Law Offices of Countryman & McDaniel
THE CARGO LETTER 
Air & Ocean Logistics - Customs Broker News
30 March 2007
Good Friday morning from our Observation Deck......overlooking the officially designated "Cargo City" area and...... Runway 25-Right, at Los Angeles International Airport, voted "Best Cargo Airport in North America.". Here's what happened in our industry during March 2007!
We are often asked whether Countryman & McDaniel, conducts training seminars. Yes, from multiple Fortune 100 companies, to smaller forwarders, to the U.S. government, to insurance companies -- for years we have conducted inovative programs for domestic & Int'l claims, Customs, security, trade compliance & post 9/11 industry business practice. McD
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Michael S. McDaniel, Editor, Countryman & McDaniel, forwarder/broker/trade consultant attorneys at LAX.
INDEX to The Cargo Letter:
OUR "A" Section: Trade, Financial & Inland News***
1. Freight Forwarder Trade Briefs ______________
2. The Cargo Letter Financial Page ______________
OUR "B" Section: FF World Ocean News***
3. Freight Forwarder World Air Briefs ____________
OUR "C" Section: FF World Ocean News***
4. FF World Ocean Briefs _____________________
5. The Cargo Letter Cargo Damage Dispatches _____
**Back By Popular Demand**
OUR "D" Section: FF in Cyberspace***
6. The Cargo Letter "Cyber Ports of Call" _________
OUR "E" Section: The Forwarder/Broker World***
7. New Transport Related Legal Cases ___________
Back To Main Page
OUR "A" Section: Trade, Financial & Inland News***
1. Freight Forwarder Trade Briefs _____________
***Our Cargo Law Website .... as after great disruption in past months, our system is now operating on greater bandwidth, high speed equipment to better serve your growing needs. For the month of March we have serviced well over 8,500,000 hits to the site, roughly 350,000 hits per day. This increased traffic to our Website is in part due to our amazing current features. You should see these remarkable current transport events in our industry --
Worst Laid Plans? M/V Republica di Genoa - March 2007
M/V MSC Napoli - Expanded To 2 Pages - March 2007
Operation Jumbo Drop - M/V Jumbo Challenger - March 2007
***Iran Sanctions Tighten .......the United Nations Security Council voted unanimously March 24 to tighten sanctions against Iran, including measures imposing a strict ban on imports & exports of Iranian weapons. The sanctions, part of resolution 1747, also broaden the freeze on assets for Iran. The UN said the resolution reaffirms its commitment to uphold the call by the Int'l Atomic Energy Agency (IAEA) for Iran to cease its nuclear enrichment & reprocessing activities, and to ratify and implement the Nuclear Non-Proliferation Treaty Additional Protocol granting the IAEA access to its nuclear program information & sites. "Except for humanitarian or development aid, states & Int'l financial institutions should not provide funds to Iran, according to the resolution," the UN said. Meanwhile, 15 UK sailors & Royal Marines remain in Iranian custody -- seized during customary vessel inspections in Iraqi waters.
***Saying No to Mexico.....as the U.S. Senate Appropriations Committee has approved an amendment on March 22 that would prevent Mexican trucking companies from gaining unrestricted access to U.S. highways until American truckers are afforded the same access in Mexico. The Dept. of Transportation created a pilot program last month that would allow a limited number of Mexican trucks free access to U.S. highways. The amendment, co-sponsored by Sen. Dianne Feinstein (D-Calif.), prohibits the use of funds to allow Mexican trucks beyond the 20- to 25-mile commercial zone on the U.S.-Mexico border until U.S. trucks are given comparable access to Mexico, Feinstein's office said in a press release. The measure was included as part of an emergency spending bill, which was approved by the full committee. The amendment requires the DOT to go through a public comment period before starting the 1 year evaluation effort, & fully explain how it intends to implement safety inspections, driver hours-of-service, drug testing and other steps to ensure compliance with U.S. highway safety standards. The Bush administration intends to start the program by the end of April without any comment period.
***Nader Lawsuit Seeks To Block Mexico ....... as Public Citizen, a non-profit watchdog group founded by Ralph Nader, has filed suit against the Federal Motor Carrier Safety Administration (FMCSA) on behalf of a highway safety organization to compel the agency to release information about a cross-border pilot program to allow Mexico-owned trucks on all U.S. highways. In Feb., the Bush administration gave the green light to a year-long pilot project to allow Mexican-owned trucks to operate beyond the current 20-mile border trade zone. Although government agencies are required to respond to FOIA requests within 20 working days, FMCSA has not provided the requested documents about the program. The lawsuit seeks to require the agency to produce the materials requested.
***"TWIC" Is Your New Word For The Day ...... as the U.S. Transportation Security Administration has set the standard user fee for issuance of a transportation worker identification credential, or TWIC, toUS$137.25. Previous rules had given a range of US$139 to US$159. The new rule, published in the Federal Register, also set the user fee for an applicant who has completed a prior comparable background check at US$105.25. This price was expected to fall within a range of US$107 to US$127. These fees are intended to cover TSA's costs to enroll applicants, complete security threat assessments, and issue biometric credentials. TWIC cards will be valid for 5 years. The "smart" photo ID card includes an integrated circuit chip that stores the applicant's fingerprints and personal identification number. TWIC enrollment is starting now at a small number of ports & will be phased in around the country during the rest of the year. Workers will be notified when & where to apply prior to the start of the enrollment period in their given area.
***Israel Finally Consents To CSI ...... as it will soon join Container Security Initiative to safeguard shipments to the U.S. CBP plans to expand the CSI program from 50 to 58 ports this year. Through bilateral agreements, the agency stations small teams of inspectors at overseas ports to analyze shipping documents for risk factors & request host customs authorities to scan selected sea containers with large-scale detection equipment prior to loading on a vessel.
***C-TPAT Deadline For Customs Borkers Approaches ....... as Customs brokers who participate in the Customs-Trade Partnership Against Terrorism (C-TPAT) will have an extra 30 days to comply with new minimum security criteria published in Dec. 2006. U.S. Customs & Border Protection said it is extending the deadline to meet the more stringent standards from March 31 until May 2. The new standards upgrade what had been loose guidelines for the voluntary program. Companies in C-TPAT commit to develop and follow a plan to make sure they have adequate controls in place for their business partners, container and trailer stuffing & sealing, physical access, document processing, information technology and other areas. In exchange CBP gives shipments from trusted shippers expedited treatment at the border. Customs brokers will need to update their security profiles by the deadline, showing how they meet the new baseline security criteria.
