Defendant found criminal guilty for failing to have a federal permit to operate on a lake owned by United States Army Corps of Engineers (USACE)

If you are on Federal land or Federal water making money you have to have a Federal Permit

United States v. Warman, 23-MJ-02-EBA, Violation 1062808 (E.D. Ky. Mar 15, 2023)

State: Kentucky; United States District Court, E.D. Kentucky, Northern Division

Plaintiff: UNITED STATES OF AMERICA

Defendant: HEATHER WARMAN

Plaintiff Claims:

Defendant Defenses: She did not own the business and she was out of the country on the day the ticket was issued.

Holding: Defendant was found guilty

Year: 2023

Summary

Defendant Heather Warman is a self-attested “CEO,” “Owner,” “Representative,” and “Manager” of SUP Kentucky. On its website, SUP Kentucky advertises kayak rentals and tours on-site at Grayson Grotto, which is situated on Grayson Lake in Olive, Kentucky. Critically, Grayson Lake is federal property, so a commercial business license issued by the United States Army Corps of Engineers (USACE) is required to lawfully solicit or conduct business on the lake. See 36 C.F.R. § 327.18(a). Warman was advised of the requirement multiple times over the course of several months by USACE Project and Resource Manager Francis Jeffrey. Nonetheless, she never applied for a commercial business license nor ceased her operations on the lake. So, on July 23, 2022, Warman was issued a notice for violating 36 C.F.R. § 327.18(a).

Facts

The United States accuses Warman of engaging in or soliciting business activities on Grayson Lake without authorization from the USACE in violation of 36 C.F.R. § 327.18(a). The regulation prohibits the “engaging in or solicitation of business on project land or waters without the express written permission of the District Commander.” Id. A violator “may be punished by a fine of not more than $5,000 or imprisonment for not more than six months or both[.]” 36 C.F.R. § 327.25. For Warman to be adjudged guilty by this Court, the United States must show beyond a reasonable doubt that Warman knowingly engaged in or solicited business on federal project land or waters, such as Grayson Lake, without the express written permission of the District Commander.

On March 28, 2022, Warman called Jeffrey to inquire about expanding certain mountain bike trails onto federal project land surrounding Grayson Lake. These bike trails were associated with her business, Grayson Getaways. During the conversation, Warman advised Jeffrey that she was also “the owner and CEO of SUP Kentucky, a guided kayak company” which seeks to expand its operations “on Grayson Lake[.]”Jeffrey informed Warman that it is illegal to operate a commercial business on federal project lands or waters without express consent from the District Commander in the form of a written permit. Warman, however, contended that a permit from the District Commander was unnecessary because she already held a permit from the Commonwealth of Kentucky which allowed her to operate a guided kayak business on “any lake in the state.” Jeffrey assured Warman, though, that she needed a permit from the District Commander and explained to her the difference between federal and state lands.

On May 13, 2022, Warman again contacted Jeffrey about expanding Grayson Getaways’ bike trails onto federal project land surrounding Grayson Lake. [Id.]. During the conversation, Jeffrey “reminded her . . . that a permit is needed to continue” her kayak rental and touring operations on Grayson Lake. This constituted her second verbal warning. Once again, Warman “disagreed.”

Five days later, on May 17, 2022, the USACE’s Real Estate Division served a cease-and-desist letter on Warman. The letter advised Warman that she was in violation of 36 C.F.R. § 327.18 for “advertising for and performing guided kayak and standup paddleboard tours on Grayson Lake . . . without the expressed written permission of the District Commander[.]”Warman acknowledged receipt via email, writing “Thank You.”

Thereafter, Warman communicated with the USACE’s Real Estate Division concerning the permit requirements. An in-person meeting was scheduled for May 27, 2022, but was later cancelled. [Id.]. On May 27, 2022, Jeffrey was contacted by Warman’s attorney about the permit requirements and application process.

On July 5, 2022, the USACE’s Real Estate Division informed Jeffrey that Warman’s company continued to operate and advertise tours on Grayson Lake. After investigating, Jeffrey concluded that Warman was, in fact, engaging in or soliciting business on project lands without a permit, in violation of 36 C.F.R. § 327.18(a). So, Jeffrey and Natural Resource Specialist Justine Smith cited Warman for violating the regulation. On September 7, 2022, Jeffrey chronicled his investigation into a Memorandum for Record, which the United States offered as an exhibit at trial.

Analysis: making sense of the law based on these facts.

This is a criminal case, meaning a State or the Federal Government has charged the defendant with committing a crime. If you are found guilty of a crime you can be forced to pay a fine or spend time in jail. In this case, it is a crime to operate a business on Federal Land without a Federal Permit.

Each of the Federal Agencies that have land available to use for recreation has similar requirements for obtaining a permit to operate on federal land. Those agencies include the US Forest Service which is part of the Department of Agriculture, the Bureau of Land Management, the National Park Service, and the Fish and Wildlife Service which is part of the Department of the Interior. And as in this case the Army Corps of Engineers, part of the Department of the Army. Each agency has different rules and regulations on how to obtain permits, how you must operate under the permit, and what the charges and fees are for the permit.

You have to have permission to “be” on proper, real estate, that you don’t own. If you are attempting to make money by using that property, you not only have to have permission to be on the real estate, but if owned by the Federal Government, you must have additional paperwork saying you have the right to make money using the Federal Government’s property.

Here the defendant was operating a SUP (Stand Up Paddleboard) business on a lake owned and controlled by the Army Corporation of Engineers. The defendant first claimed that since she had a permit to operate in Kentucky she did not need an Army Corp of Engineers Permit.

She did not use this argument in court. An analogy would be you can’t stand on your neighbor’s land without their permission and argue that the neighbor across the street told you it was OK to be there.

