View
3
Download
0
Category
Preview:
Citation preview
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
Judicial Aids to Navigation: Charting the Boundaries of Environmental Criminal Enforcement in the Maritime Sector
GREGORY F. LINSIN & ARIEL S. GLASNER*
I.INTRODUCTION ........................................................................................ 154 II. THE ACT TO PREVENT POLLUTION FROM SHIPS .................................. 155 III. THE COAST GUARD’S AUTHORITY UNDER APPS TO IMPOSE
CONDITIONS FOR RELEASE OR RE-ENTRY OF A VESSEL ................ 156 A. Watervale Marine Co., Ltd. v. United States Department of
Homeland Security .................................................................. 157 1. Procedural Background...................................................... 158 2. The District Court’s Decision ............................................ 161
i.Justiciability Under the APA ........................................... 161 ii. The Court’s Analysis of § 1908(e) ............................... 164
3. The Effect of the Court’s Holding in Watervale Marine ... 166 B. Angelex Ltd. v. United States .................................................. 166
1. Procedural Background...................................................... 166 2. The Fourth Circuit’s Decision ........................................... 168
i.Jurisdiction Under the APA ............................................. 169 ii. Admiralty Jurisdiction ................................................. 170
3. The Significance of the Courts’ Holdings in Angelex
and Watervale Marine ....................................................... 171 C. Wilmina Shipping AS v. United States Department of
Homeland Security .................................................................. 171 1. Procedural Background...................................................... 172 2. The District Court’s Decision ............................................ 174
i. The Applicable Statutory Framework .......................... 174
* Gregory F. Linsin is a partner at Blank Rome LLP. Mr. Linsin concentrates his practice in the
areas of white collar criminal law and environmental criminal litigation involving shore-based
and maritime clients, environmental compliance, and internal corporate compliance
investigations. Prior to joining Blank Rome LLP, Mr. Linsin served for more than 25 years with
the United States Department of Justice, including as Special Litigation Counsel for the
Environmental Crimes Section. In the interests of disclosure, Mr. Linsin represented a number of
the defendants in certain cases that are discussed in this article, including Sanford, Ltd., Efploia
Shipping Co., Fleet Management Ltd., and Cardiff Marine Inc.
Ariel S. Glasner is an associate at Blank Rome LLP. Mr. Glasner concentrates his practice in
the areas of white collar criminal law and government investigations.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
154 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
ii. Judge Jackson’s Analysis of the Applicable
Statutory Framework ................................................... 176 3. The Effect of the Court’s Holding in Wilmina Shipping ... 178
IV. CRIMINAL LIABILITY WITH RESPECT TO SPECIFIC MARITIME
ENFORCEMENT ACTIONS: UNITED STATES V. KALUZA ..................... 179 A. Individual Employees Charged with Violations of
Seamans’ Manslaughter Statute ............................................... 181 B. Dismissal of Ship Officers’ Manslaughter Charges ................ 182 C. The Court’s Reasoning in Kaluza ............................................ 183 D. The Significance of the Court’s Dismissal of 11 Counts in
Kaluza ...................................................................................... 185 V. LIMITATIONS ON THE AMOUNT OF CRIMINAL PENALTIES AND
STANDARDS FOR WHISTLEBLOWER AWARDS ................................ 185 A. The Application of the Alternative Fines Act and Civil
Forfeiture Proceedings: United States v. Sanford Ltd. ............ 186 1. The Alternative Fines Act .................................................. 186
i. The Meaning of “Gross Gain” and “Derived From” ... 188 ii. The Meaning of “Undue Complication” ...................... 189
2. Civil Forfeiture Proceedings .............................................. 191 3. The Significance of the Court’s Holdings in Sanford ........ 192
B. Equitable Factors Considered in the Granting of Awards to
Whistleblowers ........................................................................ 192 VI. CONCLUSION ....................................................................................... 195
I. INTRODUCTION
Recent decisions in several federal district and appellate courts have
addressed and resolved a number of key issues regarding the procedural
and substantive scope of the government’s environmental criminal
enforcement authority concerning maritime operations in the United States.
Some of the decisions resolve issues that have been the subject of
numerous prior judicial challenges; and some address questions of first
impression that will likely help to guide future enforcement actions under
the relevant maritime statutes. Taken together, these judicial opinions
establish boundaries that the U.S. Coast Guard, federal prosecutors, and
maritime practitioners, as well as commercial vessel owners and operators,
should understand.
This article provides a comprehensive review of these court decisions
that have affected a broad sweep of issues related to the environmental
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 155
criminal maritime enforcement program, including the standards that apply
to the Coast Guard’s shipboard investigation of potential environmental
criminal violations, the applicability of the 176 year old Seaman’s
Manslaughter Statute to the operation of offshore drill ships, the potential
amount of a criminal penalty for violations of the marine environmental
statutes, and the standards that should guide judicial awards to
whistleblowers. As discussed below, opinions have been issued in three
cases, Watervale Marine Co., Ltd. v. United States Department of
Homeland Security,1 Angelex Ltd. v. United States,2 and Wilmina Shipping
AS v. United States Department of Homeland Security.3 These opinions
have clarified the extent of the U.S. Coast Guard’s authority to detain
vessels and crew members and to bar foreign-flagged vessels from entering
the navigable waters of the United States during the pendency of or
immediately following a preliminary shipboard investigation of potential
environmental offenses. An opinion issued in United States v. Kaluza4 has
clarified the standards that govern individual criminal liability for deaths
resulting from maritime casualties. A memorandum opinion issued in
United States v. Sanford Ltd5 defined limitations on the criminal penalties
that the government may seek to impose against organizational defendants
convicted of violating environmental maritime laws or regulations. Finally,
a number of cases have addressed the standards that should govern judicial
awards to individual whistleblowers in criminal maritime enforcement
actions.
II. THE ACT TO PREVENT POLLUTION FROM SHIPS
The most significant federal law that provides criminal penalties for
environmental violations in the maritime sector is the Act to Prevent
Pollution from Ships (“APPS”).6 Congress enacted APPS to implement
two international marine pollution treaties, the 1973 International
1. Watervale Marine Co., Ltd. v. United States Department of Homeland Security, Civil
Action No. 12-cv-0105, 2014 WL 3563159 (D.D.C. July 18, 2014).
2. Angelex Ltd. v. United States, 723 F.3d 500 (4th Cir. 2013).
3. Wilmina Shipping AS v. United States Department of Homeland Security, 934
F.Supp.2d 1 (D.D.C. 2013).
4. United States v. Kaluza, Criminal Action No. 12-265, 2013 WL 6490341 (E.D. La.
Dec. 10, 2013).
5. United States v. Sanford Ltd., No. 11-352 (D.D.C. 2012).
6. Act to Prevent Pollution from Ships of 1980, 33 U.S.C. §§ 1901-1915 (2012).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
156 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
Convention for the Prevention of Pollution from Ships7 and the Protocol of
1978 Relating to the International Convention for the Prevention of
Pollution from Ships.8 Together, these treaties are known as “MARPOL,”
to which there are over 150 signatories, including the United States.9
Because MARPOL is not self-executing, each signatory must enact
domestic legislation implementing MARPOL’s provisions.10 Under APPS,
a person who “knowingly violates the MARPOL Protocol . . . [APPS], or
the regulations issued thereunder” is guilty of a felony.11 The United States
Coast Guard has promulgated regulations to implement APPS.12
III. THE COAST GUARD’S AUTHORITY UNDER APPS TO IMPOSE
CONDITIONS FOR RELEASE OR RE-ENTRY OF A VESSEL
The courts’ decisions in Watervale Marine13 and Angelex14 addressed
the scope of the Coast Guard’s authority to impose conditions for granting
departure clearance to a foreign-flagged vessel following a shipboard
7. Nov. 2, 1973, 1340 U.N.T.S. 184.
8. Feb. 17, 1978, 94 Stat. 2297, 1340 U.N.T.S. 61.
9. United States v. Sanford, 880 F.Supp.2d 9, 11 (D.D.C. 2012).
10. Id. at 11–12. See also International Convention for the Prevention of Pollution from
Ships, Nov. 2, 1973, 1340 U.N.T.S. 184, and Protocol of 1978 relations to the International
Convention for the Prevention of Pollution from Ships [collectively MARPOL] art. 1(1), Feb. 17,
1978, 1340 U.N.T.S. 63. There are six annexes to MARPOL. Annex I concerns prevention of
pollution by oil from operational measures and accidental discharges. Annex II details the
discharge criteria and measures for the control of pollution by noxious liquid substances carried
in bulk. Both of these annexes entered into force on October 2, 1983. Annex III, which became
effective on July 1, 1992, contains general requirements for the prevention of pollution by
harmful substances carried by sea in packaged form. Annex IV entered into force on September
23, 2003, and concerns the requirements to control pollution of the sea by sewage from seas.
Annex V deals with different types of garbage from ships and specifies the distances from land
and the manner in which they may be disposed of. It first became effective on December 31,
1988. A revised Annex V was adopted in July 2011 and became effective on January 1, 2013.
Annex VI sets limits on air emissions pollution from ships. This annex first became effective on
May 19, 2005. A revised version became effective on January 1, 2013. See International
Convention for the Prevention of Pollution from Ships (MARPOL), INTERNATIONAL MARITIME
ORGANIZATION, http://www.imo.org/About/Conventions/ListOfConventions/Pages/International-
Convention-for-the-Prevention-of-Pollution-from-Ships-(MARPOL).aspx (last visited Jan. 19,
2015). The United States has not ratified Annex III or Annex IV of the Convention.
11. 33 U.S.C. § 1908(a) (2012).
12. See 33 C.F.R. pt. 151, subpart A (2015).
13. Watervale Marine Co., Ltd. v. United States Department of Homeland Security, Civil
Action No. 12-cv-0105, 2014 WL 3563159 (D.D.C. July 18, 2014).
14. Angelex Ltd. v. United States, 723 F.3d 500 (4th Cir. 2013).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 157
investigation that identified a probable violation of APPS. The court’s
decision in Wilmina Shipping AS15 addressed the related issue of the Coast
Guard’s authority to impose conditions for re-entry of a foreign-flagged
vessel into a U.S. port following an inspection that identified an APPS
violation onboard. Taken together, these decisions firmly establish that the
Coast Guard has broad, unreviewable discretion to establish both financial
and non-financial conditions for granting departure clearance for detained
foreign-flagged vessels suspected of APPS violations, and also to set
specific conditions for re-entry of foreign-flagged vessels into U.S. ports
following a determination that an APPS violation occurred onboard. The
court’s opinion in Watervale Marine is particularly significant in that it
applied case authority promulgated by the D.C. Circuit Court of Appeals,
generally considered the most authoritative appellate court to review
federal agency actions. Angelex is also significant as it represents the first
direct appellate opinion concerning the Coast Guard’s authority to detain
foreign-flagged vessels under 33 U.S.C. § 1908(e). Both Watervale
Marine and Angelex are certain to be considered carefully in any future
challenge to the scope of the Coast Guard’s authority in this area. We now
examine the courts’ holdings in each of these three cases in turn.
A. Watervale Marine Co., Ltd. v. United States Department of
Homeland Security
In Watervale Marine, the United States District Court for the District
of Columbia concluded that the Coast Guard has virtually unfettered
authority to determine the conditions that must be met by the vessel owner
or operator before granting departure clearance to a detained vessel
suspected of unlawful conduct. The specific issue raised in the case was
whether a district court has the ability, under the Administrative Procedure
Act (“APA”),16 to review the lawfulness of conditions imposed by the
Coast Guard under its APPS authority.
15. Wilmina Shipping AS v. United States Department of Homeland Security, 934
F.Supp.2d 1 (D.D.C. 2013).
