Today, the Miami Daily Business Review (DBR) reported on an arbitration award entered against Norwegian Cruise Line (NCL) on behalf of a seriously injured crew member.

The DBR article, titled “Miami Attorney Helps Secure $3.3M for Man Whose Arm Was Amputated After Seeking Care for Flu-Like Symptoms,” explains that the case involved a 30 year-old crew member from Serbia by the name of Ilija Loncar who was employed by NCL as a waiter aboard the Norwegian Breakaway.

Mr. Loncar, who previously worked as a carpenter prior to working on the NCL cruise ship, was treated by the NCL shipboard team for flu-like symptoms in March of 2016. NCL had earlier hired a doctor, Sebastian Campuzano, who the arbitrator described as a “young, inexperienced, Columbia trained physician (licensed in 2013) who was hired by NCL just 4 months before the subject accident.”

Dr. Campuzano prescribed promethazine which the ship nurse injected in a massive dose too quickly, causing an intensely painful and  harmful reaction.  NCL then failed to timely medically evacuate Mr. Loncar from the ship, squandering any chance his arm could be saved.  As a result of the malpractice and delayed medical evacuation, Mr. Loncar developed Compartment Syndrone and required the eventual amputation of his dominant right arm.

The arbitrator’s decision reflects what appears to be completely abysmal medical care by an inept doctor and nurse who demonstrated a complete lack of basic medical knowledge, training and experience. The arbitrator found that: Dr. Campuzano had no experience or familiarity with the drug which he ordered to be mistakenly injected intravenously in Mr. Loncar’s arm rather than intramuscularly in his buttocks; he first attempted to schedule a consultation via the internet with a medical facility in South Florida for advice but he gave up after he could not establish a connection; he didn’t read the relevant physician desk book, medical literature, package inserts or warnings for the medication; he never warned Mr. Loncar of the risks associated with the medicine or obtain his informed consent; and he didn’t consider ordering a lower dosage or other medicines available on the ship which did not contain the risk of such catastrophic injury.

Dr. Campuzano tried to refute his deposition admissions after the fact via an “errata sheet” which the arbitrator rejected. The decision seems to indicate that the arbitrator did not find Dr. Campuzano or the ship nurse (Marco Oracion) or NCL’s defense particularly credible.

The case was the result of “arbitration.” NCL is one of many cruise lines which prohibit injured crew members from filing cases in the U.S. legal system and require them to pursue “arbitration” cases where a single arbitrator, paid by the cruise lines, applies the law of the Bahamas.  NCL started the trend toward arbitration after a decrepit, poorly maintained steam boiler on NCL’s 40+ year-old SS Norway exploded at the port of Miami in 2003. The explosion killed eight NCL crew members and seriously burned another nineteen crew members. NCL forced the families of the dead Filipinos to pursue the limited benefits permitted under Filipino law, as opposed to the full range of damages permitted under U.S. law.

The arbitration award, which you can view here, was rendered in June of this year. The arbitrator awarded past pain and suffering in the amount of $337,500, and $3,000,000 for future pain and suffering (estimated at 48 years), loss of future earning capacity (over the course of 35 years) and future medical expenses, including the replacement of the crew member’s prosthesis.

One of the reasons NCL requires arbitration (as opposed to a trial by a U.S. jury) is to keep awards to a minimum in catastrophic injury cases like this.

The case was handled by Thomas Scolaro and  Mason Kerns of the Leesfield Scolaro firm here in Miami. NCL was represented by  Curtis Mase and Larry Krutchik of the Mase, Mebane and Briggs firm.

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Photo credit: Dickelbers (Dick Elbers) CC 3.0 wikipedia / commons.

 

Former Norwegian Cruise Line ("NCL") CEO Colin Veitch’s trial against his successor, Kevin  Sheehan, and their old cruise line, NCL, for defamation and breach of contract has been underway in the Miami-Dade County courthouse, here in Miami, Florida this past week.

Veitch worked at the helm of NCL from 2000 to 2008. According to Travel Weekly, Veitch was the architect of "Freestyle Cruising" and undertook an ambitious fleet renewal program, purchasing nine new cruise ships. By some accounts, but  not all, Veitch was an innovative cruise executive who was successful in beginning the transformation of under-performing old cruise ships into a larger and far more profitable fleet. 