***Big Fine For Going Against The Grain...... as the U.S. Customs & Border Protection (CBP) will begin assessing fines against importers, carriers, or bonded custodians for importing wood packaging material (WPM) that violates the regulations. Immediate exportation is required of any noncompliant WPM. This includes WPM that is unmarked, inappropriately marked, or marked but found infested with a live wood-boring pest. The regulations require all wood packaging material entering or transiting through the U.S. to be free of pests and to be properly marked to indicate that it has been either heat treated or treated with methyl bromide. When violations occur, liquidated damages and/or penalties will be assessed based on the value of the wood packaging and the value of the commodity or commodities identified for importation on the entry documentation. The liquidated damages claim may be up to 3 times the entered value of the merchandise but not greater than the bond amount.
***E-Border Comes To Golden State ....... as highway carriers entering the U.S. through ports of entry in California will be required to file electronic manifests instead of using paper documents beginning April 19, U.S. Customs & Border Protection said. E-manifests are already required in Washington, Arizona & several North Dakota crossings.
***Industry Costs Impair U.S. Generosity ...... as the United States remains the world's largest donor of food aid. Since the 2002 Farm Bill, Congress has appropriated about US$2Bn per year in food aid, which delivered an average 4 million metric tons of agricultural commodities a year. However, business & transportation costs have contributed to a 43% decline in the average food aid tonnages delivered during the past 5 years. Transportation & assorted delivery costs represent about 65% of the total food expenditures.
***California Has A Little Message For France...... as U.S. wine exports for 2006 -- 95% coming from California, jumped 30% in value & 4% in volume over the previous year. According to numbers compiled by the Wine Institute, U.S. businesses exported more than US$876M & 404.5 million liters of wine in 2006. Exports to Europe, which now represents more than half of annual sales abroad, surged 48% of the same year-ago period. Exports to Canada grew 29% by value. Other major growth markets outside of Europe and Canada include: China, up 53% by value, Singapore, up 68% & Hong Kong, up 19%.
***EGL Buys From Within ....... as it has agreed to the US$38-cash-per-share takeover offer from a consortium headed by Jim Crane, the Houston-based company's chairman & CEO. Total value of the deal is about US$1.7Bn. Crane & other EGL management partnered with investment firms Centerbridge Partners L.P. and The Woodbridge Co. Ltd. after the original backers General Atlantic LLC pulled out. Crane will continue as chairman & CEO. EGL earlier purchased the famed Circle Int'l.
***TNT Takes Over In China ...... as the Netherlands based mail & express company has completed the acquisition of Shanghai-based freight & parcels delivery firm Hoau, following approval from the Chinese government. Established in 1995, Hoau's network includes 1,100 depots, 3,000 vehicles and 56 hubs in China covering all major & 2nd-tier cities. Hoau has 12,000 employees.
***Major U.S Truck Buy..... as U.S. truckload carriers Western Express & Smithway Motor Xpress Corp. said that Western would acquire Smithway for US$10.63 per share, in a deal worth about US$90M.
***FedEx Rate Increase....... as FedEx Freight & FedEx National LTL, the less-than-truckload subsidiaries of Memphis, Tenn.-based FedEx Corp., have announced a 5.59% general rate increase, effective April 2.
***Schneider National Enters A 2nd Nation ........as it is using a license to operate as a domestic carrier in China, to grow an Asian investment wave by U.S. fleets, joining both truckload and less-than-truckload companies that have partnerships or logistics operations there. Schneider said it will spend "tens of millions of dollars" to open operations in all major Chinese cities over the next 3 to 5 years as a prelude to reaching the entire country, and several other carriers said they are either preparing or investigating expanded operations there. YRC Worldwide told investors last week it plans to make trucking & logistics investments in China through its Meridian IQ logistics subsidiary, which already has a freight-forwarding operation there.
***Old Dominion Freight Line Also Sights China Roads ...... as the less-than-truckload carrier will offer Int'l transportation service between China & the U.S., using the company's China partner, Hong Kong-based Cargo Services Far East Ltd. Old Dominion Freight Line said it will increase rates for its LTL service by about 5.1%. The company says customers with Int'l business moving between China & the U.S. will be able to bypass the destination warehouse & expedite sold goods to their customer and to point of sale locations. The plan is to roll the service out across the Old Dominion network beginning in May of this year.
***Safer Rail ...... as last year was the safest in history for railroads in the United States with train accidents down 21.4% compared to 2005, according to the Federal Railroad Administration.
***Border Bridge Builder ..... as the Michigan Dept. of Transportation will recommend whether Moroun's Detroit Int'l Bridge Co. will get tax-exempt bonds to help pay for a new US$1BN twin span that connects Detroit to Windsor, Ontario, and the state agency that will help make that decision is a chief competitor in building a new bridge. The 4-lane bridge currently carries more than 10,000 commercial vehicles on a typical weekday.
***Bridge Burner ...... as the Union Pacific railroad is offering a US$10,000 reward for information leading to an arrest in connection with the fire that destroyed a 60 year old 1,400-foot-long double-track trestle near Sacramento on March 15. Fire raged for nearly 3 days, fire officials had been reported as labeling the blaze suspicious in origin. UP estimates that the entire rebuilding process will cost upwards of US$30M. The destruction of the trestle and the mainline track that ran over it have led to detours and delays of up to 2 days for freight moving through the busy California region.
***He's Ready For The Sixth Circle of Hell ....... as U.S. federal prosecutors on March 19 indicted San Francisco area wine entrepreneur Mark Anderson, 58, for starting a 2005 blaze that destroyed a massive Mare Island wine warehouse & 6 million bottles of wine. The 19-count indictment includes charges of arson, tax evasion, mail fraud, using a fake name & interstate transportation of fraudulently obtained property. The charges allege that Anderson, who rented space from the warehouse owners, set the blaze to cover up embezzling wine from his customers, who stored wine with his company. The charges allege that his customers knew nothing of the sales. Prosecutors do not expect to charge anyone else in the blaze, which destroyed US$100M worth of inventories from 92 wineries stored at the Mare Island warehouse. A total estimate of the fire loses, including the warehouse, ranges from US$200M to US$250M. The destroyed wine included the entire inventories of some small wineries, as well as some private collections of rare wines. If true, the greed of Mark Anderson ruined careers, lives & dreams. The so called "small wineries" are mostly family businesses -- who staked their entire future & retirement on safe wearehousing of vintages which they watched over like babes in a cradle. This is more than an insurance matter.
***Banana Payoff? ...... as Chiquita Brands Int'l Inc. will pay a fine of US$25M after a former banana-producing subsidiary in Colombia paid protection money to paramilitary groups designated as foreign terrorist organizations under a U.S. statute. Chiquita is considering selling its overseas shipping & shipping-related logistics operations to help reduce its debt.
