By Melisse Speligene

Introduction

In Thomas v. Housing Louisiana Now, LLC, (Thomas) the Louisiana Supreme Court was asked to resolve what was thought to be a straightforward breach of contract dispute that ultimately raised fundamental questions about the limits of contractual damages and the relationship between contract and quasi-contract in the Louisiana Civil Code.[1] In this case, Maxine Thomas, a homeowner in New Orleans, entered into a written agreement with Housing Louisiana Now, LLC (HLN) to repair her home after it sustained severe tornado damage.[2] Under the written contract, Thomas was obligated to pay HLN an upfront sum of $83,597.03, which she did, in exchange for HLN completing the repairs.[3] HLN did not carry out the repairs directly, but instead hired a subcontractor to perform the work.[4] The subcontractor, Master Builders & Contractors LLC (MBC), ultimately completed the project and the trial court found that the repairs were properly performed.[5]

Despite this outcome, Thomas sued HLN for breach of contract, alleging nonperformance and delay.[6] Following trial, the district court found HLN in breach and awarded Thomas damages equal to the entire amount she had paid under the contract—$83,597.03.[7] In effect, the judgment allowed Thomas to recover her payment in full while also retaining the benefit of the completed repairs.[8] HLN appealed, but the Louisiana Fourth Circuit Court of Appeal affirmed the district court’s ruling in all respects, reasoning that HLN had received payment for work it did not itself perform and was therefore bound to return the funds.[9]

The Louisiana Supreme Court granted certiorari, signaling the significance of the legal issues presented.[10] Yet, in a very brief opinion, the majority affirmed the judgments of the lower courts, concluding simply that HLN had breached its contractual obligations and was liable for the damages awarded.[11] The majority did not address the Civil Code’s requirements that contractual damages be proven to flow from the obligor’s breach, nor did it confront the implications of permitting a plaintiff to recover both the benefit of the contract and the return of her payment.[12]

Justice Crain, joined in dissent by Justices Hughes and McCallum, adamantly rejected the majority’s approach.[13]The dissent emphasized that Thomas failed to prove she suffered recoverable damages under the Civil Code, since she had ultimately received the repairs she contracted for.[14] By affirming the award, the majority effectively allowed a duplicative recovery that Louisiana law has long prohibited.[15] Moreover, the dissent criticized the lower courts’ reliance on Civil Code article 2299—governing “enrichment without cause”—to justify the refund.[16] That article, Justice Crain explained, applies only when a payment is made absent a valid contractual obligation, which was not the case here.[17]By applying quasi-contract principles where a valid contract existed, the lower courts and majority undermined the coherence of Louisiana’s law of obligations.[18]

The implications of the Court’s decision here extend far beyond the immediate parties. By blurring the line between contractual and quasi-contractual remedies, the majority risks destabilizing the Civil Code’s carefully established system for addressing breaches of contract. The decision may encourage litigants to seek windfalls and invite courts to conflate distinct areas of obligations law. The dissent in Thomas offers a sounder approach by insisting on proof of actual damages, rejecting the misapplication of quasi-contract, and prohibiting double recovery. Justice Crain’s dissenting opinion better serves Louisiana’s civil law tradition and the principles of fairness that uphold it. Ultimately, The Louisiana Supreme Court should reevaluate its conclusion in this case.

I. Contract Damages Require Proof of Loss

Louisiana law has long required that damages for breach of contract be tied to an actual demonstrable loss. The Civil Code provides that an obligor who fails to perform is liable only for the damages caused by that failure.[19] Article 1994 states plainly that “[a]n obligor is liable for the damages caused by his failure to perform.”[20] Likewise, article 2769, which governs contracts for work, instructs that damages are owed when the contractor “fails to do the work he has contracted to do, or if he does not execute it in the manner and at the time he has agreed to do it.”[21] Together, these provisions establish that damages are compensatory in nature: they are intended to place the obligee in the position she would have occupied had the contract been properly performed, but no further.

The Louisiana Supreme Court in Thomas affirmed the lower courts’ judgment finding HLN in breach of contract and awarding Maxine Thomas $83,597.03 in damages.[22] The majority’s opinion, however, offered little reasoning beyond a blanket statement that “there is no error” in the judgments below.[23] By adopting this approach, the Court left undisturbed an award that effectively allowed Thomas to receive both the benefit of her bargain—the home repairs that were completed to her satisfaction—and the return of the full contract price.[24] Justice Crain’s dissent directly confronted this result as inconsistent with the Civil Code’s requirements for recovery of damages in breach of contract cases.[25] Under Louisiana Civil Code articles 1994 and 2769, a plaintiff may recover only for damages actually caused by the obligor’s failure to perform.[26]

In Thomas’s case, the trial court expressly found that the home repairs were properly completed—not by HLN itself, but by another contractor to whom HLN transferred the funds.[27] The dissent highlighted this key fact: Thomas did not suffer a loss of the value of the work performed.[28] The only damages awarded were the $83,597.03 contract price she had paid, but this amount was not a loss—it was the amount she had agreed to pay in exchange for repairs that were ultimately provided.[29] As Justice Crain observed, this judgment resulted in a “windfall”—Thomas received the agreed-upon repairs and her money back.[30]

By ignoring the proof-of-loss requirement, the majority departed from the core principles of Louisiana’s contract law.[31] The Civil Code does not allow recovery simply because a technical breach occurred; damages flow only from proven injury caused by that breach.[32] The dissent’s approach, therefore, better aligns with Louisiana’s civilian tradition by preventing duplicative recovery and preserving the balance between obligor and obligee.

II. Misapplication of Quasi-Contract Principles

To sustain the award, the lower courts invoked Civil Code article 2299, which provides that “[a] person who has received a payment or a thing not owed to him is bound to restore it to the person from whom he received it.”[33]Framing HLN’s retention of Thomas’s payment as “a thing not owed,” the courts reasoned that HLN must return the $83,597.03 even though the work was ultimately completed.[34] The Louisiana Supreme Court majority, by affirming without discussion, implicitly endorsed this reasoning.[35]

Justice Crain’s dissent exposes the doctrinal flaws in this approach.[36] As he explained, article 2299 falls within the Civil Code’s provisions on obligations “arising without agreement.”[37] These quasi-contractual remedies—such as actions like unjust enrichment or return of a thing not owed—apply only where no valid contract governs the parties’ relationship.[38] They are not designed to displace contract law when a valid and enforceable agreement exists.[39]Article 2300 reinforces this boundary by clarifying that a “thing not owed” exists only when something is paid to discharge an obligation that does not exist.[40]

In this case, Thomas’s payment to HLN was not gratuitous or mistaken—it was made pursuant to a valid, binding contract.[41] HLN’s later breach did not retroactively transform the payment into something “not owed.”[42] Rather, the payment discharged an existing contractual obligation.[43] As Justice Crain emphasized, the appropriate remedy for a breach of contract lies within the Civil Code provisions governing contractual damages, not quasi-contract.[44] Allowing a plaintiff to use article 2299 in place of traditional contract remedies undermines the integrity of Louisiana’s civilian system, where each body of law—contracts, torts, and quasi-contracts—operates within defined boundaries.[45]

By permitting recovery under article 2299, the lower courts blurred this boundary and allowed Thomas to circumvent the burden of proving actual damages caused by HLN’s breach.[46] In doing so, the courts not only misapplied the Civil Code but also created the possibility of inconsistent and inequitable outcomes in future cases. Justice Crain’s dissent thus serves as a corrective approach, reminding courts that quasi-contractual remedies are not an alternative to contractual remedies, rather they are a last resort available only when no valid contract governs the dispute.

III. Policy and Fairness: Avoiding Double Recovery

Beyond doctrinal consistency, Justice Crain’s dissent underscores the policy dangers of the majority’s decision. By affirming the damages award, the Louisiana Supreme Court effectively sanctioned double recovery as Thomas received both the completed home repairs and a full refund of the contract price.[47] This outcome goes against the most basic principle of Louisiana law—to provide compensation, not enrichment.[48]

The Civil Code has long rejected the notion that a party may recover more than the actual loss sustained.[49]Articles 1994 and 1995 emphasize that damages are measured by the loss suffered or the profit of which the obligee has been deprived, not by the mere occurrence of breach.[50] In other words, damages serve to make the plaintiff whole, not to provide a windfall. By allowing Thomas to keep both the repairs and her payment, the majority departed from this principle and imposed a disproportionate penalty on HLN.[51]

Justice Crain also highlighted how this approach destabilizes contractual relationships.[52] If plaintiffs are permitted to recover contract payments in addition to receiving performance, contractors face liability wholly disconnected from the loss actually caused.[53] Such a rule could discourage efficient arrangements, such as subcontracting, and incentivize opportunistic claims. The result is an erosion of predictability and fairness—values central to Louisiana’s civil law tradition.

In contrast, the dissent’s framework preserves balance. By requiring proof of loss and rejecting quasi-contract as a shortcut, Justice Crain’s approach ensures that remedies correspond to actual harm, protecting both parties’ rights and maintaining coherence in Louisiana obligations law. The restraint not only aligns with codal text but also prevents courts from expanding liability in ways that risk economic distortion and inequitable outcomes.

Conclusion

The Louisiana Supreme Court’s decision in Thomas v. Housing Louisiana Now, LLC illustrates the risks of drifting away from the Civil Code’s established contract principles. By affirming damages without requiring proof of actual loss, the majority effectively allowed Thomas to receive both completed repairs and a full refund, a result that strains the logic of contract remedies and undermines the prohibition against double recovery.

Justice Crain’s dissent restores coherence to the law. He grounds his analysis in the core provisions of the Civil Code, insisting that plaintiffs must show damages caused by the breach itself, not simply point to the existence of a breach.[54]His reasoning avoids the misapplication of quasi-contractual doctrines and preserves the balance between fairness and predictability in private agreements.

Ultimately, the dissent better reflects Louisiana’s civilian tradition: remedies must flow from the law of contracts when a valid agreement exists. Respecting this principle ensures clarity, fairness, and fidelity to the Civil Code. The Louisiana Supreme Court should reconsider its ruling and instead adopt the reasoning of Justice Crain’s dissent, which faithfully applies the Civil Code’s requirement of proven damages and prevents unjust windfalls tht distort the balance of contractual obligations.

[1] See generally Thomas v. Hous. La. Now, LLC, 403 So. 3d 570 (La. 2025).

[2] Thomas v. Hous. La. Now, LLC, 414 So. 3d 509, 511 (La. App. 4th Cir. 2024).

[3] Id.

[4] Id.

[5] Id.

[6] Id.

[7] Id. at 515.

[8] Thomas v. Hous. La. Now, LLC, 403 So. 3d 570 (La. 2025) (Crain, J., dissenting).

[9] Thomas, 414 So. 3d at 515.

[10] Thomas, 403 So. 3d at 570.

[11] Id.

[12] Id.

[13] Id. at 572 (Crain, J., dissenting).

[14] Id. at 571 (Crain, J., dissenting).

[15] Id. at 570 (Crain, J., dissenting).

[16] Id. at 571 (Crain, J., dissenting).

[17] Id. at 571–72 (Crain, J., dissenting).

[18] Id. at 572 (Crain, J., dissenting).

[19] See generally La. Civ. Code art. 1994 (2010).

[20] Id.

[21] Id. art. 2769.

[22] Thomas, 403 So. 3d at 570.

[23] Id.

[24] Id. at 570–71 (Crain, J., dissenting).

[25] Id. at 571 (Crain, J., dissenting).

[26] See La. Civ. Code art. 1994 (2010); id.  art. 2769.

[27] Thomas v. Hous. La. Now, LLC, 414 So. 3d 509, 512 (La. App. 4th Cir. 2024); see also Thomas, 403 So. 3d at 571 (Crain, J., dissenting).

[28] Thomas, 403 So. 3d at 571 (Crain, J., dissenting).

[29] Id.

[30] Id. at 570 (Crain, J., dissenting).

[31] See generally La. Civ. Code art. 1994 (2010); see also id. art. 1995.

[32] See generally La. Civ. Code art. 1994; see also id. art. 1995.

[33] La. Civ. Code art. 2299.

[34] Thomas v. Hous. La. Now, LLC, 414 So. 3d 509, 515 (La. App. 4th Cir. 2024).

