Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-akd-3_22-cv-00027/USCOURTS-akd-3_22-cv-00027-2/pdf.json

Nature of Suit Code: 120
Nature of Suit: Marine Contract Actions
Cause of Action: 46:1156 Administrative Procedure Act

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ALASKA

KANAWAY SEAFOODS, INC., et al.,

Plaintiffs,

v.

PACIFIC PREDATOR, et al.

 Defendants.

Case No. 3:22-cv-00027-JMK-KFR

FINDINGS AND RECOMMENDATIONS ON 

MOTIONS TO DISMISS UNDER 12(b)(1)

The Court recommends Defendants’ Motions to Dismiss at Dockets 66 and 76, 

each seeking dismissal of portions of Plaintiffs’ Amended Complaint pursuant to 

Federal Rule of Civil Procedure 12(b)(1) be denied. Plaintiffs’ Amended Complaint 

contains allegations that on their face are sufficient to invoke federal jurisdiction. 

Specifically, as it relates to money advanced by Plaintiffs for Defendants’ purchase

of three limited entry fishing permits, maritime jurisdiction under 46 U.S.C. § 31342

exists as these permits can properly be considered necessaries essential for the 

operation of Defendants commercial fishing enterprise. In addition, Plaintiffs’ 

action for possession of the Pacific Predator is a proper basis for jurisdiction 

pursuant to Supplemental Admiralty Rule D. 

I. Relevant Proffered Facts and Allegations1

Starting in 2019, Defendants Dana and Bryan Howey entered into a series of 

agreements with Plaintiffs Liberty Packing, LLC (“Liberty”), and Kanaway Seafoods 

Inc. (“Kanaway”), doing business as Alaska General Seafoods (“AGS”). On or about 

1 The Relevant Proffered Facts are limited to those facts necessary to decide the motions

before the Court. The Court does not intend for the Relevant Proffered Facts to constitute 

binding findings of fact should this matter proceed to trial.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 1 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 2 of 22

April 17, 2019, Defendants Dana and Bryan Howey entered into a Loan and Security 

Agreement with Liberty (“the Loan Agreement”).2 Under the Loan Agreement, 

Liberty loaned Defendants $800,000 to pay off Defendants’ outstanding loan to a 

third party.3 In exchange for this loan from Liberty, Defendants Bryan and Dana 

Howey agreed to enter into a Fishing Agreement with AGS to deliver and sell seafood 

products to AGS for a fixed period.4 The Liberty loan was further documented by a 

Promissory Note dated April 17, 2019, reciting the applicable loan terms (“the 

Liberty Note”).5

On or about June 30, 2019, Defendant Bryan Howey entered into a Promissory 

Note with AGS for $23,949.32 (“the AGS Note”), documenting a loan from AGS to 

Howey in that amount.6 On or about July 12, 2019, Howey purchased a limited entry 

fishing permit for the 2019 season in the amount of the AGS Note.7 Howey could 

repay the loan personally no later than September 30, 2019, or repayment could be 

made by that date through the “deliver[y of] sufficient product to [AGS].”8 

In addition to the AGS Note, AGS loaned Defendant Bryan Howey additional 

sums on an “open account” between 2019 and 2021 to be repaid under AGS’s 

standard terms and conditions, which included interest on the open amounts at 10% 

per annum (“AGS Open Account Loan”). These funds were loaned on the credit of 

Defendant Howeys’ fishing vessel, the Pacific Predator (“the Vessel”), and some of 

these funds were used by Defendants for necessaries for the Vessel, including vessel 

permits for the 2020 and 2021 fishing seasons.9

2 Doc 64-1.

3 Doc. 64 at 3.

4 Id. 5 Id. at 4.

6 Id. at 5. 

7 Doc. 64-3 at 1.

8 Id.

9 Doc. 64 at 5; see also Doc. 64-3 at 3 and 5.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 2 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 3 of 22

As to each of these loans, Plaintiffs’ Amended Complaint alleges that

Defendants have failed to comply with their terms. According to Plaintiffs, 

Defendants Bryan and Dana Howey, individually and through their company AWE, 

defaulted on the obligations in the Liberty Loan Agreement and Liberty Note by 

failing to make agreed principal and interest payments, and failing to register the 

Vessel in Washington and provide documentation of that registration to Liberty.10

Plaintiffs contend that these, and other acts and omissions of Defendants, constitute 

default under both the Loan Agreement and Note.11 Plaintiffs state that as of January 

14, 2022, the principal due on the Liberty Loan was $746,666.67 and the accrued 

interest as of February 1, 2022, was $113,166.62, with interest continuing to accrue 

at a rate of $368.22 per day.12

With regard to the AGS matters, Plaintiffs allege that Defendant Bryan Howey 

never repaid the AGS Note nor fully repaid the AGS Open Account Loan. Plaintiffs 

claim that Howey failed to repay the sums loaned to him under the AGS Note by 

September 30, 2019, and that the $23,949.32 balance on the note remains unpaid 

with interest continuing to accrue.13 In addition, Plaintiffs state that by making 

deliveries of fish to AGS, Howey repaid a total of $326,644.13 that had been advanced 

to him by AGS.14 The result Plaintiffs allege is that the unpaid balance on these two 

AGS loans stood at $115,953.48, with interest accruing.15 Plaintiffs further state that 

AGS advanced additional sums after 2021.16 

10 Doc. 64 at 5. 11 Id. 12 Id.

13 Id. 14 Id. at 7. Plaintiffs state that “AGS applied these payments to interest first, then to 

unsecured amounts advanced, and then to sums advanced for necessaries under both the 

AGS Note and AGS Open Account Loan.” Defendants’ motion to dismiss at Docket 66 

challenges how payments were applied by AGS. The Court views this issue as one for the 

trier of fact to decide at trial, not an issue for this Court to decide in a motion to dismiss. 