***Twinlode Triload .... as this corp. has been issued a provisional patent for a triple-wide racking system that the company will market under the name Trilode. The new system, which the company premiered at the ProMat2007 materials handling convention last month, enables the transfer and storage of three pallets simultaneously. The patent is a design extension of the firm's namesake Twinlode dual-pallet system that allows two pallets to be moved, stacked and stored as one load.
***Customs Classifies A Honey Grenade ..... as border guards in Kazakhstan arrested a man on March 16 for trying to smuggle a home-made grenade in a pot of honey. The man, a Russian citizen, was travelng by train from the Russian town of Omsk. "The pot seemed too heavy so it had to be checked," a senior Kazakh border official told the Kazakhstan Today news agency. The man told police he did not know it was a grenade and that his wife had given it to him as a present for her relatives in Kazakhstan. We would not want to be the relatives.
2. The Cargo Letter Financial Page ______
**A.P. Moller-Maersk (world's largest ocean carrier) DOWN with a loss of US$568M for its container shipping & related activities in 2006.
**Cathay Pacific Airways UP with of US$523M in 2006, up 24 %
**CMA CGM. UP with profit of 2006 of US$611M, up from US$584M in the prior year.
**COSCO Pacific (Chinese terminal operator ). UP with US$398M in profits before tax in 2006, a 10.7% rise over 2005.
**Eagle Bulk Shipping Inc. DOWN as 4th quarter net income fell to US$4.5M from US$12.1M from the year earlier period.
**EGL Eagle Global Logistics. DOWN with net profit of US$56.3M in 2006, down by 3%.
**EL AL. DOWN As 4th quarter revenue totaled US$41M, 6% less than in the preceding quarter. Income generated from cargo operation was US$317.6, up 8% compared to 2005.
**FedEx Corp. DOWN with a 2% drop in net income in 3rd quarter ended Feb. 28 to US$420M, down from US$428M in the corresponding period last year. Company blamed slowing economic environment, lower fuel surcharges & severe winter storms.
**Horizon Lines. UP with best-ever 4th quarter net income of US$10.6M, compared to a net loss of US$10.9M in same quarter in 2005.
**Interpool Inc. UP as profit for the year was US$106.6M or US$3.29 per share, up from US$60.5M or US$1.94 the previous year.
**Kuehne + Nagel Group. UP with net profit of US$371M in 2006, a 45% increase over 2005.
**Lufthansa Cargo. DOWN with operating profit of US$108.3M in 2006, down 24.7%.
**Orient Overseas (International) Ltd., (parent of Orient Overseas Container Line) DOWN with net profit of US$581.1M for 2006, down 10.7% from US$651.3M in 2005.
**Panalpina. UP with net income of US$151.2M in 2006, up 52.5% as the company saw double-digit volume growth in its air & ocean units.
**Lufthansa Cargo. DOWN with operating profit of US$108.3M in 2006, down 24.7% from the previous year.
**Seaspan Corp. UP with 4th quarter net earnings of US$10.1M on revenue of US$35.6M.
**TUI AG (parent of Hapag-Lloyd) DOWN with operating loss of US$152M from container shipping in 2006 due to lower freight rates & higher costs.
**Trailer Bridge. UP with 4th quarter net income of US$3.88M, a 40.6% increase compared to US$2.7M posted in the same period in 2005.
**US 1 Industries. UP as 4th-quarter income was US$1.4M or 11 cents a share, compared with US$600,000 or 5 cents a year earlier.
**UTi Worldwide. UP as 4th-quarter net income rose to US$23.6M or 24 cents a share, from US$9.7M or 10 cents a year earlier.
OUR "B" Section: FF World Air News***
3. Freight Forwarder World Air Briefs ___
***Maiden Voyages Make Waves ..... as 2 of European manufacturer Airbus' A380s, current holders of the world's largest passenger plane title, made maiden U.S. calls on March 19, in a showy simultaneous bi-coastal landing at New York's Kennedy Int'l Airport and Los Angeles Int'l Airport........ where the A380 taxied dirctly under windows of The Cargo Letter. Airbus hopes the US$300M double-decker A380, which is 50% larger than a 747 and can carry 60% more passengers, will become the standard for high volume civilian air travel for the next 2 decades. The A380, in a full-coach model, can hold up to 850 seats, but both of Monday's planes were configured with 519 seats in the more typical 3-class setup: first on the lower deck, business on the upper & coach spread between the two. The 747, with a full load of just under 400 passengers, has held the largest passenger airliner title for more than 40 years. Despite a 2-year delay in the A380's delivery, which has wiped out more than US$6.6Bn in profit forecasts for the firm, Airbus has 166 orders from 15 airlines for the new plane. LAX, the world's 5th-busiest passenger airport, is expected to be the 1st U.S. destination for the A380 when it enters full commercial service.
***UPS Just Says No ..... as it has cancelled its order for 10 A380 freighters from Airbus after the troubled European aircraft manufacturer announced it is suspending production on the cargo version of the "super-jumbo" to focus on the passenger plane. Airbus is cutting 10,000 jobs to try and return losses related to the delays to the A380 project, but said it would resume development of the freighter version in the future and anticipates sales of 400 over the next 2 decades. But late last month, Atlanta-based UPS reached agreement with Airbus to reschedule the delivery dates of its order from 2010 to 2012. UPS originally expected its first freighter in 2009. The revised agreement also gave either party the right to cancel the order anytime in 2007.UPS said that 2012 was a reasonable estimate of when Airbus could supply this plane, but no longer are confident that Airbus can adhere to that schedule. In Nov., FedEx cancelled its order for 10 of the A380Fs, replacing it with an order for 15 Boeing 777 freighters with options for 15 more.
***North Americans Open Skies ...... as the deal between the U.S. & Canada went into force March 12, giving travelers more choice in destinations, flights & routes -- as well as increased competition that could lower prices. The 2 nations agreed to liberalize their aviation markets in Nov. 2005. The new agreement also removes restrictions on air services for passenger & cargo airlines between each other's territory & a 3rd country.
***U.S. & European Union Also To Open Skies? ..... as negotiators have reached agreement on an accord designed to greatly increase the number of transatlantic flights, & otherwise increase the freedom of airlines to serve each others markets. The deal would allow European & U.S. airlines to fly from anywhere in their respective territories to the anywhere in the other market without restriction and could increase travel 34% by adding 26 million extra passengers during a 5 year period over current traffic level of just under 50 million. Eliminating bilateral restrictions could save passengers up to US$15.8Bn and lead to the creation of as many as 80,000 jobs, according to the EU. Union organizations in the U.S. have objected. The cargo market would see growth of 1% to 2%, a significant figure given the size of the market globally. The preliminary deal must still be approved by the EU's Transport Council of Ministers. The U.S. Congress is expected to approve the deal.
