5th Circuit: No Exception to East River For Post Sale Negligence

The US Court of Appeals for the Fifth Circuit ruled that a maritime plaintiff is restricted to warranty remedies when a defective product damages only the product itself. In the instant case, plaintiff’s helicopter made an emergency landing in the Gulf of Mexico due to engine trouble.  The pilot and passenger escaped safety, but the helicopter inverted and was a total loss.  Evidence indicated that the problem was the result of a manufacturing defect on the part of the engine manufacturer.  The helicopter owner brought suit against the engine manufacturer and the helicopter manufacturer, alleging post-sale failure to warn of a pre-sale product defect.  The court held that, under US maritime jurisprudence, such economic loss, when not accompanied by damage to other property, is recoverable, if at all, only for breach of warranty.  Turbomeca, S.A. v. Era Helicopters LLC, No. 07-30885 (5th Cir., July 16, 2008).

Limited Punitive Damages Under Exxon Valdez Case


For the first time in U.S. jurisprudence, the Supreme Court Supreme Court has approved an award of punitive damages under maritime law.

The Supreme Court has established that as a general rule, punitive damages in general maritime law cases should be in the range of 0.65:1, with a maximum of 1:1. What will the impact be on other cases involving punitive damages and statutory causes of action under maritime law?

Interestingly, the Supreme Court was divided on the important issue of whether under maritime law, a ship owner may be vicariously liable for the acts of a managerial employee such as a vessel’s master. The Supreme Court’s opinion leaves the decision of the Ninth Circuit that there is such liability intact, but does not overrule contrary decisions in other circuits.

The Supreme Court's opinion may be read in full at:
http://www.supremecourtus.gov/opinions/07slipopinion.html

Private Yachts and Loss of Use Damages

The general rule, particularly as applied by courts in the Ninth Circuit, is that loss of use of a private pleasure boat is not a compensable item of damages under the General Maritime Law of the United States. The rule is predicated upon the unremarkable principle that one seeking damages must show an actual loss and a reasonable proof of the amount. The seminal case is The Conqueror, 166 U.S. 110, 17 S. Ct. 510, 41 L. Ed. 937 (1897).

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