15 Id. 16 Id. 

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 3 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 4 of 22

According to Plaintiffs’ Amended Complaint, Plaintiffs Kanaway and AGS are 

affiliated corporations organized under the laws of the State of Delaware.17 Plaintiff 

Liberty is a limited liability company operating under the laws of the State of 

Washington.18 Defendants Bryan and Dana Howey are residents of the State of 

Alaska.19 Defendant AWE is a limited liability company organized under the laws of 

the State of Alaska, and Defendant Bryan Howey is the governing person and 

authorized agent of AWE.20 At all times material herein, in rem Defendant Vessel was 

registered in the State of Alaska and is within the District of Alaska during the 

pendency of this action and subject to the jurisdiction of this Court.21 The Vessel is 

owned by Defendant Bryan Howey and/or Defendant AWE.22

Plaintiffs’ Amended Complaint raises three causes of action. In their first 

cause of action, Plaintiffs allege a breach of contract and promissory note. 

Specifically, Plaintiffs allege that Defendants Bryan and Dana Howey breached the 

terms of the Liberty Loan and Liberty Note by failing to make principal and interest 

payments on the loan and note, and by failing to register the vessel in Washington 

State and provide documentation of that registration.23 Plaintiffs’ second cause of 

action seeks to foreclose on their maritime and state lien rights as a result of 

Defendants’ failure to repay money advanced to Defendants under the AGS Note and 

AGS Open Account Loan for “the maintenance and operation of the [V]essel as 

necessaries.”24 Plaintiffs also seek to foreclose on the Vessel pursuant to 

Supplemental Admiralty Rule D as a result of Defendants’ alleged default on the 

17 Id. at 2.

18 Id.

19 Id. at 3. 20 Id. 21 Id. at 2-3. 22 Id.

23 Id. at 7-8.

24 Id. at 9.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 4 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 5 of 22

Liberty Loan.

25 Plaintiffs’ third cause of action alleges corporate disregard, and seeks 

to have the Court disregard AWE as an entity.26

Plaintiffs seek declaratory and monetary judgment against Defendants over 

the $75,000 threshold for diversity jurisdiction.27 On the face of the amended 

complaint, Plaintiffs assert jurisdiction under 46 U.S.C. § 31322, § 31325, and § 

31342; under Supplemental Admiralty Rules C and D; and within the meaning of Fed. 

R. Civ. P. 9(h). Plaintiffs further state that venue is proper because the Court has 

personal jurisdiction over the parties to this matter since the Vessel is currently 

located in this District, and Defendants are located and do business in the State of 

Alaska.

II. Procedural History and Motions Presented

On February 23, 2022, Plaintiffs filed a complaint, in rem and in personam,

against Defendants for breach of contract and promissory note, corporate disregard, 

to foreclose maritime liens, and for a warrant to arrest the Vessel, pursuant to Rule 

C(3) of the Supplemental Rules for Certain Admiralty and Maritime Claims

(hereinafter “Admiralty Rule or Rules”).28 

This Court issued a warrant for the arrest of the Vessel on March 16, 2022.29 

Upon the execution of the arrest warrant, Defendants filed a motion for a hearing to 

either vacate the arrest pursuant to Admiralty Rule E(4)(f), or set the amount of a 

special bond to secure the release of the Vessel under Admiralty Rule E(4)-(5).30 The 

Court heard argument on the motion on May 3, 202231 and directed additional 

briefing on the matter, which the parties provided. 

On July 29, 2022, the Court denied the motion to vacate the arrest, and granted 

25 Id.

26 Id. at 10. 27 Id.

28 Docs. 1 and 3.

29 Doc. 7.

30 Doc. 15.

31 Doc. 28.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 5 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 6 of 22

the motion to set a special bond to secure the release of the Vessel in the amount of 

$148,500. In that order, the Court found that maritime liens existed, thus creating 

subject matter jurisdiction over Plaintiffs’ claims. The Court declined to issue a 

ruling on the strength of Defendants’ argument that a “maritime lien cannot attach 

to a limited entry permit,” and whether $46,964.32 of the unpaid balance, plus 

interest, must be discounted from the bond amount.32

Plaintiffs filed an Amended Complaint on September 7, 2022.33 

On September 25, 2022, Defendants filed a motion to dismiss a portion of the 

Amended Complaint under Federal Rule of Civil Procedure 12(b)(1) for lack of 

admiralty jurisdiction (hereinafter “Fed. R. Civ. P.” or “Rule”). The portion of the 

Amended Complaint Defendants sought to have dismissed involved a claim relating 

to money loaned by AGS to Defendants that was used by Defendants to pay for the 

temporary emergency transfer of Alaska State limited entry fishing permits.34 The 

motion also sought to reduce the Court’s previously-ordered special bond under 

Admiralty Rule E(6) by the amount of the money advanced for the permits.35

Plaintiffs responded in opposition, and Defendants replied.36

Shortly after, Defendants filed a second motion to dismiss the Amended 

Complaint under Rule 12(b)(6) for failure to state a claim regarding the AGS Note 

and for an award of attorney’s fees and costs, along with another Admiralty Rule 

E(6) motion to reduce security and costs, to which Plaintiffs responded in opposition 

and Defendants replied.37

Defendants then filed a third motion to dismiss the Amended Complaint under 

Rule 12(b)(1) for lack of admiralty jurisdiction regarding Rule D “Petitory Action” 

32 Doc. 52.

33 Doc. 64. The amended complaint included an itemized accounting of the losses alleged by 

Plaintiffs. All of the original claims remained unchanged.

34 Doc. 66.

35 Id.

36 Docs. 77 and 80.

37 Docs. 71, 78, 81.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 6 of 22
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Order on 12(b)(1) Motions to Dismiss 

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 7 of 22

and under the Preferred Ship Mortgage Act. Plaintiffs opposed the motion to 

dismiss.38

In this Order, the Court considers all filings related to both motions to dismiss 

the Amended Complaint under Rule 12(b)(1). Defendants’ motion to dismiss the 

Amended Complaint pursuant to Rule 12(b)(6) will be addressed in a separate order. 