Veitch turned the revitalized cruise line over to Sheehan in 2008. Things turned sour between the two NCL Colin Veitchrich cruise executives after a travel periodical, Travel Weekly, wrote a glowing article in December of 2014 about Veitch and his success at NCL. Sheehan then sent an email to Travel Weekly mocking the article and criticizing Veitch. The Miami Herald reported at the time, quoting the lawsuit allegations, that Sheehan sent a “vindictive, false and defamatory” email to Travel Weekly which eventually published. A few days later, Travel Weekly retracted the complimentary article about Veitch.

Veitch then sued Sheehan and NCL alleging defamation, as well as breach of contract, claiming that his former cruise line and its new CEO allegedly cheated him out of revenue sharing. 

The overblown 187-page lawsuit which you can review here is, in my opinion, a rather fascinating insight into the hurt-feelings and out-of-control personalities of two multi-millionaire former NCL cruise executives.

The lawsuit which Veitch filed against Sheehan included allegations which have been characterized by the Skift travel publication as "incendiary" accusations that Mr. Sheehan engaged in “a long pattern of personal and professional misconduct and recklessness, stunning in its scope and hubris, corrosive and detrimental in its impact on the company, and deeply undermining of the workplace culture . . . ” 

In response, Mr. Sheehan and NCL asked the court to strike what they characterized as "immaterial, impertinent and scandalous" allegations. 

The bitter personal allegations between these two former cruise executives arise from a nasty dispute between two very wealthy former cruise executives.  When Mr. Veitch resigned from NCL’s parent company, Star Cruises, he reportedly received $10,000,000 as part of a severance package. He also settled a $300,000,000 lawsuit which he filed against Sir Richard Branson and the Virgin Group after he alleged that the British billionaire and his company stole his ideas for a new cruise project. The precise amount of money that Veitch pocketed is confidential. 

Kevin SheehanSheehan also received a severance package from NCL in 2015 after it terminated his employment, totaling $13,400,000.

The many articles written by trade publications and major newspapers in Miami. like the Miami Herald and the Miami New Times, have covered the Veitch-Sheehan squabbles at length, but they are ignoring the biter irony of the litigation. Veitch was the NCL CEO in 2003 when a decrepit, poorly maintained steam boiler on NCL’s 40+ year-old SS Norway exploded at the port of Miami. The explosion killed eight crew members and seriously burned another nineteen NCL crew members.

The National Transportation Safety Board ("NTBS") concluded that the deadly boiler explosion was caused by NCL’s "improper operation, maintenance and inspection" of the old cruise ship’s steam chamber. The old boiler had "extensive fatigue cracking" and deteriorated materials that weakened the metal and caused it to rupture under pressure. The NTSB reported that NCL was aware of the dangerous condition but failed to take action to fix the problem. 

CEO Veitch tried to deflect blame but NCL was forced to plead guilty to a criminal charge of gross negligence regarding the explosion. The Norway was subsequently sold for scrap.

When the families of the eight dead crew members who were scalded to death filed suit in Miami to obtain compensation for the loss of their fathers and husbands, Veitch’s lawyers argued that the crew members were not entitled to file suit before a judge and jury in Miami. Instead, NCL argued, because the crew members were Filipinos, their loved ones had to pursue the extremely limited death benefits pursuant to the arbitration process in the Philippines. 

Kicking "foreign" (i.e., non-U.S.) crew members out of the American legal system was unprecedented.  Foreign crew members injured or killed due to the negligence of U.S. based shipping companies have long been permitted to have their cases resolved through jury trials under the Jones Act here in the U.S. In addition to the Jones Act, crew members have also been entitled to obtain medical treatment and daily living expenses when they are injured aboard U.S. based cruise ships Norway Boiler Explosionunder the "maintenance and cure" doctrine, one of the oldest legal American legal doctrines dating back to the early 1800’s. 

But NCL, which faced substantial liability and damages for the deaths of eight crew members and nearly twenty other ship employees burned in the explosion, sought to dismiss the cases, arguing that their only remedy was the limited benefits under the Filipino law. NCL argued that Miami was not the proper location to resolve the dispute even though it is based in Miami and the deaths occurred at the port of Miami.  In Batista v. Star Cruises, our federal court agreed with NCL and sent the cases to Manila, where Filipino law limited the widows to just $50,000 and the children to just $7,500 for the loss of their dead husbands/fathers.

