Thursday, December 20, 2012
INTERNATIONAL TRADE: IRB-Brasil Resseguros, S.A. v Inepar Invs., S.A.
INTERNATIONAL TRADE: IRB-Brasil Resseguros, S.A. v Inepar Invs., S.A.: IRB-Brasil Resseguros, S.A. v Inepar Invs., S.A. 2012 NY Slip Op 08669 Decided on December 18, 2012 Court of Appeals Lippman, Ch. J. Pub...
IRB-Brasil Resseguros, S.A. v Inepar Invs., S.A.
IRB-Brasil Resseguros, S.A. v Inepar Invs., S.A.
2012 NY Slip Op 08669 Decided on December 18, 2012
Court of Appeals Lippman, Ch. J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
[*1]IRB-Brasil Resseguros, S.A., Respondent,
v
Inepar Investments, S.A., Defendant, Inepar S.A. Industria e Construcoes, Appellant.
Decided on December 18, 2012
No. 191
Fredric S. Newman, for appellant.
Lea Haber Kuck, for respondent.
LIPPMAN, Chief Judge:
2012 NY Slip Op 08669 Decided on December 18, 2012
Court of Appeals Lippman, Ch. J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
[*1]IRB-Brasil Resseguros, S.A., Respondent,
v
Inepar Investments, S.A., Defendant, Inepar S.A. Industria e Construcoes, Appellant.
Decided on December 18, 2012
No. 191
Fredric S. Newman, for appellant.
Lea Haber Kuck, for respondent.
LIPPMAN, Chief Judge:
The issue before the Court is whether a conflict-of-laws analysis must be undertaken when there is an express choice of New York law in the contract pursuant to General [*2]Obligations Law § 5-1401. We hold that the need for a conflict-of-laws analysis is obviated by the terms of the parties' agreement.
Defendant Inepar S.A. Industria e Construç es (IIC) is a Brazilian power company which held a 60% stake in defendant Inepar Investments, S.A. ("Inepar"), a corporation organized under the laws of Uruguay. IIC specializes in providing equipment and services for the generation, transmission, distribution, and consumption of electric power.
In September 1996, Inepar issued $30 million in Global Notes in the Guaranteed Euro Medium-Term Note Program (the "Global Note Program") in order to raise capital and refinance debt previously incurred by Inepar and IIC. The Global Notes were denominated in U.S. dollars, issued on September 30, 1996, matured on October 1, 2001, and paid interest at a fixed rate of 9.9% per annum. A Fiscal Agency Agreement (the "Agreement") between Inepar as issuer, IIC as guarantor, and the Chase Manhattan Bank as the fiscal and paying agent, governed the Global Note Program. IIC provided in a Guarantee to "unconditionally and irrevocably guarantee . . . the due and punctual payment of principal and interest" under the terms of the Global Notes. The Agreement stated that "[t]his Agreement, the Notes, and the Guarantee shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to conflict of laws principles." The Guarantee provided that it would be "governed by, and . . . be construed in accordance with, the laws of the State of New York." New York was designated as the venue in the Guarantee, and thereunder IIC submitted to the jurisdiction of New York courts.
Plaintiff IRB-Brasil Resseguros S.A. (IRB), a 50% state-owned corporation organized under the laws of Brazil, bought $14 million of Inepar's Global Notes through brokers Smith Barney and Lehman Brothers. IRB received eight interest payments on the Global Notes between April 1997 and October 2000. The interest payments ceased after October 2000, and IRB never received the payment of the principal of $14 million from either IIC or Inepar.
IRB commenced the instant action against IIC and Inepar seeking payment of the Global Note principal and the unpaid accrued interest. Inepar defaulted in this action, and IIC moved for summary judgment, arguing that the Guarantee was void under Brazilian law because it was never authorized by IIC's board of directors. IIC claimed that New York's choice-of-law principles should apply, resulting in the application of Brazilian substantive law. IRB also moved for summary judgment. Supreme Court denied IIC's motion and granted IRB summary judgment on the issue of liability only. A Special Referee appointed to hear and determine the issue of damages directed that judgment be entered against IIC in the sum of $27,772,409.86 and that interest on the award be paid at a 9.9% rate. Supreme Court ruled that "a choice-of-law clause in the agreement denoting that New York law governs the parties' rights and obligations, shall be given mandatory effect" under General Obligations Law § 5-1401 (2009 NY Slip Op 31723[U] [Sup Ct, New York County 2009]). [*3]
The Appellate Division modified the judgment only to the extent of limiting the rate of post-judgment interest to the statutory rate of 9% per year, and otherwise affirmed (83 AD3d 573 [1st Dept 2011]). This Court granted leave to appeal (17 NY3d 717), and we now affirm.
General Obligations Law § 5-1401 (1) states in relevant part:
"The parties to any contract . . . arising out of a transaction covering in the aggregate not less than two hundred fifty thousand dollars . . . may agree that the law of this state shall govern their rights and duties in whole or in part, whether or not such contract, agreement or undertaking bears a reasonable relation to this state."
The Legislature passed the statute in 1984 in order to allow parties without New York contacts to choose New York law to govern their contracts. Prior to the enactment of § 5-1401, the Legislature feared that New York courts would not recognize "a choice of New York law [in certain contracts] on the ground that the particular contract had insufficient 'contact' or 'relationship' with New York" (Sponsor's Mem, Bill Jacket, L 1984, ch 421). Instead of applying New York law, the courts would conduct a conflicts analysis and apply the law of the jurisdiction with "'the most significant relationship to the transaction and the parties'" (Zurich Ins. Co. v Shearson Lehman Hutton, 84 NY2d 309, 317 [1994] [quoting Restatement (Second) of Conflict of Laws § 188 (1)]). As a result, parties would be deterred from choosing the law of New York in their contracts, and the Legislature was concerned about how that would affect the standing of New York as a commercial and financial center (see Sponsor's Mem, Bill Jacket, L 1984, ch 421). The Sponsor's Memorandum states, "In order to encourage the parties of significant commercial, mercantile or financial contracts to choose New York law, it is important . . . that the parties be certain that their choice of law will not be rejected by a New York Court . . ." (id.). The Legislature desired for parties with multi-jurisdictional contacts to avail themselves of New York law if they so designate in their choice-of-law provisions, in order to eliminate uncertainty and to permit the parties to choose New York's "well-developed system of commercial jurisprudence" (id.).
"The parties to any contract . . . arising out of a transaction covering in the aggregate not less than two hundred fifty thousand dollars . . . may agree that the law of this state shall govern their rights and duties in whole or in part, whether or not such contract, agreement or undertaking bears a reasonable relation to this state."
The Legislature passed the statute in 1984 in order to allow parties without New York contacts to choose New York law to govern their contracts. Prior to the enactment of § 5-1401, the Legislature feared that New York courts would not recognize "a choice of New York law [in certain contracts] on the ground that the particular contract had insufficient 'contact' or 'relationship' with New York" (Sponsor's Mem, Bill Jacket, L 1984, ch 421). Instead of applying New York law, the courts would conduct a conflicts analysis and apply the law of the jurisdiction with "'the most significant relationship to the transaction and the parties'" (Zurich Ins. Co. v Shearson Lehman Hutton, 84 NY2d 309, 317 [1994] [quoting Restatement (Second) of Conflict of Laws § 188 (1)]). As a result, parties would be deterred from choosing the law of New York in their contracts, and the Legislature was concerned about how that would affect the standing of New York as a commercial and financial center (see Sponsor's Mem, Bill Jacket, L 1984, ch 421). The Sponsor's Memorandum states, "In order to encourage the parties of significant commercial, mercantile or financial contracts to choose New York law, it is important . . . that the parties be certain that their choice of law will not be rejected by a New York Court . . ." (id.). The Legislature desired for parties with multi-jurisdictional contacts to avail themselves of New York law if they so designate in their choice-of-law provisions, in order to eliminate uncertainty and to permit the parties to choose New York's "well-developed system of commercial jurisprudence" (id.).
General Obligations Law § 5-1402 (1) further provides:
"any person may maintain an action or proceeding against a foreign corporation, non-resident, or foreign state where the action or proceeding arises out of or relates to any contract, agreement or undertaking for which a choice of New York law has been made in whole or in part pursuant to section 5-1401 and which (a) is a contract, agreement or undertaking, contingent or otherwise, in consideration of, or relating to any obligation arising out of a transaction covering in the aggregate, not less than one million dollars, and (b) which contains a provision or provisions whereby such foreign corporation or non-resident agrees to submit to the jurisdiction of the courts of this state." [*4]
Section 5-1402 (1) opened New York courts up to parties who lacked New York contacts but who had (1) engaged in a transaction involving $1 million or more, (2) agreed in their contract to submit to the jurisdiction of New York courts, and (3) chosen to apply New York law pursuant to General Obligations Law § 5-1401. The statutes read together permit parties to select New York law to govern their contractual relationship and to avail themselves of New York courts despite lacking New York contacts.
"any person may maintain an action or proceeding against a foreign corporation, non-resident, or foreign state where the action or proceeding arises out of or relates to any contract, agreement or undertaking for which a choice of New York law has been made in whole or in part pursuant to section 5-1401 and which (a) is a contract, agreement or undertaking, contingent or otherwise, in consideration of, or relating to any obligation arising out of a transaction covering in the aggregate, not less than one million dollars, and (b) which contains a provision or provisions whereby such foreign corporation or non-resident agrees to submit to the jurisdiction of the courts of this state." [*4]
Section 5-1402 (1) opened New York courts up to parties who lacked New York contacts but who had (1) engaged in a transaction involving $1 million or more, (2) agreed in their contract to submit to the jurisdiction of New York courts, and (3) chosen to apply New York law pursuant to General Obligations Law § 5-1401. The statutes read together permit parties to select New York law to govern their contractual relationship and to avail themselves of New York courts despite lacking New York contacts.
Applying General Obligations Law §§ 5-1401 and 5-1402 to the facts of the present case, we conclude that New York substantive law must govern, since the parties designated New York in their choice-of-law provision in the Guarantee and the transaction exceeded $250,000. IIC argues that the "whole" of New York law should apply, including New York's common law conflict-of-laws principles. IIC maintains that the Guarantee's choice-of-law provision would have had to expressly exclude New York's conflict-of-laws principles in order for New York substantive law to apply; otherwise, IIC claims that the court must engage in a conflicts analysis that results in the application of Brazilian substantive law. IIC's argument is unpersuasive. Express contract language excluding New York's conflict-of-laws principles is not necessary. The plain language of General Obligations Law § 5-1401 dictates that New York substantive law applies when parties include an ordinary New York choice-of-law provision, such as appears in the Guarantee, in their contracts. The goal of General Obligations Law § 5-1401 was to promote and preserve New York's status as a commercial center and to maintain predictability for the parties. To find here that courts must engage in a conflict-of-law analysis despite the parties' plainly expressed desire to apply New York law would frustrate the Legislature's purpose of encouraging a predictable contractual choice of New York commercial law and, crucially, of eliminating uncertainty regarding the governing law.
The Restatement (Second) of Conflict of Laws supports our conclusion that an express exclusion of New York's conflict-of-laws rules is unnecessary. According to the Restatement (Second) of Conflict of Laws § 187, "[i]n the absence of a contrary indication of intention, the reference [to the law of the state chosen by the parties] is to the local law of the state of the chosen law." "Local law" is defined as "the body of standards, principles and rules, exclusive of its rules of Conflict of Laws" (Restatement [Second] of Conflict of Laws § 4[1] [emphasis added]). Under the Restatement (Second), the parties' decision to apply New York law to their contract results in the application of New York substantive law, not New York's conflicts principles.
It strains credulity that the parties would have chosen to leave the question of the applicable substantive law unanswered and would have desired a court to engage in a complicated conflict-of-laws analysis, delaying resolution of any dispute and increasing litigation expenses. We therefore conclude that parties are not required to expressly exclude New York conflict-of-laws principles in their choice-of-law provision in order to avail themselves of New [*5]York substantive law. Indeed, in the event parties wish to employ New York's conflict-of-law principles to determine the applicable substantive law, they can expressly so designate in their contract [FN1].
Accordingly, the order of the Appellate Division should be affirmed, with costs.
* * * * * * * * * * * * * * * * *
Order affirmed, with costs. Opinion by Chief Judge Lippman. Judges Ciparick, Graffeo, Read, Smith and Pigott concur.
Decided December 18, 2012 Footnotes
Footnote 1: For the foregoing reasons, we find the difference between the language of the choice-of-law provision in the Agreement and the Guarantee to be inconsequential as a matter of law.
* * * * * * * * * * * * * * * * *
Order affirmed, with costs. Opinion by Chief Judge Lippman. Judges Ciparick, Graffeo, Read, Smith and Pigott concur.
Decided December 18, 2012 Footnotes
Footnote 1: For the foregoing reasons, we find the difference between the language of the choice-of-law provision in the Agreement and the Guarantee to be inconsequential as a matter of law.
Wednesday, December 5, 2012
INTERNATIONAL TRADE: International Business Transactions
INTERNATIONAL TRADE: International Business Transactions: By Norka M. Schell, Experienced International Business Transaction Attorney, at Law Offices of Norka M. Schell, LLC www.lawschell.com I...
International Business Transactions
By Norka M. Schell, Experienced International Business Transaction Attorney, at Law Offices of Norka M. Schell, LLC
www.lawschell.com
International business transactions are described in the form of an international contract, containing the objectives and commitments of each of the parties involved and the terms which govern the transaction.
International sale contracts are governed by the Uniform Nations Conventions on Contracts for the International Sale of Goods (CISG). If the countries of the parties to the contract have ratified the CISC -- and if the parties have not agreed to some other law will govern their contract-- CISG covers the transaction.
One key element of international contract law includes the provision that the parties' nationality does not play any role when applying the law, thereby placing all parties on an equal playing field. Rules of the contracts are interpreted by what a "reasonable person" would consider fair and appropriate given the circumstances.
