In a recent update, we discussed the Louisiana Supreme Court’s June 29, 2022 holding in Martin v. Thomas which allows a plaintiff to pursue simultaneous claims of direct negligence and vicarious liability against an employer where its employee allegedly injures another.
As anticipated, the U.S. Fifth Circuit addressed the issue as well, with their holding in Fox v. Nu Line Transport putting the nail in coffin for employers’ “written stipulation rule.” In Fox, the 5th Circuit eliminates the stipulation rule in all jurisdictions applying Louisiana law, adopting the reasoning from Martin v. Thomas. As we discussed, the Louisiana Supreme Court in Martin held that a plaintiff can simultaneously maintain an action for vicarious liability and direct negligence against an employer for its employee’s negligence arising out of the same incident that occurred in the course and scope of employment, even where the employer stipulates that the negligent employee was in the course and scope of employment. This holding effectively expands employers’ exposure from the limited negligent conduct of its employees to a much broader range of claims involving negligent hiring, training, retention and supervision. In Fox, the U.S. Fifth Circuit adopted the Martin rule for federal courts. Consequently, employers across all industries should be on the offensive for updating policies and procedures as well as coverage in anticipation of the effect of Martin and Fox.