On July 14, 2012, the container ship MSC FLAMINIA suffered a catastrophic explosion and fire, while in the middle of the Atlantic, during a voyage from Charleston, S.C. to Antwerp, Belgium. Three crew members were killed, the vessel suffered massive structural damage, and a substantial number of the container cargos on board were lost or severely damaged.
On December 7, 2012, the Plaintiffs Conti 11 Container Schiffahrts-GMBH & Co. KG MSC “FLAMINIA” (“Conti”), as owner, and NSB Niederelbe Schiffahrtsgesellschaft MBH & Co. KG (“NSB”), as technical manager and operator, of the MSC FLAMINIA, filed a Complaint for Exoneration From or Limitation of Liability pursuant to 46 U.S.C. § 183, et seq. (the U.S. Limitation Act). The resulting limitation proceeding consolidated the existing actions filed by certain cargo interests. Subsequently, the various cargo claimants, NVOCCs, and the estate of the Chief Officer, who died as a result of injuries sustained during the explosion, filed claims in the limitation action.
Following discovery on the jurisdictional presence of Conti and NSB in the United States, Conti and NSB filed a motion to dismiss the claims of the Chief Officer’s Estate on the basis that neither the Jones Act, Death On the High Seas Act (“DOHSA”), nor the General Maritime Law of the United States apply to this case. Instead, Conti and NSB argued that German law applies exclusively to the Estate’s claim.
The US Jones Act (a/k/a Merchant Marine Act of 1920) is a federal law designed to promote and maintain the American merchant marine industry. 46 U.S.C. § 688, et seq. In the context of merchant mariners, the Jones Act allows any seaman, who was injured during his employment, to maintain a cause of action for damages with a right to a trial by jury. Although the language of the statute is broad, not all seamen under all circumstances get the benefit of this law and its associated remedies. In order for the Jones Act to apply, there needs to be a substantial connection with the United States. For an American seaman or an American-flagged vessel, there can be a substantial connection no matter where the injury occurred.
To determine whether the Jones Act applies in a particular case, courts apply a choice of law analysis as set forth in two US Supreme Court cases – Lauritzen v. Larsen and Hellenic Lines Ltd. v. Rhoditis. This same analysis is applied for DOHSA and US General Maritime law claims.
Based on Lauritzen, a court must consider: (1) the place of the wrongful act; (2) the law of the ship’s flag; (3) the allegiance or domicile of the injured seaman; (4) the allegiance of the shipowner; (5) the place where the shipping articles were signed; (6) the accessibility of the foreign forum; (7) the law of the forum. The US Supreme Court in Rhoditis considered an additional factor: (8) the shipowner’s base of operations and the location of the managing and chartering agents for the vessel. A court may consider additional factors since whether US law applies depends on the substantial contacts between the underlying transaction and the United States.
In opposing the motion to dismiss, the Chief Officer’s Estate conceded that none of the Lauritzen factors existed. In fact, the Chief Officer was injured in the middle of the Atlantic Ocean (i.e., international waters), the vessel German-flagged, the Chief Officer was a Polish national, Conti was a German company, the employment contract was signed in Germany and subject to German law and forum, and Germany was an accessible forum with laws that allowed for a specified recovery, which the Estate has received. Instead, the Estate argued the application of the Rhoditis factor. Specifically, the Estate argued that Rhoditis was satisfied by the presence of a NSB office in the United States, the frequency of NSB vessels calling on US ports, and NSB’s efforts to sell passenger cruises that include US ports.
Having agreed that none of the Lauritzen factors were satisfied, the District Court noted that the Estate did not even attempt to argue that the owner or charterer had bases of operation in the United States, and instead focused on NSB alone. As to the those arguments, the District Court found that the US port calls, the presence of NSB’s agent in the United States, and the revenue derived from the cruise operations were simply not substantial enough contacts with the US, even when taken together.
Ultimately, the District Court held that: “Under the circumstances of this case, the interests of the United States have not been sufficiently implicated to warrant the application of United States law.” In re M/V MSC Flaminia, 12-cv-8892 (SAS), 2016 WL 1718252, *9 (S.D.N.Y. Apr. 27, 2016)