The basic obligation of a seller under a sales contract is to transfer and deliver conforming goods -- that is goods that conform to the specifications of the contract.
The basic obligation of a buyer is to accept and pay for conforming goods in accordance with the contract.
When either the seller or the buyer fails to perform his or her obligation under the contract,for instance, the failure to supply goods or to perform a service or to make payment as agreed upon, a breach of contract occurs. To protect the innocent party, the law allows the nonbreaching party to bring an action for damages to compensate for the loss of the bargain.
The object of damages is usually to put the nonbreaching party in position that he or she would have occupied had the contract been fully performed. Sometimes damages are not an adequate remedy and this is where the equitable remedies (such as specific performance and injunction) may be awarded. However, the nonbreaching party has an obligation to mitigate the damages incurred as a result of the contract's breach.
For more information about International Business Transactions, please call my offices at (212)564 1589 to speak with me.
www.lawschell.com
International business transactions are described in the form of an international contract, containing the objectives and commitments of each of the parties involved and the terms which govern the transaction.
International sale contracts are governed by the Uniform Nations Conventions on Contracts for the International Sale of Goods (CISG). If the countries of the parties to the contract have ratified the CISC -- and if the parties have not agreed to some other law will govern their contract-- CISG covers the transaction.
One key element of international contract law includes the provision that the parties' nationality does not play any role when applying the law, thereby placing all parties on an equal playing field. Rules of the contracts are interpreted by what a "reasonable person" would consider fair and appropriate given the circumstances.
The basic obligation of a seller under a sales contract is to transfer and deliver conforming goods -- that is goods that conform to the specifications of the contract.
The basic obligation of a buyer is to accept and pay for conforming goods in accordance with the contract.
When either the seller or the buyer fails to perform his or her obligation under the contract,for instance, the failure to supply goods or to perform a service or to make payment as agreed upon, a breach of contract occurs. To protect the innocent party, the law allows the nonbreaching party to bring an action for damages to compensate for the loss of the bargain.
The object of damages is usually to put the nonbreaching party in position that he or she would have occupied had the contract been fully performed. Sometimes damages are not an adequate remedy and this is where the equitable remedies (such as specific performance and injunction) may be awarded. However, the nonbreaching party has an obligation to mitigate the damages incurred as a result of the contract's breach.
For more information about International Business Transactions, please call my offices at (212)564 1589 to speak with me.
Tuesday, September 25, 2012
INTERNATIONAL TRADE: CROSS-BORDER TRANSACTIONS
INTERNATIONAL TRADE: CROSS-BORDER TRANSACTIONS: Attorney Norka M. Schell Law Offices of Norka M. Schell, LLC Trading good across borders or "cross-border transactions" continue to a lar...
CROSS-BORDER TRANSACTIONS
Attorney Norka M. Schell
Law Offices of Norka M. Schell, LLC
Trading good across borders or "cross-border transactions" continue to a large extent to be subject to our national laws and international trade.
International business affects almost each one of us. The buyer of a Japanese iPhone or a German Mercedes-Benz are involved a series of links in a foreign trading relationship. But their roles were indirect, they undoubtedly bought the phone or car from a United States retailer. The individual was not directly engaging in international trade. The seller of the phone or the car may have been, although it is quite possible that they were indirect links, purchasing from United States distributors. At some point, however, an entity in the United States ordered these goods from abroad. Or the foreign manufacturers may have established subsidiaries in the United States to undertake the distribution. In that case, the purchasers from the distributors were dealing with a foreign direct investment, an equity investment in the United States by foreign capital. Numerous international trade people played a role in the movement of the iPhone and Mercedes-Benz from their place of manufacture in Japan and Germany to the ultimate purchaser in New York or California.
Law Offices of Norka M. Schell, LLC
Trading good across borders or "cross-border transactions" continue to a large extent to be subject to our national laws and international trade.
International business affects almost each one of us. The buyer of a Japanese iPhone or a German Mercedes-Benz are involved a series of links in a foreign trading relationship. But their roles were indirect, they undoubtedly bought the phone or car from a United States retailer. The individual was not directly engaging in international trade. The seller of the phone or the car may have been, although it is quite possible that they were indirect links, purchasing from United States distributors. At some point, however, an entity in the United States ordered these goods from abroad. Or the foreign manufacturers may have established subsidiaries in the United States to undertake the distribution. In that case, the purchasers from the distributors were dealing with a foreign direct investment, an equity investment in the United States by foreign capital. Numerous international trade people played a role in the movement of the iPhone and Mercedes-Benz from their place of manufacture in Japan and Germany to the ultimate purchaser in New York or California.
Friday, June 29, 2012
INTERNATIONAL TRADE: U.S. PROMOTES TRADE RELATIONSHIP, ECONOMIC GROWTH ...
INTERNATIONAL TRADE: U.S. PROMOTES TRADE RELATIONSHIP, ECONOMIC GROWTH ...: Posted By ATTORNEY NORKA M. SCHELL LAW OFFICES OF NORKA M. SCHELL 11 BROADWAY, SUITE 615 NEW YORK, NY 10004 PH. (212) 564-1589 FOR I...
U.S. PROMOTES TRADE RELATIONSHIP, ECONOMIC GROWTH AND JOB CREATION IN TURKEY
Posted By ATTORNEY NORKA M. SCHELL
LAW OFFICES OF NORKA M. SCHELL
11 BROADWAY, SUITE 615 NEW YORK, NY 10004
PH. (212) 564-1589
FOR IMMEDIATE RELEASE
Acting U.S. Commerce Secretary Rebecca Blank wrapped up her visit to Turkey on Wednesday, June 27, 2012, after co-chairing the second meeting of the U.S.-Turkey Framework for Strategic Economic and Commercial Cooperation (FSECC) with U.S. Trade Representative Ron Kirk in Ankara yesterday. The Turkish delegation was led by Deputy Prime Minister Ali Babacan and Minister of the Economy Zafer Caglayan. The FSECC was created following the first meeting between President Obama and Turkish President Gul in April 2009. The two leaders tasked the U.S. and Turkish governments to create a framework to help substantially increase the trade and investment flows between both countries to help strengthen the economic dimension of our partnership.
The meeting focused on opportunities for increased bilateral trade and investment relations to create jobs in both countries, and the ministers agreed on several concrete steps to advance the U.S-Turkish commercial relationship. The Acting Secretary promoted increased Foreign Direct Investment, including calling for greater Turkish FDI to the U.S., highlighting Commerce’s SelectUSA initiative. The four principals made a joint statement after the meeting.
During the meeting, Acting Secretary Blank announced that the Commerce Department's International Trade Administration will lead an Aerospace and Defense Industry Trade Mission to Turkey in December 2012. She also applauded the work that has been done so far to increase bilateral trade between the U.S. and Turkey. She emphasized the work that must be done to continue to advance the U.S.-Turkey trade relationship, such as overcoming market access barriers, furthering cooperation on intellectual property rights, and enabling businesses to take advantage of opportunities in key sectors such as renewable energy, financial services, and infrastructure.
Acting Secretary Blank spoke about the commitments made by both sides that will lead to an even stronger partnership between the U.S. and Turkey – and even greater prosperity for people of both countries. These commitments include holding a World Bank Ease of Doing Business Symposium, as well as a Symposium on Infrastructure Cooperation. She also made a strong push for both governments to listen to the advice and recommendations of the U.S.-Turkey Business Council. She highlighted the commitment of the U.S. to ensuring that these efforts remain on track, in addition to future efforts to bring new ideas to the forefront in strengthening the commercial relationship between the two countries. Also at FSECC, Leocadia I. Zak, Director of the U.S. Trade and Development Agency (USTDA), part of the U.S. delegation and participating in the energy and transportation sessions at the FSECC, announced that USTDA will host a smart grid workshop in Turkey this winter that will connect U.S. technology providers to the public and private sectors in Turkey.
In addition to co-chairing the FSECC, Blank participated in the grand opening of the American Business Center in Ankara, which will house the new offices of the Foreign Commercial Service in Ankara. She noted that the Center, which is located in the same building as the Ankara Chamber of Industry, will help strengthen the bonds between private industries in both countries. At both FSECC and throughout the day, Blank advocated for U.S. companies that are seeking to do business with Turkey, stressing the high quality and competitive advantages that U.S. companies offer.
As the world’s fastest growing economy during the first quarter of 2011, Turkey represents a market with great potential. Turkey has been designated as a priority market under President Obama’s National Export Initiative and has, as a result, been the focus of sustained International Trade Administration and U.S. Government efforts, including targeted trade promotion. U.S.-Turkish trade grew by 34 percent last year, reaching a record high of almost $20 billion. Furthermore, U.S. exports to Turkey rose 38 percent, totaling $14.6 billion and making Turkey one of the top 25 U.S. export markets.
For more information about our services, please visit our website at www.lawschell.com
LAW OFFICES OF NORKA M. SCHELL
11 BROADWAY, SUITE 615 NEW YORK, NY 10004
PH. (212) 564-1589
FOR IMMEDIATE RELEASE
Acting U.S. Commerce Secretary Rebecca Blank wrapped up her visit to Turkey on Wednesday, June 27, 2012, after co-chairing the second meeting of the U.S.-Turkey Framework for Strategic Economic and Commercial Cooperation (FSECC) with U.S. Trade Representative Ron Kirk in Ankara yesterday. The Turkish delegation was led by Deputy Prime Minister Ali Babacan and Minister of the Economy Zafer Caglayan. The FSECC was created following the first meeting between President Obama and Turkish President Gul in April 2009. The two leaders tasked the U.S. and Turkish governments to create a framework to help substantially increase the trade and investment flows between both countries to help strengthen the economic dimension of our partnership.
The meeting focused on opportunities for increased bilateral trade and investment relations to create jobs in both countries, and the ministers agreed on several concrete steps to advance the U.S-Turkish commercial relationship. The Acting Secretary promoted increased Foreign Direct Investment, including calling for greater Turkish FDI to the U.S., highlighting Commerce’s SelectUSA initiative. The four principals made a joint statement after the meeting.
During the meeting, Acting Secretary Blank announced that the Commerce Department's International Trade Administration will lead an Aerospace and Defense Industry Trade Mission to Turkey in December 2012. She also applauded the work that has been done so far to increase bilateral trade between the U.S. and Turkey. She emphasized the work that must be done to continue to advance the U.S.-Turkey trade relationship, such as overcoming market access barriers, furthering cooperation on intellectual property rights, and enabling businesses to take advantage of opportunities in key sectors such as renewable energy, financial services, and infrastructure.
Acting Secretary Blank spoke about the commitments made by both sides that will lead to an even stronger partnership between the U.S. and Turkey – and even greater prosperity for people of both countries. These commitments include holding a World Bank Ease of Doing Business Symposium, as well as a Symposium on Infrastructure Cooperation. She also made a strong push for both governments to listen to the advice and recommendations of the U.S.-Turkey Business Council. She highlighted the commitment of the U.S. to ensuring that these efforts remain on track, in addition to future efforts to bring new ideas to the forefront in strengthening the commercial relationship between the two countries. Also at FSECC, Leocadia I. Zak, Director of the U.S. Trade and Development Agency (USTDA), part of the U.S. delegation and participating in the energy and transportation sessions at the FSECC, announced that USTDA will host a smart grid workshop in Turkey this winter that will connect U.S. technology providers to the public and private sectors in Turkey.
In addition to co-chairing the FSECC, Blank participated in the grand opening of the American Business Center in Ankara, which will house the new offices of the Foreign Commercial Service in Ankara. She noted that the Center, which is located in the same building as the Ankara Chamber of Industry, will help strengthen the bonds between private industries in both countries. At both FSECC and throughout the day, Blank advocated for U.S. companies that are seeking to do business with Turkey, stressing the high quality and competitive advantages that U.S. companies offer.
As the world’s fastest growing economy during the first quarter of 2011, Turkey represents a market with great potential. Turkey has been designated as a priority market under President Obama’s National Export Initiative and has, as a result, been the focus of sustained International Trade Administration and U.S. Government efforts, including targeted trade promotion. U.S.-Turkish trade grew by 34 percent last year, reaching a record high of almost $20 billion. Furthermore, U.S. exports to Turkey rose 38 percent, totaling $14.6 billion and making Turkey one of the top 25 U.S. export markets.
For more information about our services, please visit our website at www.lawschell.com
Friday, May 11, 2012
HOW TO AVOID DISPUTES IN CONTRACT
Everyone concedes that the best time to think about possible disputes is when the contract is being negotiated and drafted. The best contract drafters anticipate possible impediments to performance and try to write contract provisions that permit the contract, when appropriate, to flex with changes in circumstances. While flexing may not necessarily be suitable for each and every contract (some parties require an extremely rigid contract), it is often possible to draft clauses that permit a little "give" in the agreement; thus avoiding an outright breach simply because something has occurred that the parties did not contemplate at the drafting stage. This concept, often referred to as contract adaptation, may appear in the express provisions of the contract or may be provided through certain gap-filling measures found in the underlying law of the contract.
Sunday, April 8, 2012
INTERNATIONAL TRADE: HAGUE SERVICE CONVENTION
INTERNATIONAL TRADE: HAGUE SERVICE CONVENTION: Posted by Norka M. Schell, Esq. Law Offices of Norka M. Schell The Hague Service Convention applies in all civil and commercial cases in ...
HAGUE SERVICE CONVENTION
Posted by Norka M. Schell, Esq.
Law Offices of Norka M. Schell
The Hague Service Convention applies in all civil and commercial cases in which there is a need to transmit judicial or extrajudicial documents for service abroad where two signatory countries are involved.
The purpose of the Hague Service Convention is to:
Before the enactment of the Hague Service Convention, service was generally made by use of "letter rogatory." A letter rogatory is a formal request from a court in the country where the proceedings are underway to a court in the country where the party on whom service is desired is a resident.