Like "freestlye cruising," NCL’s unprecedented legal posturing has also been copied by NCL’s competitors Carnival, Royal Caribbean and all other cruise lines, which quickly inserted one-sided arbitration clauses into their crew member employment agreements to escape or limit their liability when things go wrong on the high seas. 

Except for Disney Cruises, all other cruise lines prohibit injured crew members from having their cases heard by juries in the U.S. legal system. Filipino seafarers are especially susceptible to being screwed by the Miami-based cruise lines, thanks to NCL’s efforts which started under Veitch’s tenure. 

During the trial last week at the Miami-Dade courthouse, where NCL crew members are barred from filing suit, Veitch’s lawyer reportedly asked the jury to consider awarding $95,000,000 in damages, according to Court View Network (CVN). That may be a proper amount to finally compensate the families of the eight Filipino crew members who were burned to death on the SS Norway back in 2003, but it seems to be an awful lot for a healthy, millionaire former cruise executive with hurt feelings. 

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December 11, 2017 UpdateAs reported by the Miami Business Review today, Norwegian Cruise Line Defeats $90M Lawsuit From Former CEO.

Photo credits:

Colin Veitch: Associated Press via the Honolulu Star-Bulletin

Kevin Sheehan: REUTERS/Brendan McDermid.

SS Norway: News7 Miami via CBS News video.

Yesterday, investigative journalist Lizzie Presser’s article about the plight of crew members from the Philippines working on cruise ships was published. Titled Below Deck – Filipinos make up nearly a third of all cruise ship workers. It’s a good job. Until it isn’t, the article follows the lives of several young Filipino men who went to sea for Miami-based cruise lines in order to provide a better life for their families. But when they were injured after working unreasonably long hours (12 hours a day for as long as 10 months without a break), the crew members found that they had no real legal rights to hold their employers responsible. 

Carnival Imagination - Filipino Crew Members This is an issue which I have written about regularly over the years, explaining the legal problems Filipinos face while working on cruise ships owned by companies like Carnival and Royal Caribbean:

Filipino Labor Board Punishes Burned Crew Member.

Screwing Filipinos & Imprisoning Lawyers: Seafarers "Protection Act" Protects Cruise Line Employers.

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Photo credit: Kevin Kunishi via https://story.californiasunday.com

Investigative journalist Karen Foshay of KCRW published a muli-media presentation this week, chronicling the plight of seafarers who work long hours, away from their families and far from home, for a pittance.

When the crew members become injured, these "foreign" (i., e., non-U.S.) ship employees are barred from filing suit in the U.S. against their U.S.-based employers. Instead, they are forced to resort to filing arbitration claims where their disputes are resolved by arbitrators (usually paid for by the shipping company), in contrast to a judge and jury. 

The situation is particularly unfair to Filipino crew members who have to agree to a scheduled compensation scheme where they are limited to small pay outs when they are seriously injured due to the negligence of their employers.

Take a minute and read or listen to the the articles and watch the introductory video below. 

Her two-part special is entitled  Troubled Waters – a private justice system leads to secrecy and mistreatment on the high seas.

The investigation has two parts: Part one is titled the Secret World of Arbitration: 

http://www.kcrw.com/news-culture/shows/kcrw-investigates/troubled-waters-low-wages-on-the-high-seas/embed-player?autoplay=false

 

Watch the video below:  Troubled Waters: KCRW Investigates Exploitation on the High Seas. 

https://youtube.com/watch?v=vXUjyxEBEKg%3Frel%3D0

 

Yesterday was the "Day of the Seafarer," which is sponsored by the International Maritime Organization ("IMO") on June 25th every year. It was interesting to watch the cruise industry’s trade organization, the Cruise Line International Association ("CLIA"), promote the day on it’s social media pages like Twitter and Facebook.     

