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A federal judge on Monday
urged lawyers for a coal ship owner and the Coast Guard to come to an
agreement so the ship can operate while the government investigates it
for an alleged environmental crime.
The Coast Guard has been detaining the Antonis G. Pappadakis, a Maltese-flagged ship, since an April 15 inspection that quickly turned into a full-blown environmental investigation.
Ship owner, Angelex Ltd., sued on April 25 for the court to intervene to earn the vessel's release.
George Challos, a New York attorney representing Angelex, made the case before Senior U.S. District Court Judge Robert Doumar. Although the Coast Guard has said it would allow such an arrangement if Angelex pays a $3 million bond, Challos said that amount is more than his client can afford.
"If the court fails to take some action, the company suffers irreparable harm and goes out of business," Challos said.
He said an accountant for Angelex has determined the company has $775,000 in cash on hand that it has already agreed to put toward a bond to free up the ship. Its scheduled destination is Santos, Brazil.
But he said the lowest the Coast Guard has been willing to go in its negotiations is $2.5 million.
Doumar in his own words "badgered" Department of Justice admiralty lawyer Michael DiLauro, who's representing the Coast Guard. Doumar expressed distaste with the fact that the government hasn't charged anyone in the 21-member crew of the Pappadakis with a criminal action even as crew members are stuck on their docked ship indefinitely.
DiLauro argued the court doesn't have jurisdiction in the case.
But he agreed to try and hash out a compromise with Angelex after Doumar called the $3 million bond amount unreasonable and said neither side would necessarily come out a clear winner if he has to write an opinion in the case.
After a break in the hearing during which attorneys sought to reach an agreement, the Coast Guard rejected a bond offer from Angelex, according to Patrick Brogan, a local attorney representing the company.
Doumar's opinion is set to be released Tuesday morning.
Coast Guard's case
In a memo filed as part of the government's response to the Angelex lawsuit, the Department of Justice said Angelex and the ship's operator Kassian Maritime, "are under criminal investigation for intentionally bypassing their ship's pollution-control equipment and discharging an oily mixture directly into the sea."
The response said a whistleblower on the ship's crew told a Coast Guard inspector the ship was "discharging oily bilge water overboard" and provided photographs showing a makeshift system of hoses devised to get rid of the polluted water.
"He led inspectors to the pump and hoses depicted in the photographs, which were confiscated," the document says.
Investigators also had a technician remove from the ship what's called its "oily water separator" – a device used to treat wastewater on ships and prevent pollution of waterways by ensuring water discharged overboard contains below a certain threshold amount of oil.
Outside of the courtroom John Liokouras, safety manager at Kassian, the ship's operator, disputed that the Pappadakis was anything but compliant with international and local environmental regulations.
And he said the ship's detention has been tough on crew members and also for customers in Brazil with the contract for its coal: "Of course they're screaming 'Where's my cargo! Where's my cargo!"
The Coast Guard has been detaining the Antonis G. Pappadakis, a Maltese-flagged ship, since an April 15 inspection that quickly turned into a full-blown environmental investigation.
Ship owner, Angelex Ltd., sued on April 25 for the court to intervene to earn the vessel's release.
George Challos, a New York attorney representing Angelex, made the case before Senior U.S. District Court Judge Robert Doumar. Although the Coast Guard has said it would allow such an arrangement if Angelex pays a $3 million bond, Challos said that amount is more than his client can afford.
"If the court fails to take some action, the company suffers irreparable harm and goes out of business," Challos said.
He said an accountant for Angelex has determined the company has $775,000 in cash on hand that it has already agreed to put toward a bond to free up the ship. Its scheduled destination is Santos, Brazil.
But he said the lowest the Coast Guard has been willing to go in its negotiations is $2.5 million.
Doumar in his own words "badgered" Department of Justice admiralty lawyer Michael DiLauro, who's representing the Coast Guard. Doumar expressed distaste with the fact that the government hasn't charged anyone in the 21-member crew of the Pappadakis with a criminal action even as crew members are stuck on their docked ship indefinitely.
DiLauro argued the court doesn't have jurisdiction in the case.
But he agreed to try and hash out a compromise with Angelex after Doumar called the $3 million bond amount unreasonable and said neither side would necessarily come out a clear winner if he has to write an opinion in the case.
After a break in the hearing during which attorneys sought to reach an agreement, the Coast Guard rejected a bond offer from Angelex, according to Patrick Brogan, a local attorney representing the company.
Doumar's opinion is set to be released Tuesday morning.
Coast Guard's case
In a memo filed as part of the government's response to the Angelex lawsuit, the Department of Justice said Angelex and the ship's operator Kassian Maritime, "are under criminal investigation for intentionally bypassing their ship's pollution-control equipment and discharging an oily mixture directly into the sea."
The response said a whistleblower on the ship's crew told a Coast Guard inspector the ship was "discharging oily bilge water overboard" and provided photographs showing a makeshift system of hoses devised to get rid of the polluted water.
"He led inspectors to the pump and hoses depicted in the photographs, which were confiscated," the document says.
Investigators also had a technician remove from the ship what's called its "oily water separator" – a device used to treat wastewater on ships and prevent pollution of waterways by ensuring water discharged overboard contains below a certain threshold amount of oil.
Outside of the courtroom John Liokouras, safety manager at Kassian, the ship's operator, disputed that the Pappadakis was anything but compliant with international and local environmental regulations.
And he said the ship's detention has been tough on crew members and also for customers in Brazil with the contract for its coal: "Of course they're screaming 'Where's my cargo! Where's my cargo!"
Copyright © 2013, Newport News, Va., Daily Press
Post to be found at:
http://www.dailypress.com/business/ports/dp-nws-ports-coal-ship-detention-0507-20130506,0,4910426.story
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