III. Applicable Law

a. Subject Matter Jurisdiction

“Federal courts are courts of limited jurisdiction, possessing only that power 

authorized by Constitution and statute.”39 Congress has statutorily implemented the 

federal courts' original subject matter jurisdiction under Article III of the 

Constitution by categorizing all cases arising under the Constitution, laws, or 

treaties of the United States under 28 U.S.C. § 1331; and cases involving citizens of 

diverse states under 28 U.S.C. § 1332. In addition, 28 U.S.C. § 1333 grants federal 

district courts the power to entertain “[a]ny civil case of admiralty or maritime 

jurisdiction.” Supplemental jurisdiction over state claims pursuant to 28 U.S.C. § 

1367 may also exist when those claims are “so related to claims in the action within 

[the district court's] original jurisdiction that they form part of the same case or 

controversy under Article III[.]”40 “It is to be presumed that a cause lies outside of 

federal courts’ limited jurisdiction, and the burden of establishing the contrary rests 

upon the party asserting jurisdiction.”41 

The standard for determining whether a plaintiff has asserted a valid basis for 

admiralty jurisdiction is the “prima facie standard,” rather than the more demanding 

38 Docs. 76, 82, 83.

39 Gunn v. Minton, 568 U.S. 251 (2013) (citing Kokkonen v. Guardian Life Ins. Co. of America, 

511 U.S. 375, 377 (1994) (internal quotation marks omitted)).

40 D'Onofrio v. Vacation Publications, Inc., 888 F.3d 197, 206 (5th Cir. 2018) (internal 

citations omitted).

41 Columbia Riverkeeper v. U.S. Coast Guard, 761 F.3d 1084, 1091 (9th Cir. 2014) (citing 

Kokkonen, 511 U.S. at 377).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 7 of 22
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Order on 12(b)(1) Motions to Dismiss 

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 8 of 22

“fair probability” or “reasonable grounds” standards.42 The “inquiry focuses on 

whether the plaintiff has [pled] a claim cognizable in admiralty.”43 It is well settled 

that the plaintiff bears the initial burden of pleading in his complaint the appropriate 

jurisdictional facts to establish both the court's jurisdiction over the subject matter 

of the action and over the parties to the action, including proper service of process.44

b. Facial Challenges to Motion to Dismiss under 12(b)(1)

A court's subject matter jurisdiction may be challenged under Fed. R. Civ. P. 

12(b)(1). Such challenges may be either “facial” or “factual.”45 In a facial attack, 

“the challenger asserts that the allegations contained in a complaint are insufficient 

on their face to invoke federal jurisdiction.”46 When opposing a facial attack on 

subject matter jurisdiction, the nonmoving party is not required to provide evidence 

outside the pleadings.47 In deciding a facial Rule 12(b)(1) motion, the court must 

assume the plaintiff's allegations in the complaint to be true and draw all reasonable 

inferences in his favor.48 By contrast, in a factual attack, “the challenger disputes 

the truth of the allegations that, by themselves, would otherwise invoke federal 

jurisdiction.”49

IV. Analysis

a. Motion to Dismiss for Lack of Subject Matter Jurisdiction Money 

Advanced by AGS for Acquisition of Limited Entry Permits and for 

Reduction in Bond at Docket 66

42 Padre Shipping, Inc. v. Yong He Shipping, 553 F.Supp.2d 328, 331-32 (S.D.N.Y. 2008). 43 Ronda Ship Mgmt. v. Doha Asian Games Org. Comm., 511 F.Supp.2d 399, 404 (S.D.N.Y.

2007). 44 102 A.L.R. Fed. 811 (originally published in 1991).

45 Wolfe v. Strankman, 392 F.3d 358, 362 (9th Cir. 2004).

46 Id. (quoting Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004)).

47 Wolfe, 392 F.3d at 362; see Doe v. Holy See, 557 F.3d 1066, 1073 (9th Cir. 2009) (treating 

defendant's challenge to subject matter jurisdiction as facial because defendant “introduced 

no evidence contesting any of the allegations” of the complaint).

48 Wolfe, 392 F.3d at 362 (citations omitted).

49 Id. at 362 (quoting Safe Air, 373 F.3d at 1039).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 8 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 9 of 22

Defendants make a facial challenge to a portion of Plaintiffs’ Amended 

Complaint, claiming that the money advanced by AGS that was used by Defendants 

to obtain three limited entry salmon seining permits cannot form a basis for federal 

jurisdiction, because such transactions do not give rise to maritime liens.

50

Defendants argue that such transactions are precluded by Alaska law,51 and that 

limited entry permits are not “necessaries” as required for a maritime lien under 

maritime law.52 In addition to dismissal for lack of subject matter jurisdiction of 

those portions of Plaintiffs’ Amended Complaint relating to the monies advanced to 

purchase the limited entry permits, which Defendants claim totaled approximately 

$46,964.32, Plaintiffs also seek a reduction in the Vessel’s bond by that amount.

53

In their opposition Plaintiffs raise several arguments. First, Plaintiffs state 

that Defendants’ motion to dismiss improperly seeks reconsideration of this Court’s 

prior decision in which the Court ruled that items purchased by Defendants with 

money advanced by AGS, which included the limited entry fishing permits, were 

properly considered “necessaries.”54 Second, Plaintiffs argue that AGS’ debt and lien 

claims against the Vessel do not implicate Alaska law or regulations regarding 

fishing permits. Moreover, Plaintiffs argue that Alaska law cannot alter federal 

jurisdiction, which is properly found in this case given that the permits fall within 

the “’broad meaning’ of necessaries” under federal law for which maritime 

jurisdiction properly exists.55 

Finally, Plaintiffs submit that because admiralty jurisdiction is proper over all 

claims within their Amended Complaint, including those related to money used to 

purchase the limited entry permit, there is no justification to reduce the bond 

50 Doc. 66 at 2.

51 Id. at 10-13. 

52 Id. at 13-14.

53 Id. at 2, 16-18.

54 Doc. 77 at 5-6 (citing to Court’s Order Denying Motion to Vacate at Doc. 52). 55 Id. at 7-11 (quoting at pages 7 and 8 Farwest Steel Corp. v. Barge Sea-Span, 769 F.2d 620, 

623 (9th Cir. 1985).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 9 of 22
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Order on 12(b)(1) Motions to Dismiss 

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 10 of 22

amount set by the Court.56 Furthermore, even if the amounts used to purchase the 

limited entry permits was improperly included, reduction of the bond amount is 

unwarranted as the currently set bond amount is reasonable because it is still less 

than what would be permitted under a recalculated total.

