Louisiana Federal Court Importantly Rejects Notion Of Co-Invitors In Offshore Operation

The owner of an offshore dive support vessel (the “Contractor”) and the operator of a pipeline recommissioning project (the “Operator”) disputed responsibility for injuries incurred by a worker employed by a services contractor hired to handle Hydrogen Sulfide issues.  The Contractor and Operator had a Master Services Contract containing reciprocal defense and indemnity provisions.  The Contractor would defend and indemnify the Operator for claims by the “Contractor Group” and the Operator would defend and indemnify the Contractor for claims by the “[Operator] Group,” with this distinction being determined by whether the worker was an invitee on the work site of the Contractor or the Operator.

The U.S. District Court for the Western District of Louisiana concluded that in this case, the worker in question was an invitee of the Operator.  Importantly, the court declined the invitation to find that the Contractor was a “co-invitor” of the worker.  The court emphasized, “No reported decisions were located in which a court expressly held that a worker was the invitee of both parties to a reciprocal indemnity agreement resulting in circular indemnity.”  The court recognized that concluding there were two invitors in this situation would “eviscerate” the purposes of contractual indemnity provisions in the offshore industry, which clearly classify each invitee as being an invitee of one or the other of the contracting parties involved in the operation.