16. Administrative Procedure Act, 5 U.S.C. §§ 701, et seq. (2012).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
158 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
1. Procedural Background
The plaintiffs in this case owned and operated four vessels that were
docked in New Orleans, Louisiana and Mobile, Alabama17 when they
separately became the subject of whistleblower complaints alleging that the
vessels’ crews had falsified the vessels’ Oil Record Books (“ORBs”).18
Following shipboard investigations, the Coast Guard determined that it had
reasonable cause to believe that the crew members of each of the four
vessels had violated APPS. Based on those findings, the Coast Guard
requested U.S. Customs and Border Protection to withhold the vessels’
departure clearance from their respective ports pursuant to the Coast
Guard’s authority under 33 U.S.C. § 1908(e).19
Section 1908(e) of APPS provides that the Coast Guard is permitted to
grant clearance to a vessel that the agency has reasonable cause to believe
is subject to a fine or civil penalty under APPS in exchange for the “filing
of a bond or other surety satisfactory to the Secretary [of the Department of
Homeland Security].”20
If any ship subject to the MARPOL Protocol . . . or this chapter,
its owner, operator, or person in charge is liable for a fine or civil
penalty under this section, or if reasonable cause exists to believe
that the ship, its owner, operator, or person in charge may be
subject to a fine or civil penalty under this section, the Secretary
of the Treasury, upon the request of the Secretary [of the
Department of Homeland Security], shall refuse or revoke the
clearance required by section 60105 of title 46. Clearance may be
17. Plaintiffs Watervale Marine Co., Ltd. and Ilios Shipping Co., S.A. owned and operated
the M/V AGIOS EMILIANOS. Plaintiffs Achillea Navigation Corp. and Cleopatra Shipping
Agency Ltd. owned and operated the M/V STELLAR WIND. Plaintiffs Mercator Lines
(Singapore) Pte, Ltd. and Target Ship Management Pte, Ltd. owned and operated the M/V
GUAREV PREM. Lastly, plaintiffs Bulkers Holdings, Inc. and Odysea Carriers S.A. owned and
operated the M/V POLYNEOS. See Complaint at 3, Watervale Marine Co., Ltd. v. United States
Department of Homeland Security, Civil Action No. 12-cv-0105 (KBJ) (D.D.C. July 18, 2014),
ECF No. 1, 2012 WL 4889454 [hereinafter Watervale Marine Complaint].
18. Watervale Marine Co., Ltd. v. United States Department of Homeland Security, Civil
Action No. 12-cv-0105, 2014 WL 3563159, at *3 (D.D.C. July 18, 2014).
19. Watervale Marine Complaint, supra note 17, at ¶¶ 16, 27, 37, 46.
20. 33 U.S.C. § 1908(e) (2012).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 159
granted upon the filing of a bond or other surety satisfactory to
the Secretary.21
In accordance with this subsection, the vessel owners each entered
into negotiations with the Coast Guard while their respective vessels were
being detained in order to obtain clearance for their release. The Coast
Guard sought both the posting of a monetary bond and the execution of a
security agreement before agreeing to grant any of the vessels their
departure clearance.22 The security agreement, which was substantially
similar for each of the four vessels, imposed a number of non-financial
conditions, including requirements that specific crew members remain
within the jurisdiction while the Coast Guard’s APPS investigation was
pending, that the vessel owners, inter alia, pay wages, housing and
transportation costs for those crew members required to remain in the
jurisdiction, and that the vessel owners encourage the crew to cooperate
with the government’s criminal investigation.23
The vessel owners all obtained departure clearance for their respective
vessel by posting bond and by executing a security agreement with the
Coast Guard.24 After the vessels were released, the vessel owners and
operators initiated the Coast Guard’s administrative appeals process to
challenge the security agreements as a condition of release.25 All of the
vessel owners’ and operators’ requests for reconsideration of the security
agreement as a condition of release were denied at the first level of the
administrative appeals process.26 Following this denial, the vessel owners
and operators for the four vessels (collectively, the “plaintiffs”) filed a
complaint in federal court under the APA against the U.S. Department of
Homeland Security and the U.S. Coast Guard (collectively, the
“defendants”). The complaint asserted that the remaining steps of the four-
step administrative appeals process were futile and that therefore the
plaintiffs had exhausted the administrative appeals process.27 The
21. 33 U.S.C. § 1908(e) (2012).
22. Watervale Marine, Civil Action No. 12-cv-0105, 2014 WL 3563159, at *4.
23. Id.
24. Id.
25. Id. at *5.
26. Id. at *5.
27. See Watervale Marine Complaint, supra note 17, at ¶ 96. At the time the plaintiffs’
complaint was filed, the administrative appeal for the Agios Emilianos was pending before the
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
160 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
plaintiffs’ complaint further stated that the Coast Guard lacked the statutory
authority to require the plaintiffs to enter into security agreements in order
to obtain departure clearances for the vessels.28 As the basis for this
assertion, the plaintiffs alleged that “[i]n demanding the terms of the
Security Agreements, the Defendants purport to rely on the APPS,
specifically 33 U.S.C. § 1908(e)” but that this statute did not authorize the
“Coast Guard to demand anything more than the posting of a bond or other
financial surety in order to grant a vessel Customs clearance to depart the
United States.”29 Relying on the APA for their cause of action, the
plaintiffs’ complaint then asserted essentially that the Coast Guard’s
imposition of non-financial conditions under the security agreements
constituted conduct that was arbitrary and capricious, contrary to the
plaintiffs’ constitutional right and in excess of the Coast Guard’s statutory
authority.30
In response to the plaintiffs’ complaint, the defendants filed a motion
for summary judgment, arguing that the Coast Guard has complete
discretion under § 1908(e) to choose the type of “surety” that is required
for the release of a detained vessel, including the imposition of non-
financial conditions.31 The defendants further argued that the Court lacked
jurisdiction to consider the plaintiffs’ complaint on the grounds that the
determination as to the conditions for granting a vessel clearance under §
1908(e) was committed wholly to the agency’s discretion.32 The plaintiffs
then filed a cross-motion for summary judgment, noting that the “central
question that gives rise to this action” is “whether 33 U.S.C. § 1908(e)
limits the Coast Guard to conditioning the granting of Customs clearance to
a vessel detained pursuant to AAPS to the posting of a bond or other
financial surety.”33
Area Commander (the third step in the appellate process), and the appeals for the other three
vessels were pending before the District Commander (the second step in the appellate process).
See also id. at ¶¶ 81, 84, 87, 90.
28. See id. at ¶ 107.
29. Id. at ¶¶ 108, 109 (emphasis in original).
30. Id. at ¶¶ 112–114 (referring to 5 U.S.C. § 706).
31. See United States’ Memorandum in Support of its Motion for Summary Judgment at
21, Watervale Marine, Civil Action No. 12-cv-0105, 2014 WL 3563159 (No. 13-1).
32. Id. at 18–21.
33. See Plaintiffs’ Response in Opposition to the Defendants’ Motion for Summary
Judgment and Plaintiffs’ Cross-Motion for Summary Judgment at 4, n.3, Watervale Marine, Civil
Action No. 12-cv-0105, 2014 WL 3563159 (No. 16-1).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 161
2. The District Court’s Decision
In a memorandum opinion filed on July 18, 2014, Judge Ketanji
Brown Jackson decided squarely in favor of the Coast Guard and granted
the defendants’ motion for summary judgment while denying the plaintiffs’
cross-motion for summary judgment.34 Judge Jackson held that 33 U.S.C.
§ 1908(e) “commits entirely to the agency’s discretion the matter of when
and under what circumstances the Coast Guard may grant departure
clearance to a vessel detained” under APPS and that therefore, “the Coast
Guard’s decision to require the challenged security agreements is
nonjusticiable.”35 The opinion concludes that the Coast Guard has
essentially unlimited discretion under § 1908(e) to determine the conditions
that must be met before the agency will grant departure clearance to a
detained vessel suspected of violating APPS.
i. Justiciability Under the APA
Judge Jackson explained that while it was clear that the Court
possessed subject matter jurisdiction over the dispute at issue,36 that was
not sufficient to make the matter “justiciable,” i.e., “capable of being
disposed of judicially.”37 The Court added that though there is a statutory
presumption in favor of judicial review of agency decisions under the APA,
the reviewability presumption is overcome under § 701(a)(2) if the
challenged agency action concerns a matter that is otherwise committed to
34. On September 19, 2014, the defendants filed a notice of appeal in the United States
Circuit Court of Appeals for the District of Columbia. The sole issue that the defendant-
appellants raised was whether the district court erred, as a matter of law, in concluding that
judicial review of the Coast Guard’s authority, interpretation and actions under 33 U.S.C. §
1908(e) is precluded. See Appellants’ Preliminary Statement of the Issue to be Raised on Appeal,
Watervale Marine Co. Ltd. v. U.S. Dep’t of Homeland Security, Case No. 14-5203 (D.C. Cir.
September 19, 2014) (No. 1513273). [Final briefs have been submitted by the parties; however,
no decision has been issued as of the date this article went to print.].
35. Watervale Marine, Civil Action No. 12-cv-0105, 2014 WL 3563159, at *1.
36. Judge Jackson determined that the Court had subject matter jurisdiction because the
dispute presented a federal question “regarding whether the Coast Guard has misinterpreted and
misapplied the statutory provision that authorizes the detention and release of vessels.” Id. at *6.
He also noted that the Court had jurisdiction because the prerequisites to the Court’s exercise of
subject matter jurisdiction under the APA were met: (1) final agency action had been taken
because the parties had entered into a security agreement and the ships were no longer detained at
port; and (2) the plaintiffs had exhausted their administrative remedies. Id. at *6, n.8.
37. Id. at *7.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
162 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
agency discretion by law.38 Judge Jackson explained that the exception to
justiciability set forth under § 701(a)(2) is a “very narrow one,”39 and noted
that the Supreme Court has identified only two scenarios in which it
applies. The first scenario is where statutes “are drawn in such broad terms
that in a given case there is no law to apply” and the second scenario is
when the statute is drawn “so that a court would have no meaningful
standard against which to judge the agency’s exercise of discretion.”40
Asserting that the instant case presented an “issue of first
impression,”41 Judge Jackson noted that the only two other cases that
considered the justiciability of § 1908(e) as it related to the departure
clearance conditions that the Coast Guard imposed on vessels suspected of
APPS violations, Angelex and Giuseppe Bottiglieri Shipping Co. S.P.A. v.
United States42 were inapposite. The Court explained that those cases did
not consider the justiciability of § 1908(e) under the APA; rather, they
considered vessel owners’ emergency motions requesting that the “court
step into the shoes of Coast Guard officials and not only select the terms of
the ‘bond or other surety’ but also order the vessels’ release.”43 Judge
Jackson also differentiated Watervale Marine from the two prior cases by
noting that, under D.C. Circuit case authority, several additional factors
that were not evaluated in either Angelex or Giuseppe Bottiglieri must be
considered in determining whether a matter is justiciable or whether it has
been committed to agency discretion by law.44
Judge Jackson then summarized the legal framework set forth by the
D.C. Circuit for evaluating justiciability under § 701(a)(2) of the APA.
Under this framework, three general categories of factors are considered by
38. Id. (citing 5 U.S.C. § 701(a)(2)).
39. Id. (citing Hi-Tech Furnace Systs., Inc. v. FCC, 224 F.3d 781, 788 (D.C. Cir. 2000)).
40. Id. (citing Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402, 410 (1971) and
Heckler v. Chaney, 470 U.S. 821, 830 (1985)).
41. Id. at *1.
42. Giuseppe Bottiglieri Shipping Co. S.P.A. v. United States, 843 F.Supp.2d 1241 (S.D.
Ala. 2012).
43. Watervale Marine, Civil Action No. 12-cv-0105, 2014 WL 3563159, at *7. Put
another way, in Angelex and in Guiseppe Bottiglieri, the court was asked to “make a decision that
has been statutorily delegated to the Coast Guard (i.e., whether the vessels should be cleared and
under what circumstances).” Id. at *10. In Watervale Marine, the Court was asked to decide
“whether the Coast Guard acted within the scope of its statutory authority when the agency
determined that the vessels should be released subject to certain conditions.” Id.
