Atlantic Sounding Co. v. Townsend

Atlantic Sounding Co. v. Townsend

Maritime law is an area of the law that is controlled, unlike most types of tort law in the United States, completely at the federal level. In Atlantic Sounding Co. v. Townsend, the Supreme Court looked at damages under maritime law. Could punitive damages be assessed against a company that blatantly refused to obey the standards that had been set by federal law? This 2008 case's impact may not have been fully felt yet, but it is likely that the outcome will influence maritime law and maritime lawyers for decades to come.

The Case

In July of 2005, Townsend, who was a crew of a motor tugboat, slipped during the course of his job duties on the boat. He landed hard, and his shoulder slammed against the boat's steel deck. Both his shoulder and clavicle were injured.

While for many years, courts were the primary place where seamen had to take their cases if they wanted fair compensation, Congress has created a large body of maritime law and regulation that has largely eliminated the need for every case to go to court. One of these Congressional acts, the Jones Act, required companies to pay “maintenance and cure” to injured sailors and allowed those who had not received this to sue their employers.

Atlantic Sounding Co. told Townsend that he would not be receiving maintenance and cure, and in fact terminated his employment with the company. Townsend began a lawsuit, alleging that Atlantic Sounding Co. had arbitrarily and willfully decided to deny him maintenance and cure and had wrongfully terminated him. He filed not only for damages based on his actual economic losses, but also for punitive damages.

When Can Punitive Damages Be Claimed?

Punitive damages are a special type of damages that have had a long history in the English common law system. Punitive damages are designed to be used when it appears that merely paying the actual damages for someone won't be enough to stop a company from flagrantly violating the law again. In order to encourage following the law, punitive damages—damages designed to punish for intentional violations of the law—can be imposed.

Outcome of Atlantic Sounding Co.

Atlantic Sounding Co. v. Townsend was taken all the way up to the Supreme Court, where the justices ruled in 2008 that Atlantic did owe Townsend not only maintenance and cure, but that Townsend could also pursue punitive damages.

The court noted that nowhere in the Jones Act or other maritime laws are punitive damages strictly forbidden, and went over the long historical course of punitive damages and their uses. After looking at the evidence in the case, the Supreme Court decided in Atlantic Sounding Co. v. Townsend that Atlantic's behavior was willful and very much in keeping with the kinds of cases where punitive damages have historically been awarded.

This case makes it substantially easier for seamen to collect punitive damages, which likely means that it will be easier for some seamen who have been unfairly denied benefits to find an attorney to take their case.