Company fights $500K settlement of Jones Act suit

A Delaware-based corporation claims it should never have had to pay the more than $500,000 it doled out to settle a lawsuit filed against it.

Cal Dive International filed a lawsuit June 3 in Jefferson County District Court against Chartis Claims, Chartis Specialty Insurance Co., Rigg Insurance Managers doing business as RISC and Orange County Insurance Brokerage doing business as Beaty Insurance Agency.

Cal Dive claims it was forced to pay $547,007.73 to settle a claim Michael Miller filed against it on Oct. 7, 2009, after Miller sustained injuries while working aboard a barge. Miller filed the suit under the Jones Act, according to the complaint.

At the time of his injuries, Miller worked for Stakes, which was a subcontractor for Cal Dive. As a subcontractor, Stakes agreed to indemnify and defend Cal Dive for any work-related damages incurred, the suit states.

Under the conditions of its agreement to subcontract, Stakes was required to and did maintain primary and umbrella insurance, which it obtained through Beaty, the complaint says. The policy was issued by Chartis.

However, when Miller filed his claims, Chartis refused to cover Cal Dive, saying its policy contained an exclusion endorsement for maritime liability claims, which included claims filed under the Jones Act, according to the complaint.

"Cal Dive maintained throughout the Miller litigation that Miller was not a Jones Act seaman, and that the Miller claims were not maritime claims," the suit states. "Charis Claims nevertheless blindly accepted Miller's characterization of his injury as a maritime claim without input or rebuttal from Cal Dive."

In its complaint, Cal Dive alleges breach of contract, reformation of contract, negligence, breach of duty of good faith and fair dealing and deceptive insurance practices against the defendants.

It seeks actual damages, plus pre- and post-judgment interest, costs, attorneys' fees and other relief the court deems just.

Michael Paul Nassif of Sugar Land and George Michael Jamail of The Reaud Law Firm in Beaumont will be representing it.

Judge Donald Floyd, 172nd District Court, has been assigned to the case.

Case No. E190-203