The Court views the issues Defendants raise of whether subject matter and 

admiralty jurisdiction exist in this case, whether the limited entry permits give rise 

to admiralty jurisdiction, and whether the limited entry permits give rise to a 

maritime lien as three related, but distinct issues. Ultimately, consistent with the 

Court’s previous order at Docket 52 and the District Court’s order regarding a similar 

limited entry permit in Finney v. Howey,57 the Court finds that subject matter and 

admiralty jurisdiction exist over all claims as it relates to the allegations in Plaintiffs’

Amended Complaint relating to money provided by AGS that was used by Defendants 

to purchase limited entry permits. The Court recommends denial of Defendants’ 

Rule 12(b)(1) motion at Docket 66.

i. A Maritime Lien Exists Giving the Court Jurisdiction. 

Federal courts may exercise their maritime jurisdiction granted by 28 U.S.C. 

§ 1333 if an action is based on a maritime lien pursuant to the Commercial 

Instruments and Maritime Liens Act (“CIMLA”), 46 U.S.C. § 31342, or if an action is 

based on a maritime contract.58 As stated in the Court’s order at Docket 52, for 

purposes of determining when a maritime lien exists, and therefore federal maritime 

jurisdiction, the relevant portion of the statute reads: 

[A] person providing necessaries to a vessel on the order of the owner 

or a person authorized by the owner, (1) has a maritime lien on the 

vessel; (2) may bring a civil action in rem to enforce the lien; and (3) is 

not required to allege or prove in the action that credit was given to the 

56 Id. at 11-13.

57 Finney v. Howey, 3:20-cv-00289-SLG-FKR, Doc. 31 (D. Alaska, Dec. 19, 2022).

58 See Farwest Steel Corp., 769 F.2d at 620 (A maritime contract may be enforced in federal 

court without any other basis of subject matter jurisdiction). See Norfolk S. Ry. Co. v.

Kirby, 543 U.S. 14, 23 (2004) (a federal action can “be sustained under the admiralty 

jurisdiction by virtue of the maritime contracts involved.”).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 10 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 11 of 22

vessel.59

A necessary is “any item which is reasonably needed for a venture in which the ship 

is engaged”60 and should be given “broad meaning.”61 Necessaries can include 

amounts paid for “goods, services and intangibles that a careful and provident owner 

would provide to enable a vessel to continue to perform well the functions for which 

she has been designed and engaged.”62

In Ventura Packers, Inc. v. Kathleen, the Ninth Circuit explained that CIMLA 

supplied a basis for maritime jurisdiction, and that the Plaintiff may show that it has 

a maritime necessaries lien under certain conditions. 

We, therefore, follow the Supreme Court's lead in Tallentire and 

conclude that [CIMLA] supplies a basis for admiralty jurisdiction 

independent from those bases available at common law. In so 

interpreting [CIMLA], we neither add nor subtract from what Congress 

passed into law. Specifically, we hold [the plaintiff] must demonstrate 

that: (1) it provided necessaries; (2) to a vessel; (3) by order of the 

owner or a person authorized by the owner. ... If [the Plaintiff] 

demonstrates these elements, it may invoke the admiralty jurisdiction 

of the federal courts to enforce a necessaries lien in rem.”63

In this case, the Court finds that the Amended Complaint does allege sufficient 

facts establishing maritime jurisdiction. As stated in the Amended Complaint, whose 

allegations the Court must consider true in light of the facial attack on jurisdiction 

made by Defendants in their motion to dismiss, “[t]he funds loaned to [Defendant] 

Howey as documented by the AGS Note were loaned on the credit of the Vessel and 

intended to be used for necessaries for the Vessel, including but not limited to a 

vessel permit lease.”64 Furthermore, as it relates to amounts advanced by AGS under

59 46 U.S.C. § 31342(a). 

60 Foss Launch & Tug Co. v. Char Ching Shipping U.S.A., Ltd., 808 F.2d 697, 699 (9th Cir. 

1987); see also Equilease Corp. v. M/V Sampson, 793 F.2d 598, 603 (5th Cir. 1986) 

(interpreting necessaries as anything that facilitates or enables a vessel to perform its 

mission or occupation).

61 Farwest Steel, 769 F.2d at 623.

62 Zitano v. F/V Diamond Girl, 963 F.Supp. 109, 112 (D.R.I. 1997) (citing Farrell Ocean 

Services, Inc. v. United States, 681 F.2d 91, 92–93 (1st Cir. 1982); Payne v. S.S. Tropic Breeze, 

423 F.2d 236, 241 (1st Cir. 1970)).

63 Ventura Packers, 305 F.3d at 919.

64 Doc. 64 at 5.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 11 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 12 of 22

the AGS Open Account Loan, Plaintiffs’ amended complaint similarly alleges that 

some of this money was used for the purchase of “necessaries.”65 Plaintiffs’

accounting of funds advanced under the AGS Open Account loan documents the 

acquisition of the permit acquired with the AGS Note,66 as well as two additional 

limited entry permits using the AGS Open Account Loan.

67

Alaska limited entry permits are informed by the Limited Entry Act (LEA), 

which was enacted in 1973 after a rising crisis brought on by poor salmon returns, 

declining fishing incomes, and a rising number of nonresident fishermen.68 Alaska’s 

LEA was developed to “keep fishing rights in the hands of Alaskans dependent on 

fisheries, especially rural residents with limited economic opportunity.”69 The LEA 

was designed to “promote the conservation and the sustained yield management of 

Alaska’s fishery resource and the economic health and stability of commercial fishing 

in Alaska by regulating and controlling entry of participants and vessels into the 

commercial fisheries in the public interest and without unjust discrimination.”70

In its Order Denying Motion to Vacate Arrest and Setting Bond, this Court 

previously analyzed the standards and elements required to determine that Plaintiffs 

65 Id. at 6-7.

66 See Doc. 64-4 at 1 (“ET SE Seine Permit Lease – Anthony -George” in the amount of 

$23,949.32). 

