Seadrill Bondholders Post Cash Deposit for Rival Restructuring
Owners of unsecured bonds in rig firm Seadrill have posted a cash deposit to back an alternative financial restructuring, paving the way for talks with the drilling operator over its future, the two sides said on Monday. Seadrill, once the largest drilling rig operator by market value, filed for bankruptcy protection in a U.S. court on Sept. 12 after being hit hard by cutbacks in oil company investment following a steep drop in crude prices. The company's main owner, Norwegian-born billionaire John Fredriksen…
Salazar Statement on Leasing Court Ruling
U.S. Department of the Interior Secretary Ken Salazar issued the following statement regarding the U.S. “I am pleased with the Court’s decision. Consistent with the Department’s request, the Court clarified that its prior ruling only applies to the Chukchi, Beaufort and Bering Seas. On April 17, 2009 the U.S. Court of Appeals for the District of Columbia Circuit vacated the entire 2007-2012 Outer Continental Shelf oil and natural gas leasing program, ruling that Bush Administration officials did not conduct sufficient scientific and environmental analysis before scheduling oil and gas lease sales on the Outer Continental Shelf off Alaska. The ruling came two years after lease sales had begun under the 2007-2012 OCS oil and natural gas leasing program.
Personal jurisdiction, Venue, Insurance, Co-insurance, Salvage, and Subrogation
The U.S. Court of Appeals for the Fifth Circuit issued a long decision regarding a lengthy and complicated litigation involving personal jurisdiction, venue, cargo insurance, co-insurance, salvage, and subrogation. Adams v. Unione Mediterranea di Sicurta, No. 03-30026 (5th Cir., April 14, 2004.) (HK Law) http://www.ca5.uscourts.gov/opinions/pub/03/03-30026-CV0.wpd.pdf
Mariner fails again to establish personal jurisdiction
In an unpublished decision, the U.S. Court of Appeals for the Third Circuit ruled that plaintiff mooring master failed to prove the court had personal jurisdiction over a foreign ship management company. In the instant case, plaintiff asserted that he was injured while transferring from one ship to another on the high seas off Galveston when the crane that was carrying him failed, dropping him into waters of the Gulf of Mexico. The ship management company is incorporated in Switzerland and headquartered in Bermuda. It has no offices or business operations in Pennsylvania, where this suit was filed. This suit is one of at least five filed in various U.S. courts by this plaintiff involving this incident. All have failed due to lack of personal jurisdiction.
Engineer in Dredge is Jones Act Seaman
The U.S. Court of Appeals for the First Circuit ruled that an engineer employed on a dredge in navigation is a seaman for purposes of the Jones Act. This decision was rendered when the court’s earlier decision was reversed and remanded by the U.S. Supreme Court. Stewart v. Dutra Construction Company, Inc., No. 99-1487 (1st Cir., August 9, 2005).
Appeals Court OKs Navy Use of Sonar
A federal appeals court on Friday said the U.S. Navy could use high-power sonar during exercises off the Southern California coast despite the technology's threat to whales and other marine mammals. A majority on a three-judge panel of the 9th Circuit U.S. Court of Appeals said the Navy can use the high-power sonar in 11 planned training exercises in its reversal of a lower-court order banning the practice. Source: AP
Appeal By Pilot Association Disallowed
In another chapter (or paragraph) of the long-running disagreement between the association of U.S. pilots operating on the Great Lakes and the U.S. Coast Guard, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the pilots’ association may not appeal a lower court decision to remand a rate dispute to the agency. Lake Pilots Association, Inc. v. U.S. Coast Guard, No. 03-5152 (D.C. Cir., March 9, 2004). (HK Law)
U.S. court upholds British Arbitration Award
In an unpublished opinion, the U.S. Court of Appeals for the Sixth Circuit affirmed a district court’s confirmation of a British arbitration award in favor of a protection and indemnity (P&I) club against plaintiff seamen. Acting on behalf of the seamen, a law firm sued States Steamship Company for alleged asbestos-related injuries. When States, which was in bankruptcy, did not answer, plaintiffs obtained a default judgment. Suit was then brought against two P&I Clubs that had insured States. One club prevailed on the “pay to be paid” provision in its policy. The suit against the second club was referred to arbitration in Britain in accordance with terms in the policy. The British arbitration was in favor of the club and included an award of legal costs and fees against plaintiffs.
