Fifth Circuit Rules Contract To Repair Offshore Oil & Gas Platform Not A Maritime Contract

In another recent decision, Genesis Energy, L.P. v. Danos, L.L.C., 152 F.4th 648 (5th Cir. 2025), the United States Fifth Circuit Court of Appeals found yet again that a contract to repair an offshore oil & gas platform was governed by Louisiana law pursuant to the Outer Continental Shelf Lands Act, rather than maritime law. In clarifying the maritime contract test set forth in In re Larry Doiron, Inc., 879 F.3d 568, 576 (5th Cir. 2018) (en banc), the Court instructed that when a contract involves platform (not vessel) repair, the proper focus is on the "use" of the vessel for work, and "whether the contract calls for substantial work to be performed from a vessel." Even though a vessel was used for ancillary functions that may have facilitated the platform repairs, Doiron calls for a close nexus between the vessel and the project's work. Accordingly, the defense and indemnity provision in the underlying Master Services Agreement was invalid under the Louisiana Oilfield Anti-Indemnity Act ("LOAIA").

The Fifth Circuit's ruling provides additional insight and clarity on how the Court views contracts relating to offshore oil and gas platforms, particularly when vessel involvement is only "ancillary" to the work being performed (i.e. repair of a platform). A detailed discussion of the case and the Court's analysis is discussed in the sections below.

Background and Lower Court Ruling

In August 2020, Hurricane Laura damaged the Genesis Garden Banks 72, an offshore platform owned by Genesis Energy, LP and located on the Outer Continental Shelf off the coast of Louisiana. Genesis' subsidiary contracted with Danos, LLC, to conduct repairs, entering into an oral work order that was memorialized by a written "Job Plan." To facilitate this project, Genesis chartered the 240-foot offshore supply vessel named Cheramie Botruc #41 (the "Vessel"), which was owned by L&M Botruc Rental, LLC.

In November 2020, Maximo Sequera, a Danos employee, fell from a personnel basket while transferring from the platform to the Vessel, sustaining injuries. Sequera sued Danos, Genesis, and Botruc Rental in Texas state court, and Danos removed the action to the Southern District of Texas. Genesis then filed a crossclaim against Danos seeking defense and indemnity in connection with the Master Services Agreement executed by Genesis' and Danos' predecessors-in-interest in 2008. Danos moved for summary judgment, contending that Genesis' crossclaim should be dismissed because the agreement was not maritime in nature and that Louisiana state law applied, invalidating the defense and indemnity provision. Genesis also moved for summary judgment, asserting that Danos was contractually obligated to provide defense and indemnity to Genesis.

The Southern District of Texas agreed with Danos, holding that the parties' contract was not maritime in nature and that the LOAIA applied, barring the enforceability of the defense and indemnity provision. The Court reasoned that "the terms of the Danos/Genesis contract and the expectations of the parties under it don't clearly establish that they anticipated platform-repair work under the contract to involve a substantial role for the vessel." The Court granted Danos' cross-motion for summary judgment, denied Genesis' motion for summary judgment, and dismissed Genesis' crossclaim with prejudice. Genesis appealed.

The Fifth Circuit Appeal

On appeal, the Fifth Circuit first examined the three contracts relevant to the platform repairs: the Master Services Agreement, the "Job Plan," and the Botruc Rental bid document. For example, the Job Plan had a stated objective to "[m]ake [the] platform safe for riser de-oil operations and drain the CHOPS pig launcher and receiver," and its Scope of Work listed steps to complete the project but made no mention of the Vessel. While the "Detailed Procedure" section listed additional steps and made one reference to the Vessel, it also provided that "crews will live on the vessel and transfer to the platform daily via man basket."

Similarly, the bid document only provided for transporting the crew and providing meals and lodging. Citing its previous decision in Earnest v. Palfinger Marine USA, Inc., 90 F.4th 804, 810 (5th Cir. 2024), the Fifth Circuit concluded that all three agreements failed to establish a "direct and substantial link between the contract and the operation of the ship, its navigation, or its management afloat." The Court concluded that the agreements "establish at most that the Vessel would transfer and house the crew, but we have previously dismissed those uses as insufficient to establish a vessel's 'substantial role.'"

The Court next examined evidence of the parties' expectations surrounding the platform repair project to determine if the Vessel had been expected to play a substantial role. Genesis relied on two declarations from Danos and Genesis employees as evidence of the parties' expectations that "the continuous use of the [Vessel] was necessary for Danos to complete its repair work." The declarations stated that the parties knew that the Vessel would be used as living quarters and a mess hall and that it would remain alongside the Platform for the duration of repairs.

The Court held that "the declarations' description of the Vessel as 'necessary' to the work is insufficient standing alone, because vessels are often necessary for offshore work." The Court pointed out that in its post-Doiron decisions, it had instead focused on whether the vessel at issue was "expected to directly aid the completion of the project." See, e.g. In re Crescent Energy Servs., L.L.C., 896 F.3d 350, 360 (5th Cir. 2018). Because "the parties anticipated that the Vessel would only house equipment that would later be transferred to the platform, where it would facilitate repairs", the Vessel's role was considered insubstantial under Doiron.

Regarding the Vessel's ancillary functions, the Court noted that it had previously held that housing is merely an "incidental" role for a vessel, while a vessel's use for "transportation to and from the job site" is to be ignored. The Court clarified that "[w]hile these ancillary functions may have facilitated the Platform repairs, Doiron calls for a closer nexus between the Vessel and the project's work than these functions have." The Fifth Circuit thus affirmed the district court, holding that the parties' agreement was not maritime in nature and that the LOAIA applied, invalidating Danos' defense and indemnity obligations to Genesis.