Recent Development of Interest: Watervale Marine v. U.S. Dept. of Homeland Security

In July the U.S. District Court for the District of Columbia, in a case of first impression, considered whether the U.S. Coast Guard had authority to impose non-financial conditions for the release of a foreign flag vessel that it had detained at a United States port due to suspected violations of federal and international environmental law.  (Watervale Marine Co., LTD v. U.S. Department of Homeland Security, et al.)

The plaintiff is owner of four foreign flagged merchant vessels that the Coast Guard detained for investigation of criminal violations and later released, but only after plaintiff had posted a bond and executed a “security agreement” that contained various non-financial obligations.  Plaintiff challenged the non-financial security agreements that it had been required to execute in order to gain release of the vessels on the grounds that the Coast Guard lacked statutory authority to require any such condition prior to releasing the vessels.

The underlying facts were not in dispute.  Whistleblowers on board each ship had reported to the Coast Guard alleged violations of the Act to Prevent Pollution from Ships (“APPS”, 33 U.S.C. 1901-1915), which was passed with the intent to “achieve complete elimination of intentional pollution of the marine environment by oil and other harmful substances…”.  APPS was enacted by Congress because the United States had entered into a treaty with other foreign nations called the International Convention for the Prevention of Pollution from ships, commonly known as MARPOL.  As a signatory to the MARPOL, the U.S. was required to enact laws to administer and enforce MARPOL.  Thus APPS was conceived.

Under APPS the Coast Guard is authorized to board and inspect ships that call on U.S. ports in order to detect violations of APPS and other environmental laws.  Before departing a U.S. port a foreign flag ship must obtain departure clearance from Customs and under APPS the government can withhold clearance for established or suspected APPS violations.  APPS also provides that a ship that has been so detained and which may be liable for a fine or civil penalty may be granted clearance upon filing of a bond or other satisfactory surety.

The “non-financial” obligations imposed on Watervale to gain release of its vessels were exacting.  It required the crew to remain in the jurisdiction until the investigation was complete, that Watervale had to pay the crew their wages and provide housing and a per diem, keep the crew on as employees, encourage the crew to cooperate with the Coast Guard, arrange for repatriation of the crew, stipulate to authenticity of documents and items seized, help the government serve subpoenas on crew located abroad, waive objections to the jurisdiction and enter an appearance in federal court.  Faced with the prospect of serious financial loss if its vessels were not released Watervale signed the agreement.  This was in addition to a surety bond paid out to the United States if the government prevailed in subsequent prosecution and a judgment entered against Watervale.

In a lengthy decision the Court concluded that APPS, as written, did not put constraints on the power of the Coast Guard to determine the conditions to which a vessel owner must agree to gain release of its vessel.  It found that with passage of APPS, Congress places the question of whether, and under what circumstances, departure clearance is to be granted entirely within the Coast Guard’s discretion.  Put another way, even if Watervale was correct that a bond or other “financial” surety is a necessary prerequisite for release by the Coast Guard, the statute makes clear that the Coast Guard “may” release the vessel upon posting of such a bond, and does not provide any statutory standards by which to assess the circumstances under which the Coast Guard may or may not grant clearance.  Thus, the Coast Guard was free to impose any other conditions is thought appropriate in the exercise of its discretion.

Of perhaps more relevance to the day to day operation of our Port, after a long delay the Transportation Security Administration began nationwide implementation of the TWIC OneVisit program.  This program, the result of years of urging by industry and certain members of Congress, reforms the process of procuring a TWIC card so that the applicant does not have to make two in-person visits to an enrollment center to retrieve his card.  Now, the applicant can apply for his card at an enrollment center and then have his card mailed to him.  For many mariners this is significant given the time and expense they have had to incur making this extra trip.  As stated by Rep. Don Young, (R-Alaska), this reform was necessary so that “thousands of transportation workers across the nation can spend less time traveling to TWIC offices and more time working to put food on their families’ tables”.  Visit www.tsa.gov for more information

Bill Introduced Re: TWIC Expiration Date

On March 15, 2011 Representative Bennie Thompson (D-MS) introduced a bill (H.R. 1105) to ensure that Transportation Worker Identification Credentials (TWIC cards) held by certain maritime workers do not expire before the deadline for full implementation of electronic readers for such credentials or December 31, 2014, whichever is earlier.  The bill has been referred to the House Homeland Security committee.  The Official text of the bill has not yet been posted.