Filed: Jul. 01, 2002
Latest Update: Feb. 21, 2020
Summary: REVISED JULY 1, 2002 IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT _ No. 01-30642 _ RODNEY SUMRALL, Etc Plaintiff v. ENSCO OFFSHORE CO Defendant _ SANTA FE ENERGY RESOURCES INC Plaintiff - Appellee v. PREMIERE, INC; ET AL Defendants PREMIERE INC Defendant - Appellant _ Appeal from the United States District Court for the Western District of Louisiana _ May 9, 2002 Before KING, Chief Judge, and REAVLEY and WIENER, Circuit Judges. PER CURIAM: Plaintiff Santa Fe Energy Resources, Inc.
Summary: REVISED JULY 1, 2002 IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT _ No. 01-30642 _ RODNEY SUMRALL, Etc Plaintiff v. ENSCO OFFSHORE CO Defendant _ SANTA FE ENERGY RESOURCES INC Plaintiff - Appellee v. PREMIERE, INC; ET AL Defendants PREMIERE INC Defendant - Appellant _ Appeal from the United States District Court for the Western District of Louisiana _ May 9, 2002 Before KING, Chief Judge, and REAVLEY and WIENER, Circuit Judges. PER CURIAM: Plaintiff Santa Fe Energy Resources, Inc. ..
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REVISED JULY 1, 2002
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
_____________________
No. 01-30642
_____________________
RODNEY SUMRALL, Etc
Plaintiff
v.
ENSCO OFFSHORE CO
Defendant
_______________________________________________________
SANTA FE ENERGY RESOURCES INC
Plaintiff - Appellee
v.
PREMIERE, INC; ET AL
Defendants
PREMIERE INC
Defendant - Appellant
_________________________________________________________________
Appeal from the United States District Court
for the Western District of Louisiana
_________________________________________________________________
May 9, 2002
Before KING, Chief Judge, and REAVLEY and WIENER, Circuit Judges.
PER CURIAM:
Plaintiff Santa Fe Energy Resources, Inc. seeks
indemnification from defendant Premiere, Inc. for a tort claim
filed by an injured employee of Premiere against a third-party
contractor of Santa Fe. The district court granted summary
judgment in favor of Santa Fe. For the following reasons, we
AFFIRM.
I. FACTUAL AND PROCEDURAL HISTORY
On September 27, 1999, Rodney Sumrall, an employee of
defendant Premiere, Inc. (“Premiere”) was working on a drilling
rig jack-up vessel owned by defendant Ensco Offshore Co.
(“Ensco”). On that day, Sumrall was injured when a crane
operator, an employee of Ensco, swung the basket of a crane
carrying Sumrall into a pole, thus knocking Sumrall to the deck
of the Ensco rig. On September 18, 2000, Sumrall filed a tort
action in federal district court against Ensco under the general
maritime law.
At the time of the accident, plaintiff Santa Fe Energy
Resources, Inc. (“Santa Fe”) was the operator on the drilling
operation. Santa Fe had a contractual relationship with Ensco,
in accordance with the terms of which Ensco would provide the
drilling rig vessel and drilling services. The Ensco-Santa Fe
contract required indemnification by Santa Fe for claims brought
against Ensco by employees of Santa Fe and of Santa Fe’s
contractors. Santa Fe contracted separately with Premiere for
Premiere to provide casing and other services on the same
drilling operation. The Premiere-Santa Fe contract likewise
required some indemnification between the parties for claims
2
brought by their respective employees. Premiere and Ensco had no
contract between them.
The parties do not dispute that Santa Fe’s contract with
Ensco obligated Santa Fe to indemnify and defend Ensco against
claims brought by any Premiere employee such as Sumrall.
Pursuant to that agreement, Santa Fe did assume defense of Ensco
against Sumrall’s claim. Then, pursuant to the indemnification
agreement between Premiere and Santa Fe, Santa Fe demanded
indemnification and defense in turn from Premiere because a
Premiere employee filed the original tort suit. Premiere
refused.
