Home » Case Summaries » 2003 » Clausen v. M/V New Carissa


Clausen v. M/V New Carissa



The owners of the freighter M/V New Carissa appealed an award of damages, attorney fees, and expenses to the Clausens, owners of a commercial oyster farm. On appeal, the owners of the New Carissa (ship’s owners) argued the testimony offered by the Clausens’ expert failed to meet the standard set out in Daubert v. Merrell Dow Pharmaceuticals (Daubert I),[1] and thus was inadmissible. They further argued that the Oregon Oil Spill Act[2] did not provide for an award of attorney fees, but rather contemplated only those expenses incurred prior the filing of a court action. Finally, they asserted the district court erred in awarding expert witness fees. The Ninth Circuit affirmed the district court’s judgment to allow the Clausens’ expert testimony as well as the grant of attorney fees and expert witness expenses.

In 1999 the New Carissa, a Japanese-owned ship, flagged in Panama, ran aground near Coos Bay, Oregon. At the time the freighter was carrying 400,000 gallons of fuel. Though extreme measures were taken to prevent an oil spill, eventually about 70,000 gallons leaked into the ocean, some of which soon turned up in Coos Bay. Particularly troubling was the detection of oil in oyster beds–oysters being a central commodity in the local economy. Due to the detection of the oil, the United States Department of Agriculture closed the Bay’s oyster farms. Ten million dollars worth of oysters had been seeded that year alone within the Bay. Over 3.5 million oysters eventually died. The Clausens brought claims against the ship’s owners under the federal Oil Pollution Act[3] and the Oregon Oil Spill Act for the death of the oysters.[4] Both statutes impose strict liability on a party found responsible for an oil spill. Thus, the central issue at the district court level was whether the oil spill caused the oysters’ deaths. After the district court judge refused to exclude testimony from the plaintiff’s expert witness, Dr. Elston, the jury heard testimony from both Dr. Elston and the defendant’s expert witness, Dr. Neff. While Dr. Neff believed the deaths were brought on by the low salinity from heavy rainfall, Dr. Elston ruled out low salinity and placed the blame squarely on contact toxicity from the oil. As a result, the jury awarded the Clausens $1.4 million dollars. The Clausens then asked the district court for an award of attorney fees and expenses, including the cost of their expert witness, under the Oregon Oil Spill Act.[5] The district court granted $651,382.30 in attorney fees and expenses, including the expert witness costs of $149,170.05.

The Ninth Circuit reviewed the district court’s decision to admit the testimony of the Dr. Elston for abuse of discretion. Referring to the Supreme Court’s analysis of Federal Rule of Evidence 702 in Daubert I,[6] the Ninth Circuit concluded that scientific evidence must be “relevant and reliable” to be admissible.[7] In Daubert I, the Supreme Court laid out a list of four factors to be considered in determining reliability: “(1) whether the scientific theory or technique can be tested; (2) whether the theory or technique has been subjected to peer review and publication; (3) whether there is a known or potential error rate; and (4) whether the theory or technique is generally accepted in the scientific community.”[8] However, this list is non-exclusive and the Ninth Circuit also looked to Daubert v. Merrell Dow Pharmaceuticals, Inc. (Daubert II).[9] In Daubert II the Ninth Circuit isolated its primary criteria for deciding the question of reliability. The first factor was whether the subject of an expert’s testimony came “naturally and directly out of research they have conducted independent of the litigation.”[10] If the expert’s opinions were developed solely for litigation, the court decided that the expert’s conclusion must be supported by research and analysis that had been subjected to “normal scientific scrutiny through peer review and publication.”[11]

The court pointed out that in this case, neither Dr. Elston nor Dr. Neff’s testimony met the criteria set out in Daubert II as both were developed for the litigation and neither was published. However, the Ninth Circuit ruled that this did not make admission of their testimony necessarily erroneous. The court again referred to Daubert II where the Ninth Circuit had concluded that admission of the testimony might still be proper provided there was a reasonable explanation for the lack of publication and the expert could sufficiently explain how they reached their conclusions.[12] The court decided that Dr. Elston had provided sufficient explanation in this case because his methodology–differential diagnosis–was a universally accepted scientific method.[13]

