While Claimant was employed by Brown International (“Brown”) in Afghanistan, he was injured by employees of a third party, BAE Systems Land & Armament (“BAE”). Claimant sued BAE and BAE then sued Brown for indemnity and negligence. Eventually, Claimant settled his suit against BAE. Brown and BAE settled their negligence claim, and BAE’s indemnity claim was dismissed. An order was then issued dismissing the action and closing the case “subject to the right of any party within sixty days to…re-open the action upon a showing of good cause.” Claimant now tries to reopen the case.
Why? Because of Section 33(g) of the Longshore and Harbor Workers’ Compensation Act. Pursuant to Section 33(g), an injured worker must obtain his employer’s consent before settling with a tortfeasor for less money than the employer owes the worker in benefits. Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469 (1992). If the worker does not obtain the consent, he forfeits future benefits. Further, an employer may assert a lien against the settlement sums to recoup previously paid benefits. Here, Claimant did not obtain Brown’s consent before settling with BAE and Brown asserted its lien against Claimant’s settlement proceeds.
The court’s problem with Claimant’s request was that he did not show good cause for re-opening the action in abrogation of the court’s “sixty-day order.” Claimant was simply trying to “protect his settlement money” but the “sixty day order” specifically declined to retain jurisdiction to enforce the settlement agreement. Claimant’s new dispute about Section 33(g) belongs in a new action.
Ketchum v. BAE Systems Land & Armaments, No. 8:10-cv-2246-T-23TBM, 2012 WL 206976 (M.D. Fla. Jan. 24, 2012).
Note: Whenever dealing with third party settlements, Section 33(g) should be an utmost concern because, as the Supreme Court said, Section 33(g)’s “forfeiture penalty creates a trap for the unwary.”
(Note: I originally published this post on Navigable Waters: A Maritime, Longshore and Defense Base Act Blog.)