44. Id. at *9.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 163
a court in determining whether a matter is justiciable: “(1) ‘the nature of the
administrative action at issue’; (2) ‘the language and structure of the statute
that supplies the applicable legal standards for reviewing the action’; and
(3) Congress’s intent to commit the matter fully to agency discretion as
evidenced by, among other things, the statutory scheme.”45
With respect to this first category, Judge Jackson noted that the
“nature of the administrative action” refers to “certain categories of
administrative decisions” that are considered presumptively unreviewable,
such as when an agency refuses to take an enforcement action or when an
agency takes an action related to a sensitive matter of national security.46
With respect to the second set of factors, the language and structure of
the statute, Judge Jackson explained that this referred to the application of
the “canons of statutory construction to determine whether the statute
provides standards for the agency to apply and for the courts to review.”47
In this regard, only if there is no “judicially manageable standard” by
which to judge the agency’s action is meaningful judicial review
considered “impossible.”48
Lastly, Judge Jackson explained that the third category of factors in
determining whether a court considers a matter to have been committed to
agency discretion by law, whether the statutory scheme evidences
Congress’s intent to commit the matter totally to agency discretion,
requires an “evaluation of the language and structure of the statutory
section at issue” and “consideration of the function and purpose of the
statute as a whole.”49 Such an evaluation is accomplished through an
analysis of other portions of the statute, consideration of whether the statute
provides alternative avenues for the aggrieved party to obtain relief, and a
determination whether a “deferential attitude on the part of Congress”
45. Id. (citing Sierra Club v. Jackson, 648 F.3d 848, 855 (D.C. Cir. 2011); Sec’y of Labor
v. Twentymile Coal Co., 456 F.3d 151, 156 (D.C. Cir. 2006); Dickson v. Sec’y of Defense, 68
F.3d 1396, 1404 (D.C. Cir. 1995)).
46. Id.
47. Id. (referring to , 718 F.3d 974, 976–77 (D.C. Cir. 2013)).
48. Id. at *9 (quoting Steenholdt v. FAA, 314 F.3d 633, 638 (D.C. Cir. 2003)).
49. Id. at *10.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
164 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
toward the agency’s decision making in this area permeates the “overall
structure” of the statute.50
ii.The Court’s Analysis of § 1908(e)
After summarizing this legal framework, Judge Jackson applied it to
an analysis of § 1908(e) of APPS. The Court first concluded that § 1908(e)
was not presumptively unreviewable under § 701(a)(2) of the APA,
reasoning that the Coast Guard’s decision with respect to the granting of
departure clearance was not sufficiently similar to other agency decisions
that had been held to be unreviewable “by nature,” such as a decision
whether or not to initiate an enforcement action.51
Judge Jackson then found that despite the fact that § 1908(e) was not
unreviewable “by nature,” the language and structure of § 1908(e) provided
no meaningful or judicially manageable standards for the Court to apply.52
In reaching this conclusion, Judge Jackson rejected the plaintiffs’ assertion
that the use of the disjunctive “or” in the phrase “bond or other surety”
required release conditions to be limited to “financial terms” and to only
“one such surety.”53 Rather, the Court explained, “by virtue of section
1908(e)’s use of the term ‘may’ in the statement ‘[c]learance may be
granted upon the filing of a bond or other surety satisfactory to the
Secretary[,]’ the statute evidences no congressional intent to require the
agency to release the vessel even if a satisfactory ‘bond or other surety’ is
posted.”54 Because of this use of the word “may” in § 1908(e), Judge
Jackson held that under the text of the statute, Congress provided the Coast
Guard with the discretion to determine both what “bond or other surety”
would be sufficient to impose as a condition of departure clearance, and
whether or not to release the vessel under any conditions, financial or
otherwise.55 In this respect, Judge Jackson viewed the bond or other surety
as a “necessary but not sufficient prerequisite for departure clearance” and
held accordingly that the statute provides “no standards for a court to use to
50. Id. (referring to Twentymile Coal, 456 F.3d at 158–59; Marshall Cnty. Health Care
Auth. v. Shalala, 988 F.2d 1221, 1224 (D.C. Cir. 1993); Inv. Co. Inst. v. FDIC, 728 F.2d 518, 526
(D.C. Cir. 1984)).
51. Id. at *11.
52. Id. at *11–13.
53. Id. at *12.
54. Id. at *13 (emphasis in original).
55. Id.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 165
determine whether the agency has improperly continued to withhold
clearance even after the ‘bond or other surety’ condition is satisfied.”56
Lastly, Judge Jackson considered the third and final set of factors set
forth under the D.C. Circuit’s applicable legal framework for determining
justiciability. The Court concluded that the overall structure of APPS
weighed in favor of his finding that § 1908(e) was non-justiciable.57 Judge
Jackson reasoned, first, that the fact that APPS authorizes the Coast Guard
to use its discretion to “engage in a variety of measures” to enforce against
MARPOL violations “demonstrates Congress’s recognition of the Coast
Guard’s particular expertise when it comes to investigating and prosecuting
such violations.”58 Judge Jackson further explained that § 1904 of APPS
provides an “alternative avenue for relief for unwarranted detention of a
vessel” because it allows a cause of action for compensation due to a
vessel’s unreasonable detention.59 The Court considered this to be further
evidence that Congress did not intend for there to be judicial review of the
Coast Guard’s decision to withhold departure clearance under the APA.60
Lastly, Judge Jackson noted that in contrast to the very specific regulations
governing Customs’ exercise of its own departure clearance authority, the
absence of standards governing the Coast Guard’s decision to grant the
release of a vessel underscored that “Congress intended to commit fully to
the Coast Guard the matter of whether and under what circumstances
Plaintiffs’ vessels must have been released.”61
56. Id. Judge Jackson further noted that the word “may” in a statute does not, in and of
itself, mean that the matter is committed to agency discretion by law, but that the use of the word
“may” in the instant case resulted in this conclusion because there was “absolutely” no other
guidance offered as to how the Coast Guard should exercise the discretion that the word “may”
afforded it. Id. (referring to Robbins v. Reagan, 780 F.2d 37, 45 (D.C. Cir. 1985)).
57. Id. at *13–14.
58. Id. at *13 (referring to 33 U.S.C. §§ 1903 (granting discretion to the Secretary to
“administer and enforce” MARPOL), 1904(a) (granting the Coast Guard the discretion to
designate persons who may issue required certificates under MARPOL), and 1907(a) (providing
that the Coast Guard “shall use all appropriate and practical measures” to detect environmental
law violations and “shall establish adequate procedures” to investigate them)).
59. Id. at *13. Section 1904(h) provides as follows: “A ship unreasonably detained or
delayed by the Secretary acting under the authority of this chapter is entitled to compensation for
any loss or damage suffered thereby.” 33 U.S.C. § 1904(h) (2012).
60. Watervale Marine, Civil Action No. 12-cv-0105, 2014 WL 3563159, at *13.
61. Id. at *14. While Judge Jackson concluded that the Coast Guard’s decision to grant
departure clearance under § 1908(e) was not justiciable, he noted that his holding did not preclude
a court from considering “constitutional” challenges to the Coast Guard’s departure clearance
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
166 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
3. The Effect of the Court’s Holding in Watervale Marine
Watervale Marine holds unambiguously that the Coast Guard has
unfettered discretion to deny departure clearance or to determine the
conditions under which it will grant departure clearance to detained vessels
suspected of APPS violations under 33 U.S.C. § 1908(e). The Court’s
decision in this case is particularly significant because of the fact that it was
brought as a cause of action under the APA rather than as an appeal from
the denial of an emergency petition for a vessel’s release, and also because
Judge Jackson’s decision is premised on the application of D.C. Circuit
case authority, which is considered persuasive authority with respect to
judicial review of federal agency actions. For these reasons, Watervale
Marine is likely to be given deference by other district courts in any future
challenges to the Coast Guard’s authority under 33 U.S.C. § 1908(e).
B. Angelex Ltd. v. United States
As in Watervale Marine, the Fourth Circuit Court of Appeals in
Angelex concluded that the district court lacked the authority to review the
Coast Guard’s decision with respect to the granting of departure clearance
to a vessel suspected of unlawful conduct. However, as indicated above,
the circumstances under which the Angelex appeal arose and the
application of legal authority differed significantly from Watervale Marine.
In addition, Angelex involved a challenge only to the amount of the surety
or bond required by the Coast Guard rather than to the non-financial
conditions imposed under the terms of a security agreement. Nevertheless,
the Angelex decision constitutes strong additional authority for the
proposition that the Coast Guard’s exercise of its discretion to establish
conditions for granting departure clearance under 33 U.S.C. § 1908(e) is
not judicially reviewable.
1. Procedural Background
Angelex involved the government’s appeal from a district court order
granting petitioner-appellees’ emergency petition for relief. The petitioner-
appellees in Angelex included the ocean-going bulk cargo carrier, M/V
ANTONIS G. PAPPADAKIS (“Pappadakis”, or the “vessel”), and
demands, including constitutional due process claims that challenge unconscionable clearance
conditions. Id. at *17.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 167
Angelex Ltd. (“Angelex”), the vessel owner.62 The government’s appeal to
the Fourth Circuit arose out of a routine Port State Control inspection of the
Pappadakis in April 2013 in Norfolk, VA. During the inspection, the Coast
Guard discovered that the Pappadakis crew had likely acted in
contravention of APPS by bypassing the vessel’s oily water separator and
discharging oily bilge water overboard without recording the discharge in
the vessel’s ORB.63 Immediately following the Coast Guard’s inspection,
the Coast Guard informed Angelex that, as a result of the agency’s
findings, the vessel’s clearance to depart Norfolk had been withheld.64
In accordance with § 1908(e), the Coast Guard and counsel for
Angelex attempted, but were unsuccessful, to negotiate a security
agreement.65 Subsequently, Angelex elected to file an emergency petition
in the Eastern District of Virginia seeking immediate release of the vessel
or the determination of an appropriate bond. Among other things, the
emergency petition specifically sought an order from the district court to
fix an amount of security for release of the Pappadakis that was less than
the $2.5 million bond that the Coast Guard had insisted upon.66
After holding a hearing to consider Angelex’s emergency petition, the
district court urged the parties to resolve their dispute without the court’s
intervention. The parties met and agreed to a $1.5 million bond, subject to
Coast Guard Headquarters’ approval, in exchange for the vessel’s
clearance; however, when the court reconvened, the government attorney
advised the court that in the interim, Coast Guard Headquarters had refused
to approve the $1.5 million amount.67
Following Coast Guard Headquarters’ rejection of the bond
agreement, the district court issued a memorandum opinion granting the
emergency petition.68 The court first found that it had subject matter
jurisdiction to review the Coast Guard’s actions both under the APA and
62. Angelex Ltd. v. United States, Civil No. 2:13cv237, at 2 (E.D. Va. May 8, 2013).
Angelex contracted with a third party, Kassian Maritime Navigation Agency, Ltd. (“Kassian”), to
serve as the vessel’s operator. See Angelex Ltd. v. United States, 723 F.3d 500, 503 (4th Cir.
2013).
63. See Angelex, 723 F.3d at 503.
64. Id.
65. Id.
66. Id.
67. Id. at 504.
68. Angelex, Civil No. 2:13cv237, at 2.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
168 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
pursuant to the court’s “admiralty jurisdiction.”69 The district court then
held that the Coast Guard acted unconstitutionally and outside its statutory
authority by demanding excessive bond for clearance and by insisting that
any security agreement include certain non-monetary conditions.70
Accordingly, the court ordered Angelex to post a surety bond in the amount
of $1.5 million and established a number of other non-monetary bond
conditions for Angelex to satisfy in exchange for obtaining clearance for
the Pappadakis to depart Norfolk.71
The government immediately appealed the district court’s order to the
Fourth Circuit on the grounds that the district court was incorrect in finding
that it possessed subject matter jurisdiction to review the Coast Guard’s
actions.72
2. The Fourth Circuit’s Decision
The Fourth Circuit decided in favor of the Coast Guard’s appeal,
holding that the district court erred in granting Angelex’s emergency
69. Id. at 6.
70. Id. at 14.
71. Id. at 16.
72. On May 22, 2013, Angelex, Kassian and the vessel’s chief engineer were indicted on
multiple charges, including conspiracy to illegally discharge oily water into the sea, presentation
of a falsified ORB and obstruction of justice. See Indictment, United States v. Kassian, Case No.
2:13-cr-0070 (E.D. Va. 2013), ECF No. 12. Angelex and Kassian were ultimately acquitted of
the charges but the vessel’s chief engineer was convicted. See Kassian, Case No. 2:13-cr-0070,
ECF Nos. 94, 97. At trial the jury received the standard instruction regarding corporate liability,
i.e., that the jury could find the company vicariously liable for the action of its employees
provided that the employees were acting “within the scope” of their employment and “for the
intended benefit” of the employer. In Kassian, however, all of the witnesses testified that any
illegal conduct occurring on board the vessel was hidden from Angelex and Kassian and that it
was done without any intent to benefit either Angelex or Kassian. The defense also established
that such conduct was in violation of the vessel’s “zero tolerance” pollution prevention policies
and procedures, which included a prohibition against bypassing the vessel’s oily water separator.