Santa Fe filed suit to compel Premiere to indemnify Santa Fe
pursuant to their contract. Santa Fe and Premiere then filed
cross-motions for summary judgment. On April 12, 2001, the
district court denied Premiere’s motion.1 At the same time, the
district court granted Santa Fe’s motion, thus ordering Premiere
to provide defense, indemnification, and attorney fees to Santa
Fe.2 Premiere filed a motion for reconsideration of the summary
1
Prior to Santa Fe’s suit, Ensco had filed a third-
party claim demanding indemnification for obligations arising
from Sumrall’s claim based on the contract between Santa Fe and
Premiere. Ensco, Santa Fe, and Premiere cross-moved for summary
judgment on Ensco’s third-party demand. On March 14, 2001, the
district court consolidated Sumrall’s and Ensco’s claims. On
April 12, the court denied Ensco’s motion for summary judgment
and granted summary judgment in favor of Premiere, dismissing
Ensco’s third-party claim. That judgment was not appealed.
2
The contract between Santa Fe and Premiere entitles
Santa Fe to indemnity and defense from Premiere for covered
3
judgment in favor of Santa Fe, which the district court denied on
May 9, 2001.3 Premiere now timely appeals the district court’s
summary judgment in favor of Santa Fe.
II. STANDARD OF REVIEW
This court reviews summary judgment de novo, applying the
same standards as the district court. Chaney v. New Orleans Pub.
Facility Mgmt., Inc., 179 F.3d 164, 167 (5th Cir. 1999). Summary
judgment is appropriate when there is no genuine issue as to any
material fact, and the moving party is entitled to judgment as a
matter of law. FED. R. CIV. P. 56(c).
III. PREMIERE’S AGREEMENT TO INDEMNIFY SANTA FE
A. Premiere’s Agreement to Indemnify Santa Fe for
Contractual and Other Legal Duties
Premiere contends that our decision in Corbitt v. Diamond M.
Drilling Co., 654 F.2d 329 (5th Cir. 1981), in which we denied
indemnification to a contractor situated similarly to Santa Fe,
controls the instant case and thus that the district court erred
in finding that Premiere must indemnify Santa Fe. In Corbitt, we
explained that a “contract of indemnity should be construed to
cover all losses ... which reasonably appear to have been within
the contemplation of the parties, but it should not be read to
obligations. Indemnity and defense are referred to under the
umbrella term of indemnification henceforth in this opinion.
3
On June 5, 2001, the district court entered final
judgment pursuant to its April 12 summary judgment order and, for
a second time, denied Premiere’s motion for reconsideration.
4
impose liability for those losses ... which are neither expressly
within its terms nor of such character that it can be reasonably
inferred that the parties intended to include them within the
indemnity coverage.” Id. at 333. A close reading of Corbitt,
however, indicates that the indemnification provision at issue in
that case was less broadly drafted than, and thus is
distinguishable from, the indemnification provision outlining
Premiere’s obligation to Santa Fe, which provision appears as
Section 15.1 of the Premiere-Santa Fe contract. See
id. at 331-
34.4 Moreover, recent decisions by this court in cases involving
4
Section 15.1 reads in relevant part:
15.1 [Premiere] agrees to protect, defend,
indemnify, hold, and save [Santa Fe] and its ...
employees ... contractors and subcontractors, and all
their ... employees ... harmless from and against all
claims, losses, costs, demands, damages, suits, ... and
causes of action of whatsoever nature or character ...
and whether arising out of contract, tort, strict
liability, unseaworthiness of any vessel,
misrepresentation, violation of applicable law and/or
any cause whatsoever, including, but not limited to,
reasonable attorney’s fees and other costs and
expenses, without limit and without regard to the cause
or causes thereof, which in any way arise out of or are
related to this Contract (including, without
limitation, the performance or subject matter of this
Contract) and which are asserted by or arise in favor
of [Premiere] or any of its agents, representatives, or
employees, or [Premiere’s] subcontractors or any of
their employees (and/or their spouses or relatives) due
to bodily injury, death, or loss of or damage to
property, or any cause whatsoever ... whether or not
caused by the sole, joint, and/or concurrent
negligence, fault, strict liability, breach of
contract, or legal duty of [Santa Fe] or any other
party indemnified hereunder, the unseaworthiness of any
vessel, or any cause whatsoever ....
5
provisions more analogous to Section 15.1, and which build on our
reasoning in Corbitt, indicate that the district court correctly
determined that Premiere owes indemnification to Santa Fe based
on their agreement in Section 15.1.