Crew members on cruise ships find themselves in a precarious position in 2016. Cruise lines overwork and underpay crew members from countries like the Philippines, India and Indonesia with impunity. Cruise lines like Royal Caribbean and Carnival pay no U.S. taxes by incorporating themselves in foreign countries like Liberia and Panama and registering their ships in third world countries like the Bahamas (the New York Times just published Tax Dodging on the High Seas). Although cruise ships are collecting record billion-dollar profits each year, they provide no job security, no meaningful union representation, or Day  of the Seafarerbasic benefits like retirement programs of any significance. Moreover, cruise lines have taken an adversarial attitude against their ship employees where they have systematically stripped crew members of the legal rights historically reserved for seamen. 

Here are at least seven ways that cruise lines are abusing crew members today:

Cruise Lines Unreasonably Overwork Crew Members – Cabin attendants, galley employees and waiters and other crew members work a minimum of ten to twelve hours a day, sometimes far more, seven days a week, for eight to ten months a year. They have no time off.  It’s all legal because cruise lines don’t have to comply with U.S. labor laws due to their foreign incorporation and flags of convenience.  Cruise lines are supposed to have been obligated to work their crew members a maximum number of hours with mandatory rest periods pursuant to MLC2006. But many companies flaunt the maritime labor code. Crew members are still often prohibited from logging in to work when they appear on duty to prepare their work stations or attend meetings. Department heads and supervisors often force crew members to sign out of the Kronos time system and keep working "off the clock." Compliance with the strict USPH standards leads to the managers overworking the crew. I chronicled the abuse aboard the Oceania Riviera earlier this year where crew members were forced to work 18 to 20 hours a day.

The excessive manual labor is hazardous to the crew members physical and mental health. "Cumulative trauma disorder" is a term I learned while representing crew members working for Royal Caribbean.  Sometimes the pressure causes crew members to snap, as this recent altercation between a cook and a chef demonstrates, and it may be one reason perhaps why there are so many suicides at sea.

Univision Noticias and the Columbia Journalism School just published an exhaustive research project and multi-media presentation "Vacation in No Man’s Sea" with a section on the abuse of cruise ship employees – Sweatshop On The High Seas (by Damia S. Bonmati). 

Cruise Lines Under-Pay Crew Members:  Crew members working these insane hours are often paid exclusively by passenger tips. It’s quite a scam where the non-tax paying cruise line require their tax-paying U.S. guests to pay the cabin attendants and waiters for the long hours they work. Cruise lines are all increasing their automatic gratuities with the implication that the extra nickel-and-dimming is for the crew members. But the reality is that the cruise lines are either diverting the tips to pay the non-tip-earning employees’ salaries or they just steal the money outright. Meanwhile, many passengers refuse to pay the auto-gratuities and then refuse to pay any tips to the crew

Cruise Lines Prohibit Crew Members from Organizing or Protesting –  A number of readers suggest that crew members should organize and protest their mistreatment.  But the last time that crew members protested low wages, Carnival fired all of the waiters on one of its cruise ships and black-balled the crew members from the cruise industry.

Cruise Lines Fire Crew Members at Will – Crew members know that if they complain about the working hours, or the pay, or the stolen tips, they will find themselves on a one-way flight back to Mumbai. Cruise lines, notwithstanding the language in the employment contracts about the right to appeal, etc., can terminate the employment of a crew member for any reason, good reason, bad reason or no reason. Cruise lines often terminate the jobs of crew members who complain of work-related injuries and can do so with little legal recourse.  We receive literally dozens of emails a month from crew members back in India or in east Europe who have completed their medical treatment and are at MMI ready to return to work and have waited for months without word from the hiring partner trying to get back to work. They are being played by the cruise lines and are waiting in vain. 

Cruise Lines Provide Few If Any Benefits to Crew Members – A couple of years ago, Carnival terminated the retirement program for Filipino crew members, some of who had worked over a decade for the company. Royal Caribbean still has a nominal retirement benefit, around $5,000 if a crew member works for 10 years. If Royal Caribbean follows the Carnival model, it won’t be around when RCCL crew members retire in the next few years.

Cruise Lines Force Crew Member to "Arbitrate" Their Disputes – Following NCL’s decision to send the cases of Filipino families of  crew members killed in the boiler explosion on the SS Norway in 2002 to Manila for arbitration under the POEA, all U.S. based cruise lines (except Disney Cruises) inserted mandatory arbitration clauses in crew member employment contracts. By doing so, cruise lines stripped the rights of seafarers to file suit in the United States before a judge and jury. Cruise lines also inserted foreign law from countries like Panama, or Bermuda or the Bahamas into employment agreements which have few laws protecting seafarers.   