[35] See Thomas v. Hous. La. Now, LLC, 403 So. 3d 570 (La. 2025).

[36] Id. at 571 (Crain, J., dissenting).

[37] Id.

[38] See Nikolaos A. Davrados, Restating the Civil Law of Quasi-Contract: Negotiorum Gestio and Unjust Enrichment, 15 J. Civ. L. Stud. 1, 3–4(2023).

[39] Id.

[40] See La. Civ. Code art. 2300 (2010).

[41] Thomas, 403 So. 3d at 571 (Crain, J., dissenting).

[42] Id.

[43] Id.

[44] Id. at 571–72 (Crain, J., dissenting).

[45] See Davrados, supra note 38, at 3–4.

[46] Thomas, 403 So. 3d at 571 (Crain, J., dissenting).

[47] Id. at 572 (Crain, J., dissenting).

[48] See Davrados, supra note 38, at 12.

[49] See id. at 97–98.

[50] See La. Civ. Code art. 1994 (2010); see also id. art. 1995.

[51] Thomas, 403 So. 3d at 572 (Crain, J., dissenting).

[52] Id.

[53] Id.

[54] Id.

By Shane Aucoin

Introduction

Louisiana’s Civil Service system is vital in preserving fairness and efficiency in state and local government operations.[1]Without this system, state and local government employees would be subject to discrimination and bias with no avenue for pursuing justice.[2] Civil Service cases have a unique appeal procedure designed to maintain fairness and efficiency.[3] This process is one of the rare occasions in which the Louisiana district courts exercise appellate jurisdiction.[4] A prominent goal of the Civil Service system is to achieve a fair balance of the government’s interests while also protecting state and local government employees.[5] After the Louisiana Supreme Court’s recent decision in Monroe Municipal Fire and Police Civil Service Board v. Brown (Brown), this balance appears to have impermissibly shifted, and the standards for these cases may have been confused.[6]The Brown decision may strip Louisiana district courts of a substantial portion of their unique appellate power in Civil Service cases.[7] Additionally, the Brown decision appears to conflate distinct processes of the Civil Service board and ignore decades of established law.[8]

I. Background

For the first 100 years of the United States’ existence, government employment was “an item of patronage,” and government employees could be hired or dismissed for any reason, even a discriminatory one.[9] After the assassination of President James Garfield in 1881, the “Civil Service reform” began, and a new system of government employment and protection was established.[10] Louisiana’s Civil Service regime provides a system where state and local government employers hire employees based on merit, and protect them from political or religious discrimination and from disciplinary actions taken without cause.[11] All state employees have Civil Service status unless a position is specifically exempted by law.[12] State employees who do not have Civil Service status are: “elected officials,” “city attorneys,” “members of state and city boards, authorities, and commission,” “members of the military or naval forces” and “teaching and professional staffs.”[13] Generally, an employee is considered a classified employee unless listed as an unclassified employee.[14]

Under Louisiana law, individuals holding permanent classified Civil Service positions have a recognized property interest in maintaining their employment.[15] Classified Civil Service employees may not be terminated without procedural due process.[16] Generally, due process requirements vary depending on the circumstances because of the imprecise nature of these situations.[17] “The essential requirements of due process . . . are notice and an opportunity to respond.”[18] “The opportunity to present reasons, either in person or in writing, why proposed action should not be taken is a fundamental due process requirement.”[19]Civil Service protections apply only against termination or other disciplinary actions taken without cause.[20] Louisiana law established distinct Civil Service frameworks, each governing specific categories of employees or governmental entities.[21]

Municipalities with a population size of 13,000 to 250,000 are governed by the Municipal and Police Civil Service law.[22] Under this law, appointing authorities have the statutory power to discipline and terminate employees for cause.[23]Subsequently, affected employees can appeal the disciplinary action to the Civil Service board and assert that the disciplinary action was not taken “in good faith for cause.”[24] If an appointing authority acts “arbitrarily or capriciously,” the disciplinary action is without good faith.[25] When reviewing an appointing authority’s disciplinary action, “a Civil Service commission or board must decide not only if a disciplinary action has been made in good faith for cause, but additionally must make an independent assessment whether the particular punishment imposed is warranted.”[26] In essence, the board must make two distinct determinations: first, whether discipline is warranted, and second, whether the specific disciplinary action imposed is appropriate.[27]

Any employee or appointing authority may appeal from any decision of the Civil Service board.[28] The appeal from the Civil Service board takes place in the district court where the board is domiciled.[29] District courts have the exclusive right to review Civil Service board decisions on appeal unless supervisory writs are sought.[30] The standard for an appeal from the board is whether the board made its decision “in good faith for cause.”[31] Louisiana Revised Statutes section 33:2501 provides the exact same “in good faith for cause” standard in evaluating both the appointing authority’s disciplinary action and the Civil Service board’s decision.[32]

II. Monroe Municipal Fire and Police Civil Service Board v. Brown

In Brown, the Monroe Police Department terminated Officer Reginald Brown because of his conduct during an investigation of an excessive force incident.[33] On July 6, 2020, Timothy Williams filed an excessive force complaint against the Monroe Police Department alleging that Monroe police officers used excessive force when they arrested him.[34] Brown had been the interim police chief for approximately five months at the time Williams filed his excessive force complaint.[35] The day Williams filed the complaint, Brown learned there was bodycam footage showing a Monroe officer kicking “Williams in the head while Williams was lying face‑down on the street with his hands behind his back.”[36] Brown contacted the Monroe city attorney and, after consultation, placed both officers involved in the Williams complaint on administrative leave.[37]

The day the Williams complaint arrived, Brown contacted Monroe Mayor Mayo and informed him of the situation.[38]The next day, Brown instructed the internal affairs division to prepare paperwork to start the administrative investigation into the Williams excessive force complaint.[39] On Thursday, July 9, 2020, the Monroe city attorney called Brown to recommend he direct the investigation to the Louisiana State Police, but Brown declined to do so because the “investigation was already underway and could be handled by the department.”[40] The Monroe mayoral election was set to take place on Saturday, July 11, 2020, where Mayor Mayo was defeated.[41] The following Monday, Brown decided to direct the criminal investigation to the Louisiana State Police, but the state police declined to review the case.[42] The eventual criminal investigation resulted in the arrest of one of the Monroe officers.[43]

Once the new mayor took office, he appointed Eugene Ellis as the new interim police chief.[44] Brown returned to his original rank of corporal and was reassigned to the detective division.[45] On September 4, 2020, Chief Ellis informed Brown of an investigation into potential misconduct that took place during the Williams excessive force investigation and placed Brown on administrative leave.[46] Brown was ordered to submit to an interrogation by an attorney to discuss the timing of the mayoral election in relation to Brown’s decision to request a criminal investigation by the Louisiana State Police.[47] Brown was then ordered to submit to a two hour polygraph examination where there were only three “test” questions to be reviewed by the polygraph examiner.[48] The test questions tested Brown’s motive regarding the mayoral election and the subsequent directing of the criminal investigation to the state police.[49] The polygraph examiner concluded Brown’s answers were “deceptive” and indicated that Brown’s decision to delay the referral request was influenced by the impending mayoral election.[50]

Chief Ellis then ordered Brown to attend a “pre‑disciplinary hearing” because he failed a polygraph examination.[51]Before the hearing, the mayor appointed a permanent police chief, Victor Zordan, who was at the pre‑disciplinary hearing.[52] At the hearing, Brown stated he answered the polygraph truthfully, and the results were skewed because he was angry during the polygraph.[53] Chief Zordan fired Brown, citing that he failed the “properly administered” polygraph, falsely testified at the interrogation, falsely testified at the pre‑disciplinary hearing, and delayed sending the Williams excessive force investigation to the state police.[54]

A. The Board Appeal and Procedural Background

Brown appealed Monroe’s disciplinary action to the Monroe Municipal Fire and Police Civil Service Board (the Board), the Civil Service board responsible for reviewing disciplinary actions against Monroe firefighters and police officers.[55] After the Board heard evidence from both sides, the Board unanimously found the disciplinary action was taken against Brown “in good faith for cause, but the punishment [wa]s not commensurate with the offense.”[56] Based on this finding, the Board modified Brown’s dismissal to a 90‑day suspension without pay.[57]

The City of Monroe appealed the Board decision to the district court.[58] On appeal, the district court determined that the Board acted in good faith for cause but found the Board arbitrarily reduced Brown’s termination.[59] The district court reversed the Board’s modification of discipline and reinstated the appointing authority’s original decision to terminate Brown.[60] Brown appealed the district court’s ruling to the Louisiana Second Circuit Court of Appeal where the court found the district court lacked the authority to inquire into the Board’s modification of Brown’s punishment.[61] The Second Circuit reinstated the Board’s modification to a 90‑day suspension without pay.[62] The Louisiana Supreme Court granted certiorari in which the City of Monroe argued the Second Circuit erred in determining the district court lacked the power to alter the Board’s disciplinary decision once it found the Board acted in good faith and for cause.[63] Further, the City of Monroe contended the Board’s ruling was arbitrary, capricious, and unsupported by the evidence; therefore, it was not made in good faith for cause.[64]

B. The Court’s Analysis and Conclusions

The Court found the Second Circuit did not err in its decision to reinstate 90‑day suspension.[65] The Court reasoned, “the [Second Circuit] court of appeal recognized the [district] court found the [B]oard acted in good faith for cause . . . For that reason, the court of appeal correctly held the trial court erred by modifying the [B]oard’s discipline.”[66] Additionally, the Court found the Board had cause to discipline Brown, but that termination was “harsh” and “the [B]oard’s decision to reduce the discipline to a 90‑day suspension without pay was not arbitrary or capricious.”[67] Thus, the Court affirmed the Second Circuit’s judgment and the Board’s decision to reduce Brown’s termination to a 90‑day suspension without pay.[68]

III. Implications on Louisiana Civil Service Appeals

The Louisiana Supreme Court’s decision in Brown has many potential implications for the Civil Service appeal procedure.[69] The Court’s decision to uphold the Second Circuit may stand to strip the district courts of appellate power expressly granted by statute.[70] Additionally, the Court may have conflated the Board’s findings of good faith discipline and the Board’s findings regarding the appropriateness of the disciplinary action.[71] While many of the potential implications could be drastic and sweeping, the Brown opinion provides some much‑needed clarity regarding the standard applicable to appointing authorities and the Board.[72]

A. Brown’s Clarity on Standards

First, the Court provided some clarification on whether the appointing authority acted in “good faith.”[73] In addition to the comparison to the arbitrary and capricious standard, the Court provided, “[t]he prohibited conduct cited by the appointing authority must be the basis for the discipline. If the cited conduct is used only as a pretext for punishment motivated by impermissible grounds, the discipline was not taken in good faith.”[74] Second, the Court stated the board must afford substantial deference to the appointing authority’s choice of discipline.[75] Previous courts explained deference is owed to appointing authorities generally, but the Court clarified that deference is owed to the appointing authority’s actual choice of discipline.[76]While these clarifications are helpful, the remainder of the opinion should raise serious concerns about the Civil Service appeal procedure for the future.