In Corbitt, Shell Oil contracted with two companies, Diamond
M. and Sladco, to work on a drilling operation. Id. at 331.
When an injured employee of Sladco sued Diamond M. in tort,
Diamond M. sought indemnification from Shell Oil pursuant to
their contract.
Id. Shell Oil then filed a third-party action
seeking indemnification in turn from the employer of the injured
plaintiff, Sladco, pursuant to their contract.
Id. Thus, in
Corbitt, Shell Oil was situated similarly to Santa Fe in the
instant case. Likewise, defendant Diamond M. and the injured
plaintiff’s employer, Sladco, which maintained no contract
between them, were situated similarly to Ensco and Premiere. In
Corbitt, we agreed with the district court that Shell Oil was not
entitled to indemnification from its contractor, Sladco, because
the indemnification provision in the contract between Shell and
employer Sladco restricted the scope of Sladco’s duty to
indemnify solely to those obligations sounding in tort.
Id. at
333.5 We reasoned that, although the underlying claim creating
(emphasis added).
5
The indemnification agreement between Shell and Sladco
at issue in Corbitt reads in relevant part: “Contractor [Sladco]
shall indemnify and defend Shell Oil Company ... against all
6
the obligation for which Shell Oil sought indemnification from
Sladco sounded in tort, the obligation for which Shell sought
indemnification itself was contractual in nature, as it arose
from the agreement between Shell and Diamond M. Id. We declined
to interpret the phrase “all claims” in the Corbitt provision to
include such contractual obligations. See
id. We noted that the
language of the indemnification provision at issue in Corbitt
made no mention of a duty to defend for obligations arising in
contract, and thus we read the scope of that provision by its
express terms, stating:
.... Shell’s liability to Diamond M is not on account
of personal injury. Rather, it is on account of its
agreement to indemnify Diamond M under [the drilling
contract between them]. Since the [indemnification
agreement] between Shell and Sladco does not
specifically provide that Sladco assumes claims arising
from Shell’s own separate contractual obligations, such
indemnification is not required.
Id. We further indicated that
[t]he contract need not contain any special words to
evince an intention to create a right of indemnity for
independent contractual liabilities. We hold only that
it must clearly express such a purpose. In this case,
there is nothing in the contractual language itself or
in the realities of the situation in which the parties
executed [the indemnification agreement] which reflects
any such intention.
Id. at 334.
claims, suits, liabilities and expenses on account of injury or
death of persons (including employees of Shell or Contractor
[Sladco] ...) ... arising out of or in connection with
performance of this [contract]
....” 654 F.2d at 331 (emphasis
added).
7
In contrast, the language of Section 15.1 of the contract
between Santa Fe and Premiere indicates that the scope of
employer Premiere’s duty to indemnify Santa Fe is broader than
was the scope of employer Sladco’s duty to indemnify Shell Oil in
Corbitt.6 Section 15.1 does include language similar to that in
the provision at issue in Corbitt, by which Premiere owes a duty
to indemnify for obligations arising in favor of Premiere
employees “due to bodily injury” or “death.” However, unlike the
provision at issue in Corbitt, Section 15.1 also includes
language that clearly and expressly indicates Premiere’s intent
to indemnify Santa Fe for obligations “whether arising in ...
tort” or “contract.” Moreover, Section 15.1 includes additional,
rather expansive, language that broadens Santa Fe’s entitlement
to indemnification for “all claims ... of whatsoever nature or
character ... whether or not caused by the ... legal duty of
[Santa Fe] ....” (emphasis added). Thus, Section 15.1 is
distinguishable from the more narrowly drafted provision in
Corbitt, and our reading of the more narrow provision in Corbitt
6
Premiere further asserts that this court’s more recent
decision in Foreman v. Exxon Corp., 770 F.2d 490 (5th Cir. 1985),
in which we denied indemnification to a party situated similarly
to Santa Fe, likewise indicates that the district court erred.
However, as we noted in Foreman, the circumstances and provisions
at issue in Corbitt and Foreman are materially
“indistinguishable.”
Id. at 494-99. We further found in Foreman
that “the reasoning in Corbitt [is] equally applicable to the
instant case.”
