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Marine & Energy News Alert: Court of Appeals
Holds U.S. Coast Guard May Detain Vessel
Suspected of Polluting U.S., Foreign Waters
January 21, 2016
Any shipowner who has had the unfortunate experience of having one of its
vessels detained for purportedly falsifying the oil record book, bypassing
mandatory anti-pollution equipment or discharging oil waste directly overboard
knows that the process of securing the vessel’s release can be quite onerous.
Contributing Author:
If the Coast Guard suspects that a vessel polluted in the United States or
international waters it will initiate an investigation and detain the allegedly
offending vessel until the owners and/or operators post a security bond and
execute a “Security Agreement.”
In many cases, this “Security Agreement” calls for the vessel interests to pay
wages, housing, and transportation costs to crew members who may be detained
in the United States for months, as well as facilitate travel for those crewmembers
to court appearances, to encourage crew members to cooperate with the
government’s investigation, to help the government serve subpoenas on foreign
crew members located outside of the United States, to waive objections to both in
personam and in rem jurisdiction, and to enter an appearance in federal district
court.
Meredith Wilson Blanque
meredith.blanque@phelps.com
The vessel interests in Watervale Marine Co. Ltd., et al v. United States
Department of Homeland Security, et al. challenged the Coast Guard’s authority to
demand these nonfinancial conditions as a term of the vessel’s release. The
vessel interests appealed to the U.S. Coast Guard, Office of the Commandant,
and then to the U.S. District Court for the District of Columbia. Both held that the
Coast Guard’s authority to detain a vessel was not limited to financial forms of
security. The U.S. Court of Appeals for the District of Columbia Circuit agreed last
month.
According to the court of appeal, the International Convention for the Prevention of
Pollution from Ships, as modified by the Protocol of 1978 (“MARPOL”) and
implemented in the United States by the Act to Prevent Pollution from Ships, 33
U.S.C. §1901, et seq. authorizes the Coast Guard to hold a vessel in port, not just
through the pendency of the investigation, but “until legal proceedings are
completed.” As a result, the court of appeal commented that “the nonfinancial
conditions can, therefore, be thought of as simply quid pro quo for allowing ships
to depart” during the investigation, and through any civil and/or criminal
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proceedings.
The vessel interests have not petitioned for a panel rehearing or for a rehearing by
the court of appeal en banc, but may still petition for a writ of certiorari for review
by the U.S. Supreme Court.
The current decision is not binding outside the District of Columbia, but will likely
be seen as persuasive authority in other jurisdictions where the Coast Guard’s
authority has not been challenged at the appellate level.
The case is Watervale Marine Co. Ltd., et al v. Department of Homeland Security,
et al., D.C. Cir. No. 14-5203.
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