B. Conflation of Board Decisions and Stripping District Court of Express Appellate Power

By affirming the Second Circuit’s judgment, the Louisiana Supreme Court may have stripped district courts of the power to review modifications of discipline made by Civil Service boards.[77] Municipalities and classified employees will both be affected if this implication turns into reality.[78] Police and firefighter Civil Service boards may have been granted unchecked power to modify an appointing authority’s disciplinary action with no avenue for review or appeal for the municipality or the employee if they take issue with the punishment.[79] Louisiana Revised Statutes section 33:2501(E)(1) is very clear in its command: “Any employee . . . and any appointing authority may appeal from any decision of the board, or from any action taken by the board . . . This appeal shall lie direct to the court of original and unlimited jurisdiction in civil suits of the parish wherein the board is domiciled.”[80] By affirming the Second Circuit’s judgment, the Court has conflated two decisions by the Board into one and has confused the issues, effectively denying district courts the power to review those decisions.[81]

By conflating the Board’s decision about whether the appointing authority had cause to discipline with the Board’s modification of the disciplinary action, the Court has effectively stripped district courts of the power to review a Civil Service board’s modification of disciplinary action.[82] In his concurrence, Justice Weimer stated:

Despite the court of appeal’s statement that the “district court determined that the Monroe Municipal Fire and Police Civil Service Board acted in good faith in imposing discipline,” nothing in the record indicates that the district court found that the discipline imposed by the board was in good faith for cause so as to preclude the district court from reviewing the board’s decision to modify Brown’s discipline. For these reasons, under the facts of this case, I believe the court of appeal erred in finding that the district court was without authority to inquire “into the Board’s choice of disciplinary penalty.”[83]

Since the district court never ruled the modification was in good faith for cause, the Court’s ruling essentially changes the standard—if a reviewing district court finds a Civil Service board was in good faith for cause to discipline an employee, then the district court cannot review any further.[84] The Court’s ruling gives the Civil Service boards unchecked modification power so long as the board acts in good faith for cause to discipline.[85] The Court appears to have merged the board’s two distinct determinations—whether discipline was imposed in good faith for cause and whether the punishment was commensurate with the offense—into a single inquiry, eliminating any meaningful avenue for review when a board alters the type of discipline originally imposed.[86]

The Court’s conflation of the separate and distinct board decisions prevents reviewing district courts from inquiring further if they find discipline was warranted.[87] The Court recently expressed concerns about lower courts conflating duty and scope of duty in the context of negligence cases. Conversely, in the Civil Service context, the Court does the exact thing it cautioned against and conflates the board’s decision to discipline and the board’s choice of discipline into one decision.[88] This conflation of the board’s decisions cuts out a substantial portion of the district court’s power to review Civil Service cases even though it is expressly granted by statute.[89] In his concurrence, Justice Weimer also stated:

Pursuant to La. R.S. 33:2501(C)(1) and (E)(3), the board’s decisions as to both the need for disciplinary action and modification of the sanction imposed are reviewable by the district court (which sits at an appellate court in these proceedings) and other reviewing courts (such as the court of appeal) . . . In the absence of a finding by the district court that the board’s modification of the discipline imposed was in good faith for cause, I believe the court of appeal legally erred in finding that the district court exceeded its scope of authority under La. R.S. 33:2501(E)(3) by analyzing the specific discipline/sanction imposed by the board.[90]

As previously mentioned, the board is charged with making independent assessments regarding: (1) the imposition of discipline and (2) whether the type of disciplinary action is commensurate.[91] Now, district courts must review these independent assessments as one decision, even if the modified discipline is in no way commensurate with the offense.[92] While the long‑term implications of the Court’s opinion are not yet known, there will likely be litigation over this exact subject.[93]

Conclusion

The Court’s decision in Brown may preclude a substantial portion of district courts’ appellate power expressly granted by statute.[94] Under Brown, when a Civil Service board has “good faith for cause” to discipline an employee, the board may modify the decision in anyway it wants despite the charge on the board to ensure the discipline is commensurate.[95] The Court has potentially rendered useless its previous rulings regarding discipline being commensurate with offense.[96] At some point, the Court should revisit this issue and properly dispose of its previous rulings so the new change in the law is not in conflict with the Court’s previous rulings on the subject.

[1] See generally La. Dep’t of Ag. & Forestry v. Sumrall, 728 So. 2d 1254, 1262 (La. 1999).

[2] See generally Bannister v. Dep’t of Sts., 666 So. 2d 641, 645 (La. 1996).

[3] See generally La. Rev. Stat. § 33:2501(E)(2).

[4] Id. Appellate jurisdiction is the power of a court to review and revise the decisions of the lower courts. See generally id. In the Civil Service context, appellate jurisdiction is the power of the district courts to review administrative decisions by a Civil Service Board. See generally id. The Louisiana Constitution provides: “A district court shall have appellate jurisdiction as provided by law.” La. Const. art. 5, § 16. District courts also have appellate jurisdiction over appeals from justice of the peace courts. See generally La. Rev. Stat. § 13:2561.17. “[F]or the purpose of judicial review of administrative action, district courts are courts of limited jurisdiction and only have appellate jurisdiction to review administrative decisions as provided by the legislature or constitution.” Metro Riverboat Assocs., Inc. v. La. Gaming Control Bd., 797 So. 2d 656, 660 (La. 2001) (citing Loop, Inc. v. Collector of Revenue, 523 So. 2d 201, 203 (La. 1987)).

[5] New Orleans Firefighters Ass’n Local 632, AFL-CIO v. City of New Orleans, 590 So. 2d 1172, 1175 (La. 1991).

[6] Monroe Mun. Fire & Police Civ. Serv. Bd. v. Brown, 417 So. 3d 547, 559 (La. 2025).

[7] See generally id.; La. Rev. Stat. § 33:2501(E)(1).

[8] See Brown, 417 So. 3d at 559 (Weimer, J., concurring).

[9] See Arnett v. Kennedy, 416 U.S. 134, 148 (1974).

[10] See id. at 148–49.

[11] Bannister v. Dep’t of Sts., 666 So. 2d 641, 645 (La. 1996). “Essentially, civil service laws and rules establish a system under which ‘non-policy forming’ public employees are selected on the basis of merit and can be discharged only for insubordination, incompetency, or improper conduct, and not for religious or political reasons.” Id. (citing New Orleans Firefighters Ass’n v. Civ. Serv. Com’n of New Orleans, 422 So. 2d 402 (La. 1982)).

[12] See La. Const. art. 10, § 2(A)–(B); Wallace v. Shreve Mem’l Libr., 79 F.3d 427, 431 (5th Cir. 1996).

[13] La. Const. art. 10, § 2(B)(1), (3), (5), (8)–(9).

[14] See id. art. 10, § 2(A)–(B). “Persons not included in the unclassified service are in the classified service.” id. art. 10, § 2(A). Police officers are classified civil service employees. See id. art. 10, §(A)–(B).

[15] See Wallace, 79 F.3d at 431 (citing Bell v. Dep’t of Health & Hum. Res., 483 So. 2d 945, 949–50 (La. 1986), cert. denied, 479 U.S. 827 (1986)).

[16] LaPointe v. Vermilion Par. Sch. Bd., 173 So. 3d 1152, 1158 (La. 2015) (citing Bishop v. Wood, 426 U.S. 341, 345 (1976)).

[17] Williams v. Bd. of Supervisors, La. Cmty. & Tech. College Sys., 272 So. 3d 84, 89 (La. Ct. App. 2019) (citing Lange v. Orleans Levee Dist., 56 So. 3d 925, 930 (La. 2010)). “[D]ue process is not a technical concept with a fixed content unrelated to the time, place and circumstances.”

[18] Williams, 272 So. 3d at 89 (citing Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 546 (1985)).

[19] Williams, 272 So. 3d at 89 (citing Loudermill, 470 U.S. at 546).

[20] Ruddock v. Jefferson Par. Fire Civ. Serv. Bd., 688 So. 2d 112, 114 (La. Ct. App. 1997) (citing Chief of Police for Kenner v. Trippi, 499 So. 2d 1177, 1180 (La. Ct. App. 1986)).

[21] La. Rev. Stat. § 33:2471 et seq. Municipalities with populations are under 13,000 are subject to the Fire and Police Civil Service Law for small municipalities. See id. § 33:2531 et seq.

[22] La. Rev. Stat. § 33:2471 et seq.

[23] Id. § 33:2500(A)(1)–(15).

[24] Id. § 33:2501(A)–(B)(1).

[25] Moore v. Ware, 839 So. 2d 940, 945 (La. 2003).

[26] City of Bossier City v. Vernon, 100 So. 3d 301, 311 (La. 2012).

[27] See id.

[28] La. Rev. Stat. § 33:2501(E)(1).

[29] Id.; Ware, 839 So. 2d at 945.

[30] See Touchette v. City of Rayne, Mun. Fire & Police Civ. Serv. Bd., 321 So. 2d 62, 63 (La. Ct. App. 1975).

[31] La. Rev. Stat. § 33:2501(E)(3).

[32] See id. § 33:2501(A).

[33] Monroe Mun. Fire & Police Civ. Serv. Bd. v. Brown, 417 So. 3d 547, 549 (La. 2025). In particular, the issue of whether Brown lied during the investigation was an important consideration in the decision to fire him. Id.

[34] Brown, 417 So. 3d at 550.

[35] Id.

[36] Id.

[37] Id.

[38] Id.

[39] Id.

[40] Id.

[41] Id.

[42] Id.

[43] Id. at 551.

[44] Id.

[45] Id.

[46] Id.

[47] Id.

[48] Id.

[49] Id.

[50] Id.

[51] Id.

[52] Id.

[53] Id. at 551–52.

[54] Id. at 552.

[55] Id. at 550–52.

[56] Id. at 553.

[57] Id.

[58] Id.

[59] Id.

[60] Id.

[61] Id. “Once the district court determined that the [Board] acted in good faith in imposing discipline upon Reginald Brown, no further inquiry by the district court into the Board’s choice of disciplinary penalty was appropriate under the law.” Id.

[62] Brown, 417 So. 3d at 553.

[63] Id. at 556.

[64] Id. at 557.

[65] Id. at 556–57.

[66] Id. at 557.

[67] Id. at 558.

[68] Id. at 558–59.

[69] See generally id. at 557–59.

[70] See generally id. at 557.

[71] See id. at 560 (Weimer, J., concurring).

[72] See generally id. at 555.

[73] Id. at 554.

[74] Id. at 554–55.

[75] Id. at 555.

[76] See generally Mathieu v. New Orleans Pub. Libr., 50 So. 3d 1259, 1268 (La. 2010); Brown, 417 So. 3d at 555.

[77] See generally Brown, 417 So. 3d at 557.

[78] See generally id.

[79] See generally id.

[80] La. Rev. Stat. § 33:2501(E)(1) (emphasis added).

[81] See generally Brown, 417 So. 3d at 561 (Weimer, J., concurring).

[82] See generally id. at 559–61 (Weimer, J., concurring).

[83] Id. at 561 (Weimer, J., concurring) (emphasis added).

[84] See generally id.

[85] See generally id.

[86] See generally id.

[87] See generally id.

[88] See generally id.

Some cases conflate “duty” with the “scope of duty,” while others use the concepts interchangeably. This is problematic as the duty/risk analysis breaks down into separate considerations: duty and scope of duty. Each is a necessary component for the imposition of tort liability and is to be considered independently of the other.

Campbell v. Orient-Express Hotels La., Inc., 403 So. 3d 573, 580 (La. 2025) (emphasis added). Drawing an inference by comparison, the Court has taken a stance against conflating elements of analysis in any action when they are clearly distinct analyses and elements. See generally id.

[89] See generally La. Rev. Stat. § 33:2501(E)(1).

[90] Brown, 417 So. 3d at 561–62 (Weimer, J., concurring) (citing Evans v. DeRidder Mun. Fire, 815 So. 2d 61, 66 (La. 2002); Alexandria v. Dixon, 196 So. 3d 592, 598–99 (La. 2016)) (emphasis added).

[91] See City of Bossier City v. Vernon, 100 So. 3d 301, 311 (La. 2012).

[92] See generally Brown, 417 So. 3d at 559.

[93] See generally id. at 561 (Weimer, J., concurring).

[94] See generally La. Rev. Stat. § 33:2501(E)(1); Brown, 417 So. 3d at 556–57.

[95] See generally Brown, 417 So. 3d at 556–57; City of Bossier City v. Vernon, 100 So. 3d 301, 311 (La. 2012).

[96] See generally Brown, 417 So. 3d at 559–60 (Weimer, J., concurring).

By Sydney M. Wright

Introduction

Louisiana’s Direct Action Statute had long been a unique feature of the state’s insurance and tort law.^[1] The Statute granted tort victims the unusual ability to sue a tortfeasor’s insurer directly, a feature found in only a few states nationwide.^[2]This ability had been central to Louisiana’s distinct litigation landscape, giving plaintiffs access to insurance proceeds in a way that was unavailable in most other jurisdictions.^[3] Louisiana courts have consistently characterized the right of a tort victim to directly sue a tortfeasor’s insurer as procedural rather than substantive.^[4] That classification has had enormous consequences for whether changes to the statute apply retroactively.^[5]

In 2024, the Louisiana Legislature amended the statute to eliminate most direct actions against insurers, leaving only limited exceptions.^[6] Almost immediately, litigants challenged whether those limitations applied to suits filed before the amendment’s effective date of August 1, 2024.^[7] Since then, federal and state courts have split on the application.[8] Some courts have found the amendment is purely procedural, and thus retroactive and applicable to suits filed before the effective date.^[9] Others have concluded that once a plaintiff invokes the statute by filing suit, the right becomes a vested property right that cannot be retroactively stripped away without violating due process.^[10] This disagreement illustrates how a single statutory change can produce wide-ranging uncertainty when courts differ on a statute’s proper characterization. Accordingly, the question remains whether the amendments to Louisiana’s Direct Action Statute apply retroactively or prospectively.