Id. Premiere’s reliance on Foreman, therefore,
is misplaced for the same reasons that its argument based on
Corbitt fails.
8
does not control. Moreover, our reasoning in Corbitt suggests
that Premiere owes indemnification to Santa Fe in the instant
case for Santa Fe’s contractual or legal duty to indemnify Ensco
against Sumrall’s injury claim.
B. Premiere’s Agreement to Indemnify Santa Fe’s Contractors
and Subcontractors
Additional language in Section 15.1, which language did not
appear in the provision at issue in Corbitt, even more
compellingly indicates that Premiere owes indemnification to
Santa Fe in the instant case. Specifically, Section 15.1
expressly indicates Premiere’s intent to indemnify not only Santa
Fe, but also Santa Fe’s “contractors and subcontractors” for the
covered obligations. Contrary to Premiere’s assertion that
Premiere owes no duty to indemnify for obligations arising due to
Santa Fe’s contractual relationships with third parties, prior
decisions by this court interpreting analogous indemnification
provisions in like circumstances indicate that such language in
Section 15.1 expresses clear intent by Premiere to indemnify
Santa Fe for amounts paid due to an injury claim filed against
Santa Fe’s third-party contractor, Ensco. In six cases since
Corbitt, we confronted circumstances indistinguishable from those
in Corbitt and the instant case in all material respects except
that the indemnification provisions at issue -- unlike the
provision in Corbitt but like Section 15.1 -- included agreement
by a party such as Premiere to indemnify third-party contractors,
9
subcontractors, and/or invitees of a party such as Santa Fe. In
all six cases, we found based on such language that the party
situated similarly to Premiere owed indemnification to the party
such as Santa Fe. See Demette v. Falcon Drilling Co., Inc., 280
F.3d 492 (5th Cir. 2002); Campbell v. Sonat Offshore Drilling,
Inc.,
27 F.3d 185 (5th Cir. 1994) (“Campbell II”); Campbell v.
Sonat Offshore Drilling, Inc.,
979 F.2d 1115 (5th Cir. 1992)
(“Campbell I”); Babcock v. Cont’l Oil Co.,
792 F.2d 1346 (5th
Cir. 1986) (per curiam); Mills v. Zapata Drilling Co., Inc.,
722
F.2d 1170 (5th Cir. 1983), overruled on other grounds, Kelly v.
Lee’s Old Fashioned Hamburgers, Inc.,
908 F.2d 1218 (5th Cir.
1990) (per curiam); Lirette v. Popich Bros. Water Transp., Inc.,
699 F.2d 725 (5th Cir. 1983).
In Campbell I & II, for example, after an employee of a
casing services contractor was injured on a drilling operation,
the employee sued the owner of the drilling vessel. See Campbell
II, 27 F.3d at 186-87. The vessel owner and the casing services
employer maintained no direct contractual relationship.
Id. A
party situated similarly to Santa Fe, Union Texas Petroleum
(“UTP”), contracted separately with the casing services employer
and the vessel owner for each to supply services on the UTP
drilling operation.
Id. Thus, the casing services employer of
the injured plaintiff was situated similarly to Premiere, and the
vessel owner was situated similarly to Ensco.
10
Pursuant to the contract between UTP and the defendant
vessel owner, in which UTP agreed to indemnify and defend the
vessel owner, UTP undertook defense of the vessel owner. UTP
further impleaded the casing services employer. Id. at 187. In
the contract between the casing services employer and UTP, the
employer agreed to indemnify not only UTP, but also “contractors
engaged by UTP, such as [the vessel owner,]” “‘for injury to ...
[the casing services employer’s] employees ....’”
Id. (emphasis
added). In Campbell I, we had “enforced [the casing services
employer’s] indemnity obligation under the UTP/[employer]
contract, affirming a ruling requiring [the employer] to defend
and indemnify [both the vessel owner] and UTP.” See Campbell
II,
27 F.3d at 187 (describing Campbell
I, 979 F.2d at 1115).
In Campbell II, however, the casing services employer
contended that it did not owe full, but only half, indemnity
under the circumstances and that UTP owed the other half. Id.
The employer thus filed for contribution from UTP.
