On December 3, 2002, the U. S. Supreme Court decided the case of Sprietsma v. Mercury Marine. The impact of this ruling, which allows lawsuits to proceed against makers of boats and engines without propeller guards, will affect the recreational boating industry for many years to come.
The Sprietsma case arose from an accident in 1995 on Dale Hollow Lake (on the Kentucky/Tennessee border). Jean Sprietsma, a passenger aboard an 18-ft. boat fell overboard and was killed after being struck by the unguarded propeller of the 115 h.p. outboard engine. In order to reach the “deep pockets” of the engine manufacturer, the Sprietsma Estate sued Mercury Marine in Illinois. The Estate alleged that under state common law, Mercury was liable for manufacturing an engine that was unreasonably dangerous without a propeller guard. Mercury then filed a Motion to Dismiss, asserting that the Coast Guard had exclusive authority to regulate boat design and safety under the Federal Boat Safety Act of 1971 (FBSA). Mercury argued that the Coast Guard’s authority pre-empted state common law and state regulations. Because the Coast Guard had specifically decided not to require boats to be equipped with propeller guards, Mercury argued that its engine was in compliance with regulations, could not be defective, and the case should be dismissed. The trial court agreed with Mercury’s pre-emption argument and dismissed the Complaint. Two Illinois appellate courts upheld the dismissal. The U.S. Supreme Court then decided to hear the Sprietsma case in order to resolve conflicting lower court rulings on the pre-emption issue.
The propeller guard issue gained importance in 1988, when the Coast Guard requested the National Boating Safety Advisory Council (NBSAC) to address the need for propeller guard regulations. After an 18-month study, the Coast Guard accepted the NBSAC’s recommendation that no regulatory action be taken. Propeller accidents continued to occur, however, and between 1995 and 1998 at least 9 persons were killed and 447 persons were injured when struck by unguarded propellers. During the 1990’s a number of lawsuits were filed, alleging that boats lacking propeller guards were unreasonably dangerous and defective. Many of these lawsuits were dismissed based upon the doctrine of federal pre-emption (a product is not defective, when it is made in compliance with the regulations issued by the federal agency that has exclusive regulatory authority over the product). Some courts disagreed with the pre-emption argument, however, allowing propeller guard cases to move forward. This conflict in lower court decisions made the issue ripe for a decision by the U.S. Supreme Court.
In deciding the Sprietsma case, the Supreme Court considered the nature and extent of the authority granted to the Coast Guard by the FBSA, to issue regulations for the safety and design of recreational boats. In particular, the Court addressed whether the authority granted to the Coast Guard pre-empted state products liability law (i.e., common law), and whether it pre-empted the states from issuing their own regulations. The Court’s decision hinged upon the language of the FBSA (which will not be discussed in this article). In a unanimous (9-0) ruling, the Supreme Court held that the regulations issued by the Coast Guard under the FBSA do not pre-empt state common law, and that Coast Guard pre-emption of state regulations only applies in areas in which the Coast Guard has issued regulations (i.e., silence is not pre-emptive). On subjects such as propeller guards, in which the Coast Guard has never issued regulations, the States remain free to adopt their own regulations. Based upon this reasoning, the Supreme Court reversed the lower courts’ rulings in Sprietsma, and remanded the case to the trial court. Eventually, a jury will decide whether the unguarded propeller was unreasonably dangerous and whether Mercury is liable to the Sprietsma Estate for damages.
The net result of this ruling is that lawsuits alleging defective boat design, including propeller guard cases, are not pre-empted by federal law, and may now proceed to trial under state common law (regardless of whether the Coast Guard has issued regulations on the subject). In addition, no federal pre-emption may be implied into the Coast Guard’s power to issue regulations over boat design. Until such time as the Coast Guard breaks its silence, and adopts regulations in an area of boat design - including propeller guard regulations, the states are free to separately adopt their own regulations. At least one other propeller injury case that was on appeal when Sprietsma was decided, has been reversed and remanded for trial, since federal pre-emption no longer provides the basis for a defense to claims that a boat lacking a propeller guard is defective. See Shrayber v. Holiday Harbor, Inc. (California 2003).
