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Barbieri v. K-Sea Transportation Corp.

December 18, 2006


The opinion of the court was delivered by: VITALIANO, D.J.


Plaintiff Mark Barbieri ("Barbieri") brings this action for damages against defendants KSea Transportation Corp., K-Sea Operating Partnership, L.P., K-Sea Transportation, L.L.C. (collectively, "K-Sea") and the barge DBL-31, in rem, pursuant to the Jones Act, 46 U.S.C. § 688, and general maritime and admiralty law for injuries sustained while working on board the vessel DBL-31 on March 9, 2003. Plaintiff also asserts claims for maintenance and cure as well as lost wages. K-Sea now moves to compel arbitration under the Federal Arbitration Act and to stay this litigation until the arbitration is concluded; plaintiff cross-moves pursuant to Federal Rule of Civil Procedure 12(f) to strike K-Sea's First Affirmative Defense demanding such arbitration. For the reasons that follow, both motions are denied.


Barbieri, a seaman by trade, was employed by K-Sea as the captain of its petroleum barge, the DBL-31. While working on the deck of the DBL-31 on March 9, 2003, Barbieri alleges that he sustained serious injuries to his lower back and other parts of his body as a result of the negligence of defendants and the unsafe and unseaworthy condition of the vessel. Compl.¶ 20.*fn1

On March 12, 2003, plaintiff was transported from the barge, then moored at Stapleton Anchorage in Upper New York Bay, to St. Vincent's Hospital on Staten Island for further treatment of these injuries. Barbieri returned to his home in Cairo, New York via ambulance upon his release from the hospital on March 14, 2003. K-Sea began paying Barbieri $15 per day for maintenance pursuant to the collective bargaining agreement then in effect between K-Sea and Barbieri's union, Local 333 United Marine Division, which covered the employer's obligation to pay maintenance and cure.*fn2

Later that month, while recuperating at home, Barbieri received a phone call from Alton Peralta, the claims manager for K-Sea. During this conversation, Peralta stated that if Barbieri signed an agreement to arbitrate all claims arising out of his injuries, K-Sea would pay Barbieri, in addition to the required $15 per day minimum maintenance payment, "his average two-thirds net weekly wage as an advance against settlement." Peralta Aff. ¶ 8. Barbieri agreed to this offer immediately. Peralta subsequently mailed Barbieri a letter enclosing a Claims Arbitration Agreement, which Barbieri signed on April 30, 2003.

In relevant part, the Claims Arbitration Agreement provides:

It is the position of K-Sea that K-Sea is responsible only for maintenance and cure and is not responsible or liable for any other damages under the doctrine of unseaworthiness, Jones Act or any other applicable law. Nonetheless, K-Sea is prepared to make advance against the settlement of any claim that could arise under the doctrine of unseaworthiness, Jones Act, or any other applicable law provided Mark Barbieri agrees to arbitrate these claims.

Therefore, in consideration of Mark Barbieri agreeing to arbitrate all claims against KSea and its affiliated and subsidiary companies, arising under the theories of unseaworthiness, Jones Act or any other applicable law in New York under the Commercial Arbitration Rules of the American Arbitration Association (AAA), K-Sea agrees to pay Mark Barbieri his average two-thirds net weekly wage as an advance against settlement until he has been declared fit for duty and/or at maximum medical improvement.

The agreement then provides that "[a]ny filing fee, up to $750.00 and any deposit for compensation of the arbitrators shall be advanced by K-Sea, subject to subsequent allocation." Finally, the Claims Arbitration Agreement contains, immediately above the signature line, the following paragraph printed in bold type: "Other than the promises contained in this agreement, I have been given no other promises to induce me to sign this Claims Arbitration Agreement. There has been no coercion used to make me sign this agreement. I have signed this agreement knowingly and willingly."

Defendants contend that they have kept their part of the bargain. As provided in the agreement, K-Sea began sending Barbieri a biweekly check amounting to approximately $838, which constituted two-thirds of Barbieri's net weekly wage. K-Sea also continued to pay Barbieri $210 every two weeks for maintenance as required by the collective bargaining agreement. According to K-Sea, although Barbieri reached the point of "maximum medical improvement" no later than July 1, 2004, it continued to pay him settlement advances and maintenance until March 29, 2005. See, e.g., Peralta Aff. ¶¶ 13, 15. However, despite the financial hardships that K-Sea's refusal to continue these payments past March 29, 2005*fn3 apparently imposed on Barbieri, Barbieri did not return to work at K-Sea once the payments stopped. Indeed, Barbieri avers that he could not return to work as he was "totally disabled and living on Social Security Disability payments." Barbieri Stmt. ¶ 10.*fn4

Barbieri filed the instant suit seeking additional damages from K-Sea on October 24, 2005. In response, K-Sea served Barbieri's counsel with a demand for arbitration pursuant to the rules of the American Arbitration Association ("AAA") on November 14, 2005. In a letter attached to the demand for arbitration, K-Sea stated that Barbieri was responsible for paying the remainder of the AAA filing fee. Canevari Aff., Ex. B. Neither the demand nor the letter specified what this fee would be.*fn5 Thereafter, in its November 28, 2005 answer to Barbieri's original complaint, K-Sea also asserted, as its First Affirmative Defense, that this litigation should be stayed or barred pending arbitration in New York pursuant to the Federal Arbitration Act, 9 U.S.C. § 1 et seq. That same day, plaintiff's counsel sent a letter to the AAA stating that Barbieri objected to arbitration on the ground that the Claims Arbitration Agreement was "little more than a device to deprive a Jones Act seaman of his rights and remedies under the United States Constitution, federal and . . . general maritime law." Hofmann Letter to Kate R. Fantoli of the AAA, dated Nov. 28, 2005.

On December 28, 2005, K-Sea filed the instant motion to compel arbitration and to grant parallel relief staying this litigation pending the outcome of the arbitration. Barbieri responded with a cross-motion to strike K-Sea's First Affirmative Defense, arguing, in essence, that not only is the Claims Arbitration Agreement invalid because it attempts to take away his rights under federal law, but also because he signed it under duress in that he had "no other alternative to provide for [his] family."*fn6 Barbieri Stmt. ΒΆ 12. Finally, Barbieri avers that even if he wanted to pursue arbitration at this stage, he ...

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