In order to use this method, the court in which proceedings are underway transmits the document to be serviced to its own country's Ministry of Foreign Affair which forwards the request to its counterpart in the country of destination. The latter then transmits the document to its local court, which arranges for the party to be served. Once completed, a certificate of service is send back using the same process in reverse.
Letters rogatory are still used in cases where the country of destination has not ratified the Hague Service Convention.
Under the Hague Convention, each signatory country designates a "Central Authority" to accept incoming requests for service.
A "Judicial Officer" who is authorized to serve process in the county of origin may send the request for service directly to the "Central Authority" of the country in which service is to be made. In the United States, any attorney admitted to the bar is a "Judicial Officer."
Once the request is received, barring any objections, the receiving state's Central Authority" arranges for service to be made, generally in accordance with that country's laws.
Once service has been effected, the "Central Authority" transmits back to the original "Judicial Officer" a certificate that is evidence of proper service.
The use of the letters rogatory can take from 6 to 12 months.
The use of the Hague Service Convention generally take 2-4 months.
If you need legal assistance to serve a party abroad, contact us at www.lawschell.com.
The purpose of the Hague Service Convention is to:
- Create appropriate means by which judicial and extrajudicial documents served abroad shall be served on an addressee in sufficient time;
- Improve international mutual judicial assistance by simplifying and expediting the process for service abroad.
Before the enactment of the Hague Service Convention, service was generally made by use of "letter rogatory." A letter rogatory is a formal request from a court in the country where the proceedings are underway to a court in the country where the party on whom service is desired is a resident.
In order to use this method, the court in which proceedings are underway transmits the document to be serviced to its own country's Ministry of Foreign Affair which forwards the request to its counterpart in the country of destination. The latter then transmits the document to its local court, which arranges for the party to be served. Once completed, a certificate of service is send back using the same process in reverse.
Letters rogatory are still used in cases where the country of destination has not ratified the Hague Service Convention.
Under the Hague Convention, each signatory country designates a "Central Authority" to accept incoming requests for service.
A "Judicial Officer" who is authorized to serve process in the county of origin may send the request for service directly to the "Central Authority" of the country in which service is to be made. In the United States, any attorney admitted to the bar is a "Judicial Officer."
Once the request is received, barring any objections, the receiving state's Central Authority" arranges for service to be made, generally in accordance with that country's laws.
Once service has been effected, the "Central Authority" transmits back to the original "Judicial Officer" a certificate that is evidence of proper service.
The use of the letters rogatory can take from 6 to 12 months.
The use of the Hague Service Convention generally take 2-4 months.
If you need legal assistance to serve a party abroad, contact us at www.lawschell.com.
Friday, January 20, 2012
INTERNATIONAL TRADE: PERSONAL JURISDICTION
INTERNATIONAL TRADE: PERSONAL JURISDICTION: January 20, 2012 Posted by Norka M. Schell, Esq. APPEAL FROM U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO,, CLEVELAND Richard...
PERSONAL JURISDICTION
January 20, 2012
Posted by Norka M. Schell, Esq.
APPEAL FROM U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO,, CLEVELAND
Richard A. Conn, Jr. v. Vladimir Zakaharov
OPINION - Alice M. Butchelder, Chief Judge
An old Russian proverb states, "If you're afraid of wolves, don't go into the forest."
For the Appellant Richard A. Conn the proverb might well read, "If you're afraid of the Russian legal system, don't do business in Russia."
Conn brought an action against Appellee Vladimir Zakharov for breach of contract, a contract that Conn moved to Russia to perform. Conn chose the Northern District of Ohio as the forum for the suit because Zakaharov owns property there and because Conn believed he would not prevail in a Russian court of law. The district court ruled that it did not have personal jurisdiction under Ohio law and dismissed the case.
The Untied States Court of Appeals for the 6th Circuit affirm the decision because under the facts of this case both Ohio law and Due Process Clause proscribes the district court from finding general personal jurisdiction over Zakharov.
A federal court sitting in diversity may not exercise jurisdiction over a defendant unless courts of the forum state would be authorized to do so by state law - and any such jurisdiction must be compatible with the due process requirements of the United States Constitution. "Int'l Techs. Consultants v. Euroglas S.A. 107 F. 3d 386, 391 (6th Cir. 1997).
Deciding whether jurisdiction exists is not an idle or perfunctory inquiry, due process demands that parties have sufficient contacts with the forum state so that it is fair to subject them to jurisdiction. See Burgen King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985). The Due Process Clause gives a degree of predictability to the legal system that allows potential defendants to structure minimum assurance as to where that conduct will and will not render them liable to suits. The court's jurisdiction accordingly extends only to those parties who have in some fashion placed themselves in the hands of the tribunal. See, e.g. Kerry Steel, Inc. Paragan Indus. Inc. 106 F3d. 147, 150 (6th Cir. 1997). (To be subject to in person jurisdiction...a defendant must purposefully avail [ ] itself to the privilege of conducting activities within the forum States, this invoking the benefits and protections of its law."
Posted by Norka M. Schell, Esq.
APPEAL FROM U.S. DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO,, CLEVELAND
Richard A. Conn, Jr. v. Vladimir Zakaharov
OPINION - Alice M. Butchelder, Chief Judge
An old Russian proverb states, "If you're afraid of wolves, don't go into the forest."
For the Appellant Richard A. Conn the proverb might well read, "If you're afraid of the Russian legal system, don't do business in Russia."
Conn brought an action against Appellee Vladimir Zakharov for breach of contract, a contract that Conn moved to Russia to perform. Conn chose the Northern District of Ohio as the forum for the suit because Zakaharov owns property there and because Conn believed he would not prevail in a Russian court of law. The district court ruled that it did not have personal jurisdiction under Ohio law and dismissed the case.
The Untied States Court of Appeals for the 6th Circuit affirm the decision because under the facts of this case both Ohio law and Due Process Clause proscribes the district court from finding general personal jurisdiction over Zakharov.
A federal court sitting in diversity may not exercise jurisdiction over a defendant unless courts of the forum state would be authorized to do so by state law - and any such jurisdiction must be compatible with the due process requirements of the United States Constitution. "Int'l Techs. Consultants v. Euroglas S.A. 107 F. 3d 386, 391 (6th Cir. 1997).
Deciding whether jurisdiction exists is not an idle or perfunctory inquiry, due process demands that parties have sufficient contacts with the forum state so that it is fair to subject them to jurisdiction. See Burgen King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985). The Due Process Clause gives a degree of predictability to the legal system that allows potential defendants to structure minimum assurance as to where that conduct will and will not render them liable to suits. The court's jurisdiction accordingly extends only to those parties who have in some fashion placed themselves in the hands of the tribunal. See, e.g. Kerry Steel, Inc. Paragan Indus. Inc. 106 F3d. 147, 150 (6th Cir. 1997). (To be subject to in person jurisdiction...a defendant must purposefully avail [ ] itself to the privilege of conducting activities within the forum States, this invoking the benefits and protections of its law."
Monday, January 16, 2012
SUBSTANTIAL NEXUS TEST
Prepared by the Reporter of Decision
Posted by Norka M. Schell, Esq.
In the Matter of Pacific Operators Offshore, LLP v. Valladolid, the Supreme Court, Justice Thomas, held that:
1. OCLA provision extending LHWCA does not require that the injury occur on outer Continental Shelf (OSC), abrogating Mills v. Director, Office of Worker's Compensation Program, 875 F2d. 356;
2. LJWCA coverage is not extended to all injuries that would not have occurred "but for" operations on OCS, abrogating Curts v. Schlumberger Offshore Services, Inc. 849 F2d. 805; and
3. Claimant seeking benefit under OCSLA must establish substantial nexus between the injury and extractive operations on OSC.
Affirmed and remanded.
STAMENT OF THE CASE
Petitioner Pacific Operators Offshore, LLP (Pacific), operates two drilling platforms on the Outer Continental Shelf (OCS) off the California coast and an onshore oil and gas processing facility. Employee Juan Valladolid spent 98 percent of his time working on an offshore platform, but he was killed in an accident while working at the onshore facility. His widow, a respondent here, sought benefits under the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. § 901 et seq., pursuant to the Outer Continental Shelf Lands Act (OCSLA), which extends LHWCA coverage to injuries “occurring as the result of operations conducted on the [OCS]” for the purpose of extracting natural resources from the shelf, 43 U.S.C. § 1333(b). The Administrative Law Judge dismissed her claim, reasoning that § 1333(b) did not cover Valladolid's fatal injury because his accident occurred on land, not on the OCS. The Labor Department's Benefits Review Board affirmed, but the Ninth Circuit reversed. Rejecting tests used by the Third and the Fifth Circuits, the Ninth Circuit concluded that a claimant seeking benefits under the OCSLA “must establish a substantial nexus between the injury and extractive operations on the shelf.”
Held: The OCSLA extends coverage to an employee who can establish a substantial nexus between his injury and his employer's extractive operations on the OCS. Pp. –––– – ––––.
(a) The Courts of Appeals have offered competing interpretations of § 1333(b)'s scope. According to the Third Circuit, because Congress intended LHWCA coverage to be expansive, § 1333(b) extends to all injuries that would not have occurred “but for” operations on the OCS. Thus, an employee who worked on a semisubmersible drill rig, but who died in a car accident on his way to board a helicopter to be flown to the rig, was eligible for benefits because he would not have been injured but for his traveling to the rig. In contrast, the Fifth Circuit has concluded that Congress intended to establish “a bright-line geographic boundary,” extending § 1333(b) coverage only to employees whose injuries or death occurred on an OCS platform or the waters above the OCS. Under its “situs-of-injury” test, a welder injured on land while constructing an offshore oil platform was ineligible for § 1333(b) benefits. In the decision below, the Ninth Circuit held that § 1333(b) extends coverage to injured workers who can establish a “substantial nexus” between their injury and extractive operations on the OCS. The Solicitor General offers a fourth interpretation, which would provide coverage for off-OCS injuries only to those employees whose duties contribute to operations on the OCS and who perform work on the OCS itself that is substantial in both duration and nature. Pp. –––– – ––––.
(b) Contrary to Pacific's position, the Fifth Circuit's “situs-of-injury” test is not the best interpretation of § 1333(b). Pp. –––– – ––––.
(1) Nothing in the text of § 1333(b) suggests that an injury must occur on the OCS. The provision has only two requirements: The extractive operations must be “conducted on the [OCS],” and the employee's injury must occur “as the result of” those operations. If, as Pacific suggests, the purpose of § 1333(b) was to geographically limit the scope of OCSLA coverage to injuries that occur on the OCS, Congress could easily have achieved that goal by omitting from § 1333(b) the words “as the result of operations conducted.” Moreover, Congress' decision to specify situs limitations in other subsections, but not in § 1333(b), indicates that it did not intend to so limit § 1333(b). This conclusion is not foreclosed by Herb's Welding, Inc. v. Gray, 470 U.S. 414, 105 S.Ct. 1421, 84 L.Ed.2d 406, or Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 106 S.Ct. 2485, 91 L.Ed.2d 174, neither of which held that § 1333(b) coverage was limited to on-OCS injuries. Section 1333(b)'s text also gives no indication that Congress intended to exclude OCS workers who are eligible for state benefits from LHWCA coverage. To the contrary, the LHWCA scheme incorporated by the OCSLA explicitly anticipates that injured employees might be eligible for both state and federal benefits. Pp. –––– – ––––.
(2) Also unpersuasive is Pacific's alternative argument that § 1333(b) imports the LHWCA's strict situs-of-injury requirement, which provides benefits only for injuries occurring “upon the navigable waters” of the United States, 33 U.S.C. § 903(a). It is unlikely that Congress intended to restrict the scope of the OCSLA workers' compensation scheme through a nonintuitive and convoluted combination of two separate legislative Acts. In addition, under Pacific's alternative theory, LHWCA coverage would not be extended to the navigable waters above the shelf. Thus, even employees on a crew ship immediately adjacent to an OCS platform who are injured in a platform explosion would be excluded from § 1333(b) coverage. That view cannot be squared with § 1333(b)'s language. Pp. –––– – ––––.
(3) Pacific's policy concerns also cannot justify an interpretation of § 1333(b) that is inconsistent with the OCSLA's text. P. ––––.
(c) Neither the Solicitor General's status-based inquiry nor the Third Circuit's “but for” test are compatible with § 1333(b). The Solicitor General's inquiry has no basis in the OCSLA's text, because § 1333(b)'s “occurring as the result of operations” language plainly suggests causation. And when taken to its logical conclusion, the Third Circuit's test, though nominally based on causation, is essentially a status-based inquiry because it would extend coverage to all employees of a business engaged in extracting natural resources from the OCS, no matter where those employees work or what they are doing at the time of injury. Because LHWCA coverage was extended only to injuries “occurring as the result of operations conducted on the [OCS],” § 1333(b)'s focus should be on injuries resulting from those “operations.” Pp. –––– – ––––.
(d) The Ninth Circuit's “substantial-nexus” test is more faithful to § 1333(b)'s text. This Court understands that test to require the injured employee to establish a significant causal link between his injury and his employer's on-OCS extractive operations. The test may not be the easiest to administer, but Administrative Law Judges and courts should be able to determine if an injured employee has established the required significant causal link. Whether an employee injured while performing an off-OCS task qualifies will depend on the circumstances of each case. It was thus proper for the Ninth Circuit to remand this case for the Benefits Review Board to apply the “substantial-nexus” test. P. ––––.
604 F.3d 1126, affirmed and remanded.
THOMAS, J., delivered the opinion of the Court, in which ROBERTS, C.J., and KENNEDY, GINSBURG, BREYER, SOTOMAYOR, and KAGAN, JJ., joined. SCALIA, J., filed an opinion concurring in part and concurring in the judgment, in which ALITO, J., joined.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT
Paul D. Clement, for Petitioners.
Joseph R. Palmore, for Federal Respondent.
David C. Frederick, for Private Respondent.