Id. In
rejecting that claim in Campbell II, and thus affirming our
decision in Campbell I, we reasoned that the employer’s “duty to
indemnify [the vessel owner] flows from its contract with UTP”
because the employer expressly agreed to indemnify contractors of
UTP.
Id. We further rejected an argument by the employer based
on Corbitt, which is similar to the argument made by Premiere,
contending that the employer owed no reimbursement of UTP because
UTP “independently contracted to indemnify” the vessel owner.
11
Id. In so doing, we noted that unlike in Corbitt, the employer
in Campbell I & II “agreed with UTP to indemnify both UTP and
[its contractor, the vessel owner].” See
id. (emphasis added).
We stated that the employer “cannot insulate itself from paying
its full indemnity obligation on the basis that UTP’s liability
to [the vessel owner] is contractual.”
Id. at 188 (citing
Lirette, 699 F.2d at 725). We concluded that “[s]imilarly” to
the employer of the injured plaintiff in Lirette, the employer’s
“duty to indemnify UTP fully for amounts UTP owes [the vessel
owner] for the [injured employee’s] claims arises from [the
employer’s] express undertaking to indemnify both UTP and [the
vessel owner] [for] such losses. The Corbitt argument fails.”
Id. (citing Lirette, 699 F.2d at 728). Like the employer in
Campbell I & II, Premiere expressly agreed to indemnify not only
Santa Fe, but also Santa Fe’s “contractors and subcontractors,”
thus including Ensco, for obligations that arise due to claims of
injury brought by Premiere employees. Consequently, under the
consistent reasoning of this court, as in Campbell I & II, we
conclude that Premiere is obligated to indemnify, and thus to
reimburse, Santa Fe for any amounts owing for indemnification and
defense provided by Santa Fe to Ensco on account of Sumrall’s
tort claim. See also
Demette, 280 F.3d at 504;
Babcock, 792 F.2d
at 1351-53;
Mills, 722 F.2d at 1174-75;
Lirette, 699 F.2d at 725.
In an unusually poor alternative argument, Premiere contends
that even if it has a duty to indemnify Santa Fe for tortious,
12
contractual or any other type of obligations, the language by
which it agrees to indemnify “from and against all claims ...
which are asserted by or arise in favor of [Premiere] or any of
its ... employees” limits its duty to indemnify. (emphasis
added). Premiere contends that it owes indemnification for only
those obligations flowing from actions filed directly against
Santa Fe by Premiere or Premiere employees. Premiere thus
asserts that any contractual obligation arising from Santa Fe’s
indemnification of Ensco is not included in Premiere’s duty
because neither Premiere nor any Premiere employee was party to
any contractual claim filed directly against Santa Fe.
None of the indemnification provisions at issue in our
Lirette line of decisions contains precisely the same “in favor
of” language as that relied on by Premiere for this argument.
The corresponding relevant language in the provision at issue in
Lirette, for example, reads: “‘Owner ... agrees to indemnify ...
Charterer ... from any claims or suits resulting from injury or
damage to Owner’s ... employees ....’” 699 F.2d at 726 n.4.
However, the presence of language that is similar, if not
identical, to the “in favor of” language of Section 15.1 in the
provisions at issue in Lirette and its progeny did not alter our
findings in favor of the parties situated similarly to Santa Fe
in those materially indistinguishable decisions. See, e.g.,
Lirette, 699 F.2d at 729; Campbell
II, 27 F.3d at 186-88.
13
Consequently, we reject Premiere’s preferred reading of the “in
favor of” language in Section 15.1 as wholly specious.
The district court did not err in finding as a matter of law
that Premiere owes indemnification to Santa Fe in the instant
case based on the express language of their agreement in Section
15.1.
IV. RECIPROCITY OF THE INDEMNIFICATION AGREEMENT
Premiere contends that its obligation to indemnify Santa Fe
is more onerous than Santa Fe’s corresponding obligation.
Premiere thus argues that its indemnification agreement with
Santa Fe is not reciprocal and therefore is unenforceable under
the Longshore and Harbor Workers Compensation Act (“the LHWCA”),
33 U.S.C. § 905 (1999), which governs the agreement. Subsection
905(b) of the LHWCA prohibits indemnification by the employer of
a longshoreman for a claim due to bodily injury brought by the
employee against a vessel owner. 33 U.S.C. § 905(b).7
Subsection 905(c) provides an exception, however, allowing
indemnification by such an employer, in this case Premiere, so
long as there is “reciprocal” agreement by the vessel owner, in
this case Santa Fe, to indemnify the employer. 33 U.S.C.