***U.S. Overseas Freight Ticks Up ...... as Int'l air freight & express shipments carried by 15 U.S. airlines increased 2.1% year-on-year in January to 1.04 billion revenue ton-miles, according to the latest statistics provided by the Washington-based Air Transport Assn.
***Northwest Airlines In Price Fixing Probe? ...... as it was publicly identified for the 1st time as a target of U.S. federal prosecutors into a wide-scale probe of price fixing in the air cargo industry, according to the Associated Press. Federal subpoenas or requests for information previously went out to American Airlines, Lufthansa, British Airways, Air France-KLM, Scandinavian Airlines, Japan Airlines, & United Airlines. Lufthansa said it has agreed to pay US$85M to settle class-action lawsuits filed in the U.S. over alleged price fixing by its cargo division.
***FedEx Corp. Overnight To China Is Okay ..... as it will offer next-business-day domestic express service in China beginning May 28. The new domestic services, expected to be fully operational in June 2007 with next-business-day, time-definite delivery service to 19 cities & a day-definite service to more than 200 cities throughout the country. FedEx said it is patterning its China network on the hub & spoke system it uses in the U.S. market, focused on the Hangzhou Xiaoshan Int'l Airport in East China's Zhejiang Province. The newly established hub will initially be able to sort up to 9,000 packages per hour. A Chinese carrier, Okay Airways, will provide domestic air transportation. Using 3 Boeing 737 freighters, Okay Airways will operate a network within China in support of FedEx on 2 circular routes nightly, covering the country's major airports.
***FedEx Corp. Increases Investmant In Self ...... as it will boost its plant and equipment investment by 15% to 20% in fiscal 2008 to expand in China, add new jets & add new stores to its FedEx Kinko's chain , Bloomberg reported. CEO Fred Smith gave few details at a FedEx investor conference held March 27 at its Memphis, Tenn., headquarters, Bloomberg said. The company earmarked US$3.2Bn for capital spending this year, so a 20% increase would amount to US$640M.
***The UPS Inerceptor ....... as it has anounched a new "Do Over" service that allows customers to reroute a package in transit to a new destination address. UPS Delivery Intercept is designed to provide maximum flexibility to customers to redirect a shipment before it is delivered. Customers can have packages returned to sender, sent to new address, held for delivery on future data, or held for consignee pick up. The service is available in the U.S. & Puerto Rico. The Web-based service, the 1st of its kind in the industry.
***Lights Burn Late At Airbus ....... as Cargolux has ordered 3 more Boeing B747-8 freighters, valued at US$845M, and added 2 options. The Luxembourg-based all-cargo airline & Japan's Nippon Cargo Airlines were the aircraft's launch customers in Nov. 2005. Cargolux's total 747-8 Freighter order now stands at 13 planes, 2 options & 10 purchase rights. In total, the 747-8 program now has 87 orders for both the freighter & passenger versions combined. The 747-8F will have a total payload capacity of 140 metric tons, providing 16% more cargo revenue volume than the 747-400F. The 747-8F will also have a slightly greater flying range of 8,275 kms.
***Israel Country Profile ..... as air carriers operate 53 aircraft. Figures published last week by the Israeli Civil Aviation Authority shows that at the end of January 2006 the 5 Israeli air carriers: El Al, Sundor, Arkia, Israir & CAL operated 53 aircraft. Out of the total number, 47 were passenger aircraft, 5 freighters & 1 convertible. Fleet consisted of 43 jet aircraft all made by Boeing & 10 turboprops.
***Goodbye C-17 Freighter ...... as 1 day after California Gov. Arnold Schwarzenegger personally asked the Bush administration for additional federal support of the C-17 Globemaster III aircraft program in Southern California, Chicago-based Boeing announced a firm decision to end production of the plane in 2009. The C-17 is one of Boeing's most visible projects, bringing in about US$3Bn in annual revenue. The company has delivered 167 C-17s out of 209 orders, including those for the UK, Australia & Canada. Production and delivery will continue on the remaining 22 aircraft under order. Unless further orders are placed, the last plane will roll off the former McDonnell-Douglas assembly line in Long Beach in Oct. 2009. The plane is the last major aircraft still under construction in Southern California, once a world center of aerospace production. This is a sad end for the people who brought you the Sprit of Saint Louis, DC-3, DC-7, DC-8, DC-9, DC-10, Lockheed Constellation, L-1011, all the WWII fighters, F-15, F-14, F-18, F-117 Nighthawk, X-1 through X-15, U-2, The SR-71Blackbird ... and so very many more histroric aircraft that changed the world. This is a sad passing.
***High Desert Air Hub ...... as construction on the Southern California Logistics Airport in Victorville is to begin with an April 5 groundbreaking. The first phase of the planned 8,500-acre desert facility, located 100 miles east of Los Angeles on the site of former George Air Force Base, will comprise 6.3 million square feet of industrial facilities projected to create more than 13,000 direct & ancillary jobs. The SCLA is being touted as a multimodal transportation hub to handle truck & rail freight from both Southern California ports and as an option for air cargo firms now using airports in the congested Los Angeles region.
***Another High Desert Hub ....as giant DHL opened its new Int'l gateway in Southern California. DHL invested US$3M at its West Coast Distribution Facility in Riverside, Calif. to establish the new operation, adding on-site offices specifically for providing customs processing & clearance functions related to Int'l shipments upon arrival. The newly expanded operation came fully online with the arrival of a flight from DHL's Central Asia SuperHub in Hong Kong into the facility on the site of the March U.S. Air Force Reserve Base in Riverside
***Giant Problem ...... as cargo transport using old freighters built in the former Soviet Union is becoming a shadowy business. The Int'l Civil Aviation Organization has published a list of 462 Antonov aircraft which are no longer considered air worthy. This marks the 1st time that ICAO made public this type of information. The move is intended to close the skies to aircraft deemed unsafe or environmentally unsound. Large Russian freighters such as the IL-76 have been eliminated from European Union airports due to tougher noise rules. The ICAO list covers smaller freighters, many of which serve networks within Africa & the Middle East. Included are 362 An-2S, the unpressurized single-engine by-plane; 27 An-12s, a 4 engine turbo-prop freighter; 23 An-28s, a twin turbo-prop; and 10 An-26s, a twin turbo- prop freighter. Many of the aircraft were added to the list because they were long past the deadline for required overhaul by the manufacturer.