Peder K. Batalden, Peter Abrahams, Horvitz & Levy LLP, Encino, CA, Paul D. Clement, Counsel of Record, Erin E. Murphy, Bancroft PLLC, Washington, DC, Michael W. Thomas, Thomas, Quinn & Krieger, LLP, San Francisco, CA, for Petitioners.
M. Patricia Smith, Solicitor of Labor, Rae Ellen Frank James, Associate Solicitor, Sean G. Bajkowski, Mark A. Reinhalter, Counsel, Rita A. Roppolo, Attorney, Department of Labor, Washington, DC, Donald B. Verrilli, Jr., Solicitor General, Edwin S. Kneedler, Deputy Solicitor General, Joseph R. Palmore, Assistant to the Solicitor General, Counsel of Record, Department of Justice, Washington, DC, for Federal Respondent.
Michael F. Sturley, Lynn E. Blais, Austin, TX, Erin Glenn Busby, David C. Frederick, Counsel of Record, Gregory G. Rapawy, Beverly C. Moore, Kellogg, Huber, Hansen, Todd, Evans & Figel, P.L.L.C., Washington, DC, Joshua T. Gillelan II, Washington, DC, Timothy K. Sprinkles, Charles D. Naylor, San Pedro, CA, for Private Respondent.
Justice THOMAS delivered the opinion of the Court.
3 The Outer Continental Shelf Lands Act (OCSLA) extends the federal workers' compensation scheme established in the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. § 901 et seq., to injuries “occurring as the result of operations conducted on the outer Continental Shelf” for the purpose of extracting natural resources from the shelf. 43 U.S.C. § 1333(b). The United States Court of Appeals for the Ninth Circuit determined that the OCSLA extends coverage to an employee who can establish a substantial nexus between his injury and his employer's extractive operations on the Outer Continental Shelf. We affirm.
I
Petitioner Pacific Operators Offshore, LLP (Pacific), operates two drilling platforms on the Outer Continental Shelf off the coast of California and an onshore oil and gas processing facility in Ventura County, California. Pacific employed Juan Valladolid as a general manual laborer—known in the trade as a roustabout—in its oil exploration and extraction business. Valladolid spent about 98 percent of his time on one of Pacific's offshore drilling platforms performing maintenance duties, such as picking up litter, emptying trashcans, washing decks, painting, maintaining equipment, and helping to load and unload the platform crane. Valladolid spent the remainder of his time working at Pacific's onshore processing facility, where he also performed maintenance duties, including painting, sandblasting, pulling weeds, cleaning drain culverts, and operating a forklift.
While on duty at the onshore facility, Valladolid died in a forklift accident. His widow, a respondent here, filed a claim for benefits under the LHWCA pursuant to the extension of that Act contained within the OCSLA. The OCSLA provides, in relevant part:
“With respect to disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf for the purpose of exploring for, developing, removing, or transporting by pipeline the natural resources, or involving rights to the natural resources, of the subsoil and seabed of the outer Continental Shelf, compensation shall be payable under the provisions of the [LHWCA].” 43 U.S.C. § 1333(b).
After a hearing, an Administrative Law Judge (ALJ) dismissed respondent's claim. The ALJ reasoned that Valladolid's fatal injury was not covered under § 1333(b) because his accident occurred on land, rather than on the Outer Continental Shelf. On appeal, the United States Department of Labor's Benefits Review Board affirmed, concluding that Congress intended to limit the coverage provided by the OCSLA to injuries suffered by employees within the “geographical locale” of the Outer Continental Shelf. L.V. v. Pacific Operations Offshore, LLP, 42 BRBS 67, 71 (2008) (per curiam).
4 The Ninth Circuit reversed, holding that § 1333(b) neither contains a “situs-of-injury” requirement, as the Fifth Circuit has held, nor imposes a “but for” causation requirement, as the Third Circuit has held. See 604 F.3d 1126, 1130–1140 (2010) (rejecting the holdings of Mills v. Director, Office of Workers' Compensation Programs, 877 F.2d 356 (C.A.5 1989) (en banc); Curtis v. Schlumberger Offshore Service, Inc., 849 F.2d 805 (C.A.3 1988)). Instead, the Ninth Circuit concluded that “the claimant must establish a substantial nexus between the injury and extractive operations on the shelf” to qualify for workers' compensation benefits under the OCSLA. 604 F.3d, at 1139. We granted Pacific's petition for a writ of certiorari to resolve this conflict. 562 U.S. –––– (2011).
II
In 1953, Congress enacted the Submerged Lands Act, 67 Stat. 29, 43 U.S.C. § 1301 et seq., which extended the boundaries of Coastal States three geographic miles into the Atlantic and Pacific Oceans and three marine leagues into the Gulf of Mexico. At the same time, Congress enacted the OCSLA, affirming the Federal Government's authority and control over the “outer Continental Shelf,” defined as the submerged lands subject to the jurisdiction and control of the United States lying seaward and outside of the submerged lands within the extended State boundaries. 67 Stat. 462, 43 U.S.C. §§ 1331(a), 1332(1). As defined by the OCSLA, the Outer Continental Shelf includes the “submerged lands” beyond the extended state boundaries, § 1331(a), but not the waters above those submerged lands or artificial islands or installations attached to the seabed. For simplicity's sake, we refer to the entire geographical zone as the “OCS.”
Section 1333 extends various provisions of state and federal law to certain aspects of the OCS. For example, § 1333(a)(1) extends the Constitution and federal laws of civil and political jurisdiction “to the subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all installations and other devices permanently or temporarily attached to the seabed,” for the purpose of extracting its natural resources. Section 1333(a)(2)(A) makes the civil and criminal laws of each adjacent State applicable to “that portion of the subsoil and seabed of the outer Continental Shelf, and artificial islands and fixed structures erected thereon, which would be within the area of the State if its boundaries were extended seaward to the outer margin of the outer Continental Shelf.” Section 1333(b), the provision involved in this case, makes LHWCA workers' compensation benefits available for the “disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf” for the purpose of extracting its natural resources.
The question before us is the scope of coverage under § 1333(b). The parties agree that § 1333(b) covers employees, such as oil rig and drilling platform workers, who are injured while working directly on the OCS to extract its natural resources. They disagree, however, whether employees who are involved in extraction operations but who are injured beyond the OCS are also covered under the OCSLA. This dispute focuses on the meaning of the phrase “any injury occurring as the result of operations conducted on the outer Continental Shelf” in § 1333(b).
5 The Courts of Appeals have offered competing interpretations. In Curtis v. Schlumberger Offshore Service, Inc., 849 F.2d, at 811, the Third Circuit held that, because Congress intended LHWCA coverage to be expansive, § 1333(b) extends to all injuries that would not have occurred “but for” operations on the OCS. The Third Circuit thus concluded that an employee who worked on a semisubmersible drill rig, but who was killed in a car accident on the way to the helicopter that was to fly him to that rig, was eligible for § 1333(b) benefits. Id., at 806, 811. As the Third Circuit summarized, “ ‘But for’ [Curtis'] travelling to [his drill rig] for the purpose of conducting ‘operations' within § 1333(b), employee Curtis would not have sustained injuries in the automobile accident.” Id., at 811.
In Mills v. Director, supra, the Fifth Circuit, sitting en banc, adopted a narrower interpretation of § 1333(b). The court concluded that Congress intended to establish “a bright-line geographic boundary for § 1333(b) coverage,” and held that § 1333(b) extends coverage only to employees engaged in OCS extractive activities who “suffer injury or death on an OCS platform or the waters above the OCS.” Id., at 362. Applying its “situs-of-injury” test, the Fifth Circuit held that a welder who was injured on land during the construction of an offshore oil platform was not eligible for § 1333(b) benefits. Id., at 357, 362.
In the case below, the Ninth Circuit rejected the Fifth Circuit's “situs-of-injury” requirement as unsupported by the text of § 1333(b), and the Third Circuit's “but for” test as too broad to be consistent with Congress' intent. 604 F.3d, at 1137, 1139. Instead, the Ninth Circuit adopted a third interpretation of § 1333(b), holding that a “claimant must establish a substantial nexus between the injury and extractive operations on the shelf “ to be eligible for § 1333(b) benefits. Id., at 1139. “To meet the standard,” the Ninth Circuit explained, “the claimant must show that the work performed directly furthers outer continental shelf operations and is in the regular course of such operations.” Ibid.
The Solicitor General suggests yet a fourth interpretation of § 1333(b). This interpretation would extend coverage to two categories of injuries: (1) all on-OCS injuries suffered by employees of companies engaged in resource extraction on the OCS; and (2) the off-OCS injuries of those employees who spend a substantial portion of their worktime on the OCS engaging in extractive operations. Brief for Federal Respondent 32–33. According to the Solicitor General, this test would provide § 1333(b) coverage for off-OCS injuries only to those employees whose duties contribute to operations on the OCS and who perform work on the OCS itself that is substantial in both duration and nature. Id., at 35.
The Director, Office of Workers' Compensation Programs, United States Department of Labor, is a respondent in this case because the Director administers the OCSLA workers' compensation scheme established by § 1333(b).
III
Pacific argues that the Fifth Circuit's “situs-of-injury” test presents the best interpretation of § 1333(b). The crux of Pacific's argument is that off-OCS injuries cannot be “the result of operations conducted on the outer Continental Shelf “ for purposes of § 1333(b). Pacific asserts that because Valladolid was injured on dry land, his death did not occur as the result of extraction operations conducted on the OCS, and therefore respondent is ineligible for LHWCA workers' compensation benefits. We disagree.
A
[1] The OCSLA extends the provisions of the LHWCA to the “disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf.” § 1333(b). Contrary to the view of Pacific and the Fifth Circuit, nothing in that language suggests that the injury to the employee must occur on the OCS. Section 1333(b) states only two requirements: The extractive operations must be “conducted on the outer Continental Shelf,” and the employee's injury must occur “as the result of “ those operations.
Despite the lack of a textual “situs-of-injury” requirement in § 1333(b), Pacific argues that it is logically impossible for an off-OCS employee to be injured “as the result of “ on-OCS operations. Pacific offers no basis for this assertion, and we find none. Indeed, given that many OCS platforms are physically connected to onshore processing facilities via oil and gas pipelines, it is not difficult to imagine an accident occurring on an OCS platform that could injure employees located off the OCS.
Moreover, if, as Pacific suggests, the purpose of § 1333(b) was to geographically limit the extension of LHWCA coverage to injuries that occurred on the OCS, Congress could easily have achieved that goal by omitting the following six words in § 1333(b)'s text: “as the result of operations conducted.” Had Congress done so, the statute would extend LHWCA coverage to the “disability or death of an employee resulting from any injury occurring on the outer Continental Shelf.” But that is not the text of the statute Congress enacted.
Pacific also argues that, because all of § 1333(b)'s neighboring subsections contain specific situs limitations, we should infer that Congress intended to include a situs-of-injury requirement in § 1333(b). See, e.g., § 1333(a)(2)(A) (adopting the civil and criminal laws of the adjacent State as federal law “for that portion of the subsoil and seabed of the outer Continental Shelf, and artificial islands and fixed structures erected thereon, which would be within the area of the State if its boundaries were extended seaward to the outer margin of the outer Continental Shelf ”). But our usual practice is to make the opposite inference. Russello v. United States, 464 U.S. 16, 23, 104 S.Ct. 296, 78 L.Ed.2d 17 (1983) (“Where Congress includes particular language in one section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts intentionally and purposely in the disparate inclusion or exclusion” (alteration and internal quotation marks omitted)). Congress' decision to specify, in scrupulous detail, exactly where the other subsections of § 1333 apply, but to include no similar restriction on injuries in § 1333(b), convinces us that Congress did not intend § 1333(b) to apply only to injuries suffered on the OCS. Rather, § 1333(b) extends LHWCA workers' compensation coverage to any employee injury, regardless of where it happens, as long as it occurs “as the result of operations conducted on the outer Continental Shelf.”
Also 43 U.S.C. § 1333(a)(1) (extending the Constitution and federal laws of civil and political jurisdiction “to the subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all installations and other devices permanently or temporarily attached to the seabed, which may be erected thereon for the purpose of exploring for, developing, or producing resources therefrom, or any such installation or other device (other than a ship or vessel) for the purpose of transporting such resources, to the same extent as if the outer Continental Shelf were an area of exclusive Federal jurisdiction located within a State”); § 1333(c) (making the National Labor Relations Act applicable to any unfair labor act “occurring upon any artificial island, installation, or other device referred to in subsection (a) of this section”); § 1333(d)(1) (granting the Coast Guard enforcement authority “on the artificial islands, installations, and other devices referred to in subsection (a) of this section or on the waters adjacent thereto”); § 1333(d)(2) (granting the Coast Guard authority to mark “any artificial island, installation, or other device referred to in subsection (a) of this section” for the protection of navigation); § 1333(e) (granting the Army authority to prevent the obstruction of access “to the artificial islands, installations, and other devices referred to in subsection (a) of this section”); § 1333(f) (saving clause applying “to the subsoil and seabed of the outer Continental Shelf and the artificial islands, installations, and other devices referred to in subsection (a) of this section”).
Pacific argues that this conclusion is foreclosed by language in Herb's Welding, Inc. v. Gray, 470 U.S. 414, 105 S.Ct. 1421, 84 L.Ed.2d 406 (1985), and Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 106 S.Ct. 2485, 91 L.Ed.2d 174 (1986); but neither of those cases held that § 1333(b) extends only to injuries that occur on the OCS. In Herb's Welding, this Court considered whether an oil platform welder, who worked both within the territorial waters of Louisiana and on the OCS, was covered under the LHWCA after suffering an injury in the waters of Louisiana. 470 U.S., at 416–417. The Court explicitly declined to address whether the employee was eligible for workers' compensation benefits under § 1333(b) because that question was neither passed upon by the Court of Appeals nor fully briefed and argued before this Court. Id., at 426, n. 12. Although the Court acknowledged that an employee might walk in and out of workers' compensation coverage during his employment due to the “explicit geographic limitation to the [OCSLA's] incorporation of the LHWCA,” id., at 427, the exact meaning of that statement is unclear. We cannot ascertain whether the comment was a reference to § 1333(b)'s explicit situs-of-operations requirement, as respondents suggest, or the recognition of an implicit situs-of-injury requirement, as Pacific argues. In any event, the ambiguous comment was made without analysis in dicta and does not control this case.
