A Mayer Brown Legal Update published late last week discussed the January 11, 2012, Supreme Court Opinion in Pacific Operators Offshore, LLP v. Valladolid, which held that “an injury is covered by the OCSLA [Outer Continental Shelf Lands Act, 43 U.S.C. 1331 – 1356] when there is a ‘substantial nexus’ between the injury and extractive operations on the Outer Continental Shelf (OCS).”
Juan Valladolid, an employee of Pacific Operators Offshore, LLP, was killed in a forklift accident onshore, though he spent “99%” of his time working offshore on drilling platforms off the coast of California. His widow sought benefits under the Longshore and Harbor Workers’ Compensation Act (LHWCA, 33 U.S.C. §901 et seq.), pursuant to the OCSLA, but because LHWCA only covers injuries “occurring as the result of operations conducted on the [OCS],” an Administrative Law Judge dismissed her claim – Valladolid was onshore when the accident occurred, after all.
The Department of Labor’s Benefits Review Board affirmed the decision, but the Ninth Circuit reversed it, concluding that a claimant seeking benefits under the OCSLA “must establish a substantial nexus between the injury and extractive operations on the shelf.”
The Supreme Court held that OCSLA extends coverage to an employee who can establish a substantial nexus between his injury and his employer’s extractive operations on the OCS.
On this “substantial-nexus” test, the Supreme Court says:
The test may not be the easiest to administer, but Administrative Law Judges and courts should be able to determine if an injured employee has established the required significant causal link. Whether an employee injured while performing an off-OCS task qualifies will depend on the circumstances of each case. It was thus proper for the Ninth Circuit to remand this case for the Benefits Review Board to apply the “substantial-nexus” test.