The Sprietsma decision is just the “tip of the iceberg” in propeller guard litigation. The courthouse doors have now been opened to anyone aggrieved by an unguarded propeller injury to sue the sellers and manufacturers of the boat and engine. Boat charter and livery operations will also be exposed to lawsuits. Over time, some of these cases will be successful and the industry will suffer losses and rising insurance costs. New construction will have to give consideration to inclusion of propeller guards, and only time will tell whether recalls and retrofitting will be required (this could benefit the boat repair industry). On its website, the National Marine Manufacturers Association has expressed its disappointment with the ruling, stating its fear that Sprietsma “may lead to a patchwork of inconsistent regulations in multiple jurisdictions, with safety standards being set by juries rather than safety experts.”
While such a “patchwork” of different state regulations is certainly possible, it appears less likely as time goes by. At the time Sprietsma was decided, the U.S. Coast Guard had already requested comments on proposed rulemaking to make certain propeller injury avoiding actions mandatory on new non-planing houseboats. The proposed actions included a combination of warning signs, cut-off devices, swim ladder interlocks, and propeller guards/devices. Although the comment period was closed in May, 2002, the Sprietsma decision and the need for possible new regulations applying to all recreational vessels (not just houseboats) has caused the Coast Guard to take a different tack. At the present time, the Coast Guard is taking a deliberate approach toward rulemaking that would apply propeller safety requirements not only to houseboats, but to virtually all propeller driven small craft.
Since Sprietsma, the Coast Guard has actively discussed the adoption of propeller guard regulations with The National Association of State Boating Law Administrators (NASBLA) and in its semi-annual meetings with the National Boating Safety Advisory Council (NBSAC). A great deal of fact-finding has occurred. A special panel discussion on proposed propeller guard requirements, co-sponsored by the Coast Guard and the American Boat & Yacht Council (ABYC), was held at the Miami International Boat Show in February, 2004. Most recently, the Coast Guard’s Office of Boating Safety participated in a panel discussion on the issue at the National Marine Manufacturer’s Association’s (NMMA) American Boating Congress, on May 4, 2004. During the discussion, Captain Scott Evans, the Chief of the Office of Boating Safety, stated that Congress has told the Coast Guard that it “has to do something” to curtail propeller-related injuries, and that if the Coast Guard fails to act, Congress may introduce its own legislation to address the issue. If the delay becomes significant, state legislatures may decide to act on their own. This does not appear likely in the near term, since the states are aware of the Coast Guard’s activities in this regard (there are seven NASBLA members on the NBSAC).
According to Phil Cappel in the Coast Guard’s Office of Boating Safety, the Coast Guard’s transition from the Department of Transportation to the Department of Homeland Security, has somewhat slowed the emphasis on rulemaking aside from national security matters. The process has also been slowed by the boat building industry’s reluctance to commit to new safety measures out of concerns for cost and liability (i.e., was the proper safety alternative selected). Prior to the Supreme Court’s Sprietsma decision, the NMMA had issued a press release on May 22, 2002, raising concerns of whether the risk justified the cost of additional safety measures and encouraging the industry to object. According to Mr. Cappel, the Coast Guard plans to continue its fact-finding in advance of proposed rulemaking by conducting additional propeller safety seminars at the International Boatbuilders’ Exposition and Conference (IBEX) in Miami October 25-27, 2004, and at next February’s Miami International Boat Show. Other alternatives being reviewed include a “backing bell” that delays engagement of the propeller for seven seconds while a warning bell rings, and a wireless kill switch that can be worn by all persons aboard a boat, so that the propeller cannot be engaged without all persons being aboard the boat, and which will stop the propeller in the event of a man overboard.
Sprietsma will also lead to new innovations. A patent was recently issued to a major boat manufacturer for a “virtual propeller guard” that uses infrared sensors to shut down an engine when persons or objects are detected too close to the propeller or on the swim ladder/platform (at present the devise is only effective at slow speeds). Another recently patented invention employs deflectors mounted on the bottom of the boat, which in combination with sensors, can stop a boat’s propeller in the event a person is detected under the boat or in its path.
Only the passage of more time will reveal the full impact of the Supreme Court’s momentous decision in Sprietsma. There can be little doubt that Sprietsma will lead to more litigation, more regulations, higher boatbuilding costs, and higher insurance premiums. “Stand by for heavy rolls” in the wake of Sprietsma.
© 2004 Stephen F. White