privilege, in so far as the causes of action covered the same ground, to sue indifferently on any one of them.

 Id. at 374-75 (internal citations ...


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