Carnival Sues BP: Pot Calls the Kettle Black

Carnival Sues BP for Pollution?This article in the Sun-Sentinel describes how Carnival Cruise Lines has filed a lawsuit against BP, Transocean and Halliburton over the Gulf oil spill.  They claim the spill got their ships dirty, added to cleaning expenses, drove passengers away and cost them revenue.

There’s something insidiously ironic about one of the cruise lines biggest polluters suing for damages caused by someone else’s pollution.

Back in May of 2003, Carnival admitted they illegally dumped contaminated water into California ports.  At the time, they were already under 5 years of federal probation for violating environmental laws.  In 2002 they pled guilty to dumping oil-contaminated waste into the ocean and then falsifying records as part of an attempted cover-up, ultimately paying an $18 million fine.

Not much has changed since then and in 2009 they were still ranked among the worst polluters in the industry.  Federal laws are weak or inconsistent, and when coastal states try to tighten their regulations the cruise lines simply dump their waste into the open ocean (beyond the 3-mile limit) or take it to Canada.

It’s worth noting that at the time, Carnival seemed to downplay the impact of the spill on its operations.  Just two months after the Deepwater Horizon exploded, their CEO Micky Arison said cruises had been virtually unaffected and that bookings hadn’t slowed down.  He said his ships didn’t need cleaning at that point and he commended the captains for their ability to avoid the oil.

David Warren - Carnival Sues BP:  Pot Calls the Kettle BlackNow they’re suing for negligence, fraudulent concealment and punitive damages.  Yet when it comes to claims of negligence, Carnival has escaped liability even when one of its physicians injures a passenger due to medical malpractice.

Carnival may be preserving its legal rights with this latest lawsuit, but it’s dripping with hypocrisy.

 

Today's article is written by a guest blogger, David Warren, who is a reader of Cruise Law News.  David is a Summa Cum Laude graduate from Florida Atlantic University with a degree in Political Science & Sociology.  He is currently studying for the law school admissions test and plans on attending law school.

With the insight shown in this article, we are confident that David will be a fine lawyer.

 

Flags of Convenience: Avoiding Taxes, Safety & Labor Regulations, and Justice

Panama Flag of ConvenienceA reader of Cruise Law News (CLN) brought an excellent opinion piece from the New York Times regarding the shipping industry's use of "flags of convenience" to my attention.  Entitled "Flying the Flag, Fleeing the State" and written by Rose George, the article explains how unscrupulous ship owners evade responsibility for environmental damage, exploitative labor and unsafe work conditions, and criminal behavior. 

The article reveals that ships used to fly the flags of their nation which protected the seafarers and passengers and punished the shipping companies when they broke the law.  But this changed when American flagged ships began flying the flags of foreign countries in order in order to avoid U.S. laws and government oversight.   The "foreign registries" were in countries with no government oversight and no real connection to the vessel or its owners in the first place, like Panama (flag above left), Liberia, North Korea and even landlocked Mongolia.  The registries often fail to monitor the safety and working conditions on ships or investigate accidents.    

What are the real consequences to employees working on foreign flagged ships? 

The New York Times article points out that there is a "human cost" which includes long hours, punishing work, and little rest; some international regulations permit 98-hour work weeks.  Cruise line employees are a good example.  Stateroom attendants and cleaners work a minimum of 12 hours a day and often are pushed to 14 to 16 hours when required to handle luggage on embarkation days, ending up with a 90 plus hour work week and no days off.  Cruise ship cleaners earn a maximum of $545 a month working a minimum of 360 hours a month.  Repetitive injuries to these crew members frequently occur, and just as frequently the cruise lines abandon them in countries like Nicaragua or India with inadequate medical care.

No foreign registry in Liberia, which often rages in civil war itself, gives a damn about the working conditions which men and women from Nicaragua or India face daily on Liberian flagged cruise ships.    

Because most ship employees are non U.S. citizens, the U.S. public has been indifferent to their plight.  But the problem inherent in flags of convenience came home to the U.S. last year when the offshore Deepwater Horizon oil rig exploded and 11 American oil and gas workers perished.  

The U.S. Coast Guard just released a preliminary report  about the Deepwater Horizon oil rig. The Coast Guard criticized not only rig owner, Transocean, but the foreign registry in the Marshall Islands (flag below) where Transocean registered the rig.  Just like a cruise ship, the Deepwater Horizon oil rig was considered to be a vessel which had to be registered. 

Why did the rig owners decide to go all of the way to an island in the Pacific to register its oil rig, you may ask?   For the same reason cruise lines like Carnival and Royal Caribbean went to South America and Africa to register their cruise ships in Panama and Liberia - to avoid U.S. taxes, U.S. Marshall Islands Flag of Conveniencesafety regulations, and U.S. labor laws.  