The Federal Regulation in question is:

§ 327.18 Commercial activities.

(a) The engaging in or solicitation of business on project land or waters without the express written permission of the District Commander is prohibited.

(b) It shall be a violation of this part to refuse to or fail to comply with any terms, clauses or conditions of any lease, license or agreements issued by the District Commander.

At trial the defendant attempted two different legal arguments.

Warman’s defense is two-fold. First, she says she doesn’t “own” SUP Kentucky, so she argues it’s impossible for her to have operated a business on federal project lands or waters without a permit in violation of 36 C.F.R. § 327.18(a). (“Warman did not and has not ever owned the Web-Site presented as evidence by the United States of America and as detailed on the Kentucky Secretary of State official records Mrs. Warman does not and has never owned Sup Kentucky.”). Second, because the citation was issued on July 23, 2022-when she was out of the country, at sea, on her way to Grenada-it was impossible for her to “solicit business or even communicate with anyone other than those physically on board her ship.”

The court went through the first defense quickly noticing all of the times she had told the Army Corp of Engineers that she was operating a SUP business on the lake.

Given Warman’s admissions, Jeffrey’s detailed chronology of his conversations with Warman, and the fact that only Jeffrey’s account has evidentiary support, the Court concludes that Jeffrey’s account of the facts is inherently more credible than Warman’s.

The second argument went down in a similar fashion. The citation was not for operating a business without a permit on one day, but multiple days. Again, the records of the Corp of Engineers and statements made by the defendant shot this argument down.

Through the testimony of Jeffrey, the United States proved that Warman is interested in the success of SUP Kentucky. See Also through the testimony of Jeffrey, and implicitly through the testimony of Warman herself, the United States proved that Warman solicited and conducted guided kayak and standup paddle tours on Grayson Lake without a commercial business license.

The judge found the defendant guilty of violating the federal statute.

Heather Warman was cited with violating 36 C.F.R. § 327.18(a) for soliciting for and operating her guided tour and kayak rental business on Grayson Lake without written permission from the District Commander. Warman pled not guilty. However, the Court concludes beyond a reasonable doubt that Warman violated 36 C.F.R. § 327.18(a). That is, she knowingly engaged in or solicited business on Grayson Lake without the express written permission of the District Commander, despite receiving two prior oral warnings and a formal, written cease-and-desist letter. Therefore, IT IS ORDERED AND ADJUDGED that Heather Warman is GUILTY of violating 36 C.F.R. § 327.18(a).

IT IS FURTHER ORDERED that Heather Warman shall appear for SENTENCING on April 13, 2023 at 10:00 A.M. in the United States District Courthouse at Ashland, Kentucky. On or before Monday, April 10, 2023, the parties shall file memoranda presenting matters that should be considered by the court in calculating an appropriate sentence.

So Now What?

In most of the US this would be called a trespassing case. Someone was on someone’s land without the landowner’s permission. However, when messing with Federal Land Owners the types of cases, damages and jail time escalate.

No matter whose land you are on, if the land is not yours, you need a lease or a permit to be there.

And remember, this is a Federal Criminal Case. It is going to effect the rest of her life.

G-YQ06K3L262

What do you think? Leave a comment.

James H. "Jim" Moss, JD, Attorney and Counselor at Law

James H. “Jim” Moss

Jim Moss is an attorney specializing in the legal issues of the outdoor recreation community. He represents guides, guide services, outfitters both as businesses and individuals and the products they use for their business. He has defended Mt. Everest guide services, summer camps, climbing rope manufacturers, avalanche beacon manufactures and many more manufacturers and outdoor industries. Contact Jim at Jim@Rec-Law.us

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United States v. Warman, 23-MJ-02-EBA, Violation 1062808 (E.D. Ky. Mar 15, 2023)

To Read an Analysis of this decision see: Defendant found criminal guilty for failing to have a federal permit to operate on a lake owned by the United States Army Corps of Engineers (USACE)

UNITED STATES OF AMERICA, PLAINTIFF,
v.
HEATHER WARMAN, DEFENDANT.

No. 23-MJ-02-EBA

Violation No. 1062808

United States District Court, E.D. Kentucky, Northern Division

March 15, 2023

MEMORANDUM OPINION & ORDER

EDWARD B. ATKINS, UNITED STATES MAGISTRATE JUDGE

INTRODUCTION

Defendant Heather Warman is a self-attested “CEO,” “Owner,” “Representative,” and “Manager” of SUP Kentucky.[1] [R. 7 at pg. 4]. On its website, SUP Kentucky advertises kayak rentals and tours on-site at Grayson Grotto, which is situated on Grayson Lake in Olive, Kentucky. [R. 6-1 at pg. 3].[2] Critically, Grayson Lake is federal property, so a commercial business license issued by the United States Army Corps of Engineers (USACE) is required to lawfully solicit or conduct business on the lake. See 36 C.F.R. § 327.18(a). Warman was advised of the requirement multiple times over the course of several months by USACE Project and Resource Manager Francis Jeffrey. Nonetheless, she never applied for a commercial business license nor ceased her operations on the lake. So, on July 23, 2022, Warman was issued a notice for violating 36 C.F.R. § 327.18(a).[3] [R. 1].

Warman appeared before the Court on February 23, 2023 for her initial appearance and arraignment. [R. 3]. Warman pled not guilty to the violation. [Id.]. Thereafter, the Court heard testimony from Jeffrey and Warman. After the taking of proof, the Court directed the parties to submit briefing on the matter no later than March 2, 2023. [Id.]. The United States and Warman tendered their briefs, so the matter is ripe for adjudication. [R. 6; R. 7].