Cruise Line are Working to Strip Crew Member from the Protection of All U.S Law which Protect Seafarers at Sea – Lobbyists for CLIA have convinced certain lawmakers to insert anti-crew member legislation as add-ons to bills before Congress designed to strip the protections of seafarers from U.S. laws such as the Jones Act,  which has provided the right of seafarers to sue maritime employers who act negligently, in U.S. courts.  This has been the centerpiece of crew member maritime law for 96 years. CLIA has been at the forefront of these efforts. It panders to the sentiment of some US. lawmakers that U.S. courts should be be closed to "foreign" seamen notwithstanding the fact that the cruise industry is essentially comprised of nothing but foreign corporations (except NCL America), based here in Miami, which benefit from their free use of over 25 federal agencies like the Coast Guard, Customs and Border Protection, USPH, and the CDC not to mention the tremendous protection of the cruise lines’ vast revenues by loopholes in our U.S. tax code.

Many cruise fans selfishly feel that paying a fair wage to crew members will result in higher fares to them. Their arguments that crew members "make more than at home" or "they can quit if they don’t like it," seem like flippant "let them eat cake" afterthoughts.  Meanwhile fat-cat executives like NCL’S Frank Del Rio make obscene salaries and perks (CEO Del Rio alone raked in almost $32,000,000 last year). 

Don’t let CLIA’s recent hollow praise to seafarers fool you. This is a cruise industry which is busy screwing crew members at every turn – at sea, in the courtroom, and in Congress. 

SeafarerThe Manila Bulletin reports that Royal Caribbean announced yesterday that it is "hiring a total of 30,000 Filipino crew members over the next five years" as the company "expands its fleet and routes to Asia."

The newspaper also states that the cruise line currently employees around 11,000 Filipinos as crew members.

Filipinos seafarers have a proud tradition of working at sea. Unfortunately, Filipinos have perhaps the fewest legal rights of any crew member working for a cruise line. That’s because the cruise industry is enforcing arbitration which requires them to pursue their claims in Manila pursuant to the Philippines Overseas Employment Agreement (POEA) which places a cap on their damages when they are injured during their work.   

The compensation is ridiculously low. For example, a Filipino crew member employed on a bulk carrier as a senior engine fitter received sustained serious burns of his abdomen and legs when scalding water overflowed a tank. The crew member underwent extensive and painful medical treatment in the burn units of West Jefferson Medical Center and Baton Rouge General Medical Center in Louisiana, U.S.A.

The Filipino underwent skin grafting burns of 35% of his body.

He thereafter was returned to the Philippines where he continued undergoing medical treatment at a number of hospitals and with a number of doctors who performed plastic surgery. He is now unemployed, disabled and scarred for life.

He filed suit in state court in Jefferson Parish where the accident occurred, but his case was dismissed and he was ordered to proceed with arbitration in the Philippines.

The shipping company argued that the case was controlled totally by Philippine law and the crew member had no rights whatsoever under U.S. law. The company argued that under the Philippines Overseas Employment agreement (POEA), the crew member suffered a grade 14 disability which would entitle him to only 3.74% of USD $50,000 or a total award of $1,870.00 (US).

The Filipino Labor Board agreed and awarded the crew member just $1,870. You can read about the case here

When Filipinos are killed at seas due to the negligence of the cruise line, the POEA has a cap of only $50,000.  

If Royal Caribbean hires some 30,000 Filipinos over the years, it will save many millions of dollars by sending them back to Manila when they are injured and forcing them to accept the limited compensation under the POEA.

Photo Credit: By Maxime Felder – Own work, CC BY-SA 3.0 / Wikimedia

A retired Supreme Court justice is suggesting that all Bahamas-flagged cruise ships require that passenger disputes (including claims involving personal injury) be arbitrated in the Bahamas, according to the Tribune newspaper

The Bahamian newspaper reports that former justice Rubie Nottage told a group of arbitrators yesterday that arbitrating cruise passenger disputes would generate a "significant volumes of business."