I. Legislative Background

Prior to 2024, Louisiana’s Direct Action Statute, Louisiana Revised Statute § 22:1269, expressly authorized an injured person to bring a lawsuit “within the terms and limits of the policy” against a liability insurer.^[11] The statute allowed “[t]he injured person or his survivors or heirs” to bring suit directly “against the insurer alone, or against both the insured and insurer jointly and in solido.”^[12] In addition to this general authorization, plaintiffs could bring suit against the insurer alone if certain exceptions applied.^[13]

Act 275 of the 2024 Regular Session significantly narrowed this right.^[14] Although Act 275 introduced a number of revisions, the most significant revision removed plaintiffs’ general ability to bring a direct action against an insurer.^[15] Effective August 1, 2024, the amended version of the statute no longer contains language broadly permitting a direct action against the insurer.^[16] The legislature carved out only a handful of exceptions for when an injured person has a direct action: (1) “the insured files for bankruptcy” or “is insolvent”; (2) service on the insured fails or the insured refuses to defend; (3) the claim involves parent-child or spousal torts; (4) “the insurer is an uninsured motorist carrier”; (5) “[t]he insured is deceased”; or, (6) “the insurer denies coverage” or defends “under a reservation of rights.”^[17]

This shift represents a dramatic contraction of the statute’s scope. In short, what was once a broadly available avenue—allowing plaintiffs to reach insurers directly in most tort cases—is now a limited remedy available only in specifically defined situations.[18] The sharp narrowing of Louisiana’s Direct Action Statute triggered the current split, as courts must grapple with whether the new limitations should apply retroactively to cases filed before the effective date.

A. Louisiana’s Retroactivity Framework

Under Louisiana Civil Code article 6, “In the absence of contrary legislative expression, substantive laws apply prospectively only. Procedural and interpretative laws apply both prospectively and retroactively, unless there is a legislative expression to the contrary.”^[19] Substantive laws either create or alter rules, rights, or duties, while procedural laws govern the method for enforcing those rights.^[20] When applying legislative enactments, courts must consider the “constitutional implications under the due process and contract clauses of both the United States and Louisiana Constitutions.”[21] Even when “the Legislature has expressed its intent to give a substantive law retroactive effect, the law may not be applied retroactively if it would impair contractual obligations or disturb vested rights,” a restriction rooted in constitutional protections.[22]

Thus, the key question is whether the 2024 amendment is substantive—changing existing rights—or procedural—merely regulating enforcement. This distinction, while technical in form, is outcome-determinative in practice, as it dictates whether plaintiffs who filed suit before August 1, 2024 can maintain claims against insurers that are already defendants in their cases.^[23]

B. History of the Classification of Louisiana’s Direct Action Statute

Even before the recent amendments to Louisiana’s Direct Action Statute, there was once a divide of whether the statute itself was procedural or substantive. In 1950, the Louisiana Supreme Court held that the Direct Action Statute had been consistently treated “as conferring substantive rights.”^[24] From then until roughly 2013, both federal and state courts held the same—“[T]he injured plaintiff acquires a valid right against the tortfeasor’s insurer under the [D]irect [A]ction [S]tatute, [and] that right is substantive in nature.”^[25] It was not until the Louisiana Supreme Court’s ruling in Soileau v. Smith True Value and Rental that courts began to consistently hold that the Direct Action Statute was procedural.[26]

In Soileau v. Smith True Value and Rental, the Court held that “[t]he Direct Action Statute does not create an independent cause of action against the insurer, it merely grants a procedural right of action against the insurer where the plaintiff has a substantive cause of action against the insured.”^[27] The Court traced this principle to earlier cases, emphasizing that the substantive cause of action arises from delictual or contractual fault, not from the statute itself.^[28] Since that holding, courts have used the Supreme Court’s language to find that the Direct Action Statute is procedural.^[29] If the analysis stops there, then the Direct Action Statute is procedural, and it therefore applies retroactively.[30] This retroactive application would allow courts to dismiss insurers from suits, regardless of whether the plaintiffs filed suit before or after the effective date.[31] Thus, the central issue dividing courts is whether the analysis ends there or whether due process demands an additional step.

II. The Courts Divided

Courts are currently divided over whether the amendment to the Direct Action Statute applies retroactively or, more specifically, whether the amendment applies retroactively to suits filed before the effective date on August 1, 2024. One side follows the United States District Court for the Eastern District of Louisiana’s holding in Howard v. J&B Hauling, LLC.^[32] In that case, the plaintiff filed suit in 2022 and amended the complaint to add the defendant’s insurer in June 2024, shortly before the amendment to the Direct Action Statute took effect.^[33] The original trial continued past August 1, 2024—the effective date of the amendment—and the insurer moved to dismiss, arguing that the amendment barred direct actions absent a coverage defense.^[34]The court found that the amendment to the Direct Action Statute created “new procedural law, not substantive law” because the amendment “removed the right of an insured’s direct action claim against insurers, save for certain, narrow exceptions, among other changes to the procedural right to sue insurers when a cause of action exists against the insured . . .”^[35] Therefore, the court found that “[b]ecause the amended Direct Action Statute reflects procedural law, it applies retroactively” since there is no legislative expression prohibiting retroactive application.^[36] Thus, concluding that the amendment applied retroactively, the court in Howard granted the insurer’s motion to dismiss.^[37]

In the other line of cases, courts have held that if a plaintiff filed a direct action before the effective date of the amendment, the plaintiff retained the procedural right granted by the Direct Action Statute because it became a vested property right.^[38] For example, in Tridico v. Allianz Underwriters Ins. Co., the United States District Court for the Middle District of Louisiana addressed whether the amended Direct Action Statute applied retroactively and dismissed the defendant insurer from plaintiff’s suit filed on November 16, 2023.^[39] The court reasoned that “[t]he Direct Action Statute facilitates a remedy for an injured third-party against the insurer of the insured tortfeasor.”[40] “Therefore, ‘a plaintiff’s right under the Direct Action [S]tatute is vested only when the plaintiff files suit, as it is at that moment that a plaintiff invokes his or her remedy conferred by the Direct Action [S]tatute.’”[41] Thus, the Tridico court held that because plaintiff exercised its procedural right on November 16, 2023—before the amendment took effect—the statute could not retroactively divest the plaintiff of that right.^[42]

Conclusion

The amendments to Louisiana’s Direct Action Statute mark a dramatic shift in the state’s approach to insurance litigation. What was once a broadly available avenue to sue insurers directly has now narrowed to a limited set of circumstances. This contraction forces courts to revisit the long-debated classification of the statute as either procedural or substantive to determine whether the 2024 amendment should apply to cases filed before the effective date.

The resulting decisions reflect two competing views. On one hand, courts like the United States District Court for the Eastern District of Louisiana in Howard v. J&B Hauling have emphasized the procedural character of the statute and concluded that, as procedural law, the amendment applies retroactively.[43] On the other hand, cases such as Tridico v. Allianz Underwriters Ins. Co. have reasoned that once a plaintiff files a direct action, the plaintiff gains a vested right to maintain that claim, and the legislature cannot retroactively divest that right without violating constitutional protections.[44]

As these cases demonstrate, Louisiana law remains unsettled on the retroactive reach of Act 275. The split turns on whether courts treat the statute as a procedural mechanism subject to retroactivity or recognize a vested interest that insulates pre-amendment filings from dismissal. Until the Louisiana Supreme Court or the legislature provides definitive guidance, this divide will continue to shape litigation strategy and outcomes in Direct Action cases across the state.

[1] Louisiana’s Direct Action Statute, codified in the Revised Statutes in 1950, was part of “a long developmental process which began with the passage of Act 253 of 1918.” John Schwab II, The Louisiana Direct Action Statute, 22 La. L. Rev. 243, 244 n. 1 (1961).

[2] La. Rev. Stat. § 22:1269 (2023); Marion Leydier, Nicholas F. Menillo & William D. Torchiana, Snapshot: insurance claims and coverage in USA,Sullivan & Cromwell LLP (Apr. 23, 2025), https://www.lexology.com/library/detail.aspx?g=93e6bf00-86c5-4e88-bb9c-672c6da5ee96 [https://perma.cc/S73J-Y4JX].

[3] Leydier, supra note 2.

[4] See Soileau v. Smith True Value & Rental, 144 So. 3d 771, 780 (La. 2013) (citing Descant v. Adm’rs of Tulane Educ. Fund, 639 So. 2d 246, 249 (La. 1994)) (“The Direct Action Statute does not create an independent cause of action against the insurer, it merely grants a procedural right of action against the insurer where the plaintiff has a substantive cause of action against the insured.”).

[5] See Howard v. J&B Hauling, LLC, 2024 WL 4647820, at *4 (E.D. La. Sep. 26, 2024) (citing Soileau, 144 So. 3d 771 to find that the Direct Action Statute applies retroactively).

[6] Act No. 275, 2024 La. Acts.

[7] See, e.g., Baker v. Amazon Logistics, Inc., 751 F. Supp. 3d 666 (E.D. La. 2024) (opposing plaintiff’s motion to amend its complaint to add defendant’s insurer one day before Act 275’s effective date, arguing the amended Direct Action Statute applied retroactively and foreclosed naming an insurer directly).

[8] See Howard, 2024 WL 4647820; Rogers v. Griffin, 410 So. 3d 890 (La. Ct. App. 5th 2024).

[9] See Howard, 2024 WL 4647820, at *11.

[10] See Rogers, 410 So. 3d 890; Tridico v. Allianz Underwriters Ins. Co., 2025 U.S. Dist. LEXIS 80616 (M.D. La. Apr. 22, 2025).

[11] La. Rev. Stat. § 22:1269(B)(1) (2023).

[12] Id.

[13] Id. § 22:1269(B)(1)(a)–(f).

[14] Act No. 275, 2024 La. Acts.

[15] Id.

[16] La. Rev. Stat. § 22:1269(B)(1) (2024).

[17] Id. § 22:1269(B)(1)(a)–(g).

[18] Id.

[19] La. Civ. Code art. 6.

[20] Blow v. OneBeacon Am. Ins. Co., 193 So. 3d 244, 254 (La. Ct. App. 4th 2016) (citing St. Paul Fire & Marine Ins. Co. v. Smith, 609 So. 2d 809, 817 (La. 1992)); Keith v. U.S. Fid. & Guar. Co., 694 So. 2d 180, 183 (La. 1997).

[21] Blow, 193 So. 3d at 254.

[22] Id.

[23] See Howard v. J&B Hauling, LLC, 2024 WL 4647820, at *10 (E.D. La. Sep. 26, 2024).

[24] West v. Monroe, 46 So. 2d 122, 123 (La. 1950).

[25] McAvery v. Lee, 260 F.3d 359, 369 (5th Cir. 2001); see also Auster Oil & Gas, Inc. v. Stream, 891 F.2d 570 (5th Cir. 1990); Cushing v. Md. Cas. Co., 198 F.2d 536 (5th Cir 1952); Lewis v. Mfrs. Cas. Ins. Co., 107 F. Supp. 465 (W.D. La. 1952).

[26] Soileau v. Smith True Value & Rental, 144 So. 3d 771, 780 (La. 2013).

[27] Id. (emphasis added).

[28] Id. at 775–76 (citing Green v. Auto Club Grp. Ins. Co., 24 So. 3d 182, 184 (La. 2009)).

[29] See, e.g., Baker v. Amazon Logistics, Inc., 751 F. Supp. 3d 666, 672 (E.D. La. 2024) (citing Soileau, 144 So. 3d at 780); Rogers v. Griffin, 410 So. 3d 890, 895 (La. Ct. App. 5th 2024) (citing Soileau, 144 So. 3d at 780).