ANALYSIS

A

The United States accuses Warman of engaging in or soliciting business activities on Grayson Lake without authorization from the USACE in violation of 36 C.F.R. § 327.18(a). The regulation prohibits the “engaging in or solicitation of business on project land or waters without the express written permission of the District Commander.” Id. A violator “may be punished by a fine of not more than $5,000 or imprisonment for not more than six months or both[.]” 36 C.F.R. § 327.25. For Warman to be adjudged guilty by this Court, the United States must show beyond a reasonable doubt that Warman knowingly engaged in or solicited business on federal project land or waters, such as Grayson Lake, without the express written permission of the District Commander.

B

On March 28, 2022, Warman called Jeffrey to inquire about expanding certain mountain bike trails onto federal project land surrounding Grayson Lake. [Gov. Ex. 1 at pg. 1]. These bike trails were associated with her business, Grayson Getaways. During the conversation, Warman advised Jeffrey that she was also “the owner and CEO of SUP Kentucky, a guided kayak company” which seeks to expand its operations “on Grayson Lake[.]” [Id.]. Jeffrey informed Warman that it is illegal to operate a commercial business on federal project lands or waters without express consent from the District Commander in the form of a written permit. [Id.]. Warman, however, contended that a permit from the District Commander was unnecessary because she already held a permit from the Commonwealth of Kentucky which allowed her to operate a guided kayak business on “any lake in the state.”[4] [Id.]. Jeffrey assured Warman, though, that she needed a permit from the District Commander and explained to her the difference between federal and state lands. [Id.].

On May 13, 2022, Warman again contacted Jeffrey about expanding Grayson Getaways’ bike trails onto federal project land surrounding Grayson Lake. [Id.]. During the conversation, Jeffrey “reminded her . . . that a permit is needed to continue” her kayak rental and touring operations on Grayson Lake. [Id.]. This constituted her second verbal warning. Once again, Warman “disagreed.” [Id.].

Five days later, on May 17, 2022, the USACE’s Real Estate Division served a cease-and-desist letter on Warman. [Id.]; [Gov. Ex. 2]. The letter advised Warman that she was in violation of 36 C.F.R. § 327.18 for “advertising for and performing guided kayak and standup paddleboard tours on Grayson Lake . . . without the expressed written permission of the District Commander[.]” [Id.]. Warman acknowledged receipt via email, writing “Thank You.” [Gov. Ex. 1 at pg. 1].

Thereafter, Warman communicated with the USACE’s Real Estate Division concerning the permit requirements. [Id.] An in-person meeting was scheduled for May 27, 2022, but was later cancelled. [Id.]. On May 27, 2022, Jeffrey was contacted by Warman’s attorney about the permit requirements and application process. [Id. at pg. 2].

On July 5, 2022, the USACE’s Real Estate Division informed Jeffrey that Warman’s company continued to operate and advertise tours on Grayson Lake. [Id.]. After investigating, Jeffrey concluded that Warman was, in fact, engaging in or soliciting business on project lands without a permit, in violation of 36 C.F.R. § 327.18(a).[5] [Id.]. So, Jeffrey and Natural Resource Specialist Justine Smith cited Warman for violating the regulation. [Id.]. On September 7, 2022, Jeffrey chronicled his investigation into a Memorandum for Record, which the United States offered as an exhibit at trial. [Id.].

C

Warman’s defense is two-fold. First, she says she doesn’t “own” SUP Kentucky, so she argues it’s impossible for her to have operated a business on federal project lands or waters without a permit in violation of 36 C.F.R. § 327.18(a). [R. 6 at pg. 2] (“Warman did not and has not ever owned the Web-Site presented as evidence by the United States of America and as detailed on the Kentucky Secretary of State official records Mrs. Warman does not and has never owned Sup Kentucky.”).[6]
Second, because the citation was issued on July 23, 2022-when she was out of the country, at sea, on her way to Grenada-it was impossible for her to “solicit business or even communicate with anyone other than those physically on board her ship.” [Id.].

Warman’s first defense calls for the Court to make a credibility determination. See United States v. Vance, 956 F.3d 846, 853 (6th Cir. 2020) (explaining that during a bench trial, where the district court sits as “the finder of fact,” the district court “is best placed to determine witness credibility”). Is Jeffrey or Warman’s account of the facts most credible?

Jeffrey, as discussed above, documented his interactions with Warman on numerous occasions spanning a period of several months.[7] During these interactions, Warman held herself out as the owner and/or CEO of SUP Kentucky (and admitted that SUP Kentucky was conducting and soliciting business on Grayson Lake). [Gov. Ex. 1 at pg. 1] (noting that Jeffrey explained orally, at least twice, that “she could not continue to guide on Grayson until a permit is issued,” but that Warman “disagreed”). During trial, however, Warman claimed that she never represented to Jeffrey that she owned, operated, or served as CEO of SUP Kentucky.[8] Yet, Warman testified to holding herself out as a “Representative” of SUP Kentucky, that she serves as a “Manager” for SUP Kentucky, and that her husband owns SUP Kentucky. This aligns with her tendency to use personal possessive pronouns on the stand when referring to SUP Kentucky, such as “we” and “our.” Given Warman’s admissions, Jeffrey’s detailed chronology of his conversations with Warman, and the fact that only Jeffrey’s account has evidentiary support, the Court concludes that Jeffrey’s account of the facts is inherently more credible than Warman’s. So, Warman’s defense that it was impossible for her to violate 36 C.F.R. § 327.18(a) for lack of an ownership interest in SUP Kentucky is unavailing.[9]

Warman’s second defense asserts a conclusion of law without reference to any legal authority: that it was legally impossible for Warman to solicit business from a website while at sea without access to the internet. [R. 6 at pg. 2]. Yet, Jeffrey testified that he issued a citation for Warman because of her ongoing, continuous wrongful conduct-conduct that Jeffrey first became aware of by Warman’s voluntary admission, no less. [Gov. Ex. 1 at pg. 1]. It is a coincidence, at best, that Warman happened to be out of the country on the date that Jeffrey and Smith wrote Warman’s citation. This “defense” would be unavailable if Jeffrey or Smith wrote Warman’s citation on any one of the other 116 days that Warman unlawfully solicited and conducted business on Grayson Lake without permission. And it is illogical to argue that Warman’s travel to another country, alone, precludes her from using a website to passively solicit business.