FMC Upheld on Claim of Unreasonably Refusing to Deal or Negotiate
In an unpublished decision, the U.S. Court of Appeals for the District of Columbia Circuit denied a petition for review sought by a stevedoring company of a decision of the Federal Maritime Commission (FMC). In a matter before the agency, the FMC had ruled that a marine terminal operator had not unreasonably refused to deal or negotiate with the stevedoring company. In its decision, the court ruled that the FMC decision was supported by substantial evidence and was consistent with past precedent. Source: HK Law
Excavator May be LHWCA Harbor Worker
The U.S. Court of Appeals for the Ninth Circuit ruled that an excavator was a harbor worker under the Longshore and Harbor Workers’ Compensation Act (LHWCA) when he was killed while excavating a utility line trench as part of a project to renovate three submarine berths at Pearl Harbor. The work was being done ashore, but directly adjacent to, the berths. The court held that the term “harbor worker” includes workers directly involved in the construction of a maritime facility, even though their specific job duties are not maritime in nature. Source: HK Law
Court Interprets Settlement Agreement
The U.S. Court of Appeals for the First Circuit interpreted a settlement agreement between an insurance company and a shipowner in order to determine whether the insurance company was entitled to share in the shipowner’s subsequent settlement with a third party in a claim relating to loss of the ship. Home Insurance Company v. Pan American Grain Manufacturing Co., Inc., No. 03-2625 (1st Cir., February 4, 2005)(HK LAW)
Eleventh Amendment and removal of admiralty case
The U.S. Court of Appeals for the Tenth Circuit ruled that the Eleventh Amendment to the U.S. Constitution does not prevent removal of an admiralty case to federal court where the state involved is the plaintiff. In the instant case, the State of Oklahoma brought suit in state court against the owner of the tugboat that allided with a highway bridge, resulting in severe damage to the bridge and the deaths of various persons. Defendant tugboat owner removed the case to federal court. The state’s motion to remand back to state court was denied and the state appealed. The appellate court held that the Eleventh Amendment only applies in cases where the state is the defendant, so as to avoid states being involuntarily involved in federal court proceedings.
ITIC: Professional Indemnity Cover Needed
ITIC says professional indemnity cover essential in litigious shipping industry. International Transport Intermediaries Club (ITIC) has warned that, in today’s increasingly litigious business environment, there is a growing need for shipping professionals to have third-party indemnity insurance cover. This can be the case even in those sectors where insurance has not previously been deemed necessary, and in cases where, despite a favourable outcome to legal proceedings, substantial costs may be unrecoverable.
Eleventh Amendment and Limitation of Liability
The U.S. Court of Appeals for the Tenth Circuit ruled that the Eleventh Amendment to the U.S. Constitution does not prevent a ship owner from pursuing a limitation of liability claim where one of the claimants is a state. In the instant case, the State of Oklahoma brought suit in state court against the owner of a tugboat that allided with a highway bridge, resulting in severe damage to the bridge and the deaths of various persons. Defendant tugboat owner removed the case to federal court. The state contended that, under the Eleventh Amendment, a state cannot be prohibited from pursuing its claim in state court and cannot be forced to pursue its claim in federal court. The federal appellate court held that the Eleventh Amendment is a shield, not a sword.
USACE May Recover Reasonable Overhead
The US Court of Appeals for the Eighth Circuit ruled that, where the US Army Corps of Engineers undertakes to repair a lock and miter gate damaged by a tug and barge, it is entitled to recover its reasonable overhead in addition to its direct expenses. United States v. Capital Sand Co., Inc., No. 05-3405 (8th Cir., October 25, 2006). Source: HK Law
ITIC Warns on Costs of U.S. Documentary Disclosure
ITIC has warned that onerous documentary disclosure rules in the U.S. courts can drastically increase the cost to shipping interests of defending even without-merit claims. In the latest issue of its Claims Review, ITIC cites a case involving the manager of a number of cruise ships which was sued by a shipowner in a U.S. court for alleged failure to oversee maintenance, for negligence in the provision of manning advice and for negligence in relation to stability problems experienced by one of the owner’s ships.