[30] La. Civ. Code art. 6; Howard v. J&B Hauling, LLC, 2024 WL 4647820, at *10–11 (E.D. La. Sep. 26, 2024).

[31] Howard, 2024 WL 4647820, at *10–11.

[32] Id.

[33] Id. at *2.

[34] Id.

[35] Id. at *4. (citing Act No. 275, 2024 La. Acts).

[36] Howard, 2024 WL 4647820, at *4.

[37] Id.

[38] See Tridico v. Allianz Underwriters Ins. Co., 2025 U.S. Dist. LEXIS 80616 (M.D. La. Apr. 22, 2025); Baker v. Amazon Logistics, Inc., 751 F. Supp. 3d 666 (E.D. La. 2024); Smith v. Fortenberry, 2024 WL 4462332 (E.D. La. Oct. 10, 2024); Rogers v. Griffin, 410 So. 3d 890 (La. Ct. App. 5th 2024); Dolese v. Kok Transp. LLC, 2025 U.S. Dist. LEXIS 169367 (W.D. La. Aug. 8, 2025).

[39] Tridico, 2025 U.S. Dist. LEXIS 80616, at *19–20.

[40] Id. at *20. (quoting Taylor v. Elsesser, 2025 U.S. Dist. LEXIS 25030, at *11 (E.D. La. Feb. 12, 2025)).

[41] Id. (quoting Taylor, 2025 U.S. Dist. LEXIS 25030, at *11).

[42] Id.; see also Baker, 751 F. Supp. 3d 666 (finding plaintiff’s right vested on July 31, 2024—one day before the amendment took effect); Rogers, 410 So. 3d 890; Hurel v. Nat’l Fire & Marine Ins. Co., (La. Ct. App. 4th 2025).

[43] Howard v. J&B Hauling, LLC, 2024 WL 4647820 (E.D. La. Sep. 26, 2024).

[44] Tridico, 2025 U.S. Dist. LEXIS 80616, at *20.

By John Paul Bourgeois

Introduction

What energy source accounts for the second largest percentage of electricity production in Louisiana after natural gas? Many might think the answer is coal, wind, solar, or several other energy sources. In fact, nuclear energy is the answer, and by a significant margin.[1] In 2021, nuclear energy generated 17.6% of Louisiana’s net electricity.[2]Although this percentage is a significant portion of Louisiana’s electric energy grid, nuclear energy production in the state only comes from two nuclear plants, each built around 40 years ago.[3] The lack of new nuclear plants in the state illustrates the recent concern over nuclear energy generation. Construction of new nuclear plants declined in the later years of the twentieth century due to concerns over safety and extremely high costs.[4] Furthermore, the safety concerns increased regulation, which led to construction delays, further driving up costs.[5] Overall, the nuclear power generation industry, at best, stagnated and, at worst, floundered.[6]

Considering this relative decline in new nuclear projects, some may believe the nuclear energy industry has simply reached its ceiling. Others, however, still see a future for nuclear energy production.[7] The reason for renewed interest in nuclear energy is small modular reactors (SMRs).[8] SMRs produce significantly less energy per reactor than traditional nuclear reactors.[9] Despite this disadvantage, analysts believe that SMRs have advantages over traditional nuclear reactors because they are smaller, easier to deploy, and potentially cheaper.[10] As of July 2025, reports identified 127 separate SMR designs worldwide.[11] Despite this progress in theoretical development, only a few SMRs are currently built and functioning, and none of them are in the United States.[12]

The reasons for the lack of development on SMRs are complex. One major reason for the lack of SMRs is extensive regulation concerning their development and construction.[13] Some entities, including several states, assert that over‑regulation limits development of the industry.[14] For example, a pending lawsuit by Texas, Utah, and Last Energy—which Louisiana  later joined—asserts that the Nuclear Regulatory Commission (NRC) does not have the authority to license SMRs and certain other types of reactors.[15] In addition, during the 2025 regular session, the Louisiana Legislature passed multiple laws addressing the regulation of nuclear energy.[16] The issue is whether reduced regulation of the industry, either by expediting federal licensing or shifting control to the states, will allow for the development of SMRs in Louisiana and across the United States.

I. History of Nuclear Regulation 

Historically, the United States federal government regulates nuclear energy.[17] In the 1940s, Congress created the Atomic Energy Commission (AEC), which oversaw the nuclear industry.[18] Subsequent years saw the rise of nuclear energy production, and Congress took further action to cement the AEC as the chief nuclear energy regulator.[19]Congress later abolished the AEC due to complaints about overly stringent regulations.[20] A new agency, the NRC, took control of nuclear power regulation during the 1970s.[21] The NRC remains in charge of the majority of nuclear energy regulation, including licensing requirements for new plants and license renewals for existing plants.[22]

Although the NRC maintains control over most nuclear energy regulation, states also have a role.[23] For example, under the Atomic Energy Act of 1954, the NRC may shift control over certain aspects of its nuclear regulatory authority to the states.[24] When a state gains this status, it becomes an “Agreement State.”[25] Louisiana and 38 other states are currently Agreement States, so each state has limited authority over nuclear energy regulation.[26] Despite the predominant federal control, Louisiana and other states have reignited a push for greater state control as SMR technology advances.[27]

II. 2025 Louisiana Nuclear Regulatory Developments

During the 2025 legislative session, the Louisiana Legislature passed three laws that are particularly relevant to Louisiana’s nuclear regulation.[28] Furthermore, earlier this year Louisiana joined a lawsuit seeking to shift licensing authority of SMRs and certain other small reactors from the NRC to the states.[29] The remainder of this blog discusses each law and the lawsuit, as well as their practical effects.

First, the Louisiana Legislature passed Senate Bill 127—also known as Act No. 179 (SB 127).[30] Louisiana’s SB 127 amends and reenacts Louisiana Revised Statutes § 30:2014.5, which governs expedited permit programs.[31] The amendment authorizes the Secretary of the Louisiana Department of Conservation and Energy to create an expedited permitting program for nuclear power generation.[32] The bill allows electric public utilities to submit applications for expedited permits to the Secretary, and the utility must certify that it intends to construct an SMR.[33] In addition, the utility must state that the application is consistent with a letter of collaboration with the federal government, and the Secretary shall indicate that the permit issuance is in accordance with the federal permitting program.[34] Essentially, the law tries to stimulate development of SMRs in Louisiana by expediting the permitting program, effectively reducing regulatory delays.[35]

Second, the Louisiana Legislature passed House Resolution 212 (HR 212), which directs the Louisiana Department of Energy and Natural Resources (LDENR) to consider whether advanced nuclear energy use is a potential path forward for Louisiana.[36] HR 212 notes recent advancements in nuclear technology, as well as the fact that other states have updated their own nuclear programs.[37] HR 212 also states factors that LDENR should consider in its evaluation, including industrial uses, environmental impacts, safety criteria, local and state tax impacts, and job creation.[38] Overall, this law focuses less on the regulatory system and more on the feasibility of advanced nuclear energy use in Louisiana, which reflects the uncertainty surrounding SMR’s economic and technological viability.[39]

Finally, Louisiana House Bill 692 (HB 692) prioritizes the security of clean, reliable, and affordable energy.[40]HB 692 defines terms relating to clean energy and notably designates “energy generated by nuclear reactors” and “energy generated using natural gas” as green energy.[41] The bill also sets requirements for energy sources, mandating that they must be affordable, dispatchable, and reliable.[42] All sources other than advanced nuclear generation must deliver cost savings to customers, relative to certain other energy sources.[43] Interestingly, HB 692 encourages use of domestically produced fuel sources, but provides an exception for nuclear resources and generation.[44]

In conclusion, these three bills illustrate several points about the current situation regarding nuclear energy production and use in Louisiana. Clearly, these laws demonstrate Louisiana’s intent to be a leader in the development of SMRs in the United States. In contrast, these laws also show the uncertainty regarding this technology and its economic feasibility. The subsequent section will analyze the implications of these laws and compare them to different regulatory systems, both in different jurisdictions and different industries, to better understand the path forward for Louisiana’s nuclear industry.

III. Comparison to Other Regulatory Regimes and Concerns for SMRs

Louisiana can look at regulatory systems in other jurisdictions and industries to navigate the complexities of advanced nuclear technology. Issues include federal versus state control and other various challenges that come with regulating new and expensive technology. In addition, the success of advanced nuclear power generation may depend on the availability of subsidies and benefits, as is common with other energy sources.[45] For example, subsidies or tax credits are often available for carbon capture and sequestration (CCS) projects, as well as for renewable energy, solar, and wind projects.[46]

The push for state influence over nuclear regulation mimics other regulatory systems, such as CCS regulation. Several states, including Louisiana, have primacy over permit applications to build Class VI carbon capture injection wells.[47] The grant of primacy gives LDENR—rather than the Federal Environmental Protection Agency (EPA)—control over CCS permitting and other regulation.[48] Although Louisiana now has primary enforcement authority for Class VI wells, the Safe Water Drinking Act’s underground injection control program requires that Louisiana’s Class VI well requirements match or exceed the EPA’s requirements.[49] This stipulation allows Louisiana’s CCS regulations to avoid preemption by federal law.

Preemption is a concern when any regulated industry shifts control from the federal government to states. The United States Constitution provides that federal laws “shall be the supreme Law of the Land” and take precedence over state laws.[50] The issue of preemption helps explain why CCS regulations in Louisiana must meet the minimum requirements set by the EPA, and a similar system is likely if the NRC cedes federal control over SMR licensing. Therefore, states will need to meet or exceed federal requirements, but states can still reduce regulatory delays by making permit decisions quicker than the NRC.[51] Furthermore, expediting the permit process aligns with current federal policy, as President Trump issued four executive orders in May 2025 designed to promote modernized nuclear energy by reducing licensing delays and increasing research.[52]

Moreover, Louisiana can look to other states and countries as examples of jurisdictions pushing advanced nuclear energy. To illustrate, in 2021, 53.5% of Illinois’s electricity generation came from nuclear power, and 53.8% of South Carolina’s electricity generation came from nuclear power.[53] This energy production, however, comes from traditional nuclear reactors, as no SMRs are currently operational in the United States.[54] To accelerate advanced nuclear generation in the United States, ten states formed the Advanced Nuclear First Mover Initiative.[55] This initiative seeks to reduce costs and licensing delays for advanced nuclear power.[56] Indiana, a member of the initiative, introduced several bills in 2025 seeking to balance utility and ratepayer costs and address siting concerns.[57]  On the international level, China and Russia each have one SMR in operation.[58]

Additionally, Louisiana has substantial opportunities to not only improve its own grid reliability and expand its electric power generation capabilities, but also to have local corporations secure lucrative commercial contracts for nuclear power.[59] For example, Google partnered with Kairos Power, an advanced reactor developer with a novel design, to purchase Kairos Power’s nuclear energy from SMRs currently under construction in Tennessee.[60] These opportunities demonstrate the potential to grow Louisiana’s economy by providing power to large corporations and creating jobs.[61] Louisiana ranks 50th in state economic growth rates over the past five years.[62] The Louisiana Legislature recognizes the potential for job creation in HR 212, which directs LDENR to consider job creation as one of the relevant factors for examining the feasibility of developing advanced nuclear power generation in Louisiana.[63]

If Louisiana expands its nuclear energy generation capabilities via SMR development, companies can bring additional jobs to the state, while also increasing revenue through an agreement like that of Kairos Power and Google. Louisiana can use its new nuclear power generation to simultaneously provide support to the Louisiana electric grid and boost the Louisiana economy. Notably, this approach also avoids eliminating jobs in other sectors of the Louisiana energy industry.