Although neither of Warman’s defenses persuade the Court, the United States must still carry its burden of proving beyond a reasonable doubt that Warman violated 36 C.F.R. § 327.18(a). Here, the United States did so.

Through the testimony of Jeffrey, the United States proved that Warman is interested in the success of SUP Kentucky.[10]
See [Gov. Ex. 1 at pg. 1]. Also through the testimony of Jeffrey, and implicitly through the testimony of Warman herself, the United States proved that Warman solicited and conducted guided kayak and standup paddle tours on Grayson Lake without a commercial business license. See [Id.]; [Gov. Ex. 6; R. 6-1 at pg. 3] (“All Stand Up Paddle Kentucky adventures meet on-site where your trip will take place…. To help you plan your travels: . . . Grayson Grotto is in Grayson Lake State Park in Olive Hill, Kentucky.”) (emphasis added).

Finally, also through the testimony of Jeffrey and Warman, the United States proved that Warman conducted these activities knowingly. See United States v. Davis, 339 F.3d 1223, 1228 (10th Cir. 2003) (holding that receiving “verbal warnings and correspondence from the Corps of Engineers . . . make clear that [Defendant] had actual knowledge of the regulations and that lake management officials considered his actions to be illegal”). Warman was orally warned by Jeffrey twice that she would need to obtain a commercial business license before operating or soliciting business on Grayson Lake and, when she failed to comply with Jeffrey’s oral warnings, Warman was warned again in writing by the USACE’s Real Estate Division that she was in violation of 36 C.F.R § 327.18(a). [Gov. Ex. 1 at pg. 1]. Warman is guilty beyond any reasonable doubt.[11]

CONCLUSION

Heather Warman was cited with violating 36 C.F.R. § 327.18(a) for soliciting for and operating her guided tour and kayak rental business on Grayson Lake without written permission from the District Commander. Warman pled not guilty. However, the Court concludes beyond a reasonable doubt that Warman violated 36 C.F.R. § 327.18(a). That is, she knowingly engaged in or solicited business on Grayson Lake without the express written permission of the District Commander, despite receiving two prior oral warnings and a formal, written cease-and-desist letter. Therefore, IT IS ORDERED AND ADJUDGED that Heather Warman is GUILTY of violating 36 C.F.R. § 327.18(a).

IT IS FURTHER ORDERED that Heather Warman shall appear for SENTENCING on April 13, 2023 at 10:00 A.M. in the United States District Courthouse at Ashland, Kentucky. On or before Monday, April 10, 2023, the parties shall file memoranda presenting matters that should be considered by the court in calculating an appropriate sentence.

Signed.

———

Notes:

[1] When interacting with USACE Project and Resource Manager Francis Jeffrey, Warman introduced herself as the “owner” and “CEO” of SUP Kentucky. But on cross-examination, Warman said that she doesn’t own SUP Kentucky or serve as its CEO, but instead serves as a “Manager” who holds herself out as a “Representative” of SUP Kentucky.

[2] [Gov. Ex. 6; R. 6-1 at pg. 3] (“All Stand Up Paddle Kentucky adventures meet on-site where your trip will take place. . . . To help you plan your travels: . . . Grayson Grotto is in Grayson Lake State Park in Olive Hill, Kentucky.”) (emphasis added).

[3] The notice was served on Warman via USPS Certified Mail at 2478 Glen Cairn Road, Roger, Kentucky 41365. Jeffrey obtained this address directly from SUP Kentucky’s website, and Warman obviously received the notice given her participation in this action.

[4] This alleged permit was never presented to Jeffrey, or anyone else with the USACE, nor was it offered as evidence at trial.

[5] Jeffrey’s investigation included soliciting a guided kayak tour on Grayson Lake from SUP Kentucky.

[6] Warman asserted at trial and in her trial brief that the Kentucky Secretary of State’s official business registry proves that she’s not an owner of SUP Kentucky. [R. 6 at pg. 2]. However, Warman never offered these records into evidence for the Court’s consideration. So, her claim is without factual support.

[7] Warman, on the other hand, did not.

[8] In a footnote, the United States suggests that Warman’s testimony that she “never informed Resource Manager Francis Jeffrey, the Real Estate Division of the USACE, or her SUP Kentucky clientele that she owned this company or that she represented she was one of the owners of the company” might constitute “perjury and obstruction of justice.” [R. 7 at pg. 7 n.1]. The United States bases its claim off a statement located on the SUP Kentucky website. [Id.]. The USACE is investigating the matter.

[9] Again, Warman’s reliance on evidence outside the record-the Kentucky Secretary of State’s official business registry to argue that she’s not an owner of SUP Kentucky fails to rebut evidence within the record that indicates the opposite. See, supra note 6.

[10] Warman’s precise title seems to be something that not even she can discern. See supra note 1 (highlighting that Warman has held herself out as the “CEO,” “Owner,” “Manager,” and “Representative” of SUP Kentucky at various times to different target audiences).