7. The same is true of the Court's opinion in Offshore Logistics. In that case, the Court considered whether the widows of oil platform workers who were killed when their helicopter crashed into the high seas could file wrongful-death suits under Louisiana law. In the Court's analysis of § 1333, it stated, “Congress determined that the general scope of OCSLA's coverage ... would be determined principally by locale, not by the status of the individual injured or killed.” 477 U.S., at 219–220 (citing the situs requirement in § 1333(a)(2)(A)). In a footnote, the Court commented: “Only one provision of OCSLA superimposes a status requirement on the otherwise determinative OCSLA situs requirement; § 1333(b) makes compensation for the death or injury of an ‘employee’ resulting from certain operations on the Outer Continental Shelf payable under the [LHWCA].” Ibid., n. 2. These comments about the scope of the OCSLA's coverage and its determinative “situs requirement” do not provide definitive evidence that § 1333(b) applies only to injuries that occur on the OCS. As in Herb's Welding, it is unclear whether the statement in the Offshore Logistics footnote regarding § 1333(b) was referring to the explicit situs-of-operations requirement or to an implicit situs-of-injury requirement. Moreover, the entire footnote is dictum because, as the Court explicitly stated, § 1333(b) had no bearing on the case. 470 U.S., at 219–220.
Finally, Pacific argues that including off-OCS injuries within the scope of the workers' compensation coverage created by § 1333(b) runs counter to Congress' intent in drafting the OCSLA. According to Pacific, Congress intended to create a uniform OCS compensation scheme that both filled the jurisdictional voids and eliminated jurisdictional overlaps between existing state and federal programs. Pacific points out that, without a situs-of-injury requirement to narrow the scope of § 1333(b), an off-OCS worker could be eligible for both state and federal workers' compensation coverage.
8. There is no indication in the text, however, that the OCSLA excludes OCS workers from LHWCA coverage when they are also eligible for state benefits. To the contrary, the LHWCA workers' compensation scheme incorporated by the OCSLA explicitly anticipates that injured employees might be eligible for both state and federal benefits. An offsetting provision in the LHWCA provides that “any amounts paid to an employee for the same injury, disability, or death for which benefits are claimed under [the LHWCA] pursuant to any other workers' compensation law or [the Jones Act] shall be credited against any liability imposed by [the LHWCA].” 33 U.S.C. § 903(e). This provision, in addition to the lack of any textual support for Pacific's argument, convinces us that Congress did not limit the scope of 43 U.S.C. § 1333(b)'s coverage to only those geographic areas where state workers' compensation schemes do not apply.
B
[2] Pacific also offers an alternative argument derived from the interaction of § 1333(b) and a provision of the LHWCA. Specifically, Pacific argues that because the LHWCA contains an explicit situs-of-injury requirement, see 33 U.S.C. § 903(a) (providing benefits only for injuries occurring “upon the navigable waters” of the United States), and because 43 U.S.C. § 1333(b) extends the LHWCA workers' compensation scheme to the OCS, § 1333(b) incorporates the strict LHWCA situs-of-injury requirement from § 903(a). According to Pacific, the words “occurring as the result of operations” in § 1333(b) impose a status requirement in addition to the imported LHWCA situs-of-injury requirement, with the result that employees who are injured on the OCS, but whose jobs are not related to extractive operations, are excluded from the workers' compensation coverage created by § 1333(b). Thus, an accountant who is injured on a field trip to the drilling platform would be ineligible under § 1333(b) despite being an employee who is injured on the OCS.
Although this alternative argument has the advantage of assigning some meaning to the words “occurring as the result of operations” in § 1333(b), we still find it unpersuasive. First, it is unlikely that Congress intended to impose a situs-of-injury requirement in § 1333(b) through such a nonintuitive and convoluted combination of two separate legislative Acts. As we have already noted, creating an express situs-of-injury requirement in the text of § 1333(b) would have been simple. Second, combining the § 1333(b) definition of “United States” with the LHWCA situs-of-injury requirement in 33 U.S.C. § 903(a) would result in an OCS workers' compensation scheme that applies only to the seabed of the OCS and to any artificial islands and fixed structures thereon. See 43 U.S.C. § 1333(b)(3) (stating that “the term ‘United States' when used in a geographical sense includes the outer Continental Shelf and artificial islands and fixed structures thereon”). Pacific concedes that this scheme would exclude the navigable waters above the shelf, including the waters immediately adjacent to any drilling platforms. Consequently, under Pacific's view, even employees on a crew ship immediately adjacent to an OCS platform who are injured during a platform explosion would be excluded from § 1333(b) coverage. That view cannot be squared with the text of the statute, which applies to “any injury occurring as the result of operations conducted” on the OCS.
C
9 [3] Pacific also makes several policy arguments in favor of a situs-of-injury requirement, but policy concerns cannot justify an interpretation of § 1333(b) that is inconsistent with the text of the OCSLA. “[I]f Congress' coverage decisions are mistaken as a matter of policy, it is for Congress to change them. We should not legislate for them.” Herb's Welding, 470 U.S., at 427. The language of § 1333(b) simply does not support a categorical exclusion of injuries that occur beyond the OCS.
IV
The Solicitor General urges us to adopt a status-based inquiry that applies one test to on-OCS injuries and a different test to off-OCS injuries. Specifically, the Government proposes that when a worker is injured on the OCS, he is eligible for workers' compensation benefits if he is employed by a company engaged in extractive operations on the OCS. But if the employee is injured off the OCS, the employee will be covered only if his “duties contribute to operations” on the OCS and if he performs “work on the [OCS] itself that is substantial in terms of both its duration and nature.” Brief for Federal Respondent 35. This approach is derived from our decision in Chandris, Inc. v. Latsis, 515 U.S. 347, 115 S.Ct. 2172, 132 L.Ed.2d 314 (1995) (establishing criteria by which an employee qualifies as a “seaman” under the Jones Act), and might well have merit as legislation. But it has no basis in the text of the OCSLA as presently enacted. The “occurring as the result of operations” language in § 1333(b) plainly suggests causation. Although the Government asserts that a status-based test would be preferable to a causation-based test, we cannot ignore the language enacted by Congress.
[4] The Third Circuit's “but for” test is nominally based on causation, but it is also incompatible with § 1333(b). Taken to its logical conclusion, the “but for” test would extend workers' compensation coverage to all employees of a business engaged in the extraction of natural resources from the OCS, no matter where those employees work or what they are doing when they are injured. This test could reasonably be interpreted to cover land-based office employees whose jobs have virtually nothing to do with extractive operations on the OCS. Because Congress extended LHWCA coverage only to injuries “occurring as the result of operations conducted on the outer Continental Shelf,” we think that § 1333(b) should be interpreted in a manner that focuses on injuries that result from those “operations.” This view is consistent with our past treatment of similar language in other contexts. In Holmes v. Securities Investor Protection Corporation, 503 U.S. 258, 112 S.Ct. 1311, 117 L.Ed.2d 532 (1992), we considered a provision of the Racketeer Influenced and Corrupt Organizations Act that provided a cause of action to “[a]ny person injured in his business or property by reason of a violation of section 1962.” 18 U.S.C. § 1964(c) (emphasis added). We rejected a “but for” interpretation, stating that such a construction was “hardly compelled” and that it was highly unlikely that Congress intended to allow all factually injured plaintiffs to recover. 503 U.S., at 265–266. Instead, we adopted a proximate-cause standard consistent with our prior interpretation of the same language in the Sherman and Clayton Acts. Id., at 267–268. Similarly, 43 U.S.C. § 1333(b)'s language hardly compels the Third Circuit's expansive “but for” interpretation.
[5] Accordingly, we conclude that the Ninth Circuit's “substantial-nexus” test is more faithful to the text of § 1333(b). We understand the Ninth Circuit's test to require the injured employee to establish a significant causal link between the injury that he suffered and his employer's on-OCS operations conducted for the purpose of extracting natural resources from the OCS.
10. Although the Ninth Circuit's test may not be the easiest to administer, it best reflects the text of § 1333(b), which establishes neither a situs-of-injury nor a “but for” test. We are confident that ALJs and courts will be able to determine whether an injured employee has established a significant causal link between the injury he suffered and his employer's on-OCS extractive operations. Although we expect that employees injured while performing tasks on the OCS will regularly satisfy the test, whether an employee injured while performing an off-OCS task qualifies—like Valladolid, who died while tasked with onshore scrap metal consolidation—is a question that will depend on the individual circumstances of each case. The Ninth Circuit remanded the case for the Benefits Review Board to apply the “substantial-nexus” test in the first instance, and we agree with that disposition.
The judgment is affirmed, and the case is remanded to the Court of Appeals for further proceedings consistent with this opinion.
It is so ordered.
Justice SCALIA, with whom Justice ALITO joins, concurring in part and concurring in the judgment.
I join the Court's judgment that the Ninth Circuit properly remanded this case to the Benefits Review Board, and I agree with almost all of the Court's opinion. My disagreement is limited to the last two substantive paragraphs of Part IV, which endorse the Ninth Circuit's “substantial-nexus” test for determining the scope of coverage under 43 U.S.C. § 1333(b). The Court indulges in considerable understatement when it acknowledges that this test “may not be the easiest to administer,” ante, at 14. “Substantial nexus” is novel legalese with no established meaning in the present context. I agree with the Court's rejection of some of the clearer rules proposed by the parties—which, though easier to apply, are unmoored from the text of § 1333(b). But if we must adopt an indeterminate standard (and the statute's “as the result of” language leaves us no choice) I prefer the devil we know to the devil of the Ninth Circuit's imagining. I would hold that an employee may recover under § 1333(b) if his injury was proximately caused by operations on the Outer Continental Shelf (OCS).
The term “proximate cause” is “shorthand for a concept: Injuries have countless causes, and not all should give rise to legal liability.” CSX Transp., Inc. v. McBride, 564 U.S. ––––, –––– (2011) (slip op., at 5). Life is too short to pursue every event to its most remote, “but-for,” consequences, and the doctrine of proximate cause provides a rough guide for courts in cutting off otherwise endless chains of cause-and-effect. See Holmes v. Securities Investor Protection Corporation, 503 U.S. 258, 287, 112 S.Ct. 1311, 117 L.Ed.2d 532 (1992) (SCALIA, J., concurring in judgment). Thus, as the Court notes in rejecting the Third Circuit's “but for” test for § 1333(b) coverage, we have interpreted statutes with language similar to § 1333(b) as prescribing a proximate-cause standard.
Although the doctrine of proximate cause is rooted in tort law and most commonly applied in negligence actions, it can also provide a useful guide in no-fault compensation schemes like this one. In Brown v. Gardner, 513 U.S. 115, 119, 115 S.Ct. 552, 130 L.Ed.2d 462 (1994), we considered a no-fault veterans' compensation statute covering injuries that occurred “as the result of” medical treatment (precisely the language at issue here); we suggested that the requisite “causal connection” between the injury and medical treatment may be “limited to proximate causation so as to narrow the class of compensable cases ... by eliminating remote consequences.” Similarly, some state workers' compensation laws use the concept of proximate cause to determine entitlement. See, e.g., Ex parte Patton, ––– So.3d ––––, –––– (Ala.2011); Marandino v. Prometheus Pharmacy, 294 Conn. 564, 591, 986 A.2d 1023, 1041 (2010); Grant v. Grant Textiles, 372 S.C. 196, 201, 641 S.E.2d 869, 871 (2007). Indeed, the statutory law of California, where Mr. Valladolid died while at work, limits workers' compensation liability to cases “[w]here the injury is proximately caused by the employment, either with or without negligence.” Cal. Lab.Code Ann. § 3600(a)(3). I see no reason why the scope of 43 U.S.C. § 1333(b) could not similarly be cabined by the familiar limits of proximate causation.
Strange to say, the California Supreme Court has held that this unmistakable term-of-art reference to a rule found in the common law of torts does not establish a rule “identical to that found in the common law of torts,” but merely “elaborat[es] the general requirement that the injury arise out of the employment.” LaTourette v. Workers' Compensation App. Bd., 17 Cal.4th 644, 651, n. 1, 72 Cal.Rptr.2d 217, 951 P.2d 1184, 1187, n. 1 (1998) (internal quotation marks omitted). Perhaps (who knows?) later California Supreme Court cases will “clarify” this general requirement by saying that it requires a “substantial nexoos” between the employment and the injury.
To be sure, proximate cause is an imperfect legal doctrine; I have no illusions that its tenets are easy to describe or straightforward to apply. Judicial opinions do not provide a uniform formulation of the test, and borderline cases are rarely clear. But “it is often easier to disparage the product of centuries of common law than to devise a plausible substitute.” McBride, 564 U.S., at –––– (ROBERTS, C.J., dissenting) (slip op., at 2–3). Unlike the substantial-nexus test, proximate cause provides a “vocabulary” for answering questions like the one raised by the facts of this case. It may be productive, for example, to consider whether the injury was “within the scope of the risk” created by OCS operations, or whether some “superseding or intervening cause” exists. Id., at –––– (slip op., at 15). In addition to that vocabulary, precedents on proximate cause “furnish illustrations of situations which judicious men upon careful consideration have adjudged to be on one side of the line or the other.” Exxon Co., U.S.A. v. Sofec, Inc., 517 U.S. 830, 839, 116 S.Ct. 1813, 135 L.Ed.2d 113 (1996) (internal quotation marks omitted).