The Tribune states that "with many of the major cruise lines, such as Carnival and Royal Caribbean, Arbitration Nassau Bahamasoperating Bahamas-flagged ships, Mrs Nottage called on them to insert a clause into passenger contracts ensuring “that matters that arise on Bahamas-flagged vessels be arbitrated in the Bahamas."

Currently, cruise passengers are entitled to trials in the United States federal courts. Royal Caribbean, Carnival, and Norwegian Cruise Line passengers are required (according to the cruise lines’ tickets) to file suit in Miami. Princess cruise passengers are required to file suit in Los Angeles. Holland America Line passengers must file suit in Seattle. All cruise passengers are entitled to have juries decide their claims against the cruise lines.

However, if arbitration clauses are inserted into cruise line tickets, and such provisions are enforced, cruise passengers would lose their right to a jury trial in the U.S.  Passengers would also be required to travel to Nassau, incur additional expenses,and risk being a victim of crime there. The murder rate in Nassau is many times higher than in the U.S. The Tribune reports today that a former government official said there is something “drastically wrong” with the government in the Bahamas and a "spirit of fear, sparked by escalating crime, shrouds the country."

As far fetched as it may sound, the prospect of cruise passengers bring forced into arbitration and losing their right to a jury trial is possible.  The cruise lines began requiring all crew members, including U.S. crew members, to submit to foreign arbitration in the last decade. Our firm is now now prosecuting crew arbitration cases in Panama and Europe where the applicable law is that of Panama, Norway or the Marshall Islands. The cruise lines resorted to this tactic to take rights away from their crew members.

Last year, the Tribune reported that the Bahamas had “a very good chance of being the arbitration centre of choice” for thousands of crew member cases generated annually. Michael Crye, a U.S. lawyer and former Cruise Line International Association (CLIA) executive vice-president, remarked that the Bahamas’ long-standing ties to the cruise industry placed it in position to “grab a substantial amount of this opportunity.”

It is questionable that a U.S. citizen could obtain a fair hearing before a Bahamian arbitrator deciding a case involving a cruise line which registers its cruise ships in the Bahamas. In addition to the inherent conflict of interest, there is a culture of corruption in Nassau. Consider the two comments to the article in the Bahamian newspaper. One comment mentioned "we are not an impartial jurisdiction, and the corruption will prevent anyone from using Bahamians as arbitrators." The other comment said: "I would only come here and when i already bribed everyone involved, that’s how it works here . . ."

This week several people died during cruises on ships owned by Carnival Corporation.  A young seafarer died on the Carnival-owned Cunard Queen Victoria cruise ship.  A crew member from the Carnival Conquest was crushed to death at the port of New Orleans. And most tragically, a 6 year-old boy needlessly drown on the Carnival Victory in a swimming pool which, incredibly, did not have a life-guard.     

What do all of these seemingly unrelated incidents have in common?  

Because of antiquated laws and recent legal developments advanced by the cruise industry, the cruise Qwentyn Hunter - Carnival Cruise Shipline will escape virtually all legal accountability for the deaths.

Let’s look first at the sad case of little 6 year old Qwentyn Hunter who died on the Carnival Victory last week. He died underwater in a swimming pool that Carnival decided not to supervise with a lifeguard for, what I believe to be, purely financial reasons.

A child on vacation dead at age 6.

Is it foreseeable that a child may drown in a pool?  Of course. We have written recently about a 4 year old boy who is severely brain injured after slipping under the water on a cruise ship Disney which also didn’t bother to assign a lifeguard to the pool.    

Put aside the debate whether the boy’s death was a lack of personal responsibility of the parents or a lack of corporate responsibility due to the the malfeasance of the cruise line (or both), what is the maximum exposure presented to Carnival?

The answer, sadly, is just the child’s burial and burial expenses. How is that possible?

There is a law in the U.S. called The Death On The High Seas Act ("DOHSA").  

DOHSA is an archaic law enacted in 1920 which provides only "pecuniary" losses to the survivors of someone who dies on the high seas. "Pecuniary" damages means only those financial losses, such as lost wages or medical expenses, suffered by those who are dependent on the dead person. In cases of a dead child or a dead retiree, there are no lost wages and no one dependent on the child or retiree for support. In Qwentyn’s situation, there are obviously no lost wages or medical expenses.  So all that the family could possibly receive in compensation after an expensive, long-drawn-out lawsuit is whatever it costs to bury a child these days.      