[11] It’s unclear from the record what type of business association SUP Kentucky is. However, even if SUP Kentucky is a Limited Liability Corporation-the most protective of business associations-“under Kentucky law, a member or manager of an LLC can be held personally liable for [her] own wrongful acts or misconduct even if [she] was acting on behalf of the LLC.” 5ifth Element Creative, LLC v. Kirsch, No. 5:10-cv-255-KKC, 2010 WL 5139235, at *2 (E.D Ky. Dec. 9, 2010); Ky. Rev. Stat. Ann. § 275.150(3); see also 4A Ky. Prac. Methods of Prac. § 18.33 (Nov. 2022) (“In fact, KRS 275.150(3) specifically provides that KRS 275.150(1) shall not affect the liability of a member, manager, employee, or agent of a limited liability company for his or her own negligence, wrongful acts, or misconduct.”). Warman never made this argument at trial or in briefing. But even if Warman had advanced such an argument, she remains liable for her wrongful criminal acts.

———

G-YQ06K3L262


In the UK you get arrested in the US you get sued

https://lnkd.in/gUavGDuX

State:

Women arrested in UK for suspicion of gross negligence manslaughter after four people died on #SUP trip. The news report is unclear about exactly what happened or how the four people died.

Why Is This Interesting?

This is a clear example of how the US legal system is so different from the UK or GB legal system. When you leave the US to guide, you might not get sued, but you might go to jail if there is an incident. (You still might get sued when you are back in the US.)

#Fatality #SUP #Paddleboard @RecreationLaw #Paddlesports #PaddleSportsLaw #RecLaw #RecreationLaw

What do you think? Leave a comment below.

Copyright 2020 Recreation Law (720) 334 8529

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To Purchase Go Here:

Facebook Page: Outdoor Recreation & Adventure Travel Law

Email: Jim@Rec-Law.US

By Recreation Law    Rec-law@recreation-law.com    James H. Moss

@2023 Summit Magic Publishing, LLC SummitMagic@gmail.com

G-YQ06K3L262

#AdventureTourism, #AdventureTravelLaw, #AdventureTravelLawyer, #AttorneyatLaw, #Backpacking, #BicyclingLaw, #Camps, #ChallengeCourse, #ChallengeCourseLaw, #ChallengeCourseLawyer, #CyclingLaw, #FitnessLaw, #FitnessLawyer, #Hiking, #HumanPowered, #HumanPoweredRecreation, #IceClimbing, #JamesHMoss, #JimMoss, #Law, #Mountaineering, #Negligence, #OutdoorLaw, #OutdoorRecreationLaw, #OutsideLaw, #OutsideLawyer, #RecLaw, #Rec-Law, #RecLawBlog, #Rec-LawBlog, #RecLawyer, #RecreationalLawyer, #RecreationLaw, #RecreationLawBlog, #RecreationLawcom, #Recreation-Lawcom, #Recreation-Law.com, #RiskManagement, #RockClimbing, #RockClimbingLawyer, #RopesCourse, #RopesCourseLawyer, #SkiAreas, #Skiing, #SkiLaw, #Snowboarding, #SummerCamp, #Tourism, #TravelLaw, #YouthCamps, #ZipLineLawyer, #RecreationLaw, #OutdoorLaw, #OutdoorRecreationLaw, #SkiLaw, Outdoor Recreation Insurance Risk Management and Law, Jim Moss, James H. Moss, James Moss,


Stand Up Paddleboard case. Rental company was not liable for the death of renter who could not swim.

Release and assumption of the risk were both used to defeat the plaintiff’s claims.

Citation: Kabogoza v. Blue Water Boating, Inc., et al

State: California, United States District Court, E.D. California

Plaintiff: Mary Bacia Kabogoza, on behalf of herself and the Estate of Davies Khallit Kabogoza

Defendant: Blue Water Boating, Inc., Skip Abed and ten “Roe” defendants

Plaintiff Claims: wrongful death, negligence, and gross negligence

Defendant Defenses: Assumption of the Risk and Release

Holding: For the Defendant

Year: 2019

Summary

A renter of a stand-up paddleboard drowned after falling off his board. He did not use the free leash and wore his inflatable PFD incorrectly so it did not work.

The court found the plaintiff assumed the risk and had signed a release preventing his survivors from suing.

Facts

In April 2017, Davies Kabogoza and his friend, Laura Tandy, rented stand-up paddleboards from Defendant Blue Water Boating. Kabogoza had rented paddleboards from this rental company before. He was familiar with the staff, but had never told them that he could not swim.

Kabogoza and Tandy signed a rental agreement before taking out the paddleboards. The one-page agreement included several general and SUP-specific safety rules, along with a release of liability. Upon signing the agreement, the rental company-per Kabogoza’s request-gave him and Tandy intermediate-level paddleboards and belt-pack flotation devices. Regular life vests were also available, but Defendants allow their customers to choose between the two options. Belt-pack flotation devices are “very popular” among paddle boarders, but customers often wear them incorrectly, with the flotation portion of the device facing backwards. Id. Plaintiff alleges that Kabogoza was wearing his incorrectly at the time of the accident.

Defendants also gave its customers the option of using a paddleboard leash. Defendant Skip Abed, the owner of Blue Water Boating, told an investigator that 9 out of 10 times, customers do not want a leash. Neither Kabogoza nor Tandy used a leash while paddleboarding.

Shortly after Kabogoza and Tandy began using their paddleboards in the Santa Barbara Harbor, the wind increased, and the water became choppy. Tandy was in front of Kabogoza when she heard a splash behind her. When she turned around, she saw that Kabogoza had fallen off his board, and was struggling to keep his head above water. Tandy was unable to reach Kabogoza and prevent him from drowning. A dive team later found his body at the bottom of the ocean in about 30 feet of water. Id. When the divers found him, Kabogoza’s flotation device was attached to his waist, but in the backwards position. An inspection revealed that the device was in “good working order.”

The defendants filed a motion to dismiss, which was granted by the district court.

Analysis: making sense of the law based on these facts.