67 Id. at 3 (“Copper River Boats/Permit S01E-56824E/B. Howey” in the amount of $9,965), 

and 5 (“ACH to Dock Street Brocker/SE Permit Lease/B Howey” in the amount of $13,050). 

In determining whether a complaint states a claim for relief, a court may consider facts 

contained in documents attached to the complaint. See Nat'l Ass'n for the Advancement of 

Psychoanalysis v. Cal. Bd. of Psychology, 228 F.3d 1043, 1049 (9th Cir. 2000). Defendants’

motion to dismiss states that “each year [Defendants] fished for AGS under the Fishing 

Agreement, AGS would advance the owner/transferor the purchase price of the [permit].”

68 Frank Homan, “30 Years of Limited Entry,” chromeextension://efaidnbmnnnibpcajpcglclefindmkaj/https://seagrant.uaf.edu/events/fishcom2/ppts/homan-limitedentry.pdf; “A Bristol Bay Fisheries Policy Retrospective,” The 

Nature Conservancy, September 11, 2021, https://www.nature.org/enus/newsroom/alaska-bristol-bay fisheries-righting-thehip/#:~:text=A%20key%20objective%20of%20Alaska's,residents%20with%20limited%2

0economic%20opportunity.

69 Id. 70 AK ST § 16.43.010(a).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 12 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 13 of 22

adequately showed a fair or reasonable probability that it has a maritime lien against 

the Vessel and that, in accordance with the Rule of Advances, necessaries were 

advanced.71 There is no basis to disturb the Court’s prior findings on this issue, nor 

its conclusion that the money advanced by AGS to Defendants was for the purpose 

of acquiring necessaries for the successful operation of the Vessel. Among those 

necessary items were the three limited entry permits at issue in this motion, items 

not only “reasonably needed” for the activities in which the Vessel was engaged, but 

essential to its success. 72 

Defendants write in their own motion to dismiss that to engage in the 

Southeast Alaska fishery, the location Defendants sought to fish in order to meet 

their obligations to Plaintiffs, “required a salmon seine limited entry permit issued 

by the Alaska Commercial Fisheries Entry Commission.”73 Because of this 

requirement, AGS’s advancement of money to purchase the permits was no less 

necessary to the success of the fishing operation at issue in this case than money 

advanced to purchase fuel to power the Vessel’s run to the fishery, or nets with which 

to catch fish upon its arrival at its intended location. Like other intangibles such as 

insurance, the permit was “an asset that [kept] the vessel ‘active’ and [was]

necessary to the ‘continued operation’ of the vessel.”74 By alleging facts in the 

amended complaint that the funds from the AGS Note and AGS Open Account Loan 

were provided to Defendants for the purpose of acquiring necessaries, which 

71 Doc. 52; Doc. 77 at 4-5.

72 See Bradford Marine, Inc. v. M/V Sea Falcon, 64 F.3d 585, (11th Cir. 1996) (“Necessaries 

are the things that a prudent owner would provide to enable a ship to perform well the 

functions for which she has been engaged.”)

73 Doc. 66 at 4 (emphasis added).

74 Zitano, 963 F.Supp at 112; see also First Bank v. Exodus, 598 F.Supp.3d 1077 (W.D. Wash. 

April 8, 2022) (noting there is “no general objection to treating an intangible as an 

appurtenance,” and when considering whether a fishing permit qualified as an 

appurtenance, noting that it was “the rights themselves” rather than the physical permit 

itself that determined the market value and creditworthiness of the vessel, as much as its 

engine, physical dimensions, and navigation equipment) (quoting Gowen, Inc. v. F/V Quality 

One, 244 F.3d 64, 67-68 (1st Cir. 2001)).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 13 of 22
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Order on 12(b)(1) Motions to Dismiss 

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 14 of 22

included the limited entry permits, Plaintiffs have met their burden and established 

a cognizable claim in admiralty under 46 U.S.C. § 31342. 75 Subject matter 

jurisdiction on that basis is proper.

Defendants’ reliance on Alaska state law and regulation governing the 

possession and transfer of limited entry permits is unavailing. As Plaintiffs correctly 

argue, the issue at hand is not the assertion of a lien against the permits themselves, 

but rather, against the Vessel based upon the advancement of funds to the Vessel’s 

owners that were then used to acquire the permits. The Court does not believe that 

Defendants’ arguments based upon state-imposed limitations on the attachment of 

these permits or whether or not they can be the subject of a maritime lien under 

Alaska laws are relevant to the issue of subject matter jurisdiction. 

Moreover, Defendants’ arguments relating to Alaska state law ignore federal 

supremacy when the issues concern federal substantive rights under admiralty law. 

While “[s]tate law may supplement maritime law, [] it must yield when it interferes 

with harmony and uniformity, or where it would defeat reasonably settled 

expectations of maritime actors.”76 Even if the Court were to assume a conflict 

between Alaska law and regulation and federal maritime law, federal admiralty 

jurisdiction would remain.

ii. The Court’s Reasoning in Finney v. Howey Is Not Inconsistent 

with Its Findings and Recommendation in this Case.

Defendants reference Finney v. Howey, in which this Court recommended 

denying a motion to vacate judgment for lack of admiralty jurisdiction regarding a 

contract for the transfer of a similar limited entry permit.77 However, the outcome 

in that case is not directly applicable to the issues in this motion to dismiss given the 

75 Padre Shipping, 553 F.Supp.2d at 331-32; Ronda Ship Mgmt., 511 F.Supp.2d at 404. 76 Bank of Pacific v. F/V ZOEA, 2017 WL 823298 at *2 (W.D. Wash. March 2, 2017) (citing 

Am. Dredging Co. v. Miller, 510 U.S. 443, 447 (1994) and Persson v. Scotia Prince Cruises, 

Ltd., 330 F.3d 28, 32 (1st Cir. 2003)).

