US Court of Appeals for the Fifth Circuit Opinions
Conti 11. Container Schiffarts-GMBH & Co. KG M.S. v. MSC Mediterranean Shipping Co. S.A.

Docket: 22-30808
Opinion Date: January 29, 2024
Judge: Duncan
Areas of Law: Admiralty & Maritime Law, Arbitration & Mediation, Civil Procedure

In a dispute between Conti 11 Container Schiffarts-GMBH & Co. KG M.S. and MSC Mediterranean Shipping Company S.A., the United States Court of Appeals for the Fifth Circuit found that the District Court for the Eastern District of Louisiana lacked personal jurisdiction over the case and reversed the district court's decision. The dispute arose from an incident where three chemical tanks exploded onboard a cargo vessel chartered by Conti to MSC, causing extensive damage and three deaths. After Conti won a $200 million award from a London arbitration panel, Conti sought to confirm the award in the Eastern District of Louisiana. MSC argued that the court lacked personal jurisdiction. The Fifth Circuit agreed with the district court’s assessment that when confirming an award under the New York Convention, a court should consider contacts related to the underlying dispute, not just those related to the arbitration itself. However, the Fifth Circuit disagreed with the district court's ruling that MSC waived its personal jurisdiction defense through its insurer’s issuance of a letter of understanding. The court also disagreed with the district court's finding that the loading of the tanks in New Orleans conferred specific personal jurisdiction over MSC, as this contact resulted from the actions of other parties not attributable to MSC. Therefore, the Fifth Circuit reversed the lower court's decision and remanded the case with instructions to dismiss it for lack of personal jurisdiction.

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US Court of Appeals for the Fifth Circuit Opinions
Briar Capital Working Fund v. Remmert

Docket: 22-20536
Opinion Date: January 22, 2024
Judge: James L. Dennis
Areas of Law: Bankruptcy

The United States Court of Appeals for the Fifth Circuit addressed an unprecedented issue in its circuit regarding the sale of preference claims arising under 11 U.S.C. § 547, in the context of Chapter 11 bankruptcy proceedings. The court was required to decide whether such claims could be sold and if the purchaser had the standing to pursue them.

The case was initiated by South Coast Supply Company (South Coast), which filed for Chapter 11 bankruptcy after experiencing financial difficulties. During the proceedings, the company borrowed funds from its then-CFO, Robert Remmert. South Coast later filed a lawsuit against Remmert to avoid more than $300,000 of allegedly preferential transfers made before the bankruptcy proceedings. The company's sole secured lender, Briar Capital Working Fund Capital, L.L.C. (Briar Capital), eventually acquired South Coast's interest in this pending preference action against Remmert.

Upon acquiring the lawsuit, Briar Capital was substituted as the assignee of South Coast. Remmert argued that Briar Capital lacked standing to prosecute the preference action. The district court agreed, holding that since a successful recovery would not benefit South Coast’s estate or its unsecured creditors, Briar Capital lacked standing to bring the preference claim against Remmert as a representative of the estate under 11 U.S.C. § 1123(b)(3)(B) of the Bankruptcy Code.

On appeal, the Fifth Circuit reversed the district court's decision. The court held that preference actions can be sold pursuant to 11 U.S.C. § 363(b)(1) because they are property of the estate under 11 U.S.C. §§ 541(a)(1) and (7). Furthermore, even if Briar Capital does not qualify as a representative of the estate, it has standing to pursue the preference claim as it validly purchased the claim outright. Therefore, the court remanded the case for further proceedings.

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Johnson v. Board of Supervisors of LSU

Docket: 22-30699
Opinion Date: January 8, 2024
Areas of Law: Civil Rights, Labor & Employment Law

In this case, the United States Court of Appeals for the Fifth Circuit reviewed an appeal by Carolyn Johnson, an African-American female who worked at Louisiana State University Health Sciences Center (LSUHSC) as an Administrative Coordinator. Johnson alleged that she experienced sexual and racial harassment as well as retaliation from her former employer, LSUHSC. The harassment claims were based on a specific incident involving a colleague, Dr. Jeffrey Schumacher, slapping her on the buttocks, as well as several other instances of inappropriate behavior by Schumacher in the months preceding this incident. After reporting the conduct to her supervisor and Human Resources, Johnson was temporarily relocated to a different workspace while an investigation was conducted. Johnson claimed this relocation was in retaliation for her reporting the harassment.

The court affirmed the district court's summary judgment in favor of LSUHSC on all counts. Regarding the harassment claims, the court found that while Johnson had sufficiently demonstrated that she was the victim of uninvited sexual and racial harassment, she failed to show that LSUHSC knew or should have known of the harassment and failed to take prompt remedial action. The court determined that LSUHSC took action to separate Johnson and Schumacher in response to Johnson's complaint and began an investigation into the matter, which was ultimately substantiated.

In terms of the retaliation claim, the court found that Johnson failed to demonstrate that LSUHSC's decision to relocate her was a pretext for retaliation. The court noted that LSUHSC provided a legitimate, non-retaliatory reason for her relocation, which was to separate Johnson and Schumacher during the investigation. Johnson did not present evidence to suggest that this reason was pretextual. Therefore, the court affirmed summary judgment on Johnson’s retaliation claim.

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www.wdsu.com/article/new-laws-taking-effect-jan-1-in-louisiana/46245866