“Substantial nexus,” by contrast, is an indeterminate phrase that lacks all pedigree. Our case law has used it as a term of art in only one context, first appearing in Justice Blackmun's opinion for the Court in Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 279, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977): We sustain state taxes against Commerce Clause challenges if they are, inter alia, “applied to an activity with a substantial nexus with the taxing State.” Oklahoma Tax Comm'n v. Jefferson Lines, Inc., 514 U.S. 175, 183, 115 S.Ct. 1331, 131 L.Ed.2d 261 (1995) (emphasis added; internal quotation marks omitted). “[S]uch a nexus is established when the taxpayer ‘avails itself of the substantial privilege of carrying on business' in that jurisdiction.” Polar Tankers, Inc. v. City of Valdez, 557 U.S. 1, 11, 129 S.Ct. 2277, 174 L.Ed.2d 1 (2009). That clarification—and any further clarification in the Commerce Clause context—will not be remotely helpful to lower courts attempting to apply the substantial-nexus test in the very different legal context of workers' compensation under § 1333(b). In this latter context, I assume the Court means by “substantial nexus” a substantial causal nexus—since § 1333(b)'s “as the result of” language “plainly suggests causation,” ante, at 13. Like the word “nexus” itself, the definition of “substantial nexus” in our state-tax cases does not require any causal relationship whatsoever. The proximate-cause test, by comparison, represents a much more natural interpretation of a statute that turns on causation.
Does the Court mean to establish, by the novel “substantial [causal] nexus” test, a new tertium quid of causality—somewhere between but-for causality and proximate cause? One might think so, since there is no other sensible reason to (1) reject but-for cause, (2) say nothing about the natural alternative (proximate cause), and (3) embrace the “substantial [causal] nexus” novelty. On the other hand, the Court's opinion suggests at least some connection (that is to say, in the Court's favored lawspeak, some “nexus”) between the proximate-cause standard and the substantial-nexus test, since it cites one of our proximate-cause cases just before concluding that “[a]ccordingly, ... the Ninth Circuit's ‘substantial-nexus' test is more faithful to the text of § 1333(b)” than the Third Circuit's but-for test. Ante, at 13–14. In the opinion below, moreover, the Ninth Circuit purported to endorse the Fifth Circuit's pre–1989 case law, which required “ ‘ that the claimant show a nexus ... similar to the proximate cause test in tort law.’ “ 604 F.3d 1126, 1140 (C.A.9 2010) (quoting Mills v. Director, Office of Workers' Compensation Programs, 846 F.2d 1013, 1015 (C.A.5 1988), rev'd en banc, 877 F.2d 356 (1989)). Who knows whether this is a tertium quid or not? The Court has given us a new test whose contours are entirely undescribed, and which has nothing to be said for it except that it will add complexity to the law and litigation to the courts.
12 Finally, I must note an additional uncertainty (or else a peculiarity) that the Court's opinion creates: The statutory text at issue requires compensation for “disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf ....“ § 1333(b) (emphasis added). Before today, I would have thought it clear that courts must apply proximate-cause analysis to the “resulting from” provision; but that would seem quite peculiar if (as the Court holds today) we apply substantial-nexus analysis to the neighboring “occurring as the result of” provision. Surely both phrases express the same concept. What a tangled web we weave.
I would affirm the Ninth Circuit's judgment to remand the case to the Benefits Review Board, but with instructions to apply a proximate-cause test.
Posted by Norka M. Schell, Esq.
In the Matter of Pacific Operators Offshore, LLP v. Valladolid, the Supreme Court, Justice Thomas, held that:
1. OCLA provision extending LHWCA does not require that the injury occur on outer Continental Shelf (OSC), abrogating Mills v. Director, Office of Worker's Compensation Program, 875 F2d. 356;
2. LJWCA coverage is not extended to all injuries that would not have occurred "but for" operations on OCS, abrogating Curts v. Schlumberger Offshore Services, Inc. 849 F2d. 805; and
3. Claimant seeking benefit under OCSLA must establish substantial nexus between the injury and extractive operations on OSC.
Affirmed and remanded.
STAMENT OF THE CASE
Petitioner Pacific Operators Offshore, LLP (Pacific), operates two drilling platforms on the Outer Continental Shelf (OCS) off the California coast and an onshore oil and gas processing facility. Employee Juan Valladolid spent 98 percent of his time working on an offshore platform, but he was killed in an accident while working at the onshore facility. His widow, a respondent here, sought benefits under the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. § 901 et seq., pursuant to the Outer Continental Shelf Lands Act (OCSLA), which extends LHWCA coverage to injuries “occurring as the result of operations conducted on the [OCS]” for the purpose of extracting natural resources from the shelf, 43 U.S.C. § 1333(b). The Administrative Law Judge dismissed her claim, reasoning that § 1333(b) did not cover Valladolid's fatal injury because his accident occurred on land, not on the OCS. The Labor Department's Benefits Review Board affirmed, but the Ninth Circuit reversed. Rejecting tests used by the Third and the Fifth Circuits, the Ninth Circuit concluded that a claimant seeking benefits under the OCSLA “must establish a substantial nexus between the injury and extractive operations on the shelf.”
Held: The OCSLA extends coverage to an employee who can establish a substantial nexus between his injury and his employer's extractive operations on the OCS. Pp. –––– – ––––.
(a) The Courts of Appeals have offered competing interpretations of § 1333(b)'s scope. According to the Third Circuit, because Congress intended LHWCA coverage to be expansive, § 1333(b) extends to all injuries that would not have occurred “but for” operations on the OCS. Thus, an employee who worked on a semisubmersible drill rig, but who died in a car accident on his way to board a helicopter to be flown to the rig, was eligible for benefits because he would not have been injured but for his traveling to the rig. In contrast, the Fifth Circuit has concluded that Congress intended to establish “a bright-line geographic boundary,” extending § 1333(b) coverage only to employees whose injuries or death occurred on an OCS platform or the waters above the OCS. Under its “situs-of-injury” test, a welder injured on land while constructing an offshore oil platform was ineligible for § 1333(b) benefits. In the decision below, the Ninth Circuit held that § 1333(b) extends coverage to injured workers who can establish a “substantial nexus” between their injury and extractive operations on the OCS. The Solicitor General offers a fourth interpretation, which would provide coverage for off-OCS injuries only to those employees whose duties contribute to operations on the OCS and who perform work on the OCS itself that is substantial in both duration and nature. Pp. –––– – ––––.
(b) Contrary to Pacific's position, the Fifth Circuit's “situs-of-injury” test is not the best interpretation of § 1333(b). Pp. –––– – ––––.
(1) Nothing in the text of § 1333(b) suggests that an injury must occur on the OCS. The provision has only two requirements: The extractive operations must be “conducted on the [OCS],” and the employee's injury must occur “as the result of” those operations. If, as Pacific suggests, the purpose of § 1333(b) was to geographically limit the scope of OCSLA coverage to injuries that occur on the OCS, Congress could easily have achieved that goal by omitting from § 1333(b) the words “as the result of operations conducted.” Moreover, Congress' decision to specify situs limitations in other subsections, but not in § 1333(b), indicates that it did not intend to so limit § 1333(b). This conclusion is not foreclosed by Herb's Welding, Inc. v. Gray, 470 U.S. 414, 105 S.Ct. 1421, 84 L.Ed.2d 406, or Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 106 S.Ct. 2485, 91 L.Ed.2d 174, neither of which held that § 1333(b) coverage was limited to on-OCS injuries. Section 1333(b)'s text also gives no indication that Congress intended to exclude OCS workers who are eligible for state benefits from LHWCA coverage. To the contrary, the LHWCA scheme incorporated by the OCSLA explicitly anticipates that injured employees might be eligible for both state and federal benefits. Pp. –––– – ––––.
(2) Also unpersuasive is Pacific's alternative argument that § 1333(b) imports the LHWCA's strict situs-of-injury requirement, which provides benefits only for injuries occurring “upon the navigable waters” of the United States, 33 U.S.C. § 903(a). It is unlikely that Congress intended to restrict the scope of the OCSLA workers' compensation scheme through a nonintuitive and convoluted combination of two separate legislative Acts. In addition, under Pacific's alternative theory, LHWCA coverage would not be extended to the navigable waters above the shelf. Thus, even employees on a crew ship immediately adjacent to an OCS platform who are injured in a platform explosion would be excluded from § 1333(b) coverage. That view cannot be squared with § 1333(b)'s language. Pp. –––– – ––––.
(3) Pacific's policy concerns also cannot justify an interpretation of § 1333(b) that is inconsistent with the OCSLA's text. P. ––––.
(c) Neither the Solicitor General's status-based inquiry nor the Third Circuit's “but for” test are compatible with § 1333(b). The Solicitor General's inquiry has no basis in the OCSLA's text, because § 1333(b)'s “occurring as the result of operations” language plainly suggests causation. And when taken to its logical conclusion, the Third Circuit's test, though nominally based on causation, is essentially a status-based inquiry because it would extend coverage to all employees of a business engaged in extracting natural resources from the OCS, no matter where those employees work or what they are doing at the time of injury. Because LHWCA coverage was extended only to injuries “occurring as the result of operations conducted on the [OCS],” § 1333(b)'s focus should be on injuries resulting from those “operations.” Pp. –––– – ––––.
(d) The Ninth Circuit's “substantial-nexus” test is more faithful to § 1333(b)'s text. This Court understands that test to require the injured employee to establish a significant causal link between his injury and his employer's on-OCS extractive operations. The test may not be the easiest to administer, but Administrative Law Judges and courts should be able to determine if an injured employee has established the required significant causal link. Whether an employee injured while performing an off-OCS task qualifies will depend on the circumstances of each case. It was thus proper for the Ninth Circuit to remand this case for the Benefits Review Board to apply the “substantial-nexus” test. P. ––––.
604 F.3d 1126, affirmed and remanded.
THOMAS, J., delivered the opinion of the Court, in which ROBERTS, C.J., and KENNEDY, GINSBURG, BREYER, SOTOMAYOR, and KAGAN, JJ., joined. SCALIA, J., filed an opinion concurring in part and concurring in the judgment, in which ALITO, J., joined.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT
Paul D. Clement, for Petitioners.
Joseph R. Palmore, for Federal Respondent.
David C. Frederick, for Private Respondent.
Peder K. Batalden, Peter Abrahams, Horvitz & Levy LLP, Encino, CA, Paul D. Clement, Counsel of Record, Erin E. Murphy, Bancroft PLLC, Washington, DC, Michael W. Thomas, Thomas, Quinn & Krieger, LLP, San Francisco, CA, for Petitioners.
M. Patricia Smith, Solicitor of Labor, Rae Ellen Frank James, Associate Solicitor, Sean G. Bajkowski, Mark A. Reinhalter, Counsel, Rita A. Roppolo, Attorney, Department of Labor, Washington, DC, Donald B. Verrilli, Jr., Solicitor General, Edwin S. Kneedler, Deputy Solicitor General, Joseph R. Palmore, Assistant to the Solicitor General, Counsel of Record, Department of Justice, Washington, DC, for Federal Respondent.
Michael F. Sturley, Lynn E. Blais, Austin, TX, Erin Glenn Busby, David C. Frederick, Counsel of Record, Gregory G. Rapawy, Beverly C. Moore, Kellogg, Huber, Hansen, Todd, Evans & Figel, P.L.L.C., Washington, DC, Joshua T. Gillelan II, Washington, DC, Timothy K. Sprinkles, Charles D. Naylor, San Pedro, CA, for Private Respondent.
Justice THOMAS delivered the opinion of the Court.
3 The Outer Continental Shelf Lands Act (OCSLA) extends the federal workers' compensation scheme established in the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. § 901 et seq., to injuries “occurring as the result of operations conducted on the outer Continental Shelf” for the purpose of extracting natural resources from the shelf. 43 U.S.C. § 1333(b). The United States Court of Appeals for the Ninth Circuit determined that the OCSLA extends coverage to an employee who can establish a substantial nexus between his injury and his employer's extractive operations on the Outer Continental Shelf. We affirm.
I
Petitioner Pacific Operators Offshore, LLP (Pacific), operates two drilling platforms on the Outer Continental Shelf off the coast of California and an onshore oil and gas processing facility in Ventura County, California. Pacific employed Juan Valladolid as a general manual laborer—known in the trade as a roustabout—in its oil exploration and extraction business. Valladolid spent about 98 percent of his time on one of Pacific's offshore drilling platforms performing maintenance duties, such as picking up litter, emptying trashcans, washing decks, painting, maintaining equipment, and helping to load and unload the platform crane. Valladolid spent the remainder of his time working at Pacific's onshore processing facility, where he also performed maintenance duties, including painting, sandblasting, pulling weeds, cleaning drain culverts, and operating a forklift.
While on duty at the onshore facility, Valladolid died in a forklift accident. His widow, a respondent here, filed a claim for benefits under the LHWCA pursuant to the extension of that Act contained within the OCSLA. The OCSLA provides, in relevant part:
“With respect to disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf for the purpose of exploring for, developing, removing, or transporting by pipeline the natural resources, or involving rights to the natural resources, of the subsoil and seabed of the outer Continental Shelf, compensation shall be payable under the provisions of the [LHWCA].” 43 U.S.C. § 1333(b).
After a hearing, an Administrative Law Judge (ALJ) dismissed respondent's claim. The ALJ reasoned that Valladolid's fatal injury was not covered under § 1333(b) because his accident occurred on land, rather than on the Outer Continental Shelf. On appeal, the United States Department of Labor's Benefits Review Board affirmed, concluding that Congress intended to limit the coverage provided by the OCSLA to injuries suffered by employees within the “geographical locale” of the Outer Continental Shelf. L.V. v. Pacific Operations Offshore, LLP, 42 BRBS 67, 71 (2008) (per curiam).