The court first looked at the gross negligence claim of the plaintiffs. Under California law, gross negligence is defined as “the want of even scant care or an extreme departure from the ordinary standard of conduct.” The court then went on to reiterate the California Supreme Court issue of disposing of gross negligence claims that do not meet the definition.

The court then looked at the defense of assumption of the risk. The plaintiffs plead admiralty and state law claims in this lawsuit. Each has different types of claims and different defenses and defenses to state law claims do not work in admiralty cases and vice versa. The court waded through the differences in each of the defenses presented by the defendant.

Assumption of the risk is not a defense to an admiralty law claim. Assumption of the risk is a defense to state law claims. The court then went back to the gross negligence claim and found the facts pleaded by the plaintiff did not rise to the level of gross negligence.

The next claim of the plaintiffs was a wrongful death claim. A wrongful death claim is a claim of the survivors of the deceased. However, any defense to a claim by the deceased is a bar to a wrongful death claim.

Because the rental agreement signed by the deceased included release language, it was a bar to the wrongful death claim of the deceased survivors.

So Now What?

First, this is a stand-up paddleboard rental; however, the court did not treat it any differently than the rental of any other boat.

The knowledge that renters might wear their PFDs incorrectly is disconcerting. I would counsel clients to at least post a sign or something showing people the proper way to wear their PFDs.

I also think a leash would be required to make sure the boards come back. Fall off your board and the currents will send it away faster than you can swim and the rental company has lost another SUP.

However, tragic this accident, legally the result was correct I believe.

James H. "Jim" Moss, JD, Attorney and Counselor at Law

James H. “Jim” Moss

Jim Moss is an attorney specializing in the legal issues of the outdoor recreation community. He represents guides, guide services, and outfitters both as businesses and individuals and the products they use for their business. He has defended Mt. Everest guide services, summer camps, climbing rope manufacturers, avalanche beacon manufacturers, and many more manufacturers and outdoor industries. Contact Jim at Jim@Rec-Law.us
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Kabogoza v. Blue Water Boating, Inc., et al.,

To Read an Analysis of this decision see: Stand Up Paddleboard case. Rental company was not liable for the death of renter who could not swim.

Kabogoza v. Blue Water Boating, Inc., et al.,

Mary Bacia Kabogoza, on behalf of herself and the Estate of Davies Khallit Kabogoza, Plaintiff,

v.

Blue Water Boating, Inc., et al., Defendants.

No. 2:18-cv-02722-JAM-KJN

United States District Court, E.D. California

April 5, 2019

ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS AND DECLARING PLAINTIFFS’ CROSS-MOTION FOR SUMMARY JUDGMENT MOOT

JOHN A. MENDEZ, UNITED STATES DISTRICT JUDGE.

On October 9, 2018, Mary Kabogoza (“Plaintiff”) filed a complaint against Blue Water Boating, Inc., Skip Abed, and ten “Roe” defendants (“Defendants”). Compl., ECF No. 1. Plaintiff brought a wrongful death claim on her own behalf, and a survival action for negligence on behalf of her deceased husband, Davies Kabogoza. Compl. ¶¶ 8-17. She amended the complaint a month later to replace the negligence claim with a claim for gross negligence. See First Am. Compl. (“FAC”) ¶ 22-29, ECF No. 4. Plaintiff properly invokes the Court’s diversity jurisdiction and admiralty jurisdiction. FAC ¶ 1 (citing 28 U.S.C. §§ 1332, 1333).[1]

Defendants filed a motion to dismiss both of Plaintiff’s claims. Mot. to Dismiss (“Mot.”), ECF No. 6. Plaintiff opposed Defendants’ motion, and filed a Motion for Partial Summary Judgment. Opp’n to Mot. to Dismiss and Cross-Mot. for Partial Summ. J. (“Cross-Mot.”), ECF No. 8. Defendants opposed Plaintiff’s motion. Opp’n to Cross-Mot. and Reply (“Opp’n”), ECF No. 9. Plaintiff, however, never filed a reply to Defendants’ opposition.

For the reasons discussed below, the Court grants in part and denies in part Defendants’ Motion to Dismiss. The Court denies Plaintiff’s Motion for Summary Judgment.

I. FACTUAL ALLEGATIONS

In April 2017, Davies Kabogoza and his friend, Laura Tandy, rented stand-up paddleboards from Defendant Blue Water Boating. FAC ¶ 6. Kabogoza had rented paddleboards from this rental company before. FAC ¶ 7. He was familiar with the staff, but had never told them that he could not swim. FAC ¶ 14.

Kabogoza and Tandy signed a rental agreement before taking out the paddleboards. FAC ¶ 18. The one-page agreement included several general and SUP-specific safety rules, along with a release of liability. FAC, Ex. A. Upon signing the agreement, the rental company-per Kabogoza’s request-gave him and Tandy intermediate-level paddleboards and belt-pack flotation devices. FAC ¶¶ 7, 10, 15. Regular life vests were also available, but Defendants allow their customers to choose between the two options. FAC ¶ 14. Belt-pack flotation devices are “very popular” among paddle boarders, but customers often wear them incorrectly, with the flotation portion of the device facing backwards. Id. Plaintiff alleges that Kabogoza was wearing his incorrectly at the time of the accident. FAC. ¶ 13.

Defendants also gave its customers the option of using a paddleboard leash. FAC ¶ 16. Defendant Skip Abed, the owner of Blue Water Boating, told an investigator that 9 out of 10 times, customers do not want a leash. Id. Neither Kabogoza nor Tandy used a leash while paddleboarding. FAC ¶ 19.