See George M. Chalos & Brian P. Sparkman, A “Game Changer”: The Failed Prosecution of the
Owner & Manager of the M/V ANTONIS G. PAPPADAKIS, Chalos & Co., P.C., International
Law Firm (undated), available at http://www.shipping2014.com/postprogram
/Wednesday/Glen/George%20Chalos%20CMA%20legal%20panel%20paper%202014.pdf (last
visited on May 15, 2015). This testimony appears to explain why the chief engineer was
convicted but Angelex was acquitted. The outcome of this case suggests that vessel owners and
operators may be less likely to face criminal liability if they can demonstrate that the appropriate
policies and procedures were in place to prohibit unlawful conduct aboard the vessel and that
those procedures were implemented and enforced by the senior officers on the vessel and by
company’s shoreside managers.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 169
petition because it lacked subject matter jurisdiction to review the Coast
Guard’s actions.73
i.Jurisdiction Under the APA
The Fourth Circuit first focused its attention on § 701(a)(2) of the
APA which, as discussed in detail above, proscribes judicial review when
the relevant statute provides that agency action is committed entirely to
agency discretion. The Court held that § 1908(e) qualified as such a
statute. In reaching this conclusion, the Court reasoned that § 1908(e)
grants the Coast Guard “broad discretion to deny bond altogether, and it
can dictate the terms of any bond that it may accept.”74 The Court added
that the language of § 1908(e) “does not provide any ‘judicially
manageable standards’ by which to review the Coast Guard’s actions.”75
According to the Fourth Circuit’s opinion, this is because the statute offers
no guidelines as to when clearance should be granted under APPS, and
because Congress did not establish any standards or parameters for the
form or amount that a bond or other surety should take.76
The Fourth Circuit further held that the district court erred in ruling
that it possessed subject matter jurisdiction under 5 U.S.C. § 706 of the
APA.77 This section authorizes federal courts to review agency actions for
an “abuse of discretion.”78 The Fourth Circuit concluded that § 706 did not
apply, reasoning that where a statute is drawn so that a court would have no
meaningful standard against which to judge the agency’s exercise of
discretion, § 701(a)(2) is controlling.79
73. Following the appellate court’s decision, Angelex filed a civil cause of action against
the United States in United States District Court for the District of Columbia seeking
compensation for the “unreasonable detention” of the PAPPADAKIS. See Angelex Ltd. v. United
States, Civil Action No. 1:15-cv-00056-RC (D.D.C. Jan. 14, 2015). The case is presently
pending a decision on the government’s motion to dismiss Angelex’s complaint. See id. (No. 6).
74. Angelex, 723 F.3d at 507.
75. Id.
76. Id.
77. Id.
78. 5 U.S.C. § 706(2)(A) (2012).
79. Angelex, 723 F.3d at 507.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
170 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
ii. Admiralty Jurisdiction
After clarifying that the district court lacked subject matter jurisdiction
to review the Coast Guard’s bond decision for the Pappadakis under the
APA, the Fourth Circuit also reversed the district court’s holding that it was
entitled to review the Coast Guard’s actions pursuant to the district court’s
in rem admiralty jurisdiction. Section 1333(1) to Title 28 of the United
States Code confers district courts with jurisdiction over “[a]ny civil case
of admiralty or maritime jurisdiction.”80 Among other things, such
admiralty jurisdiction applies to actions in rem.81 The district court
concluded that the Coast Guard’s withholding of departure clearance for
the Pappadakis without an agreement on the amount of the bond was
tantamount to “an arrest” of the vessel in rem and that the court accordingly
had authority to review the Coast Guard’s actions under its admiralty
jurisdiction.82
The Fourth Circuit flatly disagreed with the district court’s conclusion.
In its memorandum opinion, the Fourth Circuit held that the Coast Guard’s
withholding of the Pappadakis’s departure clearance was not tantamount to
an attachment pursuant to a civil action, such as a maritime lien that is
given to a creditor by law as security for a debt or claim.83 On the contrary,
the Court reasoned, the Coast Guard was properly withholding the
departure clearance pursuant to its authority under § 1908(e).84
The Fourth Circuit also noted that Angelex mischaracterized the
surety bond as “stand[ing] in place of the Vessel for the potential criminal
fine or civil penalty imposed.”85 The Court held that the purpose of the
surety bond was to act as consideration for the United States’ agreement
not to cause the arrest of the vessel; it was not intended to stand in place of
the vessel for the potential fine imposed.86 The Court also rejected
Angelex’s legal argument that the Coast Guard’s withholding of clearance
was equivalent to an “arrest” that was done to provide the government
80. 28 U.S.C. § 1333(1) (2012).
81. See Supplemental Rules for Certain Admiralty and Maritime Claims, FED. R. CIV. P.,
Rule E(1).
82. Angelex, Civil No. 2:13cv237, at 11.
83. Angelex, 723 F.3d at 509.
84. Id.
85. Id.
86. Id. at 509–10.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 171
“with the ability to obtain financial security for a potential fine or
penalty.”87 The Court explained that, on the contrary, the withholding of
clearance for the Pappadakis was not an offense to the ship itself, but was a
discretionary action on the part of the Coast Guard under APPS.88
3. The Significance of the Courts’ Holdings in Angelex and
Watervale Marine
The Fourth Circuit’s ruling in Angelex is the first appellate court
review of a challenge to the Coast Guard’s authority under 33 U.S.C. §
1908(e), and the panel’s decision holds emphatically that the agency has
broad discretion to establish the bond conditions for granting departure
clearance to a vessel detained for suspected APPS violations. Taken
together, the decisions in Angelex and Watervale Marine demonstrate that,
regardless of the procedural posture, future challenges to the Coast Guard’s
exercise of its discretion under § 1908(e) are likely to be viewed with
skepticism by the courts, and the agency’s decision regarding the
conditions required for departure clearance will be accorded substantial
deference, unless they rise to the level of unconscionable actions giving
rise to a constitutional due process claim.89
C. Wilmina Shipping AS v. United States Department of Homeland
Security
In contrast to the courts’ holdings in Watervale Marine and Angelex,
in Wilmina Shipping the Court offered a more restrained view of the Coast
87. Id. at 510.
88. Id. at 507–08. In addition to ruling that the district court lacked subject matter
jurisdiction to review the Coast Guard’s bond decision, the Fourth Circuit weighed in on the
merits of the arguments that the petitioner-appellees made before the district court. Specifically,
the Court rejected petitioner-appellees’ arguments that the higher bond amount insisted upon by
the Coast Guard violated the Coast Guard’s statutory authority under § 1908(e) as well as
Angelex’s constitutional due process rights. Id. at 508. With respect to the Coast Guard’s
statutory authority, the Court opined that the bounds of § 1908(e) are “quite limitless.” Id.
Accordingly, the Coast Guard “may demand a low bond, a high bond, or may refuse to grant
clearance altogether.” Id. Moreover, if the Coast Guard requests that clearance be refused or
revoked, under § 1908(e), “it is mandatory that such action occur.” Id. Finally, as to Angelex’s
claim that the Coast Guard’s actions were unconstitutional, the Fourth Circuit dismissed this
claim as a poorly concealed attempt to have the court engage in a direct review of the specific
bond conditions sought by the Coast Guard in order to allow the Pappadakis to depart the port.
Id.
89. Watervale Marine, Civil Action No. 12-cv-0105, 2014 WL 3563159, at *17.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
172 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
Guard’s enforcement authority stemming from the agency’s APPS-related
investigations of foreign-flagged vessels docked in U.S. ports.
Nevertheless, like Watervale Marine and Angelex, the Court’s opinion in
Wilmina Shipping greatly clarified the Coast Guard’s ability to impose
significant conditions for re-entry on a vessel suspected of violating APPS.
Specifically, the Court held that the Coast Guard has the authority to bar a
foreign-flagged vessel from U.S. waters where the agency has found
reasonable cause to believe that the vessel’s crew had committed APPS
violations. The Court clarified, though, that the Coast Guard must inform
the vessel owner or operator of the conditions that must be satisfied in
order for the vessel to restore its compliance certification and be permitted
to re-enter U.S. waters. The Court further held that the Coast Guard’s
authority to bar a foreign-flagged vessel from U.S. waters does not extend
to the exclusion of the vessel for a set period of time, without providing the
vessel’s owner or operator a path for reinstatement of its certificate of
compliance.90
1. Procedural Background
Wilmina Shipping arose out of a Port State Control inspection by the
Coast Guard of the M/T Wilmina (“Wilmina”), a Norwegian-flagged
oceangoing tank vessel, in May 2010 while the vessel was docked at the
Port of Corpus Christi. During the inspection, the Coast Guard issued the
vessel a certificate of compliance, which stated that “the ship has been
examined and found to be in compliance with all applicable U.S. and
international marine safety and environmental protection standards.”91
Following a report from a former member of the Wilmina’s engine
department that the vessel’s crew had bypassed its pollution control
equipment and discharged oily bilge waste directly overboard, the Coast
Guard re-boarded the Wilmina later the same evening. During this
subsequent investigation, the Coast Guard found that the ship’s oily water
separator was inoperable, that the vessel had failed to maintain engine
room alarms to signal when there was a certain level of oil in the water to
90. See Wilmina Shipping, 934 F.Supp.2d 1 (D.D.C. 2013).
91. Id. at 3.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 173
be discharged, and that the ship had failed to maintain proper records in its
ORB.92
Based upon the findings of its investigation, the Coast Guard issued a
Captain of the Port Order that revoked the Wilmina’s certificate of
compliance due to its “willful noncompliance with MARPOL and APPS.”93
“[U]nder the authority of 33 U.S.C. § 1228,” the order banned the Wilmina
from entering the port until after the ship had developed and implemented
an acceptable Environmental Compliance Plan (“ECP”) and completed one
year of successful audits under the vessel’s ECP or, in the alternative, until
after three years had passed. 94 The Coast Guard Office of Vessel
Activities subsequently issued an order extending the conditions of the ban
imposed under the Captain of the Port Order to exclude the Wilmina from
entering all U.S. ports and U.S. navigable waters.95 The vessel’s owner,
Wilmina Shipping AS (“Wilmina Shipping”), and its technical manager,
Wilhelmsen Marine Services AS (“Wilhelmsen”) (collectively, the
“plaintiffs”), sought to have the Coast Guard orders dismissed through the
Coast Guard’s administrative appeals process but were unsuccessful. The
plaintiffs then filed a complaint against the Coast Guard and the United
States Department of Homeland Security (collectively, the “defendants”) in
United States District Court for the District of Columbia, asserting that the
defendants lacked the statutory authority under the Port and Waterways
Safety Act (“PWSA”)96 to issue the orders.97 In response to the plaintiffs’
complaint, the defendants filed a motion for summary judgment to have the
complaint dismissed.98 The plaintiffs filed a cross-motion for summary
judgment requesting the Court to enjoin the Coast Guard from excluding
92. Id. at 4. Although evidence establishing reasonable cause to believe that a MARPOL
violation occurred often results in a criminal referral to the U.S. Department of Justice, no
criminal referral was made in this case for reasons that do not appear in the public record.
93. Id.
94. Id. at 2, 4.
95. Id. at 4–5.
96. Port and Waterways Safety Act, 33 U.S.C. §§ 1221, et seq. (2012).
97. See Complaint, Wilmina Shipping AS v. U.S. Dep’t. of Homeland Sec., Case No. 11-
2184 (D.D.C. December 9, 2011), ECF No. 1. The plaintiffs’ complaint further alleged that the
plaintiffs did not receive the due process required under the law when the Coast Guard revoked
the Wilmina’s certificate of compliance without a pre-deprivation hearing, and that the Coast
Guard’s findings following its investigation of the Wilmina were arbitrary and capricious and
improperly based upon information provided by an unreliable whistleblower.