If the cruise line is negligent for a child’s death in an unattended pool, it will pay a maximum of $10,000 or so if liability is proven. Big deal. From a financial perspective, the cruise line is ahead of the game by not paying millions to employ lifeguards on over a hundred Carnival cruise ships to keep the kids safe. Carnival’s Micky Arison, worth around 6 billion dollars, gets to keep his bounty.    

Cruise lines love DOHSA. It exculpates the cruise lines when they act irresponsibly.  The cruise industry has lobbied hard against amending the law.  Read about that here and here. Don’t miss reading: What Does BP, Al Qaeda and a Cruise Line Have In Common?  

Crew members who die due to the negligence of the cruise lines face the same hardship of DOHSA. 

But that’s not all. The cruise lines have also fought tooth & nail to keep the claims of "foreign" crew members outside of the U.S. legal system and deprive injured crew members from having their cases heard by U.S. juries by insisting that they resolve their cases through "arbitration."  

Read about this injustice here. The Filipinos face a "schedule" of compensation depending on the Filipino Crew Member - Cruise - Burn Unitinjury. A lost finger, or hand, or an arm may result in an award of only $7,500 or $25,000 or $35,000. A death? $50,000, plus only $7,000 per child with a limit of 4 children. 

One of the worst cases involved a Filipino crew member who received 35% burns on his body in a clear case of the vessel operator’s negligence. At the ship owner’s request, the disabled and disfigured crew member’s case was dismissed from the U.S. legal system and sent to Manila where a Kangaroo Court awarded the burned Filipino just $1,870.00 (US).

The cruise lines don’t want you to understand what happens when the nice, smiling Filipino waiters or bartenders who serve your family are subsequently seriously injured or die on cruise ships. It is fundamentally different and absolutely unfair compared to when people are injured or die on land. 

And this is exactly how the multi-billion dollar cruise industry wants it.  

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Several years ago, U.S. based cruise lines began insisting that injured crew members seeking compensation for their injuries must pursue their claims through arbitration in foreign countries.

Companies like Carnival, NCL and Royal Caribbean started moving to dismiss lawsuits filed here in Miami, arguing that seriously injured crew members are not entitled to jury trials in the U.S. but must file arbitration claims in either their home countries or where the cruise ships are flagged.

The cruise industry’s lawyers understood perfectly well that many of these foreign countries, like the Philippines, Bermuda or Panama, had virtually no laws that provided compensation to their employees NCL Norway Explosion or the existing compensation scheme was a pittance.          

In 2003, the NCL Norway blew up at the port of Miami (photo right).  Eight Filipinos were scalded to death. Many other crew members were seriously burned in the explosion.

NCL responded to lawsuits filed by the dead men’s surviving wives and children by moving to dismiss the cases and arguing that the grieving family members could not file suit here in Miami, where the explosion took place and NCL was headquartered. Instead, the only claims permitted were in a non-jury arbitration process in Manila where the damages for wrongful death were limited to around $50,000.

NCL won its motions and paid very small amounts to the families, even though the 45-year-old Norway cruise ship was in deplorable condition. You can read our analysis here

Since then, most of the cruise lines have drafted onerous terms and conditions in the crew member’s employment contracts which prohibit lawsuits to be filed in the U.S. and limit recovery to the smallest imaginable amounts for serious injuries even in cases where the cruise line is grossly negligent.    

A recent case illustrated just how unfair the arbitration process is.   

Filipino crew member Lito Asignacion worked as a senior engine fitter on board the vessel M/V Rickmers Dalian (flagged in the Marshall Islands) for Global Management Limited.

Rickmers Dalian AccidentIn October 2010, while the ship was in the port of New Orleans alongside of 7th Street Wharf, crew member Asignacion sustained serious burns of his abdomen and legs when scalding water overflowed a tank. The crew member underwent extensive and painful medical treatment in the burn units of West Jefferson Medical Center and Baton Rouge General Medical Center in Louisiana, U.S.A.

Asignacion was treated and underwent skin grafting burns of 35% of his body.

