A dispute involving a Florida marina and a make-shift floating abode makes an improbable appearance at the Supreme Court on Monday to answer the question—and casinos, bankers and the Coast Guard are among those watching.
The case marks the latest attempt by the justices to clarify what types of structures qualify as vessels, a question that goes back to the early days of the republic.
The issue can trigger application of federal maritime law, which sets out special rules designed to account for the unique circumstances of life at sea. Seamen, for example, are entitled to special legal rights because of the hazards of their work. The gambling industry hopes to avoid slot-machine repairmen and blackjack dealers on floating casinos getting the same maritime rights.
The case is being argued on the opening day of the court’s 2012-13 term, which is likely to see major opinions on affirmative action and gay marriage as well as antitrust cases of importance to businesses, including one in which Philadelphia-area customers claim Comcast Corp. CMCSA -0.11% had an anticompetitive grip on the cable-TV service.
The houseboat case of Fane Lozman is a reminder that some cases with business consequences don’t have a big corporate litigant. The southern Florida city of Riviera Beach invoked U.S. maritime law to have Mr. Lozman’s two-story floating home “arrested” by a U.S. marshal and towed away from a city-owned marina in 2009.
The city says Mr. Lozman, 51 years old, refused to bring his home into compliance with new marina-safety requirements. Riviera Beach prevailed in a federal trial court, took ownership of the structure and later had it destroyed.
Mr. Lozman, who says he still hasn’t established a new permanent residence, says the city stretched the common-sense understanding of a vessel in order to transform a local dispute into a federal matter. He says his home, which had been towed to the marina and was moored with cables, had no steering or motor propulsion.
“This was a plywood shack. Everything in it came from Home Depot,” says Mr. Lozman, a financial-software developer who represented himself in court for much of the case. “A lot of things will float. That doesn’t make it a practical means of transportation.”
The two sides tangled almost from the moment Mr. Lozman arrived in the marina in 2006. He says city officials targeted him because he successfully fought a marina redevelopment plan that the city proposed the year he arrived. Riviera Beach tried to evict him in state-court proceedings and lost, with a jury in 2007 saying the city’s actions were motivated at least in part by his opposition to the redevelopment.
Two years later, city lawyers went to federal court with City of Riviera Beach v. That Certain Unnamed Gray, Two-Story Vessel Approximately Fifty-Seven Feet in Length, Her Engines, Tackle, Apparel, Furniture, Equipment and All Other Necessaries Appertaining and Belonging in Rem.
Washington lawyer David Frederick, who will argue Monday for Riviera Beach, says Mr. Lozman wasn’t complying with regulations that applied to all marina users and that the best way to pursue the violations was suing the vessel under federal maritime law.
“The vessel here is what creates the hazard,” he says, because if it came unmoored in a storm and damaged other property, the city would get sued.
The city in briefs argues that a vessel is any structure that is practically capable of moving people or things over water. The Atlanta-based 11th U.S. Circuit Court of Appeals sided with the city last year and ruled Mr. Lozman’s house was a vessel. The court noted that the structure had been transported over water, via tow, several times. The court said it didn’t matter that the structure wasn’t intended to be a vessel.
Stanford University law professor Jeffrey Fisher, who will argue for Mr. Lozman, says the 11th Circuit’s standard could mean that even floating restaurants or hotels could be considered vessels and subject to maritime law.
That is where the casinos come in. The American Gaming Association filed a brief supporting Mr. Lozman, saying a win for the city could undermine recent court rulings that said dockside casinos weren’t vessels. The group pointed to a 2011 Louisiana case in which a drunken casino customer failed in her bid to sue under maritime law for injuries she suffered in a fall. It also said courts have rejected attempts by casino employees to take advantage of maritime legal protections intended for seamen and harbor workers.
The federal government also sided with Mr. Lozman, saying the 11th Circuit’s approach would force the Coast Guard to inspect more “vessels” and divert resources from “structures that are far more relevant to maritime safety.”
The city’s supporters include a carpenters’ union and the National Marine Bankers Association, which says the city’s definition of a vessel is simple to understand and makes marine lending easier. The banking group said a win for Mr. Lozman could lead to tighter credit.”Lenders would have no idea at the time of making a marine loan whether the watercraft they seek to lend against is a vessel, real estate, personal property or something else,” the group said in a brief.
A decision is expected by the end of June.