Shortly after Kabogoza and Tandy began using their paddleboards in the Santa Barbara Harbor, the wind increased, and the water became choppy. FAC ¶ 9. Tandy was in front of Kabogoza when she heard a splash behind her. Id. When she turned around, she saw that Kabogoza had fallen off his board, and was struggling to keep his head above water. Id. Tandy was unable to reach Kabogoza and prevent him from drowning. Id. A dive team later found his body at the bottom of the ocean in about 30 feet of water. Id. When the divers found him, Kabogoza’s flotation device was attached to his waist, but in the backwards position. FAC ¶ 12. An inspection revealed that the device was in “good working order.” Id.

II. OPINION

A. Defendants’ Motion to Dismiss

1. Legal Standard

Federal Rule of Civil Procedure 8(a)(2) requires a “short and plain statement of the claim showing that the pleader is entitled to relief.” A court will dismiss a suit if the plaintiff fails to “state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). When considering a motion to dismiss, the Court “must accept as true all of the allegations contained in a complaint.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). It is not, however, “bound to accept as true a legal conclusion couched as a factual allegation.” Id. A court may consider documents whose contents are alleged in or attached to the complaint if no party questions the documents’ authenticity. Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005).

2. Analysis

a. Choice of Law

Plaintiff’s claims arise out of this Court’s admiralty jurisdiction as well as its diversity jurisdiction. A claim arising in admiralty is governed by federal admiralty law. Yamaha Motor Corp., U.S.A. v. Calhoun, 516 U.S. 199, 206 (1996). Ordinarily, a court may not supplement maritime law with state law when the state’s law “will not work material prejudice to the characteristic features of the general maritime law, nor interfere with the proper harmony and uniformity of that law.” Id. at 207 (quoting Western Fuel Co. v. Garcia, 257 U.S. 233, 242 (1921)). However, admiralty law does not provide a cause of action for wrongful death or survival suits independent of the remedies provided by state law. Id. at 206. Thus, in admiralty, “state statutes provide the standard of liability as well as the remedial regime” for wrongful death and survival actions. Id. To the extent that Plaintiff’s claims arise under the Court’s admiralty jurisdiction, California law applies.

When a claim arises out of the court’s diversity jurisdiction, the court applies the substantive law of the forum state. Erie R. Co. v. Tompkins, 304 U.S. 64, 78 (1938). But if the dispute is covered by a valid choice-of-law clause, the laws of the contractually-designated state applies. PAE Government Services, Inc. v. MPRI, Inc., 514 F.3d 856, 860 (9th Cir. 2007). Here, the law of the forum and the law designated by the rental agreement’s choice-of-law clause are the same. See FAC, Ex. A. California law applies to the claims arising out of this Court’s diversity jurisdiction.

b. Gross Negligence

Plaintiff has not stated a claim for gross negligence. Gross negligence is defined as “the want of even scant care or an extreme departure from the ordinary standard of conduct.” Id. (quoting Kearl v. Board of Med. Quality Assurance, Cal.App.3d 1040, 1052-53 (1986). The California Supreme Court has emphasized “the importance of maintaining a distinction between ordinary and gross negligence, ” and disposing of cases on that bases “in appropriate circumstances.” City of Santa Barbara, 41 Cal.4th at 766.

Defendants first argue that Plaintiff’s claim should be dismissed because it is barred by the assumption-of-risk doctrine. Mot. at 9-11. The Court disagrees. To the extent that the claim is arising out of the Court’s admiralty jurisdiction, maritime tort law does not adopt California’s approach to this doctrine. Barber v. Marina Sailing, Inc., 36 Cal.App.4th 558, 568-69 (1995). Assumption of risk, be it express or implied, may not serve as a bar to claims that arise under admiralty law. Id. at 568 (“Numerous federal cases have held in a variety of contexts that assumption of [] risk is not permitted as an affirmative defense in admiralty law.”). While true that California law governs the standard of liability and the remedial regime for survival actions, Defendants do not identify any cases to suggest that Yamaha likewise intended state law to modify the defenses available in admiralty. To the extent that Plaintiff’s gross negligence claim arises under the Court’s admiralty jurisdiction, assumption of risk does not bar the action.

Assumption of risk likewise does not preclude Plaintiff’s gross negligence claim arising under the Court’s diversity jurisdiction. Although California law recognizes assumption of risk as a bar to recovery under some circumstances, it does not allow a party to release itself from liability for gross negligence. City of Santa Barbara v. Super. Ct., 41 Cal.4th 747, 779 (2007). To the extent that Plaintiff’s gross negligence claim arises under the Court’s diversity jurisdiction, assumption of risk, again, does not bar the action. For the same reason, the exculpatory clause in Defendants’ rental agreement does not bar Plaintiff’s survival action for gross negligence. So long as the allegations in the complaint support a plausible claim for relief, Plaintiff’s claim must survive Defendant’s motion to dismiss.

But even when accepted as true, Plaintiff’s allegations do not state a plausible gross negligence claim. Plaintiff alleges that Defendants’ gross negligence is reflected in the following omissions:

• Failing to ask Kabogoza about his swimming abilities before renting him a paddleboard;

• Failing to warn Kabogoza of the danger of using and/or misusing the paddleboard and belt-pack flotation device;

• Failing to ensure that Kabogoza was leashed to the paddleboard while using it; and

• Failing to ensure that Kabogoza knew how to use the paddleboard and belt-pack flotation device.

FAC ¶ 25.[2]

These omissions, when viewed in light of the circumstances surrounding this incident, might give rise to a colorable negligence claim had Kabogoza not released Defendants of liability. But they do not rise to the level of culpability found in the cases Plaintiff cites where gross negligence claims survived motions to dismiss. See Cross-Mot. at 10-11. In City of Santa Barbara, the court found that the plaintiff’s claim for gross negligence properly fell outside the defendant’s exculpatory clause when a young girl with epilepsy drowned at defendant’s camp for developmentally-disabled children. 41 Cal.4th at 751-52. The girl’s parents had told the city that their daughter was prone to seizures while in the water and required constant supervision. Id. at 752. Even so, a camp supervisor- knowing the girl had suffered from a seizure less than an hour earlier-diverted her attention while the child was swimming. Id. The girl had a seizure and drowned. Id.Mayall v. USA Water Polo,Inc., 909 F.3d 1055 (9th Cir. 2018) and Lewis v. Mammoth Mountain Ski Area, No. 1:07-cv-00497-OWW-GSA, 2009 WL 426595 (E.D. Cal. Feb. 20, 2009) involved similarly culpable omissions.