Although SMRs have huge potential to support the grid and help the Louisiana economy flourish, questions persist regarding the state of SMR technology and the economic viability of SMRs.[64] SMRs have extremely high costs, as does traditional nuclear energy.[65] The significant regulatory hurdles and delays in licensing also exemplify the concerns about the safety and feasibility of the technology itself.[66] Louisiana’s HR 212 also highlights these concerns, as it directs LDENR to examine the feasibility of advanced nuclear power generation in Louisiana.[67]

The federal government and Louisiana have several options to reduce the high cost of SMRs. Some of these options are evident in the design of the SMRs themselves. For example, some commentators believe SMRs are cheaper than traditional nuclear reactors due to their small size.[68] Although SMRs are very expensive to build, financing and shorter construction times help make them cost‑competitive with traditional nuclear energy.[69] SMR construction is often faster than traditional nuclear plant construction, so investors would begin recovering initial capital costs earlier.[70]Additionally, SMRs are smaller than traditional reactors and thus require significantly less upfront capital cost.[71] The combination of these factors may allow companies to more easily secure funding for SMRs.[72]

Aside from the cost benefits of SMRs, Louisiana and the federal government can offer other financial incentives, such as tax credits or subsidies for companies producing nuclear energy via SMRs. In fact, the federal government has a history of providing financial incentives on energy projects.[73] The federal government provides various tax credits for CCS, residential clean energy, and industrial‑level renewable electricity production.[74] Similar credits for advanced nuclear power generation would encourage companies, investors, and states to invest in these projects because the tax credits would cover a portion of the costs. Likewise, the Louisiana Legislature’s decision in HB 692 to classify nuclear energy as “green energy” might allow nuclear energy to qualify for additional tax credits or subsidies, further reducing costs.[75] These methods for cost reduction could help make SMRs a reality in the United States.

Conclusion

In conclusion, the regulation of SMRs has significant hurdles, as evidenced by the total lack of SMRs in operation in the United States.[76] Despite these challenges, Louisiana could benefit both economically and socially if the state becomes a leader in SMR development. Louisiana can become a leader in this industry by expediting the licensing period or shifting control to the state, as the Louisiana Legislature and state lawsuits are attempting to do.[77] Furthermore, traditional nuclear reactors shut down increasingly often.[78] New traditional reactors are not sufficiently replacing the electricity generation of the retiring reactors, although both of Louisiana’s existing reactors extended their licenses by 20 years.[79] Nonetheless, after a two decade plateau, United States electricity consumption started rising again, highlighting the need for additional generation capabilities.[80] Louisiana could benefit from working to overcome the challenges presented by SMR regulation, as the Louisiana Legislature already started to do during the 2025 legislative session.[81]

[1] See State Electricity Generation Fuel Shares, NEI, https://www.nei.org/resources/statistics/state-electricity-generation-fuel-shares [https://perma.cc/CDQ8-T9SH] (updated Aug. 2022).

[2] Id. The other shares of Louisiana electricity generation are 64.8% natural gas, 8.0% coal, 4.2% biomass/other, 4.0% petroleum, 1.2% hydro, and 0.2% solar.

[3] River Bend Station, entergy, https://www.entergy.com/nuclear/river-bend [https://perma.cc/NTX3-BKN2] (last visited Oct. 6, 2025); Waterford 3 Steam Electric Station, entergy, https://www.entergy.com/nuclear/waterford-3 [https://perma.cc/E49X-W3SX] (last visited Oct. 6, 2025).

[4] Phillip Rossetti, Low-Energy Fridays: Why Aren’t We Using More Nuclear Energy?, RStreet (Oct. 23, 2023),https://www.rstreet.org/commentary/low-energy-fridays-why-arent-we-using-more-nuclear-energy/.  [https://perma.cc/32VC-RRJR]; see World Nuclear Power Reactors 1951-2025, World Nuclear Indus. Status Rep. (May 19, 2025), https://www.worldnuclearreport.org/reactors.html#tab=iso [https://perma.cc/5WU2-PBP8].

[5] Rossetti, supra note 4. For example, the Three Mile Island crisis in the late 1970s, during which a nuclear reactor core partially melted, led to the evacuation of nearly 150,000 people. After the incident, the Nuclear Regulatory Commission began requiring additional safety inspectors and more stringent licensing requirements. J. Samuel Walker & Thomas R. Wellock, A Short History of Nuclear Regul. 1946–2009, 53–57 (2010).

[6] Rossetti, supra note 4.

[7] See generally Robin Gaster, Small Modular Reactors: A Realist Approach to the Future of Nuclear Power, Info. Tech. & Innovation Found. (Apr. 2025), https://www2.itif.org/2025-small-modular-reactors.pdf [https://perma.cc/LF35-AWFE] (indicating small modular reactors could be the future of nuclear power generation).

[8] Id. SMRs are a form of advanced nuclear reactor that produce up to roughly one-third of a traditional reactor. Joanne Liou, What are Small Modular Reactors (SMRs)?, Int’l Atomic Energy Ass’n (Sep. 13, 2023), https://www.iaea.org/newscenter/news/what-are-small-modular-reactors-smrs [https://perma.cc/WM6C-X2J2].

[9] Liou, supra note 8.

[10] Id. SMRs can also make the grid more reliable by reducing reliance on individual units or reactors since multiple SMRs can support rural areas, reducing the need for extensive transmission infrastructure.

[11] There are now 127 different SMR designs, finds NEA report, World Nuclear News (July 23, 2025), https://www.world-nuclear-news.org/articles/there-are-now-127-different-smr-designs-finds-nea-report [https://perma.cc/TA7T-E2PC].

[12] Liou, supra note 8.

[13] See, e.g., Francisco “A.J.” Camacho, NRC lawsuit could hand states power over advanced reactors, EnergyWire (July 23, 2025, 6:30 AM), https://www.eenews.net/articles/nrc-lawsuit-could-hand-states-power-over-advanced-reactors/ [https://perma.cc/J9RB-3XZ2] (explaining suit seeking greater state control of regulation of advanced reactors due to federal delays). Notably, this case is currently stayed, as the parties sought to seek alternative solutions following President Trump’s nuclear-related executive orders.

[14] Id.

[15] Id.

[16] Benn Vincent et al., Energy & Environmental Highlights of the 2025 Louisiana Legislative Session, Kean Miller (July 30, 2025), https://www.louisianalawblog.com/energy/energy-environmental-highlights-of-the-2025-louisiana-legislative-session/ [https://perma.cc/CK7T-GBFK].

[17] History, U.S. Nuclear Regul. Comm’n, https://www.nrc.gov/about-nrc/history.html [https://perma.cc/3CAR-PDP4] (last updated Feb. 20, 2025).

[18] Id.

[19] Id.

[20] Id.

[21] Id.

[22] Id.

[23] See, e.g., Agreement State Program, U.S. Nuclear Regul. Comm’n, https://www.nrc.gov/about-nrc/state-tribal/agreement-states.html [https://perma.cc/3Z2X-GK3P] (last updated Mar. 7, 2024).

[24] Atomic Energy Act of 1954, 42 U.S.C. § 2021 (2024); Agreement State Program, supra note 23. Most of this authority is the regulation of nuclear byproducts and source materials.

[25] Agreement State Program, supra note 23.

[26] Agreement States, U.S. Nuclear Regul. Comm’n, https://www.nrc.gov/agreement-states.html [https://perma.cc/2AYF-JFHU] (last updated Sep. 12, 2025).

[27] See, e.g., H.R. 212, 2025 Leg., Reg. Sess. (La. 2025); H.B. 692, 2025 Leg., Reg. Sess. (La. 2025), Act No. 462; S. 127, 2025 Leg., Reg. Sess. (La. 2025), Act No. 111; Texas v. U.S. Nuclear Regul. Comm’n, No. 24-CV-00507 (filed Dec. 30, 2024).

[28] See generally Vincent, supra note 16 (detailing relevant nuclear laws from the 2025 legislative session).

[29] Camacho, supra note 13.

[30] Id.

[31] S. 127, 2025 Leg., Reg. Sess. (La. 2025), Act No. 111.

[32] See id.

[33] See id. § 2014.5(B).

[34] See id. § 2014.5(B)(1)(b).

[35] See generally id. § 2014.5(B)(1)(b).

[36] H.R. 212, 2025 Leg., Reg. Sess. (La. 2025).

[37] Id.

[38] Id.

[39] See generally id. (noting issues to examine regarding feasibility of nuclear energy in Louisiana).

[40] H.B. 692, 2025 Leg., Reg. Sess. (La. 2025), Act No. 462.

[41] Id. § 1502(D). This law defines “green energy” as “any energy generated by utilizing those energy sources listed in 42 U.S.C. 15852(b) or hydrocarbons which, when combusted for the purpose of electricity generation meet the National Ambient Air Quality Standards set by the United States Environmental Protection Agency under the authority of the Clean Air Act.” Vincent, supra note 16.

[42] La. H.B. 692 § 1502(B).

[43] Id. § 1502(B)(3).

[44] Id. § 1502(B)(1)–(3).

[45] See, e.g., Credit for Carbon Oxide Sequestration, IRS, https://www.irs.gov/credits-deductions/credit-for-carbon-oxide-sequestration [https://perma.cc/2X7Y-LSUB] (last updated May 29, 2025); Residential Clean Energy Credit, IRS, https://www.irs.gov/credits-deductions/residential-clean-energy-credit [https://perma.cc/BM7P-3DRK] (last updated July 3, 2025); Renewable Electricity Production Tax Credit Information, U.S. Env’t Prot. Agency, https://www.epa.gov/lmop/renewable-electricity-production-tax-credit-information [https://perma.cc/XBB7-KJ75] (last updated Dec. 10, 2024).

[46] See, e.g., Credit for Carbon Oxide Sequestration, supra note 45; Residential Clean Energy Credit, supra note 45; Renewable Electricity Production Tax Credit Information, supra note 45.

[47] The State of Louisiana Is Granted Primacy Over Class VI Wells, Gibson Dunn (Jan. 8, 2024), https://www.gibsondunn.com/the-state-of-louisiana-is-granted-primacy-over-class-vi-wells/ [https://perma.cc/RDV7-CYBT].

[48] Id.

[49] Id.

[50] U.S. Const. art. VI, cl. 1.

[51] It is worth noting here that President Trump’s executive orders regarding nuclear energy also seeks to reduce regulatory delays on the federal level. See Michael Goff, 9 Key Takeaways from President Trump’s Executive Orders on Nuclear Energy, U.S. Dep’t of Energy (June 10, 2025), https://www.energy.gov/ne/articles/9-key-takeaways-president-trumps-executive-orders-nuclear-energy [https://perma.cc/XPX3-5PS8].

[52] Id.

[53] State Electricity Generation Fuel Shares, supra note 1.

[54] Small modular reactors, Int’l Atomic Energy Ass’n, https://www.iaea.org/topics/small-modular-reactors [https://perma.cc/JKE7-XBWD] (last visited Sep. 9, 2025); Small Modular Reactor (SMR) Global Tracker, World Nuclear Ass’n, https://world-nuclear.org/information-library/current-and-future-generation/small-modular-reactor-smr-global-tracker [https://perma.cc/LS96-QKJG] (last updated July 29, 2025).

[55] John Siciliano, US states start project to cut costs, speed permitting for advanced nuclear units, S&P Global (Feb. 6, 2025), https://www.spglobal.com/commodity-insights/en/news-research/latest-news/electric-power/020625-us-states-start-project-to-cut-costs-speed-permitting-for-advanced-nuclear-units [https://perma.cc/7NZN-DJ5R].

[56] Id.

[57] Id. Regarding the siting concerns, one Indiana county passed a moratorium on all forms of energy generation.

[58] See Small Modular Reactor (SMR) Global Tracker, supra note 54.

[59] See, e.g., Michael Terrell, New nuclear clean energy agreement with Kairos Power, Google (Oct. 14, 2025), https://blog.google/outreach-initiatives/sustainability/google-kairos-power-nuclear-energy-agreement/ [https://perma.cc/25F4-LW3G].

[60] Id. Google plans to purchase this energy to support AI technologies. See also Kairos Power, https://kairospower.com [https://perma.cc/6VVA-RMQR] (2025).

[61] See generally Terrell, supra note 59.

[62] See generally Louisiana – State Economic Profile, IBISWorld, https://www.ibisworld.com/united-states/economic-profiles/louisiana/ [https://perma.cc/83D9-XYKH] (last visited Sep. 8, 2025) (providing an analysis of the Louisiana economy).

[63] H.R. 212, 2025 Leg., Reg. Sess. (La. 2025).

[64] See generally Camacho, supra note 13 (explaining suit seeking state regulation of advanced reactors).

[65] See David Dalton, Generation IV / Economic Modelling Compares Costs Of SMR To Conventional PWR, NUCNET (Oct. 15, 2020), https://www.nucnet.org/news/economic-modelling-compares-costs-of-smr-to-conventional-pwr-10-4-2020 [https://perma.cc/85BQ-58BM].