98. See Motion for Summary Judgment, Wilmina Shipping, Case No. 11-2184 (D.D.C.
June 7, 2012), ECF No. 13.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
174 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
the Wilmina from U.S. waters and from withholding the vessel’s certificate
of compliance.99
2. The District Court’s Decision
In a memorandum opinion, District Court Judge Amy Berman Jackson
denied in part and granted in part the defendants’ motion for summary
judgment and the plaintiffs’ cross-motion for summary judgment.100 Judge
Jackson specifically ruled that the Coast Guard was authorized to prohibit
the Wilmina from entering U.S. ports and navigable waters until it
developed and implemented an acceptable ECP and successfully completed
one year of audits; however, the Coast Guard’s authority did not extend to
the agency’s ban of the Wilmina for a period of time without providing a
path for reinstatement of its certificate of compliance.101
i. The Applicable Statutory Framework
The principal question that Judge Jackson considered was whether the
Coast Guard’s reliance on “the authority of 33 U.S.C. § 1228” in the
Captain of the Port Order authorized it to ban the Wilmina from entering
U.S. waters until it successfully implemented an ECP and completed one
year of audits or until a period of three years passed. Section 1228 of Title
33 to the United States Code is a provision of the PWSA that is titled
“Conditions for entry to ports in the United States.” Subsection (a) of §
1228 specifically states that “[n]o vessel, subject to the provisions of
chapter 37 of Title 46, shall operate” in U.S. waters if it meets any one of
99. See Plaintiffs’ Response in Opposition to the Defendants’ Motion for Summary
Judgment and Plaintiffs’ Cross-Motion for Summary Judgment in Wilmina Shipping, Case No.
11-2184 (D.D.C. July 20, 2012), ECF No. 20.
100. Aside from resolving the question of whether the Coast Guard possessed the statutory
authority to issue the orders excluding the Wilmina from U.S. ports and navigable waters, Judge
Jackson’s memorandum opinion concluded that no due process violation occurred when the
Wilmina’s certificate of compliance was revoked. On December 22, 2014, Judge Jackson issued
a memorandum opinion ruling in favor of the Coast Guard’s motion for summary judgment on
the merits of the Coast Guard’s investigation’s findings. Judge Jackson specifically concluded
that the evidence in the administrative record supported the Coast Guard’s order requiring the
plaintiffs to develop and implement an environmental compliance plan that was acceptable to the
Coast Guard and to have a year of satisfactory audits before the ship would be allowed to reenter
U.S. waters. See Wilmina Shipping AS v. U.S. Dep’t of Homeland Security, Case No. 11-2184,
2014 WL 6765439, at *1–2 (D.D.C. December 2, 2014).
101. Wilmina Shipping, 934 F.Supp.2d at 12–15.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 175
seven conditions.102 Those conditions include, inter alia, (1) a history of
accidents, pollution incidents, or serious repair problems that create a
reason to believe that the vessel may be unsafe; (2) a failure to comply with
any applicable regulation under chapter 37 of Title 46 to the United States
Code; and, (3) the discharge of oil or hazardous material in violation of
United States law or an international law to which the United States is a
signatory (such as APPS).103 Subsection (b) further authorizes the
Secretary of Homeland Security to determine “to the satisfaction of the
Secretary” when a vessel that was in violation of a condition of subsection
(a) “is no longer unsafe or a threat to the marine environment, and is no
longer in violation of any applicable law, treaty, regulation or condition.”104
In addition to § 1228 under the PWSA, Judge Jackson considered the
applicable sections of chapter 37 of Title 46 to the United States Code,
which is included by reference in § 1228(a) and which addresses the
“Carriage of Liquid Bulk Dangerous Cargoes.” She noted that, like § 1228,
46 U.S.C. § 3711 also governed the Coast Guard’s “granting, withdrawal,
and restoration of permission”105 for foreign-flagged vessels to enter U.S.
waters, providing as follows:
A foreign vessel to which this chapter applies may operate on the
navigable waters of the United States, or transfer oil or hazardous
material in a port or place under the jurisdiction of the United
States, only if the vessel has been issued a certificate of
compliance by the Secretary. The Secretary may issue the
certificate only after the vessel has been examined and found to
be in compliance with this chapter and regulations prescribed
under this chapter. The Secretary may accept any part of a
certificate, endorsement, or document, issued by the government
of a foreign country under a treaty, convention, or other
international agreement to which the United States is a party, as a
basis for issuing a certificate of compliance.106
102. 33 U.S.C. § 1228(a) (2012).
103. Id.
104. 33 U.S.C. § 1228(b) (2012).
105. Wilmina Shipping, 934 F.Supp.2d at 10.
106. Id. at 7 (citing 46 U.S.C. § 3711(a)).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
176 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
Subsection (c) of § 3711 further states that a certificate of compliance
shall be suspended or revoked if the Secretary of Homeland Security “finds
that the vessel does not comply with the conditions under which the
certificate was issued.”107 Finally, under 46 U.S.C. § 3712, the Coast
Guard is required to notify the owner or operator of a vessel when a vessel
is found to be out of compliance and must also state to the owner or
operator “how compliance may be achieved.”108
ii. Judge Jackson’s Analysis of the Applicable Statutory Framework
In her memorandum opinion, Judge Jackson observed that the
question of whether the Coast Guard was authorized under 33 U.S.C. §
1228 to ban the Wilmina from U.S. waters under the particular conditions
the agency imposed in the Captain of the Port Order was a matter of first
impression.109 She explained that this was because the plain text of §
1228(a) only listed the conditions that were cause for the Coast Guard
excluding a foreign-flagged vessel from entering U.S. waters but did not
establish exactly how the Coast Guard was expected to administer this
prohibition.110
To reach a determination regarding the scope of the Coast Guard’s
authority, Judge Jackson first considered the plaintiffs’ assertion that §
1228(a) limited the Coast Guard’s authority to ban a foreign-flagged vessel
from entering U.S. waters only when the vessel met one of the seven
conditions enumerated in that subsection and when the vessel was in
“imminent danger of colliding with another vessel, alluding with bridge or
structure, running aground, exploding or catching fire.”111 Judge Jackson
rejected this contention on the grounds that nothing in the language of §
1228(a) or in the statute’s legislative history limited its applicability to
“exigent circumstances.”112 She further declined to adopt the plaintiffs’
argument that the Coast Guard’s enforcement authority under the PWSA
107. Id. (citing 46 U.S.C. § 3711 (c)).
108. Id. (citing 46 U.S.C. § 3712).
109. Id. at 9.
110. Id. at 9.
111. Id. at 10.
112. Id.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 177
was limited to the civil and criminal penalties listed in 33 U.S.C. § 1232113
and that the Coast Guard exceeded this authority by imposing particular
conditions in the Captain of the Port Order not enumerated in § 1232.114
Judge Jackson then considered whether 33 U.S.C. § 1228 authorized
the Coast Guard to require the Wilmina to implement an ECP and to
successfully complete one year of audits before permitting the vessel to re-
enter U.S. waters. She concluded that it did. Relying on the language of §
1228(b) allowing a vessel to prove to the “satisfaction of the Secretary”
that it is no longer unsafe or a threat to the marine environment,” Judge
Jackson reasoned that, “Congress left it to the Coast Guard to use its
expertise as the regulatory agency entrusted with the administration of the
statute to determine when a ship may reenter U.S. waters.”115 Judge
Jackson further noted that her reading of § 1228(b) was reinforced by 46
U.S.C. § 3712, which authorized the Secretary of Homeland Security to
inform the owner or operator of a vessel found not to be in compliance
“how compliance may be achieved.”116
In contrast to her conclusion that 33 U.S.C. § 1228 authorized the
Coast Guard to require the Wilmina to implement an ECP and complete
one year of successful audits before being permitted to re-enter U.S.
waters, Judge Jackson held that the same statute did not extend the Coast
Guard’s authority to order, in the alternative, that the Wilmina be excluded
from U.S. waters for three years. Judge Jackson reached this conclusion by
first considering the language of § 1228(b). She found that this subsection
requires that the Coast Guard’s exclusion of foreign-flagged vessels from
U.S. waters under § 1228(a) be terminated when an owner or operator
“demonstrates that the safety hazard or threat or violation that gave rise to
the prohibition no longer exists.”117 This is because that section expressly
provides that a vessel “shall not” be subject to the conditions for entry “if
the owner or operator of such vessel proves, to the satisfaction of the
Secretary, that such vessel is no longer unsafe or a threat to the marine
113. 33 U.S.C. §1232 (2012) provides that anyone who has been found to have violated the
PWSA is liable for a civil penalty up to $25,000 per violation. Section 1232 further provides that
any person who “willfully and knowingly” violates the PWSA commits a felony.
114. Wilmina Shipping, 934 F.Supp.2d at 11–12.
115. Id. at 13.
116. Id. at 14.
117. Id. at 15.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
178 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
environment, and is no longer in violation of any applicable law, treaty,
regulation or condition, as appropriate.”118
Judge Jackson also considered the meaning of 46 U.S.C. §§ 3711 and
3712 in her analysis. She first explained that the permissive language of §
3711 indicated that the Coast Guard is not in fact required to issue a
certificate of compliance but “may” do so if it determines that a ship
complies with applicable laws.119 Once the Coast Guard has decided to
revoke a certificate of compliance that it has issued, however, Judge
Jackson held that the language of § 3712 made it mandatory for the Coast
Guard to notify the owner or operator of a vessel found not to be in
compliance and to state to the owner or operator precisely “how
compliance may be achieved.”120
Based on the language of both 33 U.S.C. § 1228(b) and of 46 U.S.C. §
3712, Judge Jackson held that if the Coast Guard revokes a vessel’s
certificate of compliance, “it must advise the owners of what they need to
do to have the certificate reinstated.”121 By simply ordering that the
Wilmina be excluded from re-entry into U.S. waters for a period of three
years, the Coast Guard failed to adhere to this rule. Accordingly, Judge
Jackson concluded that the Coast Guard exceeded the scope of its authority
under 33 U.S.C. § 1228 when it excluded the Wilmina from U.S. waters for
three years without providing a path for reinstatement of its certificate of
compliance.122
3. The Effect of the Court’s Holding in Wilmina Shipping
Wilmina Shipping clarifies that, based on evidence of what the Captain
of the Port Order termed “willful noncompliance with MARPOL and
APPS,” the Coast Guard has authority under the PWSA to withdraw a
vessel’s certificate of compliance and establish specific conditions to be
met before the certificate will be reinstated and the vessel permitted to re-
enter U.S. waters. The Court’s ruling, though, places clear limits on the
scope of that authority and clarifies that such restrictions may not be
118. Id. at 13 (citing 33 U.S.C. § 1228(b)).
119. Id. at 14–15.
120. Id. at 15.
121. Id. (emphasis added).
122. Id.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 179
imposed for set periods of time without providing a clear path for
reinstatement of the certificate.
IV. CRIMINAL LIABILITY WITH RESPECT TO SPECIFIC MARITIME
ENFORCEMENT ACTIONS: UNITED STATES V. KALUZA
In addition to the Coast Guard’s significant role in investigating
foreign-flagged vessels docked in U.S. ports for potential APPS violations,
environmental criminal maritime enforcement actions often involve the
application of more traditional criminal laws and regulations, some of
which are specific to the maritime industry. In United States v. Kaluza,123
the United States District Court for the Eastern District of Louisiana, in
another case of first impression, delineated the categories of crew members
who can be viewed as potential defendants under the Seaman’s
Manslaughter Statute when fatal maritime casualties occur on a mobile
offshore drilling unit (“MODU”).
On April 20, 2010, a gas release and subsequent explosion occurred
on the MODU Deepwater Horizon oil rig working on the Macondo
exploration well for British Petroleum (“BP”) in the Gulf of Mexico.
Eleven people on the rig were killed in the explosion. The Deepwater
Horizon blowout resulted in an extraordinary amount of litigation,
including thousands of private civil causes of action for damages, a federal
civil law suit to determine liability for the explosion and federal criminal
charges against BP and four individual employees.124 With respect to the
123. United States v. Kaluza, Criminal Action No. 12-265, 2013 WL 6490341 (E.D. La.
2013).