He thereafter was returned to the Philippines where he continued undergoing medical treatment at a number of hospitals and with a number of doctors who performed plastic surgery. He is now unemployed, disabled and scarred for life.

Asignacion filed suit in state court in Jefferson Parish where the accident occurred, but his case was dismissed and he was ordered to proceed with arbitration in the Philippines.

The shipping company argued that the case was controlled totally by Philippine law and Asignacion had no rights whatsoever under U.S. law.  The company argued that under the Philippines Overseas Employment agreement (POEA), the crew member suffered a grade 14 disability which would entitle him to only 3.74% of USD $50,000 or a total award of $1,870.00 (US).

The Filipino Labor Board agreed and awarded Asignacion just $1,870.

Crew Member BurnThe labor board made a point of stating that the shipping had offered the burned crew member $25,000 “out of compassion and generosity," implying that he had foolishly rejected the "generous" offer.  The opinion reads and sounds vindictive.

The labor board also cited language from a prior decision that compensation for serious injured Filipino seafarers is low because the labor board sad that the seafarers are perceived as crew members "who complain too much.”  

The award is a disgrace.  The process is the result of a kangaroo court.

This is how shipping companies and cruise lines doing business in the U.S. treat their crew members from the Philippines and other countries outside of the U.S.

 

The case name is Lito M. Asignacion, Complainant, vs Rickmers Marine Agency Philippine, Inc.,Global Management Limited, and Navis Maritime Services, Ind., Respondents. AC-305-NCMB-NCR-100-07-11-12.  If you would like a copy of the decision, please contact me: jim@cruiselaw.com. 

Republic of the Philippines, Department of Labor and Employment, National Conciliation and Mediation Board, National Capital Region, Intramuros Manila. The award was by: 

Jesus S. Silo – Chairman.

Leonardo B. Saulog – Member.

Gregorio C. Blares, Jr. – Member.

 

Photo Credit: Rickmers Dalian

Fabian Zanzi - Royal CaribbeanA year ago. Cruise Law News was the first one in the U.S. to report that a Royal Caribbean crew member, Fabian Zanzi, claimed that movie celebrity John Travolta sexually harassed and assaulted him during a cruise.  We had first heard of the alleged incident several years ago from a crew member client who worked on Royal Caribbean’s Enchantment of the Seas cruise ship. 

We were told that a Royal Caribbean crew member claimed that Travolta came-on-to-him during a cruise on the Enchantment in 2009.  

Zanzi’s lawsuit claims that after he served Travolta room service, Travolta disrobed, "forcibly embracing" Zanzi while naked, and engaged in "nonconsensual, inappropriate, extreme and outrageous" contact. 

Zanzi reported the incident to his supervisors at the cruise line. Royal Caribbean then punished Zanzi and kept him confined to his cabin. Travolta ended his cruise early and took a jet back to the U.S.    

Travolta denied everything of course. 

Travolta’s lawyers responded to Zanzi’s lawsuit by moving to dismiss it and to send the case to arbitration. This way Travolta could avoid the publicity of a jury trial. Arbitration usually results in lower damages awarded to the aggrieved party. This is how cruise lines respond to lawsuits by injured crew members.

A federal court judge recently denied Travolta’a motion to arbitrate the case. You can read the well reasoned opinion here. This means that the case would head toward a jury trial.

But yesterday, the Hollywood news reporters said that Zanzi’s lawsuit had been "dropped," after the John Travolta - Fabian Zanzi - Cruise Shipparties had stipulated to a dismissal.  Sounds to me like Travolta paid a settlement, after losing his arbitration motion, in order to avoid the prospect of all of his dirty laundry being aired out before a jury in Los Angeles. The parties probably agreed to keep the settlement terms secret.  A good move by Travolta to put this spectacle to bed.

Meanwhile, Zanzi is proceeding with his claim against Royal Caribbean that it falsely imprisoned him in retaliation for reporting the alleged sexual harassment.

The Zanzi – Royal Caribbean false imprisonment claim is in arbitration, so there will be no jury trial for the Hollywood reporters to attend. My prediction is that eventually the cruise line will agree to a settlement, subject to a confidentiality agreement.

Then the case will end like it began, with everyone trying to keep what happens on cruise ships secret. 

 

Photo credit – John Travolta – WENN