Celebrity Files $300M Suit Against Rolls Royce, Alstom Power Conversion

Thursday, August 07, 2003
Celebrity Cruises filed a $300 million lawsuit today against Rolls Royce and Alstom Power Conversion, co-producers of a ship pod- propulsion system, to recover lost revenue and costs associated with failing pods. The lawsuit was filed in state court in Miami-Dade County, Florida. The lawsuit charges that the Rolls Royce and Alstom Power Conversion pods, brand-named Mermaid, have failed repeatedly, resulting in cancelled cruises and thousands of disappointed guests. These recurring failures cost the company hundreds of million of dollars, for which the lawsuit seeks restitution. The lawsuit further claims that Rolls Royce and Alstom Power Conversion misrepresented their product, which was "defectively designed" and "deceptively and fraudulently marketed." Mermaid pods are installed on four Celebrity ships -- Millennium, Summit, Infinity and Constellation. All four had one or more mechanical or electrical problems with the pods, which caused the ships to be taken out of water -- and out of service -- to repair. "Unfortunately, the Mermaid pods have not lived up to the manufacturers' promise or to Celebrity's high operating standards," said Jack Williams, president and chief operating officer of Celebrity. "This has created intolerable consequences for our guests, and imposed unacceptable conditions on our company." There are -- and have been -- no safety issues with any of these ships. All have been given clearance to sail by the U.S. Coast Guard and the ships' classification society. Even with the problems, safety was never compromised. "Guests and travel agents should continue to have full confidence in the Celebrity brand," Williams said. "We have modified the more troublesome components, and we are working on a permanent solution. "In the meantime, guests should know that any cruise we have to cancel, as a result of any issue with these pods, we will back with a full refund and a free cruise." Propulsion pods consist of an electrical motor and a propeller. They are typically favored by cruise operators because the pod's design -- a 360 degree rotating unit -- provides a number of advantages, including greater maneuverability.

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