One of the the Coast Guard's initial conclusions is that the Marshall Islands "abdicated" its safety responsibilities.  Transocean got just what it wanted - lax safety inspections and substandard safety requirements from the little spec of an island in the Pacific.   The owners enjoyed lower operating costs in addition to the substantial tax benefits of flying a flag of convenience.  But the financial benefits came at the expense of poor training, poorly maintained equipment, and even poorer safety procedures which resulted in inoperable alarms and failed shut-down systems.  

The ultimate result of the Marshall Islands flag of convenience?  11 dead men.  And 11 families consumed with grief and suffering.  

 

For additonal information, read:

Like Cruise Ships, Foreign Flagged Oil Rigs Avoid U.S. Laws

No Taxes - The Cruise Lines' Dirty Little Secret

Will BP and the Cruise Industry Join Forces to Screw Americans?

Mother Jones published an interesting article this morning by  Stephanie Mencimer, "Will the Cruise Industry Do BP's Dirty Work?" about how the cruise line lobbyists may join forces with BP to help the oil company dodge liability for the eleven workers killed on the Transocean drilling rig.

BP - Transocean Deepwater Horizon Rig - DOSHAYou see the drilling rig is considered to be a vessel for purposes of maritime law.  And when an employee (or passenger) is killed on a vessel in international waters, the case is governed by the Death on the High Seas Act (DOSHA).  

Enacted in 1920, DOHSA prohibits the families of loved ones lost at sea to recover any compensation for their grief, sadness and bereavement or their children's loss of love, nurture and guidance.  We have written about this outdated and inequitable law before: "The Death on the High Seas Act - Screwing American Passengers for 89 Years."  The cruise industry and its trade organization spend millions each year lobbying against efforts to repeal DOHSA.

So when the BP oil well exploded and killed the oil workers, the lawyers for BP undoubtedly began to educate their negligent client that liability for the dead men would be limited under DOHSA solely to the wages they earned.  There is no liability for the dead men's pain and suffering after they were burned and lay dying, or their fear of imminent death, or the mental anguish and suffering of their wives and children.     

Mother Jones points out that one of the rig workers who was killed was single and childless. That means his family would only be entitled to recover funeral expenses under DOHSA.  But because his body was never found after the rig blew up, there is nothing to bury.  BP could get away with paying as little as $1,000 for his death. 

There are representatives in Congress, including Senator Leahy, who will introduce legislation to repeal DOHSA so that families of the oil workers are reasonably compensated.  But the article predicts that:    

"There’s another powerful industry with an interest in doing BP's dirty work to preserve the status quo. That would be cruise line operators - and when it comes to Beltway battles, the Son Michael Pham - Death On High Seas Actcruise lobby is no Love Boat."

The article addressed the sad story of Son Michael Pham (photo right), the vice president of the International Cruise Victims Association. (Mr. Pham is the founder of the non-profit organization Kids Without Borders).

As the article explains: "In 2005, his parents went on a Caribbean cruise and never came back. Carnival Cruise Line, one of the world’s largest cruise operators, never offered any explanation for what had happened, and has refused to discuss the incident with Pham and his family since then. That was how Pham discovered the horrible divide in the way the law treats people killed through negligence at sea. "We couldn't take legal action to get justice," he says. Long before the BP explosion, his group was lobbying Congress for DOHSA to be overhauled . . .

Finally, in 2009, the cruise ship victims succeeded in getting legislation introduced with help from Sen. John Kerry (D-Mass.) that would have updated DOHSA in just the way Leahy has proposed. That change would have allowed families of cruise ship victims to sue for non-economic damages - a huge deal for cruise-goers, because so many are retired and have no salaries that would provide the basis of a legal award under the current law . . .

Mr. Hue Pham - Mrs. Hue Tran - DOHSABut the cruise industry spent $2.2 million fighting these changes. The Carnival cruise line company alone has donated more than $400,000 since 2007 to members of Congress from both parties, according to the Center for Responsive Politics. The offending provision was eventually removed from the cruise-ship safety bill.

The Cruise Lines International Association did not return requests for comment. But Pham says he has no doubt that the DOHSA revision will not slip by without the lobbyists’ notice. "Cruise lines absolutely didn’t want DOHSA to be part of that [2009 bill] at all," he says, noting that the industry would suddenly become liable for all sorts of incidents that it's currently able to dodge legal responsibility for - everything from on-board murders to rapes to mysterious disappearances like that of Pham’s parents. "It’s an industry that self-polices. When there’s an incident on board, there’s nobody but themselves investigating themselves. You're not going to turn yourself in."

 

What do you think of DOHSA?  Please leave a comment below. 

Are you a travel agent or cruise specialists who is a member of CLIA?  Do you think that CLIA should spend millions of dollars a year lobbying to make certain that families on cruise ships lose their rights under DOHSA? 

 

Credits:

Deepwater Horizon Explosion          U.S. Coast Guard