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Grace Ocean and Synergy settle civil suit with US Justice Department for $102m

Money will cover costs of US government’s clean-up efforts, DOJ says

The owners and managers of the containership Dali have settled with the US Department of Justice for $102m, a little over a month after the US filed a suit accusing the companies of ‘reckless conduct’

GRACE Ocean and Synergy Marine, the owners and managers of the containership Dali (IMO: 9697428), have agreed to pay $101.9m to settle a civil lawsuit filed by the US last month, the Department of Justice announced on Thursday.

The lawsuit, which was part of legal action the companies initiated after the Baltimore bridge allision to limit their liability to $43.7m, alleged that the “entirely avoidable” catastrophe was caused by Grace Ocean and Synergy’s “careless and grossly negligent decisions”.

The settlement money will be used to cover the costs that federal agencies incurred as part of their response to the disaster, the DOJ said.

“This is a tremendous outcome that fully compensates the United States for the costs it incurred in responding to this disaster and holds the owner and operator of the Dali accountable,” said principal deputy assistant attorney general Brian Boynton, head of the DOJ’s civil division.

“The prompt resolution of this matter also avoids the expense associated with litigating this complex case for potentially years.”

The settlement comes as billions in other claims are ongoing, with the timeline for future litigation set to be decided soon.

Grace Ocean and Synergy have petitioned to limit the payout on non-settled claims at $43.7m, the value of Dali, under the US Limitation of Liability Act (LOLA).

However, liability will not be capped if the allision was due, at least in part, to the unseaworthiness of Dali or negligence of the LOLA petitioners — Synergy or Grace Ocean — and whether either of the petitioners “had privity or knowledge” of any such negligence or unseaworthiness.

In filing the lawsuit in September, the DoJ alleged precisely that.

“The owner and operator of Dali were well aware of vibration issues on the vessel that could cause a power outage. But instead of taking necessary precautions, they did the opposite,” said principal deputy associate attorney general Benjamin Mizer in a statement last month.

“Out of negligence, mismanagement, and, at times, a desire to cut costs, they configured the ship’s electrical and mechanical systems in a way that prevented those systems from being able to quickly restore propulsion and steering after a power outage. As a result, when the Dali lost power, a cascading set of failures led to disaster.”

Six construction workers who were on the Francis Scott Key Bridge in Baltimore when Dali crashed into it were killed and another was injured.

Their families are seeking damages for pain, suffering, emotional distress “and all other damages applicable under the law”. They are each seeking “damages far in excess of the value of the vessel”, implying total potential damages far in excess of $308m.

The DOJ settlement does not include any damages for the reconstruction of the bridge, which was built and operated by the state of Maryland and is estimated at $1.7bn-$1.9bn. Maryland is seeking the full cost of reconstruction, and other damage claims. 

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