***Booking Your Human Cargo In Time of Need ...... as if a Medjet Assist member is ever hospitalized more than 150 miles away from home MedjetAssist will send a medically equipped & staffed aircraft to pick up the member & fly him or her you to the hospital of choice &emdash; at no additional charge. No transportation cost limitations. No preexisting-condition exclusions. Just peace of mind each & every time you travel. Otherwise, U.S. domestic air medical evacuation averages US$10,000 to US$20,000, and internationally, it can exceed US$75,000. Cost: US$195 per year.
***Headlining Eyeliner ....... as French luxury beauty products maker & distributor L'Occitane has selected Carson, Calif.-based Target Logistic Services to manage the beauty firm's national supply chain. Target, a subsidiary of Target Logistics Inc., will handle supply chain strategies related to transporting L'Occitane's organic and natural beauty products, including perfumes, bath, body & skincare products to the French firm's 156 stores & independent retail outlets throughout the U.S. Started in 1970, the US$175M a year Target has facilities in 200 domestic airport cities & offices/agents in more than 80 countries worldwide.
***Dying To Upgrade ..... as first-class passenger Paul Trinder on a flight from Delhi to London awoke find the corpse of a woman who had died in the economy cabin being placed in a seat next to him, British Airways said March 19. The economy section of the flight was full, and the cabin crew needed to move the woman & her grieving family out of that compartment to give them some privacy, the airline said. British Airways said in a statement that about 10 passengers die each year in flight and that while each situation is dealt with on an individual basis, safety is paramount. Diverting the flight would be an unusual move.
***Big Boise Beers Bagged ..... as SkyWest Airlines apologized to a passenger who said he wasn't allowed to use the restroom during a 1-hour flight and ended up urinating in an air-sickness bag. James Whipple said he had 2 "really big beers" at the Boise, Idaho airport. While on a flight to Salt Lake City on March 7 he wanted to use the cabin restroom. The captain had declared it off-limits during the short flight because a light wasn't working. Whipple said he had used the cabin restroom before the plane departed but had to go again & finally reached for the air-sickness bag. No other passengers noticed Whipple using the bag, but a flight attendant asked him about it & told the captain, who called airport police. The airline sent him a letter of apology & a flight voucher. In return, Mr. Whipple agree not to squeeze the Charmin on future flights.
OUR "C" Section: FF World Ocean News***
4. FF World Ocean Briefs _______________
***End of The Peak Season? ...... as traffic at the nation's major retail container ports is beginning to climb out of the slow season and could top last year's peak as early as July, according to the monthly Port Tracker report by the National Retail Federation and Global Insight. "The slow season is on its way out," Global Insight Economist Paul Bingham said. "February was the slowest month of the year, as usual, but volume is starting to pick up now in March and we think July could top the peak for all of last year. We saw some weather disruptions in Feb., but U.S. ports are operating without congestion, and truck & rail performance has been sufficient." The 2007 West Coast shipping year may go down in the history books as a smooth sailing year without majot delays.
***Birth of A New Stock Index ...... as the Philadelphia Stock Exchange has launched a marine shipping index and that options on the index would be launched at a later date. The exchange said the PHLX Marine Shipping Index (SHX) seeks to reflect the performance of publicly listed companies primarily involved in worldwide seaborne transportation of liquid goods of crude oil, petroleum products, chemicals, and dry goods of iron ore and agricultural commodities. The index had a start date of March 1, and a beginning price level of 250. Component issues of the index are: American Commercial Lines Inc., Alexander & Brown Inc., DryShips Inc., Diana Shipping Inc., Eagle Bulk Shipping Inc., Excel Maritime Carriers Ltd., Frontline Ltd., General Maritime Corp., Kirby Corp., Nordic American Tanker Shipping, OMI Corp., Overseas Shipholding Group, Ship Finance Int'l Ltd., Seaspan Corp., Teekay Shipping Corp., Tsakos Energy Navigation Ltd., Knightsbridge Tankers Ltd.
***Cheaper West Coast Alternative Will Compete With U.S. Ports ....... as Mexican government is downplaying legal wrangling that has held up private investment in a new container port 150 miles south of San Diego at Baja California's Punta Colonet. The Mexican sub-secretary of transportation overseeing the project, told the San Diego Union-Tribune that the dispute, over sea floor mineral rights off Punta Colonet, would not last. "We're going to resolve it. Believe me, this won't stand in the way for long." Differing versions of the port plan have ranged in cost from US$1Bn to US$9Bn and varied in scale from smaller than the Port of San Diego to as large as the Port of Los Angeles and Port of Long Beach combined. The plan calls for the Mexican government to bid out the 3 parts of the project -- port operations, port administration and a rail line to the U.S. border -- to private companies. The Mexican government is hoping to grow the port to handle 6 million to 8 million TEUs by 2025 and ship it directly to the Midwest and eastern U.S., effectively removing commerce from West Coast ports.
***Union Pacific Lining Up For Mexico ..... as its own plans for the Punta Colonet project are still under development, but that it has started acquiring options to buy property for the U.S. portion of a 200-mile spur that container trains could travel between UP's east-west "Sunset Route" main line near Yuma, Calif., and the proposed Baja California seaport 150 miles south of San Diego. UP is upgrading the Sunset Route, adding a second track through Arizona to increase its capacity to move trains. The Sunset Route main line runs from Louisiana to California.
***Looking For The Bomb ...... as the U.S. Dept. of Homeland Security will begin operational testing of an integrated radiation detection & density imaging system for cargo containers at Puerto Cortes, Honduras, in April. The pilot test is part of the Secure Freight Initiative to evaluate at 6 foreign ports systems designed to automatically scan all containers transiting a terminal or specific gate. DHS officials also say information technology links are being finalized before the system in Pakistan's Port Qasim is ready to do cargo security checks. This article may seem blunt, but both the reason for the pilot test & the threat are self evident.
***Taking More Sino Control ..... as China will now require liner conferences & freight discussion agreements involved in services calling at its ports to negotiate any rate or surcharge adjustments with Chinese shippers, according to an announcement from the country's Ministry of Communication (MOC). While the implementation deadlines of the new rules are vague, they will require the relevant carrier groups to designate a representative within the Chinese territory before April 15 and pass that contact information on to press agencies selected by the MOC. Carriers themselves will have the responsibility of submitting photocopies of the agreements written in Chinese to the MOC 15 days before they become effective, either individually or through the conference's China-based representative.
***Call For Navigational Safety Fund ...... as research institutions from Malaysia, Singapore & Indonesia, supported by Japan's Nippon Foundation, have called upon the shipping industry to make financial contributions to the navigational safety of the Malacca Strait, the world's busiest maritime trade route. The 1,000 km. sea corridor is one of the most difficult regions in the world to navigate, with dangerous shallows, deceptive cross currents and occasional attacks by pirates. Traffic volume is projected to rise from 4 billion deadweight tons in 2004 to 6.4 billion dwt by 2020, which the Nippon Foundation said would increase the risk of accidents and maritime pollution. The Nippon Foundation, which has contributed more than US$125.5M in assistance to the area of the Straits of Malacca and Singapore, is prepared to set up a Malacca Straits Fund.