77 Finney v. Howey, 3:20-cv-00289-SLG-FKR, Doc. 28 (D. Alaska, Nov. 14, 2022) (hereinafter 

“Finney”).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 14 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 15 of 22

arguments raised by the parties in each respective matter. In Finney v. Howey, 

Defendant Bryan Howey argued that his agreement to purchase a seasonal limited 

use permit from Plaintiff in exchange for $27,500 did not give rise to maritime 

jurisdiction because, among other arguments, Plaintiff did not and could not assert 

a maritime lien, nor was the transfer a maritime contract.78 In their response, 

Plaintiffs did not argue that a maritime lien existed, asserting instead that admiralty 

jurisdiction was proper because the agreement to transfer the permit was a maritime 

contract.79

The District Court disagreed with Defendants’ arguments, adopting this 

court’s Report and Recommendation finding that the transaction at issue – the 

transfer of a fishing permit – was a maritime contract, and that therefore federal 

maritime jurisdiction was proper.80 As Plaintiff did not argue that a maritime lien 

existed, neither the District Court nor the Magistrate Court addressed this issue. In 

addition, the Court dismissed Defendants’ reliance on case law asserting that 

Alaska’s regulation of fishing permits placed the transaction outside of admiralty 

jurisdiction, noting that the contract at issue did not involve any state actors, but 

rather, was between two private parties, and that it conflicted “neither with the 

admiralty jurisdiction of any court of the United States conferred by Congress, nor 

with any law of congress whatsoever.”81

In this case, however, the entirety of both parties’ arguments are based on 

whether or not an agreement to advance money to Defendants to be used for the 

purchase of limited entry permits from a third party was sufficient to establish a

maritime lien, and therefore maritime jurisdiction. The parties do not raise, and the 

Court is not making any findings or recommendations as to whether or not the AGS 

78 Finney at Doc. 17.

79 Finney at Doc. 19. In their opposition, Plaintiffs stated that they mistakenly asserted a 

maritime lien in their complaint, but did not seek to enforce any lien rights, thereby making 

“the factual and legal discussion on this point...irrelevant.”

80 Finney Doc. 31 at 2-3.

81 Finney at 3-4 (D. Alaska, Dec. 19, 2022). 

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 15 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 16 of 22

Note and AGS Open Account Loan were maritime contracts, and whether or not 

maritime jurisdiction exists on that alternative basis. 

The Court believes its reasoning in both cases to be consistent and that 

depending upon the facts of each particular case, agreements for the purchase of 

fishing permits can involve both necessaries, and be a contract whose “nature and 

subject matter” is central to the business of maritime commerce.82 Moreover, 

jurisdiction on this basis is not an either or proposition as “[s]ome maritime liens 

[may be] based on an underlying breach of contract[.]”83

iii. There Is No Basis to Reduce the Previously-Ordered Security 

Under Rule E(6) at Docket 66 

As detailed above, the Court finds Plaintiffs’ Amended Complaint properly 

establishes admiralty jurisdiction pursuant to 46 U.S.C. § 31342. The Court 

previously set a bond amount of $148,500, and in making that determination 

considered, but did not expressly determine as it does here, Defendants’ argument 

that monies used for limited entry permits cannot give rise to a maritime lien.84

However, the Court did state that even if it were to accept this argument, a bond of 

$148,500 would still be reasonable given that it was significantly less than the bond 

amount authorized under the law.85 This fact remains true and the Court’s findings 

and recommendations herein provides no basis to disturb its prior ruling. 

Accordingly, as it relates to the advances for the three limited entry permits, the 

Court recommends that Defendants’ request to reduce its security for lack of 

jurisdiction be denied.

//

//

//

82 Exxon Corp. v. Central Gulf Lines, Inc., 500 U.S. 603, 608 (1991).

83 Ventura Packers, 305 F.3d at 920-21 (citing Farwest Steel Corp., 769 F.2d at 621)). 84 Doc. 52 at 14.

85 Id. at 13-14 (citing Supplemental Admiralty & Maritime Claims Rule E(5)(a)).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 16 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 17 of 22

b. Motion to Dismiss for Lack of Admiralty Jurisdiction re Rule D 

“Petitory Action” and Under Preferred Ship Mortgage Act at Docket 

76

Defendants move to dismiss for lack of subject matter jurisdiction claims 

made in Plaintiffs’ Amended Complaint relating to petitory relief, as well as claims 

invoking the Preferred Ship Mortgage Act under 46 U.S.C. §§ 31322 and 31325.86

Defendants claim that Plaintiffs lack legal title to the vessel, and thus lack admiralty 

jurisdiction to support a claim of petitory relief under Admiralty Rule D.

87

Defendants also argue that because the Vessel is not a United States documented 

vessel, it does not meet the requirements under 46 U.S.C. § 31322 necessary to create

admiralty jurisdiction. Similarly, Defendants argue that no admiralty jurisdiction 

exists under 46 U.S.C. § 31325 because there is no preferred mortgage.88 Finally, 

Defendants claim that Plaintiffs failed to assert supplemental jurisdiction in their

Amended Complaint.

89

Plaintiffs respond that Admiralty Rule D applies to Plaintiff Liberty’s claims, 

creating admiralty jurisdiction, that supplemental jurisdiction exists because the 

claims derive from a common nucleus of operative facts, and that diversity 

jurisdiction also exists, which although not plead in its amended complaint, the 

Court may infer on its own.90

For the reasons stated below, the Court recommends that Defendants’ motion 

to dismiss for lack of admiralty jurisdiction regarding the Rule D “Petitory Action” 

be denied. In light of its findings on this issue, the Court declines to consider 

Defendants’ request to dismiss under the Preferred Ship Mortgage Act.

