The Supreme Court yesterday ruled that both state and federal courts have jurisdiction over personal injury cases arising from work on offshore oil rigs.
The court, in an 8-to-0 decision affirming a state court ruling, said federal courts aren't the only ones allowed to hear cases involving areas covered by the Outer Continental Shelf Lands Act. It said that generally state courts can take such cases unless Congress says otherwise.
Justice Lewis Powell wrote the opinion with a concurrence written by Justice Harry Blackmun and joined by Thurgood Marshall and William J. Brennan. Justice Potter Stewart declined to consider or vote in the case.
The case arose from a lawsuit filed by Steven Gaedecke, an employe of Gulf Offshore Co., who was working on a Mobil Oil Corp. well drilling platform in the Gulf of Mexico off the Louisiana coast when Hurricane Eloise crossed the Yucatan Peninsula in September 1975.
While clearing the drilling platform in anticipation of the storm, Gaedecke was injured. He sued Mobil in a Texas state court and won a $900,000 judgment. Mobil won a $900,000 award from Gulf, which earlier had agreed to indemnify Mobil. However, Gulf claimed the state court didn't have jurisdiction over the case because Congress had given only federal courts authority over the Outer Continental Shelf.
"Congress did grant United States District Courts original jurisdiction of cases and controversies arising out of or in connection with . . . the outer Continental Shelf." the court said. "It is black letter law, however, that the mere grant of jurisdiction to a federal court does not operate to oust a state court from concurrent jurisdiction over the cause of action."
The law "is not inimical to state court jurisdiction over personal injury actions," the court said. "Nothing inherent in exclusive federal sovereignty over a territory precludes a state court from entertaining a personal injury suit concerning events occurring in the territory and governed by federal law."
The court said the Gulf argument confused the political jurisdiction of a state and its judicial jurisdiction.
Another issue in the case was whether the jury should have been given instructions telling them that personal injury damages are not subject to federal income taxation and they shouldn't increase or decrease an award with tax consequences in mind.