***Goodbye Dubai ....... as AIG Global Investment Group has completed the purchase of 100% of the stock P&O Ports North America from P&O Holdings Inc., a wholly owned subsidiary of global marine terminal operator, Dubai Ports World. The company will operate as Ports America Inc. Ports America Inc.'s operations principally comprise marine terminal concessions in the ports of New York-New Jersey, Philadelphia, Baltimore, Miami, Tampa & New Orleans, along with stevedoring operations in 16 locations along the U.S. East & Gulf coasts and a passenger terminal in New York City. DP World was forced to divest itself of the U.S. holdings acquired in the purchase of P&O Ports, due to a media firestorm & outcry from members of Congress who raised security questions about the Dubai-based company operating U.S. terminals. This was the #1 "issue of crisis" facing U.S. ports last year. Now the enterprise is being sold to an insurance company.
***Looking Over Your Shoulder -- Are They Watching My Terminal? ....... as tracking system manufacturer iControl Inc. has quietly completed installation of an asset monitoring, tracking & communications system at an undisclosed Port of Long Beach container terminal. Manufactured under the name iGATE, the system creates a wireless computer network that can communicate with mobile radio transmitters placed on equipment or containers within the facility. Terminal or law enforcement staff in a central location can then track & monitor data from the equipment via their existing computer network. Another pilot program is already underway, with a recent iGATE system installation in an undisclosed foreign port. The new program will also tag containers for shippers & customers to track as they move toward the U.S.
***Adventures In Partadise ....... as Hawaiian state legislators are considering a resolution that threatens legal action if California enacts a proposed container tax bill moving through the California legislature. California Senate Bill 974, introduced in Feb. by Sen. Alan Lowenthal, D-Long Beach, seeks to impose a US$30 fee on each TEU -- meaning US$60 for a 40 ft. box moving through the three largest California container ports. Of the roughly 1.6 million TEUs shipped through Hawaii last year, about 90% passed through the ports of Oakland, Long Beach and Los Angeles -- the nation's 4th, 2nd & 1st-ranked container ports, respectively. Based on Hawaiian TEU volumes, that could add close to US$50M a year to the cost of goods being shipped to Hawaii. Earlier this year, a heated battle sparked between the states of Washington & Alaska over a similar issue, when Washington state lawmakers proposed a fee on containers moving through their state -- but later decided just to do a study.
***Popularity Charge ...... as Maersk Line has introduced a congestion surcharge on all import cargo to Canada's inland destinations via the West Coast gateway, due to the severe disruption at Canada's Port of Vancouver. The surcharges applicable on the intermodal moves (not including local Vancouver deliveries) is on a sliding scale of US$225 for a 20-foot container to US$380 for a 45-foot container. There is also a new, but less pricey congestion surcharge at the Israeli ports of Ashdod & Haifa. Haifa: US$26 per TEU Ashdod: Us$19 per TEU. Lines will continue to monitor the situation and the position with effect 15 June 2007.
***7 Days Approaching A Standard ...... as OOCL will from the start of next month reduce its export demurrage free time at ports in the United Kingdom from 11 days to 7 days. This follows the decision of Southampton Container Terminal to combat rising container dwell times by no longer accepting delivery of export laden containers more than 7 days prior to the vessel arrival day. We see 7 days to becoming more nornal almost everywhere.
***APL Revenue Drops ..... as per 40-foot equivalent units (FEU) dropped 7% during the 6-week period ended Feb. 9, while its container volume rose 17% thanks to "robust market growth and pre-Chinese New Year shipments," parent company Neptune Orient Lines reported. Singapore-based APL transported 247,500 FEUs during the six weeks, up from 211,200 FEUs in the same period in the prior year. In the same time frame, APL's average revenue per FEU dropped to US$2,562 from US$2,745.
***Maersk Line Increases ..... as it will introduce a general rate increase of US$200 per TEU on all southbound dry & reefer cargo from the U.S. & Canada to Southern Africa and the Indian Ocean Islands, effective May 1.
***Tom Crowley Takes Control ..... as Crowley Maritime Corp. plans to go private after it reached an agreement to settle a class action lawsuit filed by shareholders in late 2004. The Franklin Balance Sheet Investment Fund has agreed to drop the litigation if it & other holders of Crowley common stock have the opportunityto sell their common stock for US$2,990 per share in cash. Thomas B. Crowley Jr., Crowley's chairman, CEO & majority shareholder with 65.2% of the company's outstanding common stock, has established Crowley Newco Corp. to purchase the outstanding shares at the agreed price.
***J.C. Penney Co. Moves Landing Pad ...... as it will open a 436,000-square-foot shipping center in Lathrop, California to handle imported goods coming in through the Port of Oakland and expand its distribution network. The news comes at the expense of the Port of Stockton, located only 11 miles away, and once the home to the largest J.C. Penney distribution center in the West before the retailer pulled out in the 1980s.
***Port of Mundra Goes Public ..... as the port on India's northwest coast is set for a public stock offering, Indian news outlets reported. The company filed to offer public shares on March 9, and is seeking roughly US$400M to build up port facilities and develop road & rail connections. DP World currently operates a container terminal in Mundra.
***Viral Hemorrhagic Septicemia Targeted ..... as the Lake Carriers' Assn., an industry group representing U.S.-flag vessel operators on the Great Lakes, has introduced a ballast water management plan designed to help prevent the spread of a deadly fish virus throughout the region. The virus, known as viral hemorrhagic septicemia (VHS), can cause large scale fish mortality in a short period. It resulted in a large fish kill in Lake St. Clair in 2003, followed by a similar event in Lake Ontario in the spring of 2005. The disease does not affect humans. To date, VHS is not known to be introduced to Lakes Michigan and Superior.
***Stowawy Incidents ...... as the Int'l Maritime Organization (IMO) issued summaries of the reports it received during 2006 of stowaway incidents. During this year, 244 stowaway incidents (involving 657 individuals) were reported.
***Ditch Passages Way Up ...... as the Panama Canal Authority (ACP) reports that ship tonnage that transited the canal during its fiscal 1st quarter ended Dec. 31 increased 11.7% to 79.9 million Panama Canal/universal measurement system tons. ACP said total transits in the 3-month period increased 8 percent to 3,568. Large vessel transits in the quarter jumped 14.6% to 1,968 transits. The Panama Canal is expected to handle approximately 320 million tons through the waterway this year.