//

86 Doc. 76.

87 Id. at 2. 

88 Id. at 7. 

89 Id. at 4. 

90 Doc. 82 at 10. See Mir v. Fosburg, 646 F.2d 342, 346-347 (9th Cir. 1980); MerricksBarragan v. Maidenform, Inc., 2011 WL 5173653 (C.D. Cal. Oct. 31, 2011).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 17 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 18 of 22

i. Jurisdiction under Admiralty Rule D

Admiralty Rule D provides a basis to bring in federal court “all actions for 

possession, partition, and to try title maintainable according to the course of the 

admiralty practice with respect to a vessel.” In the Amended Complaint, Plaintiff 

states that this action has been brought “in personam arising from maritime 

contracts, as well as in rem against the Vessel for provision of necessaries and for 

petitory relief under Supplemental Admiralty Rule D.”91 A petitory suit seeks to try 

title to a vessel and “is to some extent akin to the terrestrial suit to quiet title, 

although, as opposed to a quiet title suit in which title is perfected against the world, 

the admiralty procedure to try title afforded by a petitory action can only be utilized 

with a specific adversary in mind.”92 A petitory action to try title under Rule D 

“requires [a] plaintiff to assert a legal title to the vessel; mere assertion of an 

equitable interest is insufficient.”93

Plaintiff Liberty’s Amended Complaint references petitory relief and goes on 

to specifically assert as a basis for federal jurisdiction CIMLA and Supplemental Rule 

C and D.94 Defendants are correct that the Amended Complaint does not assert a 

right to title against the Vessel sufficient to support petitory relief. However, 

Defendants are incorrect that this is a basis upon which to grant their motion to 

dismiss.

What Defendants call a “petitory action” does not accurately state the 

substance of the allegation contained within the Amended Complaint. A reading of 

the Amended Complaint shows that Plaintiff Liberty is not seeking to try title to the 

Vessel. Rather, Plaintiff Liberty seeks to execute its lien rights, sell, or possess the 

91 Doc. 64 at 2.

92 Kawa Leasing, Ltd. V. Yacht Sequoia, 544 F.Supp. 1050, 1063 (D. Md. July 9, 1982) (citing 

7A Moore's Federal Practice P D.03, at D-25).

93 Gulf Coast Shell and Aggregate LP v. Newlin, 623 F.3d 235, 239 (5th Cir. 2010) (citing Silver 

v. Sloop Silver Cloud, 259 F.Supp. 187, 191 (S.D.N.Y. 1966).

94 Doc. 64 at 2.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 18 of 22
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Order on 12(b)(1) Motions to Dismiss 

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 19 of 22

Vessel.95 As stated in its Amended Complaint and exhibits filed therewith, 

Defendants entered into a Loan and Security Agreement that gave Plaintiff Liberty a 

security interest in the Vessel.96 That agreement explicitly granted Plaintiff Liberty 

the right of “seizure and sale” of the Vessel if default occurred, and though disputed, 

Plaintiffs’ Amended Complaint presents sufficient facts alleging Defendants 

defaulted under the agreement.97

Plaintiff Liberty’s “legal claim to possession” of the Vessel is a proper basis 

under Rule D to proceed in an admiralty claim.98 “It does not appear, either from 

Rule D or from other court opinions, that dispute of legal title is required for a Rule 

D possessory action. Rule D makes note both of actions for possession and of actions 

to quiet title.”99 Accordingly, Plaintiffs need only assert the right to possess the 

Vessel to maintain a Rule D action in federal court, which Plaintiff Liberty did in its 

Amended Complaint.

100

95 Doc. 64 at 9.

96 Docs. 64 and 64-1.

97 See Gallagher v. Unenrolled Motor Vessel River Queen, 475 F.2d 117 (5th Cir. 1973) 

(recognizing that suits for possession based on the claimant's right to title are properly 

within the admiralty jurisdiction of the federal judiciary (citing Ward v. Peck, 59 U.S. 267 

(1855)).

98 Cary Marine, Inc. v. M/V Papillon, 701 F.Supp. 604, 606 (N.D. Ohio 1988), aff'd, 872 F.2d 

751 (6th Cir. 1989); see also Newlin, 623 F.Supp. at 1063. 99 FED. R. CIV. P. SUPP. D; Warhurst v. One Twenty Foot Bertran, Civil Action No. 14-00245-

N, 2015 U.S. Dist. LEXIS 31008, at *5-7 (S.D. Ala. Mar. 13, 2015); see also The Tietjen & Lang

No. 2, 53 Supp. 459, 1944 A.M.C. 518 (D.N.J. 1944) (finding jurisdiction since “[p]ossessory 

actions are actions to recover ships or other property to which a party is of right entitled,” 

which are analogous to suits for replevin). 100 Doc. 82 at 7-8 FN 6; see also Jones v. One Fifty Foot Gulfstar Motor Sailing Yacht, Hull No. 

01, 625 F. 44, 47 (5th Cir. 1980) (jurisdiction is proper in a Rule D possessory suit where 

the Plaintiff alleges “ownership, right to immediate possession, [and] an unlawful ... 

detention by defendant ...”); Ward v. Peck, 59 U.S. 267, 267 (1855); Gallagher v. Unenrolled 

Motor Vessel River Queen, 475 F.2d 117, 119 (5th Cir. 1973); Matsuda v. Wada, 128 F.Supp.2d 

659 (D. Hawaii, 2000); Ogner v. M/V KILOHANA, O.N. 1208577, 2017 WL 5892196, at *2 (D. 

Hawaii, 2017); Schatek v. Tsui, 2010 WL 5169006, at *1 (E.D. Cal. Dec. 14, 2010); Offshore 

Express, Inc. v. Begeron Boats, Inc. 1978 A.M.C. 1504 (E.D. La 1977); Hunt v. A Cargo of 

Petroleum Prods. Laden on the Steam Tanker Hilda, 378 F. Supp. 701, 703-04 (E.D. Pa. 1974).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 19 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 20 of 22

Ultimately, whether Defendants defaulted or not is up to the trier of fact to 

decide, not this Court in the present motion to dismiss. Since this Court must assume 

Plaintiffs’ proffered facts as true, Plaintiff Liberty has the right under Rule D to an 

action to determine possession in federal court and jurisdiction exists for the Court 

to hear those claims.

ii. Additional Bases for Jurisdiction

Two additional bases of federal jurisdiction exist in this case - supplemental 

jurisdiction under 28 U.S.C. § 1367 and diversity jurisdiction pursuant to 28 U.S.C. 

