## Facts

- Lockheed Martin Corporation owned a vessel damaged at sea in June 2001 and sought coverage under a marine insurance policy issued by National Casualty Company.
- In April 2005, Lockheed submitted a claim exceeding $2.6 million for repair costs and indicated it would sue unless the insurer accepted a six-year contractual limitations period.
- National filed a federal declaratory judgment action first, invoking admiralty jurisdiction and designating the case under Federal Rule of Civil Procedure 9(h) as an admiralty (non-jury) claim.
- National sought declarations that (1) Lockheed’s claim was time-barred, or alternatively (2) the amount of covered loss.
- Lockheed answered, asserted a counterclaim for breach of the insurance contract seeking monetary relief, and demanded a jury trial.
- The district court held the policy provided a six-year limitations period and dismissed the time-bar declaratory claim.
- The district court retained the remaining declaratory claim on the amount of loss, ruled Lockheed had no jury right in the admiralty-designated action, and struck Lockheed’s jury demand.
- Lockheed petitioned the Fourth Circuit for a writ of mandamus to compel the district court to grant a jury trial.

## Issues

1. Whether a defendant-counterclaimant has a Seventh Amendment right to a jury trial on an in personam marine insurance breach-of-contract claim when the insurer filed first as a Rule 9(h) admiralty declaratory judgment action.
2. Whether mandamus is an appropriate remedy to correct the improper denial of a jury demand before final judgment.

## Decision

- The Fourth Circuit granted Lockheed’s mandamus petition and issued the writ.
- The court held Lockheed was entitled to a jury trial on its in personam breach-of-contract counterclaim seeking coercive monetary relief.
- The court ruled the insurer’s Rule 9(h) designation and declaratory-judgment posture could not eliminate Lockheed’s jury right.
- The court remanded with directions that the district court grant Lockheed’s jury demand.

## Legal Principles

- The Seventh Amendment preserves a jury right for claims that are legal in character, including contract actions seeking money damages.
- For in personam maritime disputes with concurrent “at law” jurisdiction preserved by the saving-to-suitors doctrine, a party’s legal claim may carry a Seventh Amendment jury right even though the subject matter is maritime.
- A plaintiff’s Rule 9(h) election to proceed in admiralty does not permit the plaintiff to defeat the opposing party’s jury right on an independently legal claim.
- Declaratory-judgment sequencing cannot be used to deprive an opposing party of a jury trial on legal issues; the “race to the courthouse” does not control the constitutional allocation of factfinding.
- Mandamus is an available mechanism to protect the jury-trial right when denial of a jury would not be adequately remedied by appeal after a bench trial.

## Conclusion

The Fourth Circuit required a jury trial on Lockheed’s legal, in personam marine insurance contract counterclaim, holding that an insurer’s Rule 9(h) admiralty declaratory action cannot strip the opposing party of the Seventh Amendment jury right, and that mandamus is proper to prevent the loss of that right.


In re Lockheed Martin Corp., 503 F.3d 351 (4th Cir. 2007)