***The Cost of Freight Operations ...... as the Board of Commissioners for the Port of Los Angeles, the nation's busiest container port, has given its top executive a raise. Geraldine Knatz, the port's executive director, received a 9.3% pay hike from US$244,795 a year to US$267,500. This puts her on the top tier of U.S. port directors.
***The Telephone Service Center Is Already In Place ....... as the Indian government is planning to roll out an Internet-based system that would link shipping agents, importers, exporters, terminal operators & banks to all 12 state-operated Indian ports. The program goal is to facilitate paperless exchange of shipment filings & improve ship turnaround times, a government official told the Economic Times of India. The Port Community System will be available at Mumbai Port sometime in 2007.
***Ranking The Ports? ...... as the Global Institute of Logistics has unveiled a new plan to develop a standard that shippers, carriers & forwarders can use to gauge global port efficiency. The plan would attempt to rationalize the huge differences in port productivity, investment & efficiency to provide port users with an accurate way to measure worldwide container terminals. Preliminary ideas involve a points system, with terminals earning points for volume forecasting and cranes per foot of berth among many suggested measurements. In Sept., the GIL will invite stakeholders from throughout the supply chain to help shape the standards.
***Ocean Container Jail ..... as a method of dealing with prison-overcrowding, the United Kingdom government willconvert sea containers imported from China into temporary jails. A British newspaper said the units would be installed in 5 prisons across the country by June at a cost of US$6.8M each. Also, 2 large-scale units comprising 5 containers welded together and capable of holding 300 prisoners could be in place by the end of the year.
***Throughput >>> The Ports of Indiana's three ports on Lake Michigan & the Ohio River handled a combined 8.6 million tons of cargo in 2006, up 12% over 2005. >>> Port of Long Beach up 5% in Feb. as the South Californian port handled 541,204 TEUs, up from 515,464 TEUs in the same month last year. >>> Port of New York & New Jersey handled a record 5.1 million TEUs of containers in 2006, 6.4% more than the prior year. However, only 3.65 million TEUs represented containers that contained cargo, the rest were empties. >>> Port of New Orleans said increased breakbulk cargo imports helped its general cargo volume rise 20.7% in 2006 to 9.38 million short tons. New Orleans needs the help. >>> Port of Philadelphia handled 5.3 million tons of containerized & breakbulk cargo last year, a 21% increase over 2005.
***Welcome Aboard! ..... as a Japanese man inspired by the sight of a luxurious British cruise liner managed to sneak himself onboard for a free 1-week voyage before being caught in Hawaii, police said March 29. Osamu Ikegame, 40, said he could not stop himself when he saw P&O Line M/V Aurora docked in Yokohama & climbed a 8ft.fence at the harbor, according to police. Ikegame then successfully blended in with the crowd of about 1,800 passengers & boarded the round-the-world cruise on March 20. But the free ride ended in Hawaii for Ikegame after the cruise operator found out he had no ticket. M/V Aurora departed Britain's Southampton port on Jan. 9 for a 3-month round-the-world cruise. The least expensive cabin on M/V Aurora costs US$33,400 for the full trip before any discounts.
5. The Cargo Letter Cargo Damage Dispatches
**Back By Popular Demand**
We're sorry, but there were so many sinkings, explosions, pirate attacks, fires, cargo mishaps, battles on the water & other disasters at sea that we do not have room to print even the highlights this month. Many people lost their lives at sea this month!! Don't miss the pirate attack on M/V Seabourn Spirit
But you can read all this month's disaster news at our special Internet web feature which provides full details of each event -- our Vessel Casualties & Pirate Activity Database. Bookmark the site and visit every day! Updated twice daily. You will be amazed.
SPECIAL NOTE: Please view the dramatic new pictures at our special "Gallery of Cargo Loss" website feature.
See our new feature for March. 2007:"Best Laid Plans?" Amazing pictures of M/V Republica di Genoa -- you have never seen this before!
See our other new feature for March 2007: "Operation Jumbo Drop" M/V Jumbo Challenger - March 2007 -- an LAX major event!
See our newest photo feature "Singles Only" - Transportation Disasters Told In A Single Photo! Includes our photo coverage of the stricken M/V MSC Napoli.
NOTE: The historic dangers of carriage by sea continue to be quite real. Shippers must be encouraged to purchase high quality marine cargo insurance from their freight forwarder or customs broker. It's dangerous out there.
OUR "D" Section: FF in Cyberspace***
6. The Cargo Letter "Cyber Ports Of Call"___
Here are our suggested world wide web sites of the week for your business, your information and your amusement..............
Cargo & Trade>>>>>>
European Assn. for Forwarding, Logistic, Transport & Customs Services CLECAT
Persistence of Corruption in Brazil
Ship Tracker ..... see movement worldwide
Small Business In Russia
Russia Import & Export
Trade Guide For Muslim Countries
UN Institute For Training & Research
U.S. Barge Fleet Profile .......... 740 new barges were added to the nation's fleet in 2006
UK Foreign & Commonwealth Office Country Profiles
U.S. Government's Export Portal
U.S. Trade Represenative
Where To Do Business? ..........economies are ranked on ease of doing business, from 1 &endash; 175, with 1st place being best. Singapore is #1, U.S. is #3 but is the best place to employ workers.
World Bank Enterprise Surveys .......a great resource for anyone who's considering doing business in a country
World Customs Organization
China Business Handbook
Oil Storage Solutions
Ritchie Bros. &emdash; Unreserved Transportation Auctions
Trade Shows, Exhibitions, Conferences & Business Events Worldwide
World Trade Organization Events
2nd Annual Canada-Asia Maritime Conference .......Sept. 10 & 11, 2007, Westin Bayshore, Vancouver, BC, Canada
2nd Annual Trans-Pacific Air Cargo Conference ......... June 5 & 6, 2006, Hyatt Regency Century Plaza, Los Angeles, CA
4th Annual Short Sea Shipping Conference ......... April 16-18, 2007, JW Marriott Orlando Grand Lakes
7th Annual JoC Trans-Pacific Maritime Conference .......March 5-6 in Long Beach, Calif.