7
Section 905(b) reads in relevant part: “In the event
of injury to a person ... caused by the negligence of a vessel,
then such person ... may bring an action against such vessel ...
and the employer shall not be liable to the vessel ... and any
agreements or warranties to the contrary shall be void.” 33
U.S.C. § 905(b).
14
§ 905(c).8 Examination of the indemnification agreement between
Premiere and Santa Fe indicates that the agreement is
sufficiently reciprocal to satisfy the subsection 905(c)
exception. Thus, the agreement is enforceable against Premiere
pursuant to subsection 905(b).
Premiere first argues that Section 15.3 of its agreement
with Santa Fe impermissibly enlarges Premiere’s burden to
indemnify beyond Santa Fe’s burden in return. Premiere notes
that in Section 15.3, Premiere agrees to indemnify Santa Fe
against any claims arising on behalf of employees of Premiere, as
well as against claims on behalf of employees of Premiere
subcontractors. Premiere contends, however, that there is no
similar provision obligating Santa Fe to indemnify Premiere on
account of Santa Fe’s third-party contractors or subcontractors.9
8
Section 905(c) reads in relevant part:
.... Nothing contained in subsection (b) of this
section shall preclude the enforcement ... of any
reciprocal indemnity provision whereby the employer ...
and the vessel agree to defend and indemnify the other
for cost of defense and ... liability for damages
arising out of or resulting from death or bodily injury
to their employees.
33 U.S.C. § 905(c).
9
Section 15.3 reads in relevant part:
15.3 In the event [Premiere] subcontracts any of
the Work to be performed under this Contract,
[Premiere] warrants that the agreements or Contracts
with its subcontractors shall contain defense,
indemnity, and hold harmless provisions equal to those
set forth in Sub-clause 15.1 above in favor of [Santa
15
Contrary to Premiere’s assertion, however, the language of the
indemnification agreement, as outlined in Section 15.2, reveals
that Santa Fe expressly and unconditionally agreed to indemnify
Premiere against any claims arising on behalf of employees of
Santa Fe’s third-party contractors. Section 15.2 reads in
relevant part:
15.2 [Santa Fe] agrees to protect, defend,
indemnify, hold, and save Contractor [Premiere] ...
harmless from and against all claims ... and which are
asserted by or arise in favor of [Santa Fe’s] employees
or [Santa Fe’s] contractors or their employees, other
than those parties identified in sub-clause 15.1, due
to bodily injury ....
(emphasis added). Thus, both Premiere and Santa Fe agreed to
indemnify each other for claims brought on behalf of the
employees of their respective third-party contractors (or in the
case of Premiere, its subcontractors).10
Fe]. Unless such agreements or contracts contain said
provisions, any and all subcontractor personnel engaged
in performing Work hereunder shall be deemed to be
employees of [Premiere] for all the purposes of Sub-
clause 15.1 hereof....
(emphasis added).
10
Although Section 15.2 refers only to Santa Fe’s duty to
indemnify on account of its “contractors,” while Section 15.1 and
Section 15.3 refer to Premiere’s duty to indemnify on account of
its “subcontractors,” this difference does not undermine the
reciprocity of the agreement. The standard by which we judge the
scope of an indemnification agreement is the reasonable
contemplation of the parties. See Corbitt, 654 F.2d at 333. It
was reasonable in this case for the parties to contemplate that,
because Santa Fe was the operator on the drilling operation, and
because Premiere was Santa Fe’s contractor, then Santa Fe would
likely only engage other third-party “contractors,” but not
16
Premiere further contends, however, that Section 15.3
creates an additional obligation because it contains an
undertaking by Premiere to obtain an express contractual
undertaking by any Premiere subcontractor to indemnify Santa Fe.
Premiere argues that because Santa Fe is not likewise required to
obtain the same contractual undertaking by Santa Fe’s contractors
to indemnify Premiere and Premiere subcontractors, then
Premiere’s obligation to Santa Fe is more onerous. We fail to
see how this undertaking creates any additional indemnification
obligation on the part of Premiere.
