Cruise Law News : Maritime Lawyer & Attorney : James M. Walker : Walker & O'Neill Law Firm : Admiralty Law, Cruise Ship Accidents & Injuries

In an exclusive story, Cruise Line News has learned that cruise industry giant Carnival Corporation recently incorporated its business in the United States (in the state of Delaware). Carnival intends to announce this historic development tomorrow, April 2nd, at Carnival's headquarters in Miami.

Since 1972, Carnival has incorporated its business and registered its cruise ships in the country of Panama. For over 40 years, Carnival cruise ships have flown the flag of Panama in order to avoid the onerous safety regulations, excessive labor laws, unreasonable environmental laws, and high taxes of the United States of America.

Cruise Law News' discovery of this historic event came about when prominent maritime lawyer Jim Walker bumped into Carnival's CEO Micky Arison at court side when Arison's championship basketball team, the Miami Heat, won another game.  Maritime ace lawyer Walker asked Arison: "Micky, if Dwayne Wade and LeBron James earn several hundred million dollars from Carnival and pay tens of millions of dollars in U.S. taxes, don't you think it is fair that Carnival - which earns over 15 billion dollars a year in cruise ticket sale - pays a few billion dollars in U.S. taxes?"

Perhaps it was the euphoria of the Heat beating the San Antonia Spurs by two points in a close overtime victory, but Micky was ecstatic. "Yes, let's do it!" he said handing maritime lawyer Walker a half-eaten hot dog and three-quarters of a warm Bud Light which a Miami cheerleader handed Micky in the first quarter of the previous game a few days earlier.

While quickly consuming the beer and hot dog in the excitement of the moment, expert cruise lawyer Walker happened to have U.S. articles of incorporation which he handed to Micky to sign as well as U.S. flags to fly on the Carnival fleet of cruise ships.

Arison has been under intense pressure lately following fires, collisions, sinkings, pirate-attacks, flounderings, norovirus outbreaks and a Jon Secada onboard concert which have ruined the last 37 Carnival cruises.  Just last week Senator Jay Rockefeller called Arison a "scallywag" on national TV. Rockefeller challenged Arison to pay his fair share of U.S. taxes on the bounty his foreign-flagged cruise ships collect on the high seas. 

Micky commented that he was embarrassed that his father Ted, the founder of Carnival Cruise Lines 40 years ago, denounced his U.S. citizenship in order to avoid paying some 10 billion dollars in U.S. taxes.

"I want to make certain that Carnival pays one hundred % of our U.S. tax obligations (estimated to be over $5,000,000,000 a year) plus be subjected to the most rigorous U.S. safety, wage,and labor laws and the most stringent U.S. environmental regulations, Micky announced over the arena's PA system! "I want Carnival Cruise Line to be synonymous with Old Betsy - the U.S. Stars and Stripes - what the U.S. stands for! Its time that indigent crew members from India and Nicaragua who earn $500 working 360 hours a month be entitled to the full benefit of U.S. employment laws, a 401(k) retirement fund, severance pay, and a college fund for their children!"

While appreciative of Arison's change of heart, sources say Walker was miffed that Arison demanded that he pay $6 for the remains of the hot dog and $7.50 for the rest of the Bud Light.

April 1 2013 Update: South Florida Business Journal picks up on this shocking development in the cruise industry. Read here.

• Comments (8)

Miami's Daily Business Review reports today that Micky Arison paid himself a "special year-end dividend" of $90,000,000. Yes, that's 90 million dollars.

Cruise CEO Arison is not the only executive in Florida lining his pockets, as the Review states that other executives in Florida are paying themselves dividends in the range of $250,000 to around $20,000,000. The newspaper states that the whopper of a dividend was probably paid due to expectations that federal tax rates will jump next year. I suppose that's called the "Romney-didn't-win-dividend."