XVI Congress of Latin American Ports .......... 23-27 April 2007, Rosario, Argentina More
94th Annual American Short Line & Regional Railroad Assn. (ASLRRA) Convention ........April 22 - 24, 2007, Baltimore Marriott Waterfront, Baltimore, Maryland
2007 D/C Expo & Conference ......... May 22-24, 2007, Navy Pier in Chicago, IL
2007 Forwarderlaw Conference -- Global Solutions For Global Risks ......... May 17 & 18 2007, Singapore
2007 Int'l Trade Symposium & Maritime Banquet .........May 10 & 11 2007, Norfolk Marriott Waterside
2007 World Ports Conference ............April 27 - May 4, Houston
Crossroads 2007 -- Supply Chain Innovation Summit ......... 21-22 May, Zaragoza, Spain
India Supply Chain Summit .......... March 1, 2007, New Delhi
Intermodal South America 2007 ........24-26 April 2007, Transamerica Expo Center Sao Paulo, Brazil
Int'l Industrial Control & Automation Technology Exhibition & Conference .......8 to 11 March 2007. Cairo &endash; Egypt
Int'l Logistics & Transportation Conference & Exhibition Israel ....... Feb. 13-14th, 2007, Airport City, Lod
ITEX National Convention & Expo for Document Solutions Providers ....... March 20-23, Las Vegas
LogiCon 2007 ......... March 5-8, JW Marriott Las Vegas, NV
Logistics & Supply Chain Forum ........May 6-9,2007- Cruise Ship M/V Norwegian Dawn, NY. -- 9th year.
Managing Offshore Relationships in China & Beyond ......... March 5 -6, 2007, Los Angeles, CA
NCBFAA 33rd Annual Conference...... April 15 - 19, 2007, Sheraton Wild Horse Pass Resort & Spa Chandler, Arizona
American Library Association's Great Web Sites for Kids.
Ask Me Help Desk ....... anythng!
Falcon 1...........launched from the Marshall Islands on March 20 -- world's lowest cost flight to orbit.
PassportSupport.com ........ store scanned images of your important documents, such as credit cards, driver's license, travelers checks, visas & passports.
Pet Food Recall
A Pilot's Watch
The True Cost of Counterfeiting & Piracy
What We Call The News
OUR "E" Section: The Forwarder/Broker World******
7. New U.S. Transport Related Legal Cases _______
Sinochem Int'l Co. v. Malaysia Int'l Shipping Corp.
U.S. Supreme Court
March 5, 2007, No. 06-102
Court ruled that a trial court may dismiss an action under the doctrine of "forum non conveniens" (inconvenient fourum) without first determining whether the court has personal jurisdiction over the defendant. In this case, a Chinese company (the defendant below) contracted to purchase steel coils from a U.S. corporation. Payment by letter of credit was based on presentation of a bill of lading showing loading of the cargo on or before April 30, 2003. The U.S. corporation produced a bill of lading dated April 30, 2003 showing that the steel coils had been loaded on plaintiff's ship. When the ship arrived in China, the Chinese company had the ship arrested, alleging that the bill of lading had been back-dated. The dispute was litigated in Chinese courts, which ruled in favor of the Chinese company. Meanwhile, plaintiff shipowner brought suit in U.S. District Court against defendant Chinese company, asserting misrepresentation by the Chinese company in the Chinese litigation & seeking compensation for losses caused by the ship arrest in China. The federal District Court dismissed the action, holding that the dispute could be adjudicated adequately and more conveniently in the Chinese courts. Plaintiff shipowner appealed, asserting that the court could not dismiss the action based on forum non conveniens until it first determined whether it has personal jurisdiction over the defendant. The appellate court reversed the dismissal, agreeing with plaintiff shipowner. The Supreme Court reversed, holding that a court need not resolve whether it has subject-matter jurisdiction or personal jurisdiction over the defendant if it determines that, in any event, a foreign tribunal is a more suitable arbiter of the merits of the case. Read The Decision.
Altadis USA v. Sea Star Line
U.S. Supreme Court
Case dismissed by settlement of the parties on Feb. 12, 2007.
Does the Carmack Amendment, 49 U.S.C. § 14706, apply to the inland leg of a multimodal shipment to a place in the U.S. from a place in a territory of the U.S., as provided in 49 U.S.C. § 13501(1)(C), even if the inland carrier does not issue a separate bill of lading for the inland leg? We won't have a ruling on this controversial issue -- because the parites settled before a ruling from the U.S. Supreme Court. Read The Background: Read The Decision.
American Roll-on Roll-off Carrier, LLC v. P&O Ports Baltimore, Inc.
U.S. 4th Circuit Court of Appeals
Feb. 26, 2007, No. 06-1058
The U.S. Court of Appeals for the 4th Circuit ruled that an indemnity action by a carrier against a stevedore is not controlled by the 1 year statute of limitations found in the Carriage of Goods at Sea Act (COGSA). In the instant case, defendant stevedore loaded cargo on plaintiff's ship. The cargo included numerous privately-owned vehicles (POVs) being shipped by the U.S. Government, as well as a 25-ton aircraft tow tractor, loaded on the deck above the POVs. The tractor broke loose during the voyage to Europe & breached a large fuel tank, which then leaked diesel fuel to the deck below, severely damaging the POVs. The carrier settled with the Government and then sought indemnification from the stevedore. The stevedore contended that the claim against it was barred by the one-year statute of limitation in COGSA, which had been incorporated into the bills of lading for all the cargo. The carrier's claim was presented to the stevedore more than one year after the cargo had been loaded on the ship & more than one year after the incident. The trial court granted stevedore's motion for summary judgment and the carrier appealed. The appellate court reversed, holding that the COGSA limitation was not applicable because this was an action for indemnification by the carrier, not a claim by a cargo owner. The court found the action to be controlled by the 3 year statute of limitation for indemnification actions as provided in state law.
U.S. v. M/V Warrior
U.S. District Cout, Northern District of California
Maltese shipowner Twighlight Marine pled guilty & wasfined US$50,000, and ordered to pay US$100,000 into the Northern Coastal California Restoration Fund, after pleading guilty to "grossly negligent operation" of the 38,800-ton cargo M/V Warrior. The owner, Twighlight Marine, admitted that, during an Atlantic crossing to the U.S., large cracks were identified, each approximately 3 feet in length, on the port side deck. Instead of ordering the cracks to be welded, the master ordered them to be covered with tape & painted over to blend in with the painting on the deck. Twighlight admitted that it knew the vessel was in a hazardous condition in that these two cracks - later discovered during a U.S. Coast Guard inspection when the vessel arrived at San Francisco - were not properly repaired. M/V Warrior was built in 1984 for Hamburg, Germany-based Hellespont Group who sold the vessel in 2004. Read The Decision.
Written from wire stories, the Associated Press, Reuters, Hong Kong Shipping News, Lloyds & other world sources.
The Cargo Letter Correspondents:
Michael S. McDaniel Esq, Editor (Countryman & McDaniel)
David Schuchman -- Interpool Corp. -- Webmaster of The Cargo Letter Archive
Andrew D. Kehagiaras, Esq. (Countryman & McDaniel)
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