We do see how Section 15.3 may result in an additional
obligation on the part of a subcontractor of Premiere. However,
regardless of whether Premiere obtains an additional agreement by
any of its subcontractors to indemnify Santa Fe pursuant to
Section 15.3, Santa Fe is already entitled to look to Premiere
for -- and Premiere is obligated to provide -- indemnification
against claims by employees of Premiere subcontractors pursuant
to Section 15.1. Consequently, Section 15.3 in no way alters or
enlarges Premiere’s obligation to indemnify Santa Fe (or Santa
Fe’s contractors), and both Premiere and Santa Fe are entitled to
look to each other for indemnification for claims brought by the
“subcontractors,” while Premiere would engage third-party
“subcontractors.” We conclude, therefore, that despite this
difference in the language, both Premiere and Santa Fe agreed
reciprocally to indemnify each other against claims brought on
behalf of their own employees, as well as against claims on
behalf of employees of their respective third-party contractors.
17
employees of the respective third-party entities with which each
might contract in turn.
We likewise reject Premiere’s argument that the reciprocity
of its indemnification agreement with Santa Fe is destroyed by
the fact that Ensco did not agree in its contract with Santa Fe
to indemnify any contractors of Santa Fe, such as Premiere. By
the terms of Section 15.2, Premiere is entitled to
indemnification from Santa Fe against claims brought against
Premiere by Ensco employees. Thus, the fact that any contractor
of Santa Fe such as Ensco does not agree to indemnify other
contractors of Santa Fe has no effect on the reciprocity of the
indemnification obligations running between Santa Fe and
Premiere.11
In support of its argument that the indemnification
agreement is not reciprocal, Premiere relies on a single,
unpublished district court decision, Falcon Operators, Inc. v.
P.M.P. Wireline Servs., Inc., Nos. Civ.A. 97-825, 97-2586, 1997
11
Premiere further argues that because it has more
employees than does Santa Fe, its exposure to claims for which it
must indemnify is larger and, thus, that reciprocity is
destroyed. This argument ignores the fact that both Premiere and
Santa Fe have agreed to indemnify each other for an unspecified
potential number of employees of their respective potential
contractors. Moreover, we decline to count the number of
employees engaged by an indemnitor on a drilling operation as a
means of determining the scope of the potential indemnification
obligation, just as we would be loathe to attempt to measure the
comparative incompetence and propensity for negligent behavior of
given indemnitors’ employees as a means of gauging the scope of
their respective obligations.
18
WL 610825, at *8-9 (E.D. La. Sept. 30, 1997). We note that
Falcon Operators is not binding on this court. Moreover, we
agree with Santa Fe that the provisions at issue in that case are
distinguishable in that the groups of constituents affiliated
with the parties that each agreed to indemnify were in greater
disparity than is the case here. Likewise, the parties in that
case agreed to indemnify against claims brought on behalf of
groups of their affiliated constituents that were in greater
disparity than is the case here. See
id. Falcon Operators is
thus distinguishable, and Premiere’s reliance upon that case is
unavailing.12
We find that the indemnification provisions of the Premiere-
Santa Fe contract are sufficiently reciprocal that their
agreement is enforceable under the LHWCA. The district court did
not err, therefore, in finding as a matter of law that Premiere’s
agreement to indemnify Santa Fe is enforceable.
V. CONCLUSION
12
The district court in Falcon Operators based its
determination that the agreement lacked reciprocity in some part
on one additional finding: that the employer of the injured
plaintiff in that case was required to obtain insurance, but that
the oil company party to the indemnification agreement was not
required to do the same. We have determined that differing
insurance obligations do not create additional indirect liability
sufficient to implicate the prohibitions of subsection 905(b).
See Voisin v. O.D.E.C.O. Drilling Co., 744 F.2d 1174, 1176-78
(5th Cir. 1984). Thus, we find that any difference in the
insurance obligations owed between Premiere and Santa Fe does not
undermine the reciprocity of their indemnification agreement.
19
For the foregoing reasons, the district court’s summary
judgment in favor of Santa Fe is AFFIRMED.
20