The defendants here differ from the defendants in City of Santa Barbara, Mayall, and Lewis in several important respects. First, Defendants knew that Kabogoza had safely engaged in paddleboarding before. FAC ¶ 9. Unlike in City of Santa Barbara, where defendant knew the decedent had a history of having seizures in the water; Mayall, where defendant knew water-polo players were dangerously returning to play after suffering concussions; and Lewis, where the employee knew he was leading beginner snowmobilers, Defendants had no reason to know that Kabogoza was at an increased risk of harm. In fact, Defendants knew that he had a history of safely participating in this activity. FAC ¶ 9. Kabogoza rented paddleboards from Blue Water Boating on up to three previous occasions. Id.

Furthermore, Defendants equipped all of their customers with safety information and safety equipment regardless of their skill level. FAC ¶¶ 6, 16. Defendants made sure that each renter signed a rental agreement that included clear safety instructions about the products it rented. FAC, Ex. A. Defendants gave each of their customers flotation devices to protect against the inherent and inevitable risk of falling into the ocean. FAC ¶ 6. They also made paddleboard leashes available to all their customers even though nine out of ten renters opted not to use them. FAC ¶ 16.

Plaintiff makes much of the fact that Defendants did not ask about each customer’s swimming abilities or require each customer to have use a leash. FAC ¶ 25; Cross-Mot. at 11. Nor did Defendants specifically work with its customers to ensure they were correctly using the flotation devices. FAC ¶ 25; Cross-Mot. at 11. Rental companies can, of course, always do more to ensure that their customers have the safest possible experience. And when those companies’ rentals involve the level of risk that gives way to this sort of tragedy, they likely should. But the law does not task the Court with answering that question today. Here, the question is whether Defendants acted with “a ‘want of even scant care’ or ‘an extreme departure from the ordinary standard of conduct.’ ” Based on Plaintiff’s pleadings, the Court cannot find that they did.

The Court dismisses Plaintiff’s gross negligence claim without prejudice.

c. Wrongful Death

Plaintiff has not stated a wrongful death claim. Nor did she meaningfully oppose Defendants’ motion to dismiss this claim. California law governs wrongful death claims regardless of whether the claim arises under the court’s diversity or admiralty jurisdiction. Yamaha Motor Corp., 516 U.S. At 206-07. To support a claim of negligent wrongful death under California law, “a plaintiff must establish the standard elements of negligence: defendants owed a duty of care; defendants breached their duty; and defendants’ breach caused plaintiff’s injury.” Hayes v. Cnty.of San Diego, 736 F.3d 1223, 1231 (9th Cir. 2013) (citing Wright v. City of Los Angeles, 219 Cal.App.3d 318, 344 (1990)).

A wrongful death action-unlike claims brought under the state’s survival statute-belong to the decedent’s heirs, not to the decedent. Madison v. Super. Ct., 203 Cal.App.3d 589, 596 (1988). All the same, “a plaintiff in a wrongful death action is subject to any defenses which could have been asserted against the decedent.” Id. at 597. These defenses include a decedent’s decision “to waive the defendant’s negligence and assume all risks.” Id.

Here, Kabogoza signed a rental agreement where he expressly assumed the risks of paddleboarding and released Defendants of liability. FAC, Ex. A. To the extent that the assumption-of-risk and exculpatory clauses purport to release Defendants from liability for ordinary negligence, they are valid. See FAC, Ex. A. See also City of Santa Barbara, 41 Cal.4th at 755-58; Knight v. Jewett, 3 Cal.4th 296, 319-21 (1992). And as already discussed, Plaintiff does not make a showing of gross negligence that would bring her wrongful death action outside the rental agreement’s scope.

The rental agreement precludes Plaintiff from making out a claim of ordinary negligence. To the extent that her wrongful death claim is predicated on Defendants’ ordinary negligence, the Court dismisses it with prejudice.

B. Plaintiff’s Cross-Motion for Summary Judgment

The Court has dismissed the gross negligence claim covered by Plaintiff’s Motion for Partial Summary Judgment. The arguments raised in Plaintiff’s motion are, therefore, moot.

III. ORDER

For the reasons set forth above, the Court GRANTS Defendants’ Motion to Dismiss. Plaintiff’s gross negligence claim is DISMISSED WITHOUT PREJUDICE. If Plaintiffs elect to amend their complaint with respect to these claims, they shall file a Second Amended Complaint within twenty (20) days of this Order. Defendants’ responsive pleading is due twenty (20) days thereafter. Plaintiff’s wrongful death claim is DISMISSED WITH PREJUDICE to the extent that it is based on Defendants’ ordinary negligence.

The Court DENIES AS MOOT Plaintiff’s Motion for Summary Judgment on her gross negligence claim.

IT IS SO ORDERED.

———

Notes:

[1] This motion was determined to be suitable for decision without oral argument. E.D. Cal. L.R. 230(g). The hearing was scheduled for February 19, 2019.

[2] Plaintiff also alleges that Defendants breached a duty to Kabogoza by failing to safely manufacture the paddleboard and flotation device, and by failing to timely issue recalls of the defective products. FAC ¶ 25. But to date, Plaintiff has not joined any manufacturers or distributors as defendants.

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