4 The Ninth Circuit reversed, holding that § 1333(b) neither contains a “situs-of-injury” requirement, as the Fifth Circuit has held, nor imposes a “but for” causation requirement, as the Third Circuit has held. See 604 F.3d 1126, 1130–1140 (2010) (rejecting the holdings of Mills v. Director, Office of Workers' Compensation Programs, 877 F.2d 356 (C.A.5 1989) (en banc); Curtis v. Schlumberger Offshore Service, Inc., 849 F.2d 805 (C.A.3 1988)). Instead, the Ninth Circuit concluded that “the claimant must establish a substantial nexus between the injury and extractive operations on the shelf” to qualify for workers' compensation benefits under the OCSLA. 604 F.3d, at 1139. We granted Pacific's petition for a writ of certiorari to resolve this conflict. 562 U.S. –––– (2011).
II
In 1953, Congress enacted the Submerged Lands Act, 67 Stat. 29, 43 U.S.C. § 1301 et seq., which extended the boundaries of Coastal States three geographic miles into the Atlantic and Pacific Oceans and three marine leagues into the Gulf of Mexico. At the same time, Congress enacted the OCSLA, affirming the Federal Government's authority and control over the “outer Continental Shelf,” defined as the submerged lands subject to the jurisdiction and control of the United States lying seaward and outside of the submerged lands within the extended State boundaries. 67 Stat. 462, 43 U.S.C. §§ 1331(a), 1332(1). As defined by the OCSLA, the Outer Continental Shelf includes the “submerged lands” beyond the extended state boundaries, § 1331(a), but not the waters above those submerged lands or artificial islands or installations attached to the seabed. For simplicity's sake, we refer to the entire geographical zone as the “OCS.”
Section 1333 extends various provisions of state and federal law to certain aspects of the OCS. For example, § 1333(a)(1) extends the Constitution and federal laws of civil and political jurisdiction “to the subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all installations and other devices permanently or temporarily attached to the seabed,” for the purpose of extracting its natural resources. Section 1333(a)(2)(A) makes the civil and criminal laws of each adjacent State applicable to “that portion of the subsoil and seabed of the outer Continental Shelf, and artificial islands and fixed structures erected thereon, which would be within the area of the State if its boundaries were extended seaward to the outer margin of the outer Continental Shelf.” Section 1333(b), the provision involved in this case, makes LHWCA workers' compensation benefits available for the “disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf” for the purpose of extracting its natural resources.
The question before us is the scope of coverage under § 1333(b). The parties agree that § 1333(b) covers employees, such as oil rig and drilling platform workers, who are injured while working directly on the OCS to extract its natural resources. They disagree, however, whether employees who are involved in extraction operations but who are injured beyond the OCS are also covered under the OCSLA. This dispute focuses on the meaning of the phrase “any injury occurring as the result of operations conducted on the outer Continental Shelf” in § 1333(b).
5 The Courts of Appeals have offered competing interpretations. In Curtis v. Schlumberger Offshore Service, Inc., 849 F.2d, at 811, the Third Circuit held that, because Congress intended LHWCA coverage to be expansive, § 1333(b) extends to all injuries that would not have occurred “but for” operations on the OCS. The Third Circuit thus concluded that an employee who worked on a semisubmersible drill rig, but who was killed in a car accident on the way to the helicopter that was to fly him to that rig, was eligible for § 1333(b) benefits. Id., at 806, 811. As the Third Circuit summarized, “ ‘But for’ [Curtis'] travelling to [his drill rig] for the purpose of conducting ‘operations' within § 1333(b), employee Curtis would not have sustained injuries in the automobile accident.” Id., at 811.
In Mills v. Director, supra, the Fifth Circuit, sitting en banc, adopted a narrower interpretation of § 1333(b). The court concluded that Congress intended to establish “a bright-line geographic boundary for § 1333(b) coverage,” and held that § 1333(b) extends coverage only to employees engaged in OCS extractive activities who “suffer injury or death on an OCS platform or the waters above the OCS.” Id., at 362. Applying its “situs-of-injury” test, the Fifth Circuit held that a welder who was injured on land during the construction of an offshore oil platform was not eligible for § 1333(b) benefits. Id., at 357, 362.
In the case below, the Ninth Circuit rejected the Fifth Circuit's “situs-of-injury” requirement as unsupported by the text of § 1333(b), and the Third Circuit's “but for” test as too broad to be consistent with Congress' intent. 604 F.3d, at 1137, 1139. Instead, the Ninth Circuit adopted a third interpretation of § 1333(b), holding that a “claimant must establish a substantial nexus between the injury and extractive operations on the shelf “ to be eligible for § 1333(b) benefits. Id., at 1139. “To meet the standard,” the Ninth Circuit explained, “the claimant must show that the work performed directly furthers outer continental shelf operations and is in the regular course of such operations.” Ibid.
The Solicitor General suggests yet a fourth interpretation of § 1333(b). This interpretation would extend coverage to two categories of injuries: (1) all on-OCS injuries suffered by employees of companies engaged in resource extraction on the OCS; and (2) the off-OCS injuries of those employees who spend a substantial portion of their worktime on the OCS engaging in extractive operations. Brief for Federal Respondent 32–33. According to the Solicitor General, this test would provide § 1333(b) coverage for off-OCS injuries only to those employees whose duties contribute to operations on the OCS and who perform work on the OCS itself that is substantial in both duration and nature. Id., at 35.
The Director, Office of Workers' Compensation Programs, United States Department of Labor, is a respondent in this case because the Director administers the OCSLA workers' compensation scheme established by § 1333(b).
III
Pacific argues that the Fifth Circuit's “situs-of-injury” test presents the best interpretation of § 1333(b). The crux of Pacific's argument is that off-OCS injuries cannot be “the result of operations conducted on the outer Continental Shelf “ for purposes of § 1333(b). Pacific asserts that because Valladolid was injured on dry land, his death did not occur as the result of extraction operations conducted on the OCS, and therefore respondent is ineligible for LHWCA workers' compensation benefits. We disagree.
A
[1] The OCSLA extends the provisions of the LHWCA to the “disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf.” § 1333(b). Contrary to the view of Pacific and the Fifth Circuit, nothing in that language suggests that the injury to the employee must occur on the OCS. Section 1333(b) states only two requirements: The extractive operations must be “conducted on the outer Continental Shelf,” and the employee's injury must occur “as the result of “ those operations.
Despite the lack of a textual “situs-of-injury” requirement in § 1333(b), Pacific argues that it is logically impossible for an off-OCS employee to be injured “as the result of “ on-OCS operations. Pacific offers no basis for this assertion, and we find none. Indeed, given that many OCS platforms are physically connected to onshore processing facilities via oil and gas pipelines, it is not difficult to imagine an accident occurring on an OCS platform that could injure employees located off the OCS.
Moreover, if, as Pacific suggests, the purpose of § 1333(b) was to geographically limit the extension of LHWCA coverage to injuries that occurred on the OCS, Congress could easily have achieved that goal by omitting the following six words in § 1333(b)'s text: “as the result of operations conducted.” Had Congress done so, the statute would extend LHWCA coverage to the “disability or death of an employee resulting from any injury occurring on the outer Continental Shelf.” But that is not the text of the statute Congress enacted.
Pacific also argues that, because all of § 1333(b)'s neighboring subsections contain specific situs limitations, we should infer that Congress intended to include a situs-of-injury requirement in § 1333(b). See, e.g., § 1333(a)(2)(A) (adopting the civil and criminal laws of the adjacent State as federal law “for that portion of the subsoil and seabed of the outer Continental Shelf, and artificial islands and fixed structures erected thereon, which would be within the area of the State if its boundaries were extended seaward to the outer margin of the outer Continental Shelf ”). But our usual practice is to make the opposite inference. Russello v. United States, 464 U.S. 16, 23, 104 S.Ct. 296, 78 L.Ed.2d 17 (1983) (“Where Congress includes particular language in one section of a statute but omits it in another section of the same Act, it is generally presumed that Congress acts intentionally and purposely in the disparate inclusion or exclusion” (alteration and internal quotation marks omitted)). Congress' decision to specify, in scrupulous detail, exactly where the other subsections of § 1333 apply, but to include no similar restriction on injuries in § 1333(b), convinces us that Congress did not intend § 1333(b) to apply only to injuries suffered on the OCS. Rather, § 1333(b) extends LHWCA workers' compensation coverage to any employee injury, regardless of where it happens, as long as it occurs “as the result of operations conducted on the outer Continental Shelf.”
Also 43 U.S.C. § 1333(a)(1) (extending the Constitution and federal laws of civil and political jurisdiction “to the subsoil and seabed of the outer Continental Shelf and to all artificial islands, and all installations and other devices permanently or temporarily attached to the seabed, which may be erected thereon for the purpose of exploring for, developing, or producing resources therefrom, or any such installation or other device (other than a ship or vessel) for the purpose of transporting such resources, to the same extent as if the outer Continental Shelf were an area of exclusive Federal jurisdiction located within a State”); § 1333(c) (making the National Labor Relations Act applicable to any unfair labor act “occurring upon any artificial island, installation, or other device referred to in subsection (a) of this section”); § 1333(d)(1) (granting the Coast Guard enforcement authority “on the artificial islands, installations, and other devices referred to in subsection (a) of this section or on the waters adjacent thereto”); § 1333(d)(2) (granting the Coast Guard authority to mark “any artificial island, installation, or other device referred to in subsection (a) of this section” for the protection of navigation); § 1333(e) (granting the Army authority to prevent the obstruction of access “to the artificial islands, installations, and other devices referred to in subsection (a) of this section”); § 1333(f) (saving clause applying “to the subsoil and seabed of the outer Continental Shelf and the artificial islands, installations, and other devices referred to in subsection (a) of this section”).
Pacific argues that this conclusion is foreclosed by language in Herb's Welding, Inc. v. Gray, 470 U.S. 414, 105 S.Ct. 1421, 84 L.Ed.2d 406 (1985), and Offshore Logistics, Inc. v. Tallentire, 477 U.S. 207, 106 S.Ct. 2485, 91 L.Ed.2d 174 (1986); but neither of those cases held that § 1333(b) extends only to injuries that occur on the OCS. In Herb's Welding, this Court considered whether an oil platform welder, who worked both within the territorial waters of Louisiana and on the OCS, was covered under the LHWCA after suffering an injury in the waters of Louisiana. 470 U.S., at 416–417. The Court explicitly declined to address whether the employee was eligible for workers' compensation benefits under § 1333(b) because that question was neither passed upon by the Court of Appeals nor fully briefed and argued before this Court. Id., at 426, n. 12. Although the Court acknowledged that an employee might walk in and out of workers' compensation coverage during his employment due to the “explicit geographic limitation to the [OCSLA's] incorporation of the LHWCA,” id., at 427, the exact meaning of that statement is unclear. We cannot ascertain whether the comment was a reference to § 1333(b)'s explicit situs-of-operations requirement, as respondents suggest, or the recognition of an implicit situs-of-injury requirement, as Pacific argues. In any event, the ambiguous comment was made without analysis in dicta and does not control this case.
7. The same is true of the Court's opinion in Offshore Logistics. In that case, the Court considered whether the widows of oil platform workers who were killed when their helicopter crashed into the high seas could file wrongful-death suits under Louisiana law. In the Court's analysis of § 1333, it stated, “Congress determined that the general scope of OCSLA's coverage ... would be determined principally by locale, not by the status of the individual injured or killed.” 477 U.S., at 219–220 (citing the situs requirement in § 1333(a)(2)(A)). In a footnote, the Court commented: “Only one provision of OCSLA superimposes a status requirement on the otherwise determinative OCSLA situs requirement; § 1333(b) makes compensation for the death or injury of an ‘employee’ resulting from certain operations on the Outer Continental Shelf payable under the [LHWCA].” Ibid., n. 2. These comments about the scope of the OCSLA's coverage and its determinative “situs requirement” do not provide definitive evidence that § 1333(b) applies only to injuries that occur on the OCS. As in Herb's Welding, it is unclear whether the statement in the Offshore Logistics footnote regarding § 1333(b) was referring to the explicit situs-of-operations requirement or to an implicit situs-of-injury requirement. Moreover, the entire footnote is dictum because, as the Court explicitly stated, § 1333(b) had no bearing on the case. 470 U.S., at 219–220.
Finally, Pacific argues that including off-OCS injuries within the scope of the workers' compensation coverage created by § 1333(b) runs counter to Congress' intent in drafting the OCSLA. According to Pacific, Congress intended to create a uniform OCS compensation scheme that both filled the jurisdictional voids and eliminated jurisdictional overlaps between existing state and federal programs. Pacific points out that, without a situs-of-injury requirement to narrow the scope of § 1333(b), an off-OCS worker could be eligible for both state and federal workers' compensation coverage.
8. There is no indication in the text, however, that the OCSLA excludes OCS workers from LHWCA coverage when they are also eligible for state benefits. To the contrary, the LHWCA workers' compensation scheme incorporated by the OCSLA explicitly anticipates that injured employees might be eligible for both state and federal benefits. An offsetting provision in the LHWCA provides that “any amounts paid to an employee for the same injury, disability, or death for which benefits are claimed under [the LHWCA] pursuant to any other workers' compensation law or [the Jones Act] shall be credited against any liability imposed by [the LHWCA].” 33 U.S.C. § 903(e). This provision, in addition to the lack of any textual support for Pacific's argument, convinces us that Congress did not limit the scope of 43 U.S.C. § 1333(b)'s coverage to only those geographic areas where state workers' compensation schemes do not apply.