124. In 2012, BP reached a settlement with approximately 100,000 private claimants against
the company regarding approximately $8 billion in damages. In January 2013, Transocean also
agreed to plead guilty to a misdemeanor charge of violating the Clean Water Act, to pay a total of
$1.4 billion in civil and criminal fines and penalties and to be on probation for a period of five
years. Under the civil settlement, Transocean agreed to implement court-enforceable strictures in
its drilling operations, including certification of maintenance and repair of blowout preventers
before each new drilling job, consideration of process safety risks and personnel training related
to oil spills and responses to other emergencies. Also, in February 2013, a three phase civil trial
began with the DOJ, Gulf states and private individuals acting as plaintiffs against BP,
Transocean, and Halliburton. The purpose of the trial was to assess liability for the blowout of
BP’s Macondo Well. Following the second phase of the trial, the judge issued a finding of fact
that BP should be held responsible for a net discharge of 3.19 million barrels of oil. See Findings
of Fact and Conclusions of Law, Phase Two Trial, In re: Oil Spill by the Oil Rig “Deepwater
Horizon” in the Gulf of Mexico, on April 20, 2010, MDL 2179, 2010 AMC 1977, (E.D. La. Jan.
15, 2015) (No. 14021). The final penalty phase of this trial commenced on January 20, 2015, and
concluded on February 2, 2015. See Minute Entry for proceedings held before Judge Carl
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
180 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
federal criminal charges, BP reached a settlement with the U.S. Department
of Justice pursuant to which it agreed to pay over $4 billion in fines and
other payments and to plead guilty to 11 counts of felony manslaughter
related to the deaths of the 11 workers who worked on the Deepwater
Horizon rig, one count of felony obstruction of Congress, and criminal
violations of the Clean Water and Migratory Treaty Acts.125
Among the individual employees charged, two BP employees were
indicted for obstruction of justice and for lying to federal investigators. One
of these employees, BP drilling engineer Kurt Mix, was convicted on one
count of obstruction of justice in December 2013; however, he was granted
a new trial in June 2014 owing to juror misconduct.126 The other
employee, BP vice president of exploration David Rainey, was acquitted of
charges that he obstructed a Congressional subcommittee investigation and
made false statements to Congress about the amount of oil spewing into the
gulf.127
Barbier, In re: Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20,
2010, (E.D. La. Feb. 2, 2015) (No. 14132). Prior to the issuance of Judge Barbier’s penalty
determination, on July 2, 2015, BP disclosed that it had reached agreements in principle with the
United States and state and local governments for a settlement of all remaining claims arising out
of the Deepwater Horizon oil spill. BP to Settle Federal, State and Local Deepwater Horizon
Claims for up to $18.7 Billion With Payments to be Spread Over 18 Years, BP Press Release, July
2, 2015, http://www.bp.com/en/global/corporate/press/press-releases/bp-to-settle-federal-state-
local-deepwater-horizon-claims.html. The agreements in principle provide that BP will pay $5.5
billion in total Clean Water Act fines; $8.1 billion (including $1 billion already paid) for natural
resource damages and restoration; and $5.9 billion to settle claims by state and local governments
for economic damages. Id. As of the date this article went to print, a consent decree
incorporating the agreements in principle has yet to be submitted for public comment and then for
court approval. See Statement by Attorney General Loretta E. Lynch on the Agreement in
Principle with BP to Settle Civil Claims for the Deepwater Horizon Oil Spill, DOJ Press Release,
July 2, 2015, http://www.justice.gov/opa/pr/statement-attorney-general-loretta-e-lynch-
agreement-principle-bp-settle-civil-claims.
125. At the same time, BP also resolved civil securities fraud charges brought by the SEC in
exchange for a settlement of $525 million. See Sec. & Exch. Comm’n v. BP p.l.c., Civil Action
No. 2:12-cv-2774 (E.D. La. Dec. 10, 2012) (No. 5).
126. See Order and Reasons, United States v. Mix, Criminal Action No. 12-171 (E.D. La.
June 12, 2014). The district court’s ruling granting Mix a new trial was upheld on appeal. See
United States v. Mix, No. 14-30837, 2015 WL 3972275 (5th Cir. June 30, 2015).
127. See United States v. Rainey, Criminal Action No. 2:12-cr-00291-KDE-DEK-1 (E.D. La.
June 5, 2015) (No. 504). The charges against Rainey arose from testimony that he provided to the
U.S. House Subcommittee on Energy and Environment in May 2010. The district court
dismissed the obstruction of justice charge against Rainey ahead of trial on the grounds that (1)
the Congressional inquiry at issue did not reflect a “due and proper exercise of the power of
inquiry” by a Congressional subcommittee as required under 18 U.S.C. § 1505; and (2) the
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 181
A. Individual Employees Charged with Violations of Seamans’
Manslaughter Statute
Two other BP employees, Robert Kaluza and Donald Vidrine, were
also charged with criminal conduct resulting from the deaths of the 11
employees aboard the Deepwater Horizon. BP, as the legal operator of the
Macondo well, did not own the rigs that drilled Macondo nor did it operate
the rigs. However, BP maintained an engineering team to design the
wells.128 BP also employed a “wells team leader” who was accountable for
safety and operation of the rig, as well as two “well site leaders” (“WSLs”),
the top BP employees on board the Deepwater Horizon. The WSLs were
responsible for supervising the implementation of BP’s drilling plans and
procedures.129 Both Kaluza and Vidrine were WSLs aboard the Deepwater
Horizon at the time of the blowout on April 20, 2010.
In addition to returning charges for involuntary manslaughter and
violation of the Clean Water Act, a federal grand jury in the Eastern
District of Louisiana indicted Kaluza and Vidrine with 11 violations of the
Seaman’s Manslaughter Statute under 18 U.S.C. § 1115.130 That statute
provides as follows:
Every captain, engineer, pilot, or other person employed on any
steamboat or vessel, by whose misconduct, negligence, or
inattention to his duties on such vessel the life of any person is
destroyed . . . shall be fined under this title or imprisoned not
more than ten years, or both.131
requests for information that served as the basis for the obstruction of justice charge did not fall
within the scope of the Congressional subcommittee’s investigation. See Rainey, Criminal Action
No. 2:12-cr-00291-KDE-DEK-1 (June 1, 2015) (No. 494). Rainey was also acquitted after a jury
trial of the charge that he made false statements to Congress. See id. (June 5, 2015) (No. 504).
128. United States v. Kaluza, Criminal Action No. 12-265, 2013 WL 6490341, at *6 (E.D.
La. Dec. 10, 2013).
129. Id.
130. Indictment as to Robert Kaluza and Donald Vidrine, United States v. Kaluza, Case No.
2:12-cr-00265 (E.D. La. 2012), ECF No. 3. By charging the defendants with 11 counts under
both the Involuntary Manslaughter statute, 18 U.S.C. § 1112 (requiring proof of gross negligence)
and the Seaman’s Manslaughter Statute (requiring proof of only simple negligence), the
government apparently anticipated that there could be jurisdictional and/or coverage challenges to
the application of the Seaman’s Manslaughter Statute to WSLs aboard a MODU operating some
50 nautical miles offshore in the Gulf of Mexico.
131. 18 U.S.C. § 1115 (2012) (emphasis added).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
182 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
Kaluza and Vidrine sought the dismissal of the charges against them
in a motion to dismiss filed in May 2013.132 In a judicial order filed on
December 10, 2013, Judge Stanwood Duval, Jr. in the U.S. Court for the
Eastern District of Louisiana denied the defendants’ motion as to the counts
charging involuntary manslaughter and violation of the Clean Water Act,
but dismissed the charges under the Seaman’s Manslaughter Statute.133
Following the government’s interlocutory appeal of the District Court’s
order of dismissal, the U.S. Court of Appeals for the Fifth Circuit affirmed
Judge Duval’s ruling dismissing the seaman’s manslaughter charges.134
B. Dismissal of Ship Officers’ Manslaughter Charges
In dismissing the Seaman’s Manslaughter Statute charges against
Kaluza and Vidrine, Judge Duval provided a comprehensive analysis of the
class of people to whom that manslaughter statute applies. Ultimately,
Judge Duval concluded that the statute only applies to individuals who are
involved in the “navigation” or “maritime operations” of a vessel and that
therefore, it did not apply to Kaluza and Vidrine.135 With respect to the
Deepwater Horizon, Judge Duval found that the individuals who were
involved in the navigation of the vessel were certain members of the
vessel’s “marine crew.”136 As WSLs, Kaluza and Vidrine were part of a
132. See Motion to Dismiss, Kaluza, Case No. 2:12-cr-00265 (E.D. La. May 30, 2013), ECF
No. 51.
133. See Kaluza, Criminal Action No. 12-265, 2013 WL 6490341. In rejecting the
defendants’ jurisdictional challenge to all of the counts in the Indictment, the Court found that the
Deepwater Horizon, “when connected and attached to the OCS through its drilling mechanisms
and is performing exploration and production of mineral resources, is ‘erected’ on the OCS” for
federal jurisdictional purposes under the Outer Continental Shelf Lands Act (“OCSLA”), 43
U.S.C § 1333(a)(1). Id. at *17.
134. See United States v. Kaluza, 780 F.3d 647, 656–69 (5th Cir. 2015). The appellate
court affirmed the dismissal of the seaman’s manslaughter charges on substantially the same
grounds as the lower court. See id. The Court further declined to consider whether the district
court erred in deciding that the Deepwater Horizon qualified as an OCSLA situs because the
issue was not properly appealed to the Court. See id. at 656. A trial on the remaining charges
against Kaluza and Vidrine has been scheduled for February 6, 2016. See Kaluza, Criminal
Action No. 2:12-cr-00265 (No. 143).
135. Id. at *28.
136. Id. at *26.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 183
separate “drilling crew” aboard the vessel, and were thus not within the
class of persons to whom the statute applied.137
C. The Court’s Reasoning in Kaluza
Neither Kaluza nor Vidrine served as a captain, engineer or pilot of
the Deepwater Horizon rig. Accordingly, the focus of the Court’s analysis
was on the meaning of the catchall phrase in the first clause of § 1115,
“other person employed.” The defendants argued that under principles of
statutory interpretation “other person employed” only included those
positions of “responsibility for the marine operations, maintenance, and
navigation of the vessel.”138 They further contended that because their
responsibilities as WSLs did not relate to the navigation of the Deepwater
Horizon and were not in any way “marine-related,” they did not fall under
this interpretation of “other person employed.”139 By contrast, the
government argued that the plain language of “other person employed”
applied to “all” persons employed on the rig, and therefore clearly included
WSLs.140
Judge Duval began his analysis by determining that the plain meaning
of “other person employed” was ambiguous because both parties’
interpretation of the phrase was reasonable; i.e., the phrase could mean
“all” persons employed on the vessel, or it could include some amount less
than “all” persons.141 He then sought to derive the contextual meaning of
“other persons employed” in § 1115 through the application of the canons
of statutory construction.