The ship’s owners claimed that Dr. Elston’s particular use of differential diagnosis was faulty because he had erred by including contact toxicity as a potential cause. The ship’s owners argued that because the threshold of oil needed to cause harm to oysters had not been established, Dr. Elston’s conclusions were not based on “scientific knowledge.”[14] The court disagreed, ruling that even though the level had not been specifically established for oysters, Dr. Elston’s theory was still supported by scholarly work. In differential diagnosis, Dr. Elston’s first step was to assemble a list of potential causes that are generally capable of producing the oysters symptoms or mortality. The Ninth Circuit ruled Dr. Elston had supported his inclusion of contact toxicity with numerous factors: the temporal and geographic proximity of the oil spill, the fact that every oyster tested by the government was found to contain the ship’s oil, and that contact with oil could result in gill lesions in shellfish, like those found in the Coos Bay oysters. Thus Dr. Elston’s inclusion of contact toxicity was supported by “a variety of objective, verifiable evidence.”[15]

The court also looked at Dr. Elston’s process of elimination. His conclusion was based on combination of factors including analysis of data relating to the historic rainfall patterns of Coos Bay and chemical data taken by the government in response to the New Carissa’s spill. He ruled out low salinity–the conclusion of Dr. Neff–because the oysters did not display any of the symptoms associated with that cause of death. Thus, because he provided clear reasoning in support of his conclusion that the oil, not low salinity, was the root cause, the Ninth Circuit held that the district court did not abuse its discretion in admitting Dr. Elston’s testimony.

The ship’s owners also challenged the district court’s award of attorney fees under the Oregon Oil Spill Act, arguing that the Act supported only attorney fees incurred prior to litigation. The Ninth Circuit reviewed this issue de novo. The court first noted that the damages provisions of the Oregon Oil Spill Act were written extremely broadly, indicating the Oregon legislature contemplated extensive recovery for damage caused by an oil spill. “Damages include attorney fees of any kind for which the liability may exist under the laws of this state resulting from, arising out of or related to the discharge of oil.”[16] The court noted that the ship’s owners’ interpretation would have the effect of reading the attorney fees provision out of the statute. The ship’s owners also argued that in other statutes where the Oregon legislature has intended to shift attorney fees, it has done so explicitly. The Ninth Circuit held that the legislature was not limited to one manner of including attorney fees. Moreover, the court looked to the legislative history of the Act and concluded the Oregon Legislature specifically defined the damages provision broadly enough to include attorney fees.

Finally, the ship’s owners contested the award of expert witness fees. The ship’s owners argued that recovery of costs in federal court should be governed by federal law–which, in this case, would have precluded the award of expert witness costs. Ultimately the court held that this was a choice between a federal procedural cost provision, 28 U.S.C. section 1821(b), and a substantive state damages provision that allowed for the recovery of litigation costs as an element of compensatory damages. The court decided that the cost provisions of the Oregon Oil Spill Act were substantive law because under the statute “cost of any kind” was part of a plaintiff’s compensatory damages, a right bound up with the right of action.[17] Under Erie Railroad Co. v. Tompkins, [18] federal courts sitting in diversity jurisdiction apply state substantive law and federal procedures. Under the Erie doctrine, the Ninth Circuit held that the Oregon Oil Spill Act trumped the federal procedural statute and the award of expert witness fees was proper. Thus the Ninth Circuit affirmed the district court on all three issues presented on appeal.


[1] 509 U.S. 579 (1993).

[2]Or. Rev. Stat. § 468B.300 (2001).

[3] Oil Pollution Act of 1990, 33 U.S.C. § 2701-2761 (2000).

[4] Or. Rev. Stat. § 468B.305 (2001).

[5] Id. §§ 468B.310(1), 300(6).

[6] 509 U.S. 579, 594-97 (1993).

[7] Clausen v. M/V New Carissa, 339 F.3d 1049, 1056 (9th Cir. 2003).

[8] Id.

[9] 43 F.3d 1311 (9th Cir. 1995).

[10] Id. at 1317.

[11] Id. at 1318.

[12] Id. at 1319.

[13] Clausen, 339 F.3d at 1058 (citing Kennedy v. Collagen Corp., 161 F.3d 1226 (9th Cir. 1998) (finding that a reliable differential diagnosis meets the requirements of Daubert II)).

[14] Id.

[15] Id.

[16] Id. at 1062 (quoting the Oregon Oil Spill Act, Or. Rev. Stat. § 468B.300(6) (2001) (internal quotation and emphasis omitted)).

[17] Id. at 1064 (citing the Oregon Oil Spill Act, Or. Rev. Stat. § 468B.300(6)) (2001).

[18] 304 U.S. 64 (1938).

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