Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Company

PETITIONER: Jerome B. Graubart Inc.
RESPONDENT: Great Lakes Dredge & Dock Company
LOCATION: Chicago District Court

DOCKET NO.: 93-762
DECIDED BY: Rehnquist Court (1986-2005)
LOWER COURT: United States Court of Appeals for the Seventh Circuit

CITATION: 513 US 527 (1995)
ARGUED: Oct 12, 1994
DECIDED: Feb 22, 1995

ADVOCATES:
John G. Roberts, Jr. - for respondents
Ben Barnow - on behalf of the Petitioner Jerome B. Grubart, Inc.
Lawrence Rosenthal - on behalf of the Petitioner City of Chicago

Facts of the case

The city of Chicago hired the Great Lakes Dredge and Dock Company (Great Lakes) to perform work that would prevent ships from bumping into piers. To that end, Great Lakes used a crane to drive piles into the riverbed, which potentially weakened the structure of the freight tunnel that ran below the river. On April 13, 1992, water from the Chicago River poured into a freight tunnel, which subsequently flooded into the basements of several buildings. After the flood, many victims sued Great Lakes in state court and argued that the flood was the result of the weakening of the tunnel. Great Lakes Dredge and Dock removed the case to federal district court and argued federal admiralty court had jurisdiction of marine cases. The district court dismissed the suit for lack of admiralty jurisdiction, but the U.S. Court of Appeals for the Seventh Circuit reversed.

Question

Does a federal district court have federal admiralty jurisdiction to determine and limit the extent of the Great Lakes Dredge and Dock Company’s tort liability?

Media for Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Company

Audio Transcription for Oral Argument - October 12, 1994 in Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Company

William H. Rehnquist:

We'll hear argument next in Number 93-762, Jerome v. Grubart, Inc., v. Great Lakes Dredge & Dock Company, and No. 93-1094 consolidated with it, City of Chicago v. the same.

Mr. Barnow.

Ben Barnow:

Mr. Chief Justice and may it please the Court:

In furtherance of the divided argument, I intend on concentrating on nonpreemption argument issues.

Mr. Rosenthal intends on concentrating on the city's preemption argument.

On April 13, 1992, the Chicago Loop flooded.

Thousands of persons and businesses suffered losses estimated upwards of $1 billion.

This catastrophe, which has now come to be known as the Chicago Flood, resulted from two occurrences.

One was the City of Chicago's failure to maintain or repair an extensive underground tunnel system under the City of Chicago.

The second was the pile-driving activities which occurred on the North Branch of the Chicago River to protect the Kinzie Street Bridge, which had been completed more than 6 months earlier.

The pile-driving work was performed by Great Lakes Dredge & Dock Company, the respondent here.

It accomplished this work using a tractor crane positioned on top of a spud scow which had been posted into the river bed and which was being used as a stationary platform.

On these facts, the Seventh Circuit, in reversing the district court, found that admiralty jurisdiction existed.

In order to accomplish this, it had to do two things:

1) acting alone from the other circuits which have considered similar situations, it refused to adopt or use the totality-of-the-circumstances approach.

Secondly, it misapplied the rulings of this Court.

It did that by misconstruing every ingredient that this Court indicated in Sisson and the cases before it, Executive Jet, and Foremost required.

William H. Rehnquist:

Didn't our Sisson decision pretty well reject totality-of-the-circumstances test which you refer to?

Ben Barnow:

Not the way I read it.

In footnote numbers 3 and 4, the Court recognizes that the circuits were employing the totality-of-the-circumstances test and suggested that at least for that case that the guidance formula of Sisson would be adequate guidance.

It never said that no other circuit could continue to use that.

However, even if it did for the facts of that particular case, where all of the activities were uniform, were the same, it left open the door as to what the case would be where the instrumentalities were involved in different activities.

I would offer to the Court that in this particular case, we have myriad activities.

The City of Chicago alone is engaged in at least two nonmaritime activities.

One is the construction or maintenance of a bridge.

The second is, is the maintenance of their underground tunnel.

We then have the nonmaritime activities of all of the other instrumentalities, all of the people like Grubart and the businesses and buildings in the Chicago Loop, which are far away, none of whom were engaged in any activity which, under any argument, could be maritime.

David H. Souter:

Isn't that an argument against the Extension Act?

Isn't that going to be true in virtually every case in which there is, in effect, a land-based injury?

Ben Barnow:

No, Your Honor, and the reason is, is that when this Court developed the nexus test it did it to find a substantial connection between the activity and traditional maritime activity.