[66] See generally Siciliano, supra note 55 (explaining concerns and state attempts to reduce hurdles).

[67] La. H.R. 212.

[68] See Dalton, supra note 65.

[69] Ján Mykhalchyk Hradický, Faster, Cheaper, Smarter? The Promise and Pitfalls of Small Modular Reactors, GlobSec (Feb. 6, 2025), https://www.globsec.org/what-we-do/commentaries/faster-cheaper-smarter-promise-and-pitfalls-small-modular-reactors [https://perma.cc/FT7Y-RUEP].

[70] Id.

[71] Id. Also, significantly more interest accumulates on traditional nuclear projects because of higher initial costs and longer construction times.

[72] See generally id. (explaining the challenges of securing funding for advanced nuclear projects).

[73] See, e.g., Credit for Carbon Oxide Sequestration, supra note 45; Residential Clean Energy Credit, supra note 45; Renewable Electricity Production Tax Credit Information, supra note 45.

[74] See, e.g., Credit for Carbon Oxide Sequestration, supra note 45; Residential Clean Energy Credit, supra note 45; Renewable Electricity Production Tax Credit Information, supra note 45.

[75] See generally H.B. 692 § 1502(B), 2025 Leg., Reg. Sess. (La. 2025), Act No. 462 (stating Louisiana’s decision to classify nuclear energy as green energy).

[76] See Small modular reactors, supra note 54; Small Modular Reactor (SMR) Global Tracker, supra note 54; see also Hradický, supra note 69.

[77] See, e.g., S. 127, 2025 Leg., Reg. Sess. (La. 2025), Act No. 111; Camacho, supra note 13.

[78] U.S. nuclear electricity generation continues to decline as more reactors retire, eia: U.S. Energy Info. Admin (Apr. 8, 2022), https://www.eia.gov/todayinenergy/detail.php?id=51978 [https://perma.cc/75HB-LE54].

[79] The licenses now expire in 2044 and 2045. See id.; River Bend Station, supra note 3; Waterford 3 Steam Electric Station, supra note 3. Despite these extensions, Louisiana must continue to plan for future electricity generation needs.

[80] Mark Shipper & Tyler Hodge, After more than a decade of little change, U.S. electricity consumption is rising again, eia: U.S. Energy Info. Admin (May 13, 2025), https://www.eia.gov/todayinenergy/detail.php?id=65264 [https://perma.cc/SWG8-JGHW].

[81] See generally La. H.B. 692, 2025 Leg., Reg. Sess. (La. 2025), Act No. 462; H.R. 212, 2025 Leg., Reg. Sess. (La. 2025); La. S. 127 (explaining Louisiana’s attempts to address challenges of SMR generation).

By John C. Witherington 

Introduction

On March 26, 2024, shortly after 1:00 a.m. EDT, the container ship M/V DALI (Dali) headed out of the Baltimore Harbor down the Patapsco River on its way to its destination in Sri Lanka.[1] Twenty four minutes later, at 1:24 a.m. EDT, the Daliexperienced a power failure.[2] Three minutes later, at 1:27 a.m. EDT, the vessel allided with a pylon of the Francis Scott Key Bridge, administering a level of force equivelant to a rocket launch.[3] The federal government classified this bridge as “fracture critical,” meaning that if one part of the bridge collapsed, the rest would likely follow.[4] After being struck, nearly all of the bridge crumbled into the water in an instant.[5] Six people did not have time to evacuate the bridge and perished because of the collapse.[6] The extent of the damage remains uncertain because of its impact on numerous parties and its reach across a geographically wide area.[7] Demolition of the bridge began in July 2025, and the new bridge is not expected to be completed until 2028.[8]

I. Background

The Francis Scott Key Bridge has been an economic engine for the Baltimore area since it opened in March 1977.[9] “The fallen bridge was one of three highway routes traversing the Baltimore Harbor.”[10] On average, the bridge handled around 31,000 cars per day, equating to 11.3 million cars per year.[11] The roadway that crossed the bridge, Interstate-695, was an important alternate route for oversized vehicles that could not fit in the Baltimore Harbor tunnel.[12] It was also the alternate route for vehicles hauling hazardous materials that could not travel through the tunnel because of safety concerns.[13]

The Port of Baltimore is the seventeenth largest port in the United States, and there are around 15,000 workers who directly rely on port operations for employment.[14] According to the office of Maryland Governor Wes Moore, over 140,000 jobs are linked to port activity.[15] In 2023, the Port of Baltimore handled 847,158 cars and light trucks, marking its thirteenth year as the leading port in the United States for importing automobiles.[16]

The cost of rebuilding the bridge could be economically devastating. Though experts can only estimate, the collapse could cost insurers billions of dollars in claims, with one expert estimating up to $4 billion in losses on the high end.[17] According to Morningstar DBRS’s managing director for global insurance ratings, Marcos Alvarez, “insured losses could total between $2 billion and $4 billion” depending on the length of the blockage and the nature of business interruption in the port.[18] Even if damages are on the low end—$2 billion—“the economic disruption and pain experienced by businesses and individuals in Maryland and the Baltimore area will be widespread and likely take years to fully comprehend and compensate those affected.”[19] If experts are correct in their high-end $4 billion assessment, this tragedy would become a record loss for shipping insurance.[20]

Fortunately for the owners of the Dali, a piece of legislation from 1851 may shield them from having to pay $4 billion.[21] Under the Limitation Act of 1851, vessel owners who face a complaint of an incident involving their vessel can file a complaint-in-limitation in an appropriate court.[22] Once filed in the appropriate court, their liability may be capped at to the post-accident value of the ship plus the pending freight.[23] The Dali’s owners did exactly that, attempting to limit their liability to a mere $43.7 million.[24] After a vessel owner files such a complaint, claimants bring claims against the owners in a concursus proceeding.[25] The concursus enjoins all pending suits and compels claimants to file their claims in a single federal forum.[26]Once the claims are joined, the claimants must prove that the vessel owners were negligent or that the vessel was unseaworthy, and that negligence or unseaworthiness caused the wreck.[27] Therefore, determining fault is the initial inquiry. The owners are exonerated if there was no fault.[28] Alternatively, if the claimants prove causative fault because of negligence or unseaworthiness of the vessel, the court must next determine whether the negligence or unseaworthiness occurred with the owners’ “privity or knowledge.”[29] The second step reverses the burden of proof, and the owners have to prove that the negligence or unseaworthiness occurred without their “privity or knowledge.”[30] If the court finds that the owners did have “privity or knowledge” of the causal acts, the owners will not enjoy the benefits of the Limitation Act.[31] If the owners lacked “privity or knowledge” of the causal acts, the owners will be entitled to limit their liability, which would shield them from full liability for the damage their vessel caused.[32]

On October 24, 2024, the United States Department of Justice filed a joint notice of settlement that dismissed its claims against the Dali’s owners.[33] The settlement “resolve[d] the U.S. government’s claim for environmental cleanup and response costs and other damages under the Rivers and Harbors Act, Oil Pollution Act and general maritime law.”[34]  The Oil Pollution Act displaces the Limitation Act, but the government’s claims under § 408 of the Rivers and Harbors Act are subject to limitation under the majority interpretation of the Limitation Act, and therefore, probably subject to limitation.[35] This settlement does not cover the cost of rebuilding the Francis Scott Key Bridge, which the state of Maryland maintained and for which it is still seeking compensation.[36] In addition, the settlement does not encompass the claims for personal injury and death brought by the deceased parties’ representatives.[37] As of August 4, 2025, the limitation proceeding is still ongoing as the Dali’s owners attempt to limit all other claims filed against them in the concursus proceeding.[38] The first trial date is set for June 1, 2026.[39]

This Blog argues that the Limitation Act needs to provide a larger monetary pool for plaintiffs to draw on if a vessel owner’s liability is limited.  This monetary pool would be funded by the increased financial liability imposed on the vessel owners and their insurers involved in these incidents. The Francis Scott Key Bridge collapse is a tragedy that provides a much-needed catalyst for legislative reform.  The collapse could cause up to $4 billion worth of damage, and the Dali’s owners may only be liable for $43.7 million worth of damage under the Limitation Act.[40] Still, $43.7 million is much less than the presumed insurance coverage of $3.1 billion provided by Protection and Indemnity (P&Ilubs.[41] Even if the owners are liable for more under the new methodology, they will likely be covered by the large P&I insurance clubs.

II. Analysis

The Limitation of Liability Act was enacted in the 19th century to protect vessel owners, but its framework no longer fits the realities of today’s modern shipping industry.[42] By tying liability to the post-accident value of a ship, the Act often leaves injured parties with far less compensation than what is needed to address their losses. A more practical and equitable approach would be to reform the Act by adopting a formula that multiplies a ship’s weight by a set dollar amount, similar to existing liability schemes in maritime and environmental law.

A. The Limitation Act Needs a Substantive Revision

The Limitation Act’s pool of money can be much smaller than what is needed to remedy aggrieved parties following a vessel accident, with one example being the Conception boat fire that killed 34 people where the owners tried to limit liability to $0 because the vessel sunk and was a “complete loss.”[43] The original reasons behind the Limitation Act are no longer appropriate in today’s well-established shipping industry.[44] The amount of marine insurance vessel owners purchase is usually enough to cover a higher monetary ceiling, and if owners do not buy enough insurance initially, they can do so later.[45]Assessing the value of the ship after it is involved in a collision—because the ship is valued post-voyage under the Limitation Act—creates a problem for plaintiffs seeking monetary compensation.[46] The vessel’s value would likely be depleted after a wreck. The proposed solution involves multiplying the weight of the ship by a dollar amount, the way the loss of life and personal injury parts of the Limitation Act do.[47]

B. The Formula

A dollar amount multiplied by the weight of the ship in tons would increase the monetary pool available for plaintiffs and may be easier for courts to apply than finding the value of a vessel after it has been involved in an accident. This formula is already seen in the Limitation Act for personal injury and wrongful death claims, along with other statutes regarding limitation of liability for non-maritime related incidents.[48] A helpful framework is the Oil Pollution Act of 1990’s limit on liability.[49] In this statute, the first step is to identify the type of vessel or facility involved in the accident.[50] Out of the vessels identified in the Oil Pollution Act, a tanker vessel is held to the highest amount of monetary liability, being potentially liable for $3,000 or $1,900 per gross ton of the tanker, depending on the type of tanker.[51] A tanker vessel is analogous to a container vessel, as they both carry massive amounts of cargo or oil, are very hard to slow down, and can cause mass damage when colliding with objects.[52]An amendment to the Limitation Act should  categorize the type of ship involved and the weight of that ship, identify the relevant dollar amount pertaining to liability, and multiply the two numbers. This formula would also take care of the “pending freight” analysis because it converts the freight’s weight into tonnage.[53] Though it may be hard to frequently weigh a container vessel, or weigh a vessel after a wreck, this question of fact could be determined at trial.[54]

C. The Application

Applying the proposed theory to the Baltimore bridge collapse, the court would need to classify the Dali’s ship type and determine its weight at impact. The Dali was a Neo-Panamax vessel.[55] These vessels are among the largest vessels in the world.[56]  According to the ship’s size, the court could classify the Dali as a Neo-Panamax ship because it could fit through the newly expanded Panama Canal.[57]  The court should classify Neo-Panamax ships as ones that should be exposed to the highest level of liability because of the vessels’ size and potential to cause damage. This classification would be similar to the largest tanker in the Oil Pollution Act. The owners of these types of vessels should be responsible for the highest category of liability, $3,000. After courts determine that the vessel fits in the $3,000 category, the court’s analysis would move to the weight of the Dali. There is speculation as to the weight of the Dali at impact, but an article presumes that the Dali weighed around 195,000 metric tons when fully loaded.[58] Applying the aforementioned formula, $3,000 multiplied by 195,000 comes out to $585,000,000.[59] This amount would increase the pool of money that claimants would be entitled to by over 1,300% and would still be well under the presumed insurance coverage of $3.1 billion that P&I clubs cover.[60]

Conclusion

In light of the devastation caused by the Francis Scott Key Bridge collapse, it is clear that the Limitation Act of 1851 is ill-suited to address the scale of modern maritime incidents. The Act’s antiquated liability cap, based on the post-casualty value of a vessel and pending freight, severely undercuts the compensation available to victims and impacted parties. While the intent behind the Limitation Act was to protect fledgling shipping ventures from financial ruin, today’s maritime operations involve billion-dollar corporations with access to extensive insurance coverage and sophisticated risk management. Allowing such entities to limit liability to just a fraction of the damage they cause is not only unjust, but also erodes public confidence in maritime law and in the broader legal system’s ability to ensure accountability.

