On February 19 2016, following an extensive briefing by both parties, Norwegian Cruise Line (NCL) secured a legally significant opinion in a Jones Act lawsuit brought by a US crew member in New Orleans. In her 42-page opinion, US District Court Judge Nannette Jolivette Brown:
- found that the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards was applicable to the case; and
- entered an order staying the proceedings pending arbitration and denying the plaintiff's motion to remand.(1)
The opinion has been widely reported and heavily cited, as the case is the first to involve a cruise line defendant in a Louisiana court. Further, it comes at a time when the applicability of the convention to US crew members is on appeal to the US Court of Appeals for the Eleventh Circuit.(2)
In Johnson, a casino pit supervisor on the Norwegian Dream cruise ship filed suit in a Louisiana state court alleging personal injuries arising from a safety drill. Relying on the employment agreement's arbitration provision, the case was removed to the US District Court for the Eastern District of Louisiana, with the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards and the Convention Act being cited as the basis for federal jurisdiction. A motion to compel arbitration and stay the proceedings was filed simultaneously.
The plaintiff opposed the motion and filed a separate motion to remand the case to the more plaintiff-friendly state court. Because both parties to the arbitration agreement were US citizens, the applicability of the convention, and thus federal jurisdiction, depended on whether the contractual relationship:
- involved property located abroad;
- envisaged performance or enforcement abroad; or
- had some other reasonable relationship with one or more foreign states.
Relying on a US Court of Appeals for the Fifth Circuit case involving a contract for work in West African waters (Freudensprung v Offshore Technical Services) and a series of cruise industry opinions from the Southern District of Florida (including Odom, D'Cruz and Rutledge), NCL argued that the term 'abroad' was not limited to foreign soil and instead encompassed anywhere outside the United States and its territorial waters, including international waters and the territorial waters of other nations.
The plaintiff argued that:
- the removal of Jones Act cases was prohibited; and
- the court should follow a series of opposing Southern District of Florida cases in which the convention was found not to apply where the plaintiffs' work was performed entirely on board cruise ships (including Matabang, Armstrong and Hines).
The plaintiff also attempted to distinguish the US Court of Appeals for the Fifth Circuit's authority by asserting that:
- his employment agreement was silent as to the place of performance; and
- he was unaware of the vessel's precise route.
In her detailed opinion, Brown ruled in favour of NCL, finding that the removal of Jones Act claims was proper under the convention. In addressing the applicability of the convention and the opposing Florida cases, Brown cited the strong federal policy in favour of arbitration expressed by the US Court of Appeals for the Fifth Circuit in Freudensprung, holding that the employment agreement envisaged performance or enforcement abroad or had some other reasonable relationship with one or more foreign states. Citing the itineraries of all NCL ships and the contractual language regarding travel documents and repatriation, the court held that the employment agreement had a decidedly international flavour, and that "a contract with a cruise line whose ships undisputedly travel almost exclusively to foreign ports of call cannot be deprived of its international character solely through the alleged ignorance of its would-be employee".