Former Congress Lawyer to Serve as AdvanFort Legal Counsel
AdvanFort Company said attorney Sheila R. Schreiber has come onboard as its in-house legal counsel. Schreiber brings experience in the private and public sectors. She is a former litigation partner with Howrey LLP, served as counsel to the U.S. House of Representatives Committee on the Judiciary and has extensive experience in the national and international sales of industrial products. Her specialties include commercial, regulatory, employment, intellectual property, corporate and antitrust matters. Schreiber is a cum laude graduate of the University of Pittsburgh law school where she was a member of the Law Review. Her bar and court memberships include the U.S. District Court for the District of Columbia, the U.S. Supreme Court and the U.S. Court of Appeals for the Federal Circuit.
Kurdistan Says Crude Cargo Near Texas Legally Sold
A $100 million cargo of crude oil in a tanker near Texas was legally shipped and sold by Kurdistan, lawyers for the autonomous region in Iraq told a U.S. court in a letter seen on Thursday, saying Baghdad has no right to the barrels. They also told the U.S. District Court for the Southern District of Texas that it has no jurisdiction over Kurdish affairs. Baghdad, in a lawsuit filed with the court earlier this week, said that only it has the authority to export oil under Iraq's constitution, a view that autonomous Kurdistan government rejects. "The oil cargo in question belonged to the Kurdistan Regional Government (KRG) before it was legally shipped and sold pursuant to KRG's authority under the 2005 Iraqi Constitution and subsequent Kurdistan law…
Iraqi Kurds Reassert Right to Export Oil to US Despite Court Ruling
Kurdistan reasserted its right to export oil independently to the United States and other countries on Tuesday despite a court ruling in favour of the Iraqi federal government, which has sought to block crude sales from the autonomous region. The U.S. Court of Appeals for the Fifth Circuit in New Orleans on Monday dismissed the Kurdistan Regional Government (KRG)'s bid to overturn an earlier ruling against a planned sale of oil to an unidentified buyer in the U.S. Iraq's federal government filed a lawsuit in a U.S. court last year to thwart the sale of the one million barrel cargo from the Kurdistan region in an ongoing dispute over the right to export oil. The tanker was stuck off U.S.
Decision on Foreign Seaman's Wage Claims
The U.S. Court of Appeals for the Fifth Circuit ruled that wage claims brought by foreign seamen for work on foreign ships are subject to the Foreign Arbitral Awards Convention, even where the claims are based on U.S. law. In the instant case, plaintiff Philippine seamen brought suit in federal court in Louisiana against the shipowner, alleging violation of the U.S. Fair Labor Standards Act (FLSA) for failure to pay federal minimum wage and overtime. Defendant asserted that plaintiffs’ employment contracts were controlled by Philippine law and required arbitration of wage disputes in the Philippines. The trial court refused to order arbitration, citing a Louisiana law expressing the state’s strong public policy against forum selection clauses in employment contracts.
Maintenance and the collective bargaining agreement
The U.S. Court of Appeals for the Second Circuit ruled that maintenance for an injured seaman should be paid at the rate specified in the collective bargaining agreement and that awards for future wages and future medical expenses should be discounted to present value. In the instant case, plaintiff seaman was injured while serving on defendant's ship. The trial court awarded maintenance based on plaintiff's approximate expenses, rather than the amount provided for in the applicable collective bargaining agreement and did not discount the award for future expenses because the collective bargaining agreement did not address the issue.
Jones Act – State and Federal Proceedings
In an unpublished decision, the US Court of Appeals for the Fifth Circuit ruled that it is inappropriate to dismiss an employer’s federal court action against an employee for breach of contract merely because it relates to a state court action brought by the employee against the employer for damages under the Jones Act. In the instant case, the employee was injured while working on the employer’s vessel. Following medical treatment, the employee signed a release and was paid $4,000. A year later, the employee brought suit in state court under the Jones Act. The employer then filed suit in federal court for breach of the release contract. The employee filed a motion to stay the federal litigation in favor of the state action, which the federal district court granted. The employer appealed.
All Three Ships at Fault, Court Finds
The US Court of Appeals for the Second Circuit reversed the trial court’s finding that one ship was solely at fault in a collision and remanded the case to the trial court to apportion the fault, directing the trial court “to consider the relative culpability of each vessel and the relative extent to which the culpability of each caused the collision.” In the instant case, two ships collided in the English Channel and another ship was involved in the incident, although not in the physical contact. The trial court determined that one of the three ships was so largely at fault that the court assigned full liability to it for damages arising from the collision. On appeal, the court held that all three ships had been negligent to some extent.