Judge Duval first applied the principle of ejusdem generis, which
holds that “[w]hen general words follow an enumeration of persons or
things, such general words are not to be construed in their widest extent.”142
Rather, the general words “are to be held as applying only to persons or
things of the same general kind or class as those specifically mentioned.”143
Judge Duval concluded that the listed categories in § 1115, which included
137. Id.
138. Id. at *18.
139. Id.
140. Id.
141. Id. at *19.
142. Id. at *19–20 (quoting Hilton v. Sw. Bell Tel. Co., 936 F.2d 823, 828 (5th Cir. 1991)).
143. Id. (quoting Hilton, 936 F.2d at 828).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
184 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
a captain, engineer and pilot, all “suggest a class of important persons
dealing with the function and navigation of the vessel” and that based on
the idea of ejusdem generis, any “other person employed” must refer to
individuals belonging to such a class.144
In applying the principle of ejusdem generis, Judge Duval rejected the
government’s argument in favor of the converse principle ex abundant
cautela. This principle is employed when Congress has included specific
examples before general language “out of an abundance of caution.”145
Judge Duval held that this principle was inapplicable based on the
“common sense” that if Congress was concerned about the inclusion of
“all” persons employed on the vessel, it would have simply said so.146 He
also explained that the principle was not appropriate in the criminal context
because “[a]s with arguments concerning vague language in criminal
statutes, the government’s broad construction of the phrase risks running
afoul of substantive due process requirements by failing to convey with fair
notice which persons might be included within the statute’s ambit.”147
The Court next examined the legislative history behind § 1115 to
further derive its contextual meaning. Following a thorough review of case
authority related to § 1115 dating back to the time of its enactment, the
Court concluded that “the case law applying the statute reflects the intent of
Congress in passing the statute: to hold accountable those persons
responsible for the marine operations and navigation of the vessel.”148
Indeed, the Court found that every case applying § 1115 from the time of
its enactment had applied to a defendant responsible for performing “some
marine-related function,” i.e., related to the navigation or marine operation
of the vessel.149
Judge Duval concluded his analysis of the contextual meaning of
“other person employed” under § 1115 by applying the rule of lenity. The
rule of lenity stands for the proposition that “criminal statutes are to be
construed strictly in favor of the defendant” so that they provide “fair
warning of the boundaries of criminal conduct.”150 The Court found that
144. Id. at *21.
145. Id.
146. Id. at *22.
147. Id.
148. Id. at *25.
149. Id.
150. Id. at *27.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 185
the narrower interpretation of the phrase “other persons employed” to
include only those persons involved in marine operations or navigation
properly favored the defendants under the rule of lenity and that without
any further indication from Congress that the phrase was intended to apply
to “all” persons employed on the vessel, the WSLs did not fall under the
statute’s reach.151
D. The Significance of the Court’s Dismissal of 11 Counts in Kaluza
As the Fifth Circuit held that the defendants had not properly appealed
the district court’s ruling concerning the application of the OCSLA, it
remains premature to evaluate the ultimate significance of the district
court’s ruling on this specific issue. Nevertheless, Judge Duval’s dismissal
of the seaman’s manslaughter charges, and the Fifth Circuit’s affirmance of
his ruling, provides substantial clarity as to the crew members who are
potentially liable under the Seaman’s Manslaughter Statute. Indeed, the
limited reach of this statute suggests that the Department of Justice must
exercise caution in its charging decisions when considering criminal
enforcement actions against individuals employed on drillships or in other
areas of the maritime industry following catastrophic incidents.
V. LIMITATIONS ON THE AMOUNT OF CRIMINAL PENALTIES AND
STANDARDS FOR WHISTLEBLOWER AWARDS
The final stage of an environmental criminal enforcement action
involves the imposition of a penalty for the offense or offenses that the
targeted individual or entity has been found to have committed. A
memorandum opinion issued by the Court in United States v. Sanford
Ltd.152 clarified the circumstances under which it is appropriate for the
government to pursue civil forfeiture or a fine under the Alternative Fines
Act against a company convicted of a maritime offense as well as the
potential amount of the fine that may be imposed. In addition, a number of
recent cases involving the granting of individual whistleblower awards in
APPS prosecutions have provided some guidance as to the factors that may
be relevant to the government’s decision to request a whistleblower award
and to a court’s decision to grant such an award. Together, these cases
151. Id. at *28.
152. United States v. Sanford Ltd., Case No. 11-352 (D.D.C. 2012).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
186 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
serve to clarify the limited circumstances under which forfeiture may be
appropriate in an environmental criminal prosecution, establish the
boundaries for application of the Alternative Fine Act for defendants
convicted of environmental criminal wrongdoing in the maritime sector,
and provide guidance concerning the appropriate standards for
consideration of whistleblower awards under the APPS statute.
A. The Application of the Alternative Fines Act and Civil Forfeiture
Proceedings: United States v. Sanford Ltd.
1. The Alternative Fines Act
In sentencing organizational defendants, a court typically may impose
one of two fine amounts. First, the court may fine the defendant pursuant
to the statutorily prescribed maximum fine for the type of offense charged,
which for most felonies is $500,000 per offense.153 Alternatively, the court
may impose a fine under the Alternative Fines Act, which provides that:
If any person derives pecuniary gain from the offense, or if the
offense results in pecuniary loss to a person other than the
defendant, the defendant may be fined not more than the greater
of twice the gross gain or twice the gross loss, unless imposition
of a fine under this subsection would unduly complicate or
prolong the sentencing process.154
Following a U.S. Coast Guard inspection in Pago Pago, American
Samoa, the U.S. government detained the New Zealand-flagged fishing
vessel F/V SAN NIKUNAU (“Nikunau”) and three of its crew members in
connection with alleged violations of APPS. Subsequently, on December
6, 2011, a grand jury returned a seven count indictment in the U,S. District
Court for the District of Columbia against Sanford Ltd. (“Sanford”), the
owner and operator of the Nikunau for violations of APPS and obstruction
of justice.155 On January 5, 2012, a grand jury returned a superseding
indictment containing the identical charges as the initial indictment, but
153. 18 U.S.C. § 3571(c)(3) (2012).
154. 18 U.S.C. § 3571(d) (2012) (emphasis added).
155. Indictment as to Sanford Ltd., United States v. Sanford Ltd., Case No. 1:11-cr-00352
(D.D.C. Dec. 6, 2011), ECF No. 1.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 187
adding two former Chief Engineers of the Nikunau as individual defendants
to certain counts.156
The superseding indictment that was returned against Sanford also
contained an introductory paragraph alleging that Sanford earned revenues
of over $24 million for the fish cargoes offloaded from the Nikunau on
certain voyages and that this amount would serve as the basis for the
imposition of an alternative criminal fine against Sanford. Specifically, the
superseding indictment stated as follows:
Sanford Ltd. gained, during the time period relevant in this
indictment, revenues of $24,862,954.89 for the offload of fish
cargo from the F/V San Nikunau in American Samoa, even
though the vessel was not in compliance with international and
United States law and therefore could have been prevented from
entering American Samoa and offloading fish cargo . . . all of
which constitutes a gain pursuant to the Alternative Fines Act, 18
U.S.C. § 3571, and is forfeitable pursuant to 18 U.S.C. §§
981(a)(1)(C) & 1956(c)(7)(E).157
Sanford filed a motion in limine challenging the admissibility of the
government’s evidence purporting to show that the company earned over
$24 million in revenues from the offloading of fish cargo from the
Nikunau. In its opposition to the motion, the government asserted that such
evidence was in fact admissible at trial because it was relevant to (1)
proving the defendants’ financial motives for committing the charged
conduct and (2) determining the appropriate amount of “gross gain” that
was “derive[d] . . . from the offense” under the Alternative Fines Act.158
While U.S. District Court Judge Beryl Howell agreed that general evidence
of monetary proceeds was admissible for the purpose of proving motive,
she reached a different conclusion with respect to the government offering
the $24 million figure as a basis for determining the appropriate criminal
156. Superseding Indictment as to Sanford Ltd., Rolando Ong Vano and James Pogue,
Sanford, Case No. 1:11-cr-00352 (January 5, 2012), ECF No. 22 [hereinafter Superseding
Indictment].
157. Id. at 3–4.
158. Memorandum Op., Sanford, Case No. 1:11-cr-00352 (July 19, 2012), ECF No. 171 at
5.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
188 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
fine to impose against Sanford.159 In her memorandum opinion resolving
the parties’ dispute on this point, Judge Howell substantially clarified the
application of the Alternative Fines Act to sentencing proceedings in
maritime enforcement actions.
Judge Howell first noted that in Sanford’s case, a conviction on all
seven felony counts would result in a statutory maximum fine of
$3,500,000.160 By contrast, if the government were to pursue a fine amount
under the Alternative Fines Act with $24,862,954.89 as the amount of the
“gross gain” derived from the charged offenses, then the total possible
amount of the fine would have far exceeded the statutory maximum.
Because the potential alternative fine exceeded the statutory maximum,
Judge Howell applied the Supreme Court’s ruling in Southern Union Co. v.
United States161 and held that the government could only seek an
alternative fine based on the $24 million figure if the jury found beyond a
reasonable doubt that that amount constituted a “gross gain” to Sanford that
was “derive[d] . . . from” the charged offenses.162 Judge Howell added that
in order to avoid the danger of unfair prejudice to Sanford presented by the
evidence of the $24,045,930.79, the government had to “provide to the jury
sufficient context for the $24,045,930.79 figure—vis-à-vis the proper
definitions of ‘gross gain’ and ‘derive[d] . . . from’” to admit it for the
purpose of establishing or calculating “gross gain.”163
i. The Meaning of “Gross Gain” and “Derived From”
Judge Howell’s memorandum opinion then addressed the meaning of
“gross gain” and “derive[d] . . .from” under the Alternative Fines Act, as
these terms are not expressly defined under the statute. Focusing first on
the term “gross gain,” she explained that this was an ambiguous term
because it was unclear whether it referred to “total income” from all
sources before deductions, exemptions or other tax reductions, or whether
159. Id. at 6–10.
160. Id. at 12.
161. In Southern Union, the Court held that, based on the rule promulgated in Apprendi v.
New Jersey, 530 U.S. 466 (2000), any fact that increases the amount of a criminal fine “beyond
the prescribed statutory maximum must be submitted to a jury and proved beyond a reasonable
doubt.” See Southern Union v. United States, 132 S. Ct. 2344, 2349–51 (2012).
162. Memorandum Op., Sanford, Case No. 1:11-cr-00352 (July 19, 2012), ECF No. 171 at
13.
163. Id.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 189
it constituted a “net profit” amount related to the “excess of receipts over
expenditures or of sale price over cost.”164 To further clarify its meaning,
Judge Howell examined the use of the term “gross gain” in the U.S.
Sentencing Guidelines, the legislative history behind 18 U.S.C. § 3571(d),
and the application of the term “gross gain” in other cases.165 Based on this
analysis, she concluded that the term “gross gain” means any additional
before-tax profit to the defendant that derives from the relevant conduct of
the offense.166
Judge Howell then examined the meaning of the term “derive[d] . . .
from,” which presented the issue of the causal nexus that is required
between a monetary amount and a charged offense.167 In defining this
term, Judge Howell relied upon the court’s reasoning in United States v. BP
Products North America, Inc.168 In that case, the court found that
“derive[d] . . . from” mandated that “gain or loss be both factually and
proximately caused by the defendant’s acts.”169 Judge Howell ruled that
this proximate causation standard was the appropriate standard to apply to
§ 3571(d). That is, the term “derive[d] . . . from” requires the government
to prove that a “given monetary amount (either a gain or a loss) was
proximately caused by the conduct of the charged offense in order to
qualify as a ‘gross gain’ under § 3571(d).”170
ii. The Meaning of “Undue Complication”
Finally, Judge Howell explained that a threshold issue before
application of the alternative fine provision of § 3571(d) was whether the
imposition of the “gross gain” measure of a criminal fine would “unduly
complicate or prolong the sentencing process.” In such a case, the
alternative fine becomes unavailable and the statutory maximum of
164. Id. at 13–14.
165. Id. at 14–16.
166. Id. at 18.
167. Id. at 18.
168. United States v. BP Products North America, Inc., 610 F.Supp.2d 655 (S.D. Tex.
2009).
169. Memorandum Op. in Sanford, Case No. 1:11-cr-00352 (July 19, 2012), ECF No. 171
at 19.