Arison is already by far the richest person in Florida with a net worth of many billions of dollars. The last time I checked it was over $4,000,000,000, or maybe it was $7,000,000,000. I forget. What's an extra billion or two?

I was thinking of entitling this blog "Micky Arison is a fat greedy pig" but at least one journalist already called him that over a decade ago. So I'll keep what I'm thinking to myself.

But, I have to add that it must be something to be the CEO of a foreign corporation that pays no U.S. federal taxes and owns a $600,000,000 cruise ship which sank (the Concordia operated by subsidiary Costa) and killed 32 people and at the end of the year you pay yourself an additional $90,000,000. Yes, the disaster caused some lost revenue for Carnival for a few months. But by the end of the year, Carnival profits are higher than ever. 32 dead customers and crew are not a problem if you keep them from filing suit in the U.S. 

While Arison pays himself a dividend of $90,000,000, he offered the families of the dead and traumatized Concordia passengers $15,000 each. 

When I think of Arison paying himself an extra $90,000.000, I also think of the 150 waiters from India who worked for P&O Cruises (another Carnival subsidiary) who were fired earlier this year at the instructions of Carnival's executives after they went on strike for about an hour in Seattle over low pay and the non-payment of tips. There are now 150 families struggling in India because Carnival made an example of them to show what happens if crew members in Carnival's fleet of 100 cruise ships complain about low pay.

Earlier this week, Arison's cruise line ignited controversy by issuing a last minute edict that passengers who bought tickets on Carnival's drag queen cruise would not be permitted to dress in drag in order to avoid offending "family values." When a boycott was threatened that might result in Carnival losing millions from the offended LGBT community, Carnival reconsidered and lifted the ban on dressing drag.

Always following the money, Arison obviously thought that paying himself a $90,000,000 dividend was not a drag either.   

I wonder what Arison will do with the extra $90,000,000?  Raise wages for his loyal employees on his cruise ships? Invest in a health clinic in India for Carnival crew? Donate the money to a charity for sick seafarers?  Ha. That's something Bill Gates or Warren Buffett would do.  

Read some of our other articles about CEO Arison and judge for yourself. 

Cruise Line Fat Cat Billionaires    

Breaking News: Carnival Cruise Lines Incorporates in the U.S. and Subjects Itself to U.S. Labor, Wage, Safety and Environmental Regulations

Is Carnival's Mickey Arison a Greedy Corporate Pig?

Consider leaving a comment below or on our facebook page.

• Comments (3)

In a proxy filing with the Securities and Exchange Commission, Royal Caribbean Cruises disclosed that its 2010 compensation paid to CEO Richard Fain (photo left) increased almost 60% to $8,600,000.  Royal Caribbean increased the compensation paid to the company's four other named executives from 18.5% to almost 50%.  The largest compensation increase of the four executives  went to Adam Goldstein (photo right), the president of Royal Caribbean International, whose total compensation increased to over $4,000,000. 

These increases were primarily incentive based, meaning that the executives met or exceeded certain financial goals for the corporation.

One of the company's goal we have been concerned with has been to reduce payments to ill and injured crew members.  In 2008, Royal Caribbean had over over 1,200 open medical files for ill and injured crew members around the world.  Due to certain cost cutting measures, by 2010 Royal Caribbean slashed the number of open crew medical files to around 400. 

In the process, the cruise line culled over 800 ill crew members from its medical department's responsibility.  In many instances, there was no legal basis to terminate the medical care.  In cases where the medical care was not arbitrarily terminated, the cruise line reduced the daily stipend for sick crew employees from $25 to $12 a day.  Needless to say, it is impossible for anyone to live on $12 for food and lodging a day.

These harsh cost cutting measures "saved" Royal Caribbean millions.  Given the fact that cruise executives Fain and Goldstein collected over $12,500,000 together last year, it looks like the money formerly spent on crew member medical benefits ended up in the executives' pockets.   

Photo credit:  Royal Caribbean International Flickr photostream

• Comments (4)