Appeals court orders hearing in Oklahoma towboat case

Wednesday, February 25th 2004, 12:00 am
By: News On 6

DENVER (AP) -- A federal court on Tuesday ordered that a lawsuit by the state of Oklahoma against a towboat company in a deadly bridge collapse be sent back to state court.

A three-judge panel of the 10th U.S. Circuit Court of Appeals agreed with Magnolia Transport Co. that transferring the lawsuit from state to federal court didn't violate the state's rights under the 11th Amendment.

But the judges rejected the Mississippi company's contention that removal of the case was also warranted under a federal maritime law.

The panel directed the U.S. District Court in Oklahoma to consider other reasons for a change in jurisdiction.

At issue is the towboat company's attempts to limit its liability in the May 26, 2002, bridge collapse to no more than $1.2 million. The state is seeking $58 million for repairs, search and rescue and numerous other damages related to the collision.

The towboat rammed two barges into the Interstate 40 bridge over the Arkansas River near Webbers Falls. The roadway collapsed, sending 14 people to their deaths in the water below.

Lawyers for Magnolia Marine argued the 1851 Limitation of Shipowner's Liability Act limits the amount of liability in the state's claims for damages.

State attorneys countered the state is immune from the federal law under the Constitution's 11th Amendment.

The judges agreed with the lower court's ruling that the state couldn't assert immunity to block transfer of the case to federal courts.

But they said the law limiting shipowners' liability includes qualifications and that arguments from both sides deserve a more thorough hearing.