Jefferson Parish Maritime Case: Are Forum Selection Clauses in Employment Contracts Enforceable in Louisiana?

Greek Seaman Dimitrios Keramidas’s ship was docked in East Charles Parish in 1999 when he became sick. He was hospitalized and treated for sepsis at East Jefferson General Hospital in Metairie for two months before he was sent back to Greece with medical approval. Keramidas never recovered and passed away in May 1999. His surviving widow and son brought suit under the Jones Act against Shipping and Steamship Mutual Underwriting Association Limited. The defendant was granted a summary judgment motion because the trial court found that “under the forum selection clause of the seaman’s employment agreement, the country of Cyprus, not the United States, is the proper forum to bring the suit.” The 5th Circuit Louisiana Court of Appeals reviewed and affirmed the trial court’s decision.

Forum Selection Clauses
Even though states usually can enforce their own procedural rules and forum selection clauses are basically procedural, in admiralty cases, they are controlled by federal law.

Under federal law, forum selection clauses are presumed to be valid and should be enforced unless it is clear that enforcement would be unreasonable, unjust, fraudulent, or against a strong public policy of the state.

Potential Exceptions to Forum Selection Clause in this Case

1. The plaintiffs contended that forum selection clauses are against the public policy of the State of Louisiana. After all, in R.S. 23:921 A(2), the enforcement of forum selection clauses is expressly prohibited. However, admiralty cases are unique. R.S. 23:921 A(2) is part of the Labor and Workers’ Compensation Section of the Louisiana Revised Statutes and is designed to protect Louisiana employees and employers, not foreign maritime workers. Had the legislature intended to protect foreign maritime workers they would have included a statement to that effect in the law.

2. The plaintiffs also argued the enforcement of the clause would be unreasonable because Mr. Keramidas was not a member of the union that negotiated the contract. The court does not accept this argument and cites several Louisiana cases where clauses were enforced despite the injured employee not being a union member. In addition, if the employee is a veteran seaman they should understand the employment contracts they sign.

3. The plaintiffs claimed that the clause is unenforceable because it leads to an unjust result. Here, the plaintiffs contend that they cannot afford to pursue the case in Cyprus. Specifically, to travel between Greece and Cyprus would cost more than the compensation that can be collected under the contract. While the compensation amount may be low by U.S. standards, the mere fact that the forum required in contract would not provide maximum recovery does not add up to injustice.

4. Finally, the plaintiffs contended that because Keramida’s widow and son were not parties to the employment contract, it does not apply to their claims. However the contract is clear in its intent to apply to both Keramidas and his family/survivors. The contract even specifically references the “seaman’s property administrator and/or seaman’s family members.”

Although tragic, this case is a good example of how the courts have applied the Jones Act. In noting the exceptions it has made in the past to apply the Act to a variety of individuals, this case also demonstrates the wide variety of application possible.