B
[2] Pacific also offers an alternative argument derived from the interaction of § 1333(b) and a provision of the LHWCA. Specifically, Pacific argues that because the LHWCA contains an explicit situs-of-injury requirement, see 33 U.S.C. § 903(a) (providing benefits only for injuries occurring “upon the navigable waters” of the United States), and because 43 U.S.C. § 1333(b) extends the LHWCA workers' compensation scheme to the OCS, § 1333(b) incorporates the strict LHWCA situs-of-injury requirement from § 903(a). According to Pacific, the words “occurring as the result of operations” in § 1333(b) impose a status requirement in addition to the imported LHWCA situs-of-injury requirement, with the result that employees who are injured on the OCS, but whose jobs are not related to extractive operations, are excluded from the workers' compensation coverage created by § 1333(b). Thus, an accountant who is injured on a field trip to the drilling platform would be ineligible under § 1333(b) despite being an employee who is injured on the OCS.
Although this alternative argument has the advantage of assigning some meaning to the words “occurring as the result of operations” in § 1333(b), we still find it unpersuasive. First, it is unlikely that Congress intended to impose a situs-of-injury requirement in § 1333(b) through such a nonintuitive and convoluted combination of two separate legislative Acts. As we have already noted, creating an express situs-of-injury requirement in the text of § 1333(b) would have been simple. Second, combining the § 1333(b) definition of “United States” with the LHWCA situs-of-injury requirement in 33 U.S.C. § 903(a) would result in an OCS workers' compensation scheme that applies only to the seabed of the OCS and to any artificial islands and fixed structures thereon. See 43 U.S.C. § 1333(b)(3) (stating that “the term ‘United States' when used in a geographical sense includes the outer Continental Shelf and artificial islands and fixed structures thereon”). Pacific concedes that this scheme would exclude the navigable waters above the shelf, including the waters immediately adjacent to any drilling platforms. Consequently, under Pacific's view, even employees on a crew ship immediately adjacent to an OCS platform who are injured during a platform explosion would be excluded from § 1333(b) coverage. That view cannot be squared with the text of the statute, which applies to “any injury occurring as the result of operations conducted” on the OCS.
C
9 [3] Pacific also makes several policy arguments in favor of a situs-of-injury requirement, but policy concerns cannot justify an interpretation of § 1333(b) that is inconsistent with the text of the OCSLA. “[I]f Congress' coverage decisions are mistaken as a matter of policy, it is for Congress to change them. We should not legislate for them.” Herb's Welding, 470 U.S., at 427. The language of § 1333(b) simply does not support a categorical exclusion of injuries that occur beyond the OCS.
IV
The Solicitor General urges us to adopt a status-based inquiry that applies one test to on-OCS injuries and a different test to off-OCS injuries. Specifically, the Government proposes that when a worker is injured on the OCS, he is eligible for workers' compensation benefits if he is employed by a company engaged in extractive operations on the OCS. But if the employee is injured off the OCS, the employee will be covered only if his “duties contribute to operations” on the OCS and if he performs “work on the [OCS] itself that is substantial in terms of both its duration and nature.” Brief for Federal Respondent 35. This approach is derived from our decision in Chandris, Inc. v. Latsis, 515 U.S. 347, 115 S.Ct. 2172, 132 L.Ed.2d 314 (1995) (establishing criteria by which an employee qualifies as a “seaman” under the Jones Act), and might well have merit as legislation. But it has no basis in the text of the OCSLA as presently enacted. The “occurring as the result of operations” language in § 1333(b) plainly suggests causation. Although the Government asserts that a status-based test would be preferable to a causation-based test, we cannot ignore the language enacted by Congress.
[4] The Third Circuit's “but for” test is nominally based on causation, but it is also incompatible with § 1333(b). Taken to its logical conclusion, the “but for” test would extend workers' compensation coverage to all employees of a business engaged in the extraction of natural resources from the OCS, no matter where those employees work or what they are doing when they are injured. This test could reasonably be interpreted to cover land-based office employees whose jobs have virtually nothing to do with extractive operations on the OCS. Because Congress extended LHWCA coverage only to injuries “occurring as the result of operations conducted on the outer Continental Shelf,” we think that § 1333(b) should be interpreted in a manner that focuses on injuries that result from those “operations.” This view is consistent with our past treatment of similar language in other contexts. In Holmes v. Securities Investor Protection Corporation, 503 U.S. 258, 112 S.Ct. 1311, 117 L.Ed.2d 532 (1992), we considered a provision of the Racketeer Influenced and Corrupt Organizations Act that provided a cause of action to “[a]ny person injured in his business or property by reason of a violation of section 1962.” 18 U.S.C. § 1964(c) (emphasis added). We rejected a “but for” interpretation, stating that such a construction was “hardly compelled” and that it was highly unlikely that Congress intended to allow all factually injured plaintiffs to recover. 503 U.S., at 265–266. Instead, we adopted a proximate-cause standard consistent with our prior interpretation of the same language in the Sherman and Clayton Acts. Id., at 267–268. Similarly, 43 U.S.C. § 1333(b)'s language hardly compels the Third Circuit's expansive “but for” interpretation.
[5] Accordingly, we conclude that the Ninth Circuit's “substantial-nexus” test is more faithful to the text of § 1333(b). We understand the Ninth Circuit's test to require the injured employee to establish a significant causal link between the injury that he suffered and his employer's on-OCS operations conducted for the purpose of extracting natural resources from the OCS.
10. Although the Ninth Circuit's test may not be the easiest to administer, it best reflects the text of § 1333(b), which establishes neither a situs-of-injury nor a “but for” test. We are confident that ALJs and courts will be able to determine whether an injured employee has established a significant causal link between the injury he suffered and his employer's on-OCS extractive operations. Although we expect that employees injured while performing tasks on the OCS will regularly satisfy the test, whether an employee injured while performing an off-OCS task qualifies—like Valladolid, who died while tasked with onshore scrap metal consolidation—is a question that will depend on the individual circumstances of each case. The Ninth Circuit remanded the case for the Benefits Review Board to apply the “substantial-nexus” test in the first instance, and we agree with that disposition.
The judgment is affirmed, and the case is remanded to the Court of Appeals for further proceedings consistent with this opinion.
It is so ordered.
Justice SCALIA, with whom Justice ALITO joins, concurring in part and concurring in the judgment.
I join the Court's judgment that the Ninth Circuit properly remanded this case to the Benefits Review Board, and I agree with almost all of the Court's opinion. My disagreement is limited to the last two substantive paragraphs of Part IV, which endorse the Ninth Circuit's “substantial-nexus” test for determining the scope of coverage under 43 U.S.C. § 1333(b). The Court indulges in considerable understatement when it acknowledges that this test “may not be the easiest to administer,” ante, at 14. “Substantial nexus” is novel legalese with no established meaning in the present context. I agree with the Court's rejection of some of the clearer rules proposed by the parties—which, though easier to apply, are unmoored from the text of § 1333(b). But if we must adopt an indeterminate standard (and the statute's “as the result of” language leaves us no choice) I prefer the devil we know to the devil of the Ninth Circuit's imagining. I would hold that an employee may recover under § 1333(b) if his injury was proximately caused by operations on the Outer Continental Shelf (OCS).
The term “proximate cause” is “shorthand for a concept: Injuries have countless causes, and not all should give rise to legal liability.” CSX Transp., Inc. v. McBride, 564 U.S. ––––, –––– (2011) (slip op., at 5). Life is too short to pursue every event to its most remote, “but-for,” consequences, and the doctrine of proximate cause provides a rough guide for courts in cutting off otherwise endless chains of cause-and-effect. See Holmes v. Securities Investor Protection Corporation, 503 U.S. 258, 287, 112 S.Ct. 1311, 117 L.Ed.2d 532 (1992) (SCALIA, J., concurring in judgment). Thus, as the Court notes in rejecting the Third Circuit's “but for” test for § 1333(b) coverage, we have interpreted statutes with language similar to § 1333(b) as prescribing a proximate-cause standard.
Although the doctrine of proximate cause is rooted in tort law and most commonly applied in negligence actions, it can also provide a useful guide in no-fault compensation schemes like this one. In Brown v. Gardner, 513 U.S. 115, 119, 115 S.Ct. 552, 130 L.Ed.2d 462 (1994), we considered a no-fault veterans' compensation statute covering injuries that occurred “as the result of” medical treatment (precisely the language at issue here); we suggested that the requisite “causal connection” between the injury and medical treatment may be “limited to proximate causation so as to narrow the class of compensable cases ... by eliminating remote consequences.” Similarly, some state workers' compensation laws use the concept of proximate cause to determine entitlement. See, e.g., Ex parte Patton, ––– So.3d ––––, –––– (Ala.2011); Marandino v. Prometheus Pharmacy, 294 Conn. 564, 591, 986 A.2d 1023, 1041 (2010); Grant v. Grant Textiles, 372 S.C. 196, 201, 641 S.E.2d 869, 871 (2007). Indeed, the statutory law of California, where Mr. Valladolid died while at work, limits workers' compensation liability to cases “[w]here the injury is proximately caused by the employment, either with or without negligence.” Cal. Lab.Code Ann. § 3600(a)(3). I see no reason why the scope of 43 U.S.C. § 1333(b) could not similarly be cabined by the familiar limits of proximate causation.
Strange to say, the California Supreme Court has held that this unmistakable term-of-art reference to a rule found in the common law of torts does not establish a rule “identical to that found in the common law of torts,” but merely “elaborat[es] the general requirement that the injury arise out of the employment.” LaTourette v. Workers' Compensation App. Bd., 17 Cal.4th 644, 651, n. 1, 72 Cal.Rptr.2d 217, 951 P.2d 1184, 1187, n. 1 (1998) (internal quotation marks omitted). Perhaps (who knows?) later California Supreme Court cases will “clarify” this general requirement by saying that it requires a “substantial nexoos” between the employment and the injury.
To be sure, proximate cause is an imperfect legal doctrine; I have no illusions that its tenets are easy to describe or straightforward to apply. Judicial opinions do not provide a uniform formulation of the test, and borderline cases are rarely clear. But “it is often easier to disparage the product of centuries of common law than to devise a plausible substitute.” McBride, 564 U.S., at –––– (ROBERTS, C.J., dissenting) (slip op., at 2–3). Unlike the substantial-nexus test, proximate cause provides a “vocabulary” for answering questions like the one raised by the facts of this case. It may be productive, for example, to consider whether the injury was “within the scope of the risk” created by OCS operations, or whether some “superseding or intervening cause” exists. Id., at –––– (slip op., at 15). In addition to that vocabulary, precedents on proximate cause “furnish illustrations of situations which judicious men upon careful consideration have adjudged to be on one side of the line or the other.” Exxon Co., U.S.A. v. Sofec, Inc., 517 U.S. 830, 839, 116 S.Ct. 1813, 135 L.Ed.2d 113 (1996) (internal quotation marks omitted).
“Substantial nexus,” by contrast, is an indeterminate phrase that lacks all pedigree. Our case law has used it as a term of art in only one context, first appearing in Justice Blackmun's opinion for the Court in Complete Auto Transit, Inc. v. Brady, 430 U.S. 274, 279, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977): We sustain state taxes against Commerce Clause challenges if they are, inter alia, “applied to an activity with a substantial nexus with the taxing State.” Oklahoma Tax Comm'n v. Jefferson Lines, Inc., 514 U.S. 175, 183, 115 S.Ct. 1331, 131 L.Ed.2d 261 (1995) (emphasis added; internal quotation marks omitted). “[S]uch a nexus is established when the taxpayer ‘avails itself of the substantial privilege of carrying on business' in that jurisdiction.” Polar Tankers, Inc. v. City of Valdez, 557 U.S. 1, 11, 129 S.Ct. 2277, 174 L.Ed.2d 1 (2009). That clarification—and any further clarification in the Commerce Clause context—will not be remotely helpful to lower courts attempting to apply the substantial-nexus test in the very different legal context of workers' compensation under § 1333(b). In this latter context, I assume the Court means by “substantial nexus” a substantial causal nexus—since § 1333(b)'s “as the result of” language “plainly suggests causation,” ante, at 13. Like the word “nexus” itself, the definition of “substantial nexus” in our state-tax cases does not require any causal relationship whatsoever. The proximate-cause test, by comparison, represents a much more natural interpretation of a statute that turns on causation.
Does the Court mean to establish, by the novel “substantial [causal] nexus” test, a new tertium quid of causality—somewhere between but-for causality and proximate cause? One might think so, since there is no other sensible reason to (1) reject but-for cause, (2) say nothing about the natural alternative (proximate cause), and (3) embrace the “substantial [causal] nexus” novelty. On the other hand, the Court's opinion suggests at least some connection (that is to say, in the Court's favored lawspeak, some “nexus”) between the proximate-cause standard and the substantial-nexus test, since it cites one of our proximate-cause cases just before concluding that “[a]ccordingly, ... the Ninth Circuit's ‘substantial-nexus' test is more faithful to the text of § 1333(b)” than the Third Circuit's but-for test. Ante, at 13–14. In the opinion below, moreover, the Ninth Circuit purported to endorse the Fifth Circuit's pre–1989 case law, which required “ ‘ that the claimant show a nexus ... similar to the proximate cause test in tort law.’ “ 604 F.3d 1126, 1140 (C.A.9 2010) (quoting Mills v. Director, Office of Workers' Compensation Programs, 846 F.2d 1013, 1015 (C.A.5 1988), rev'd en banc, 877 F.2d 356 (1989)). Who knows whether this is a tertium quid or not? The Court has given us a new test whose contours are entirely undescribed, and which has nothing to be said for it except that it will add complexity to the law and litigation to the courts.
12 Finally, I must note an additional uncertainty (or else a peculiarity) that the Court's opinion creates: The statutory text at issue requires compensation for “disability or death of an employee resulting from any injury occurring as the result of operations conducted on the outer Continental Shelf ....“ § 1333(b) (emphasis added). Before today, I would have thought it clear that courts must apply proximate-cause analysis to the “resulting from” provision; but that would seem quite peculiar if (as the Court holds today) we apply substantial-nexus analysis to the neighboring “occurring as the result of” provision. Surely both phrases express the same concept. What a tangled web we weave.
I would affirm the Ninth Circuit's judgment to remand the case to the Benefits Review Board, but with instructions to apply a proximate-cause test.
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