A reformed Limitation Act should incorporate a standardized, scalable formula for determining liability, reflecting the true risk posed by massive commercial vessels like the Dali. Multiplying a vessel’s weight by a fixed dollar amount based on its category, as proposed in this Blog, would provide a more equitable and predictable basis for compensating victims. Such a reform would preserve the Limitation Act’s core purpose of limiting runaway liability, while ensuring that the monetary pool available to injured parties is commensurate with the scale of harm caused. The Baltimore tragedy offers an urgent and highly visible opportunity for lawmakers to modernize this outdated statute and better align maritime liability with today’s commercial and social realities.

[1] Lisa Shumaker, Baltimore bridge collapse: What happened and what’s next?, Reuters, https://www.reuters.com/world/us/why-did-baltimore-bridge-collapse-what-do-we-know-about-ship-2024-03-26/ [https://perma.cc/7L6W-TL5F] (updated Apr. 15, 2024).

[2] Id.

[3] Pylons are the critical load-bearing components of cable-supported bridges responsible for transmitting the loads from the cables to the bridge foundation. Id.; see also Aitish Bhatia & Francesca Paris, Force of Ship Impact Was on the Scale of a Rocket Launch, The N.Y. Times (Mar. 28, 2024), https://www.nytimes.com/interactive/2024/ 03/28/upshot/baltimore-bridge-ship-force.html [https://perma.cc/N6ZU-MR7U] (discussing the force it would have taken to stop the Dali).

[4] Brad Brooks, Collapse highlights need to protect critical foundations, Reuters, https://www.reuters.com/world/u s/baltimore-bridge-collapse-highlights-need-protect-critical-foundations-2024-03-28/ [https://perma.cc/F4U7-DJJV] (updated Mar. 28, 2024).

[5] Shumaker, supra note 1.

[6] Id.

[7] See generally Sinead Cruise, Jonathan Saul & Carolyn Cohn, Insurers could face losses of up to $4 billion after Baltimore bridge tragedy, analyst says, Reuters, https://www.reuters.com/business/insurers-brace-multi-billion-dollar-losses-after-baltimore-ship-tragedy-2024-03-27/ [https://perma.cc/8HUM-LK5H] (updated Mar. 28, 2024); see also Jana Byron, The Baltimore bridge collapse: a $4 billion question, Lockton (July 9, 2024), https://global.lockton.com/news-insights/the-baltimore-bridge-collapse-a-4-billion-question [https://perma.cc/S5H3-2S4L].

[8] Maryland Transportation Authority, Demolition Set to Begin as Maryland Transportation Authority Shares Key Bridge Rebuild Update (June 26, 2025), reproduced in Key Bridge Rebuild Press Releases (on file with MDTA).

[9] See Zephan Matteson, Matt Cohen & Andrew Mollenauer,  Baltimore has averted economic crisis one year after Key Bridge collapse, Cap. News Serv. (Mar. 31, 2025), https://marylandmatters.org/2025/03/31/baltimore-averted-economic-crisis-one-year-after-key-bridge-collapse/; see also Christopher Beranito,  Francis Scott Key Bridge History: See 1970’s Construction Photos, Md. Dep’t of Transp. (Mar. 19, 2025), https://mdta.maryland.gov/keybridgenews#:~:text= Construction%20on%20the%20Francis%20Scott,is%2010.9%20miles%20in%20length [https://perma.cc/5WNM-KNYX] (last visited Sep. 5, 2025).

[10] Shumaker, supra note 1.

[11] Id.

[12] Chloe Demrovsky, The Economic Impact Of The Baltimore Bridge Collapse Will Linger, Contributing To Inflation, Forbes, https://www.forbes.com/sites/chloedemrovsky/2024/03/26/the-economic-impact-of-the-baltimore-bridge-collapse-will-linger-contributing-to-inflation/ [https://perma.cc/83NG-7JHS] (updated Mar. 27, 2024, 11:36 AM).

[13] Id.

[14] Shumaker, supra note 1.

[15] Press Release, The Office of Governor Wes Moore, Governor Moore Announces New Port of Baltimore Cargo Records (Feb. 23, 2024) (on file with author).

[16] Id.

[17] Cruise, supra note 7; see also Byron, supra note 7.

[18] Cruise, supra note 7.

[19] Id.

[20] Id.

[21] 46 U.S.C. §§ 30521–30.

[22] Dominic Dewey, Is Limitation of Liability an Illusion? Examining the Numbers and Current Trends of the Limitation Act Today, 23 Loy. Mar. L.J. 59, 65 (2024).

[23] The post-accident value of the ship and pending freight will be expanded on throughout this Blog. Id.

[24] Petition for Exoneration from or Limitation of Liab., In re the Petition of Grace Ocean Priv. Ltd. et al. for Exoneration from or Limitation of Liab., 1:24CV00941 (filed Apr. 1, 2024).

[25] Dewey, supra note 23, at 63.

[26] Id.

[27] Craig H. Allen, Limitation of Liability, 31 J. Mar. L. & Com. 263, 265–66 (2000).

[28] Exoneration occurs when the plaintiff-in-limitation is not at fault for the purported claim. When the claimants cannot prove fault by either negligence or unseaworthiness, the owner is exonerated and owes no liability. The court does not reach the question of the plaintiff-in-limitations “privity or knowledge” when the plaintiff-in-limitation is exonerated. See generally Bryan L. Adkins et al., Cong. Rsch. Serv., LSB11155, The Baltimore Bridge Collapse and the Limitation of Liability Act of 1851 (2024).

[29] Allen, supra note 28.

[30] Id.

[31] See generally Adkins, supra note 29.

[32] See generally 46 U.S.C. §§ 30521–30530.

[33] Proposed Settlement Order at 1, In re Grace Ocean Priv. Ltd., 24-CV-00941 (D. Md. Oct. 24, 2024).

[34] Linda Chiem, DOJ Reaches $102M Deal In Baltimore Bridge Collapse Suit, Law360 (Oct. 24, 2024), https://www.law360.com/articles/2251457.

[35] The Oil Pollution Act “displacing” the Limitation Act means that claims brought under the Oil Pollution Act would not be subject to limitation under the Limitation Act due to the Oil Pollution Act having its own internal limitation scheme. James Coleman et al., Oil in the Sea III: Inputs, Fates, and Effects Appendix K. Regulatory Framework (Nat’l Acad. of Scis. 2003), https://www.ncbi.nlm.nih.gov/books/NBK220699/ [https://perma.cc/HX27-6ABW]; see also In re Am. River Transp. Co., 800 F.3d 428, 437 (8th Cir. 2015) (stating “[t]he in rem remedy inherently limits recovery for violations of § 408 [of the River and Harbors Act] to the value of the property, which is consistent with the Limitation Act’s standard limiting a vessel owner’s liability to the value of the ship and its freight”).

[36] Chiem, supra note 35.

[37] Id.

[38] See In re Grace Ocean Priv. Ltd., No. 24‑CV‑00941 (D. Md. Apr. 1, 2024).

[39] See Scott Maucione, First trial involving Key Bridge collapse in Baltimore to start in June 2026, WYPR News (Nov. 8, 2024, 10:29 AM), https://www.wypr.org/wypr-news/2024-11-08/first-trial-involving-key-bridge-collapse-in-baltimore-to-start-in-june-2026 [https://perma.cc/PJ2W-6RD8].

[40] Petition, In re Grace Ocean Private Ltd., No. 24-CV-00941 (Apr. 1, 2024); see also Cruise, supra note 7; see also Byron, supra note 7.

[41] P&I clubs are protection and indemnity clubs that insure and reinsure vessels. There are about a dozen P&I clubs that insure around 90% of the world’s oceangoing tonnage. Adam Tooze, Baltimore Insurance Claims & the Logic of Big Ships, Chartbook Newsl. (Mar. 30, 2024), https://adamtooze.substack.com/p/top-links-395-baltimore-insurance [https://perma.cc/QD5F-VX8Z].

[42] Dewey, supra note 23 at 62.

[43] See generally Edhat Staff, Conception Boat Owner Files Lawsuit to Limit Liability, EDHAT (Sep. 6, 2019, 5:58 AM), https://www.edhat.com/news/conception-boat-owner-files-lawsuit-to-limit-liability/ [https://perma.cc/E4LZ-GFA9]; see also Brian Melley, Boat owners seek to head off lawsuits after 34 die in fire, Associated Press (Sep. 5, 2019, 11:56 P.M.), https://apnews.com/article/d33314e1e77447cba3ca4f820e441370.

[44] The “reasoning” behind the Limitation Act was to promote investment in the shipping industry. See Dewey, supra note 23, at 62–63.

[45] Richard C. Reilly & Thomas Shumaker, What Does the Titanic Have To Do With the Francis Scott Key Bridge Collapse?, NYSBA (July 10, 2024), https://nysba.org/what-does-the-titanic-have-to-do-with-the-francis-scott-key-bridge- [https://perma.cc/LD25-KXRB] (stating that P&I clubs collectively buy reinsurance covering up to “$3.1 billion per ship”); see also Karen Shipman, Is the Limitation of Liability Act Going to Sink with the Deepwater Horizon?, Kean Miller: La. L. Blog (Jan. 3, 2011), https://www.louisianalawblog.com/admiralty-and-maritime/is-the-limitation-of-liability-act-going-to-sink-with-the-deepwater-horizon/ [https://perma.cc/EUB6-PY4G] (stating that “[t]he arguments against the Limitation Act being that the public policy behind the Limitation Act is antiquated and unnecessary because vessel owners today can readily procure liability insurance to protect themselves from damage claims caused by a vessel’s alleged unseaworthiness or negligence”).

[46] 46 U.S.C. § 30523.

[47] Id. § 30524.

[48] See id. § 30524(b).

[49] See 33 U.S.C. § 2704.

[50] See id. § 2704(a)(1)–(4).

[51] See id. § 2704(a)(1)(A)–(B).

[52] See generally Bhatia, supra note 3 (discussing the force it would have taken to stop the Dali).

[53] An alternative approach to “pending freight” would be to disregard it and take the sole weight of the ship without freight.

[54] The “lightweight” of a ship is the weight of the hull, machinery, and equipment on board. This measure is the weight of the ship without any cargo and should be fairly constant for most ships. The “deadweight” of a ship is the weight of cargo, fuel, and consumables stored on ship. The “deadweight” will fluctuate, and the final weight could be a question of fact at trial. In the formula proposed, the tonnage will be determined at the time the ship left port and embarked on the voyage that resulted in the wreck. Tonnage Measurements of Ships, S.S. Mut. (Aug. 9, 2010), https://www.steamshipm utual.com/publications/articles/articles/tonnage#:~:text=’Lightweight%20Ton’%20is%20the%20unit,the%20scrap%20value%20of%20ships [https://perma.cc/7PSL-3RPZ].

[55] Containership Size: The Panamax, DHL, https://www.dhl.com/content/dam/dhl/global/dhl-global-forw arding/documents/pdf/glo-dgf-cargo-sizes-infographic.pdf [https://perma.cc/3YR6-YB2X] (last visited Oct. 3, 2024).

[56] Container Ship: Definition, Types, and Design, inbound logistics (May 2023), https://www.inboundlogis tics.com/articles/container-ship/ [https://perma.cc/6MD9-5T5G].

[57] Id.; see also Jamie Rock, Addressing the M/V Dali Incident: Infrastructure, Trade and the Future of U.S. Maritime Policy, marinelink (Jan. 23, 2025), https://www.marinelink.com/news/addressing-mv-dali-incident-521457 [https://perma.cc/64VG-AUVX].

[58] See generally Bhatia, supra note 3 (speculating that the Dali weighed 195,000 metric tons).

[59] Id.

[60] P&I clubs are protection and indemnity clubs that insure and reinsure vessels. There are about a dozen P&I clubs that insure around 90% of the worlds oceangoing tonnage. Tooze, supra note 42.