170. Id.; see also id. at 23 (“in order to qualify as ‘gross gain’ that is ‘derive[d] . . . from’
the charged offenses, it will be the government’s burden to prove to the jury beyond a reasonable
doubt that any before-tax profits earned by Sanford were earned as a proximate result of the
charged offenses”).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
190 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
$500,000 per offense applies instead.171 Again, Judge Howell turned
toward the BP Products case as instructive. In that case, the court
discussed the circumstances in which calculating an alternative fine might
be inappropriate:
[F]or example, if determining the amount of the defendant’s gain
were to require a protracted hearing that would last longer than
the trial, the judge could decline to base the fine on the
defendant’s gain. The court’s determination as to whether
imposing a fine based on defendant’s gain or victim’s loss is
discretionary, and the committee is confident that federal judges
will not abuse this discretion.172
Judge Howell agreed with the court’s holding in BP Products that “in
determining whether a ‘gross gain’ determination would meet the threshold
[of causing undue complication], [a court] should consider three factors: (1)
whether there are multiple victims; (2) whether the causation issues are
disputed; and (3) whether disputed future losses are involved.”173
Notably, in her memorandum opinion, Judge Howell did not rule on
whether allowing the government to seek a fine under § 3571(d) would
“unduly complicate or prolong” the trial. Instead, she directed the
government to submit to the Court, before the commencement of the trial,
the number of witnesses and kinds of evidence it intended to present to the
jury regarding the “gross gain” that Sanford “derive[d] . . . from” the
charged offenses.174 Following the issuance of Judge Howell’s
memorandum opinion, the government notified the Court that it had elected
not to pursue an alternative fine under 18 U.S.C. § 3571(d), and instead
only intended to use the proceeds of $24,045,930.79 as evidence of
motive.175
171. Id. at 21.
172. Id. at 21–22 (quoting H.R. REP. NO. 98-906 at 17).
173. Id. at 22 (quoting BP Products, 610 F. Supp. 2d at 691).
174. Id. at 23.
175. See Notice of Election not to Pursue an Alternative Fine, Sanford, Case No. 1:11-cr-
00352 (July 23, 2012), ECF No. 179.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 191
2. Civil Forfeiture Proceedings
The superseding indictment that was returned against Sanford further
asserted that the purported revenues of over $24 million that Sanford
earned for the fish cargoes offloaded from the Nikunau on certain voyages
were subject to civil forfeiture proceedings under 18 U.S.C. §§
981(a)(1)(C) and 1956(c)(7)(E).176 Notably, the government’s decision to
pursue civil forfeiture proceedings against Sanford appears to mark the first
time that the government has sought forfeiture of revenues in a vessel
pollution prosecution. In its reply to the government’s opposition to its
motion in limine, Sanford asserted that the jury would be required to
consider separately the government’s forfeiture allegations after the guilt
phase of the trail.177 The government disagreed, arguing that because it
only sought a money judgment, the determination of the amount of the
money judgment was reserved for the Court.178
In considering this dispute, Judge Howell examined Fed. R. Crim. P.
32.2, which governs criminal forfeiture procedures.179 Subsection (b)(1)(a)
of that rule states that when the government seeks forfeiture of a “personal
money judgment, the court must determine the amount of money that the
defendant will be ordered to pay.”180 Moreover, subsection (b)(5)(B) of
this Rule provides that when “a party timely requests to have the jury
determine forfeiture,” the government must submit a Special Verdict Form
“asking the jury to determine whether the government has established the
requisite nexus between the property and the offense committed by the
defendant.”181
Referencing case authority from other jurisdictions, Judge Howell
observed that several Circuits had held that Fed. R. Crim. P. 32.2(b)(5)
does not apply to money judgments.182 She also stated that the language of
176. Superseding Indictment, supra note 157, at 3–4.
177. See Reply to Gov’t’s Opposition to Def. Sanford Ltd.’s Motion in Limine, Sanford,
Case No. 1:11-cr-00352 (June 27, 2012), ECF. No. 156, at 5, n.3.
178. See Gov’t’s Pre-Trial Memorandum Regarding Forfeiture, Sanford, Case No. 1:11-cr-
00352 (July 2, 2012), ECF No. 160, at 3.
179. See Memorandum Op., Sanford, Case No. 1:11-cr-00352 (July 19, 2012), ECF No. 171
at 4, n.1.
180. FED. R. CRIM. 32.2(b)(1)(A).
181. FED. R. CRIM. 32.2(b)(5)(B).
182. Memorandum Op., Sanford, Case No. 1:11-cr-00352 (July 19, 2012), ECF No. 171 at
5, n.1.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
192 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
Rule 32.2 suggested that it is “within the Court’s discretion to either submit
the nexus question to the jury or determine the question itself.”183 Judge
Howell however did not resolve the dispute. Instead, she held that in light
of her holding in the memorandum opinion that the jury would have to
determine whether any “gross gain” was “derive[d] . . . from” the charged
offenses, as well as the amount of that gain, she invited the parties to be
prepared to address before the close of the government’s case-in-chief
whether 32.2(b)(5) applies to money judgments and, if it does apply,
whether the Court should exercise its discretion to have the jury determine
both the “gross gain” question as well as the nexus question under Rule
32.2.184 Following the issuance of the Court’s memorandum opinion, the
government elected not to pursue its forfeiture claim against Sanford.185
3. The Significance of the Court’s Holdings in Sanford
Remarkably, the Superseding Indictment in Sanford, in an APPS
prosecution involving a single fishing vessel, demonstrated the
government’s intention to seek civil forfeiture of nearly $25 million dollars
plus a criminal fine calculated under the Alternative Fines Act of nearly
$50 million dollars. Following Judge Howell’s rulings, which clarified the
substantial burden of proof the government would need to meet in order to
prevail on those claims, the government announced its intention to abandon
both claims.186 In light of the rulings in Sanford, the government may have
reason to reconsider the wisdom of seeking such extraordinary criminal
penalties in the context of the typical APPS prosecution.
B. Equitable Factors Considered in the Granting of Awards to
Whistleblowers
Convictions under APPS often result in the payment of individual
whistleblower awards.187 Such payments are made pursuant to the criminal
penalty provision in APPS, 33 U.S.C. § 1908(a):
183. Id.
184. Id.
185. See Sanford Ltd.’s Response to the Sentencing Memorandum of the United States,
Sanford, Case No. 1:11-cr-00352 (January 2, 2013), ECF No. 229, at 9.
186. At sentencing, the Court ultimately imposed a criminal fine of $1.9 million dollars
against Sanford. See Minute Entry, Sanford, Case No. 1:11-cr-00352 (January 11, 2013).
187. Over the past 20 years, a total of more than $19 million dollars has been awarded by
courts to individual crew members who disclosed information of MARPOL violations to U.S.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 193
A person who knowingly violates the MARPOL Protocol . . .
[APPS], or the regulations issued thereunder commits a class D
felony. In the discretion of the Court, an amount equal to not
more than ½ of such fine may be paid to the person giving
information leading to conviction.188
Notably, there is no case law specifically addressing a court’s exercise
of its discretion to award a monetary payment under the whistleblower
provision of APPS.189 The legislative history for the statute is also silent as
to the factors to be considered when determining the appropriateness of an
award.190 Nevertheless, a number of recent cases have suggested that case-
specific equitable factors can influence the discretionary decision of federal
prosecutors to recommend a whistleblower award and the determination of
an award amount by courts, including whether the whistleblower (1)
followed internal reporting controls before notifying the government of a
purported APPS violation, (2) misled shoreside managers of the company
regarding the existence of a potential MARPOL violation on the vessel,
and (3) was motivated by personal financial gain and therefore delayed
authorities. See, e.g., United States v. Herm. Dauelsberg GmbH & Co., KG, Case No. 2:14-cr-
00200 (C.D. Cal. 2014) ($500,000 award); United States v. Diana Shipping, Case No. 2:13-
00040-MSD-DEM (E.D. Va. 2014) ($150,000 award); United States v. Columbia
Shipmanagement (Deutschland) GmbH and Columbia Shipmanagement Ltd., Case No. 2:13-cr-
00205-SDW (D. N.J. 2013) ($1 million award); United States v. Aquarosa Shipping, Case No.
1:11-cr-00671-MJG (D. Md. 2012) ($462,500 award); United States v. Target Ship Management
Pte. Ltd., Case No. 1:11-cr-00368 (S.D. Ala. 2012) ($250,000 award); United States v. Odysea
Carriers, S.A., Case No. 2:12-cr-00105 (E.D. La. 2012) ($183,000 award); United States v. Ilios
Shipping Co., Case No. 2:11-cr-00286-JCZ-SS (E.D. La. 2012) ($350,000 award); United States
v. Noka Shipping Company Ltd., Case No. 2:11-cr-00534 (S.D. Tx. 2011) ($250,000 award);
United States v. Ionia Management, Case No. 3:07-cr-00134-BA (D. Ct. 2011) ($1.9 million
award); United States v. Overseas Shipholding Corp., Case No. 1:06-cr-10408-RGS (D. Mass.
2007) ($437,500 award); United States v. Wallenius Ship Management Pte. Ltd., Case No. 3:06-
cr-002130-JAG (D.N.J. 2006) ($2.5 million award); Unites States v. OMI Corporation, Case No.
2:04-cr-00060-KSH (D.N.J. 2004) ($2.1 million award); United States v. HAL Beheer BV, A98-
108 CR(HRH) (D. Alaska 1998) ($500,000 award).
188. 33 U.S.C. § 1908(a) (2012) (emphasis added).
189. See Efploia Shipping Co. S.A.’s Opposition to Gov’t’s Motion for Whistleblower
Award, United States v. Efploia Shipping Co. S.A., Case No. MJG-11-0652 (D. Md. Jan. 24,
2012), ECF No. 6, at 3 [hereinafter Efploia Opposition].
190. Id.
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
194 U.S.F. MARITIME LAW JOURNAL [Vol. 27 No. 2
reporting the violation in other port States until the vessel entered a U.S.
port.
In United States v. Efploia Shipping Co. S.A.,191 the vessel manager,
Efploia Shipping, opposed the government’s motion for a whistleblower
award on the grounds that the whistleblower failed to report illegal
discharges from the vessel, the M/V AQUAROSA, to his supervisors
pursuant to company policy and to the company’s internal reporting
controls, which the company reviewed with its employees on a regular
basis.192 The defendant further asserted that the whistleblower intentionally
failed to report the unlawful conduct aboard the M/V AQUAROSA to port
state authorities in other jurisdictions prior to the vessel’s arrival in the
United States because he was motivated by the possibility of personal
financial gain under 33 U.S.C. § 1908(e).193
Though the court in Efploia Shipping has yet to rule on the pending
motion for an award, a consideration of these same equitable factors in
other recent cases appears to have resulted in a reduction of the fine amount
or even no fine at all. For instance, in United States v. Fleet Management
Ltd., Case No. 6:10-cr-00051 (S.D. Tex. 2010), the government had
requested an award in the amount of $500,000, but the court decided to
grant an award of only $200,000 after defense counsel argued at the
sentencing hearing that the whistleblower had failed to follow company
policies for reporting MARPOL violations and had misled the vessel’s
managers regarding the existence of MARPOL deficiencies on the
vessel.194 Similarly, in United States v. Cardiff Marine, Inc., Case No.
1:11-cr-00058-MJG-1 (D. Md. 2011), the defendant argued that an award
was not warranted because the whistleblower had ignored the company’s
internal reporting requirements before notifying the U.S. Coast Guard of
the unlawful discharge of oily waste aboard the M/V CAPITOLA. Though
the government did not disclose the basis for its decision, ultimately no
whistleblower award was sought by the government in that case.
191. Efploia Shipping Co. S.A., Case No. MJG-11-0652.
192. See Efploia Opposition, supra note 190, at 15–16.
193. Id. In the parallel criminal prosecution, United States v. Aquarosa Shipping, Case No.
1:11-cr-00671-MJG (D. Md. 2012), the vessel owner did not object to the award and the
whistleblower received an award of $462,500.
194. See Minute Entry for Contested Sentencing Hearing, Fleet Mgmt., Case No: 6:10-cr-
0051 (S.D. Tex. Sept. 9, 2010).
11 LINSIN AND GLASNER (DO NOT DELETE) 10/1/2015 4:41 PM
2014-2015] JUDICIAL AIDS TO NAVIGATION 195
In the absence of statutory guidance or legislative history, the outcome
of Fleet Management and Cardiff Marine, as well as the defendant’s
opposition to a whistleblower award in Efploia Shipping, indicate that the
referenced equitable factors can provide useful guidance in evaluating the
propriety of whistleblower award determinations under APPS. Careful
consideration of these factors can help ensure that the availability of such
financial awards does not work to undermine the effectiveness of the vessel
operator’s SMS policies or the statutory objective of preventing pollution
from ships.
VI. CONCLUSION
The judicial decisions discussed in this article have clarified and, in
some cases, limited, the scope of the U.S. government’s authority to pursue
environmental criminal enforcement actions in the maritime sector. The
cases have also helped to resolve issues concerning the extent of agency
discretion, the scope of the potential financial penalties, and the standards
that should govern the consideration of financial awards to whistleblowers.
A thorough understanding of the legal reasoning that was applied in each of
these cases and their outcomes offers valuable guidance to government
authorities who are weighing prosecutive decisions in future vessel
pollution investigations. The cases also contain valuable lessons for
maritime counsel, as well as companies and individuals that operate in the
maritime sector concerning the potential risks of noncompliance with
environmental regulatory requirements.
Recommended