El Faro owners file legal complaint to block legal action by families of ship’s crew

Posted at 6:27 AM, Nov 02, 2015
and last updated 2015-11-02 08:36:03-05

Just hours before the Navy homed in on what’s believed to be the wreckage of missing American cargo ship El Faro, lawyers for the owner of the ship went to court in an action that one maritime attorney calls “highly insensitive to the families” of the sunken ship’s crew.

In a complaint filed Friday in U.S. District Court in Florida, El Faro owner TOTE Maritime claims “exoneration from or limitation of liability” in any claims the families of crew members might file. The company says it “exercised due diligence” to make sure the 40-year-old vessel was seaworthy and well-equipped for its September 29 trip from Jacksonville, Florida, to San Juan, Puerto Rico, and should thus be “(exonerated) from liability for any and all losses or damages sustained during the voyage … and from any and all claims for damages that have been or may hereafter be made.”

The El Faro disappeared October 1 some 30 miles off the Bahamas, as Hurricane Joaquin raged in the region. The massive ship vanished with 33 crew members on board — in the month since, the remains of one unidentified body and several pieces of debris are all that’s been recovered.

The Navy said Saturday it has zeroed in on the wreckage of a cargo ship in some 15,000 feet of water, and it’s believed the El Faro.

Families of four crew members have already filed lawsuits against TOTE on the grounds that the El Faro had a shoddy maintenance history and was reckless for knowingly sailing toward a hurricane.

But TOTE’s court action Friday would prevent any other families from doing the same until a judge rules on the complaint, according to Kurt Arnold, an attorney representing the family of one of those four crew members.

“It’s aggressive because it happened so fast,” Arnold, who is based in Houston, said of the ship owner’s legal action. “(TOTE) is coming out early, while the families (are) still grieving … they only called the search off for (crew members) three weeks ago.”

Daniel Rose, a maritime attorney not presently involved in any litigation pertaining to El Faro, agreed, telling CNN the maneuver came “too soon” and called it “highly insensitive to the families.”

“The wreckage hadn’t even been identified, let alone retrieved,” said Rose. “TOTE had six months to file a limitation action. They should have waited to see if the wreckage would be found, which appears likely, and loved ones retrieved, rather than slapping the families with a lawsuit.”

At the same time, said Rose, TOTE’s action was to be expected. “Unfortunately, (it is) not a surprise for this industry.”

TOTE sent a statement to CNN that said “the company will not discuss individual legal actions, out of respect for the legal process. Our focus remains on support and care for the families and their loved ones.”

Blame the captain?

Both Arnold and Scott Wagner, a lawyer representing the family of El Faro crew member Jackie Jones Jr., told CNN it appears TOTE is not only seeking to avoid blame, but angling to place any that may come its way squarely on the captain of the ship, Michael Davidson.

“They are without question making a calculated move to shove this off to the captain,” said Wagner, who added that the filing opens the possibility of suits against Davidson’s estate.

Arnold agreed, pointing to carefully worded language in TOTE’s suit that spells out how everything was up to par on the company’s end before the El Faro left the Port of Jacksonville on September 29 — including the ship’s plan to avoid then-Tropical Storm Joaquin, which was churning in the Atlantic but was forecast to turn into a hurricane. If any decisions made after departure led to its sinking, the ship’s owners argue, “such fault was occasioned and occurred without … knowledge of (TOTE).”

TOTE points to a change of course ordered by the captain once the ship was at sea. “After departure and during the voyage, (Capt. Davidson) altered the planned course for S.S. EL FARO to account for the hurricane’s track. (…) ”

But Wagner isn’t buying it. He said TOTE was intimately involved in and responsible for any and all decisions made at sea. It didn’t matter that the decision was made after departure.

“They are acting like they didn’t know what was happening, (but) there isn’t a damn thing the crew can do without the owners telling them what to do,” he said. “Nowadays the technology is so good these owners are on the bridge with the captain every step of the way. They are virtually on the ship, so for TOTE to file limited liability and say they didn’t know what was happening, that is wrong,” he said.

Rose, a partner at New York law firm Kreindler & Kreindler, said “it doesn’t do TOTE any good to blame the captain since his acts or omissions will likely be imputed to them regardless,” and characterized shifting blame to the captain as “more posturing than prudent legal strategy.”

“First, the captain, individually, is obviously not a realistic source of recovery for the families,” Rose said. “Second, the only reason to assert allegations against the captain is to impute his acts or omissions to TOTE, but it still has to be done in a way to defeat the limitation. Simply suing the Captain does not accomplish that.”

TOTE hopes ‘arcane’ law limits its liability

But even after making its case that it should not be held responsible, TOTE nevertheless hedged in its filing, citing what Arnold called “an arcane” maritime law from the 19th century to limit how much the company might have to pay out.

“(If TOTE) shall be judged liable (…) such liability be limited to the value of (TOTE’s) interest in the El Faro including her pending freight at the end of the voyage, and $420 per gross registered ton fund for death claimants,” the company said in its complaint.

But, explains Arnold, that’s not exactly a magnanimous gesture, because at the end of the voyage TOTE’s interest in the 737-foot container ship was $0, since it was lost at sea. That leaves only the $420 per gross registered ton of pending freight — a number that comes from the 19th century, according to Arnold — that would be eligible for death claimant to go after. With the registered tons El Faro was hauling on its final voyage, that amount comes out to be about $15.3 million, or about $464,000 for each of the 33 lives lost.

Arnold said the legal maneuver, which he called “an offensive tool for defendants,” stands in direct contrast to the statements made publicly by TOTE.

“They didn’t have to file a limitation action,” said Arnold, who represented several families who sued BP and Transocean in the Deepwater Horizon disaster in 2010. “They say one thing to the press how their hearts and minds are with the families, meanwhile they have their lawyers in federal court trying to get a judge to limit damages.”

In its statement to CNN, TOTE acknowledged the suit, but said it remains focused on “providing care and support” to the families of crew members.

“We confirm that families have been contacted regarding compensation,” continued TOTE’s statement. “We do understand that in these difficult and tragic circumstances, a number of families may have pressing financial burdens and we want to ensure that we are there to help immediately. All details of these discussions are, of course, confidential among the parties as they should be. Our efforts remain focused on providing care and support and this step is a step for those who may choose it.”