§ 1332. The Court finds that supplemental jurisdiction is proper because Plaintiff 

Liberty’s claims derive from the same nucleus of operative facts as Plaintiff AGS’

maritime lien claims.101 As stated in the Amended Complaint and accompanying 

exhibits, Plaintiff AGS entered into a Fishing Agreement with Defendants in 2019, 

whereby Defendants agreed to fish the Vessel for Plaintiff AGS for a 15-year term 

under certain terms and conditions. The Fishing Agreement was simultaneously 

made with the $800,000 rescue loan from Plaintiff Liberty, which also had a 15-year 

repayment term.102 All of the loans by both companies involved the same debtors 

and the same vessel, and Liberty’s claims can fairly be considered part of the same 

case or controversy as those presented by AGS.103

Additionally, diversity jurisdiction exists in this case. Plaintiffs concede that 

they did not plead diversity jurisdiction in their Amended Complaint.104 However, 

this fact is not dispositive so long as sufficient facts are alleged upon which the Court 

may determine jurisdiction.105 Federal Rule of Civil Procedure 12(h)(3) provides that 

a court may raise the question of subject matter jurisdiction, sua sponte, at any time 

101 Mine Workers v. Gibbs, 383 U.S. 715, 725 (1966). 102 Doc. 78 at 2.

103 Doc. 82 at 9.

104 Doc. 82 at 10. 105 See Mir v. Fosburg, 646 F.2d at 346-347; see also Arbaugh v. Y&H Corp., 546 U.S. 500, 513 

(2006).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 20 of 22
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Order on 12(b)(1) Motions to Dismiss

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 21 of 22

during the pendency of the action.”106 “[W]hile a complaint must present certain 

quite particular allegations of diversity jurisdiction in order to be adequate, the 

actual existence of diversity jurisdiction, ab initio, does not depend on the 

complaint's compliance with these procedural requirements.” The “essential 

elements of diversity jurisdiction” must be “affirmatively allege[d],” and “the 

burden of proving” diversity jurisdiction “is on the party asserting” it.

Plaintiffs have met their burden in this case. Although Plaintiffs did not 

specifically allege diversity jurisdiction in their Amended Complaint, they did plead 

the essential elements of diversity jurisdiction for the Court to find that such

jurisdiction exists. As stated in the Amended Complaint, Plaintiff Liberty is a 

Washington company doing business in Washington, and Plaintiff AGS is a Delaware 

company doing business in Washington. Defendants Bryan and Dana Howey are both

citizens of Alaska, the Vessel is registered in Alaska, and Defendant AWE is 

incorporated in Alaska. Finally, the jurisdictional threshold amount of over $75,000

is met for suit in federal court. Accepting Plaintiffs’ allegations as true, considering 

the facts alleged, and drawing all reasonable inferences in favor of Plaintiffs,107 the 

Court finds that Plaintiffs’ claims, on their face, sufficiently invoke federal diversity 

jurisdiction under the Rule 12(b)(1) standard.

iii. Motion to Dismiss Under Preferred Ship Mortgage Act at 

Docket 76

Plaintiffs do not specifically address whether there is jurisdiction under either 

46 U.S.C. § 31322, and § 31325, Preferred Ship Mortgage Act. Since jurisdiction exists 

on multiple other grounds, the Court declines to consider this issue at this time.

//

//

106 See Snell v. Cleveland, Inc., 316 F.3d 822, 826 (9th Cir. 2002); see also Qingdao Youli 

Century Guarantee Co., Ltd. v. Shaoqiang Chen, 2018 WL 6264971, at *1 (C.D. Cal., 2018). 107 See Safe Air, 373 F.3d at 1039.

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 21 of 22
1 

2 

3 

4 

5 

6 

7 

8 

9 

10 

11 

12 

13 

14 

15 

16 

17 

18 

19 

20 

21 

22 

23 

24 

25 

26 

27 

28 

Order on 12(b)(1) Motions to Dismiss 

Kanaway Seafoods, Inc., et al. v. Pacific Predator, et al.

3:22-cv-00027-JMK-KFR Page 22 of 22

V. Conclusion 

Plaintiffs’ Amended Complaint alleges sufficient facts to support federal 

jurisdiction over monies advanced by AGS to Plaintiffs for the acquisition of 

necessary limited entry permits. Similarly, admiralty jurisdiction exists as it relates 

to Plaintiff Liberty’s action for possession of the Vessel pursuant to Supplemental 

Admiralty Rule D, as does supplemental and diversity jurisdiction. For the reasons 

stated above, the Court recommends that Defendants’ Motions to Dismiss at Dockets 

66 and 76 be DENIED. 

DATED this 24th day of January, 2023 at Anchorage, Alaska.

s/ Kyle F. Reardon KYLE F. REARDON United States Magistrate Judge District of Alaska 

NOTICE OF RIGHT TO OBJECT

Under 28 U.S.C. § 636(b)(1), a district court may designate a magistrate judge 

to hear and determine matters pending before the Court. For dispositive matters, a 

magistrate judge reports findings of fact and provides recommendations to the

presiding district court judge.108 A district court judge may accept, reject, or modify, 

in whole or in part, the magistrate judge’s order.109

A party may file written objections to the magistrate judge’s order within 

fourteen (14) days.110 Objections and responses are limited to five (5) pages in length 

and should not merely reargue positions previously presented. Rather, objections 

and responses should specifically identify the findings or recommendations objected 

to, the basis of the objection, and any legal authority in support. Reports and 

recommendations are not appealable orders. Any notice of appeal pursuant to Fed. 

R. App. P. 4(a)(1) should not be filed until entry of the district court’s judgment.111

108 28 U.S.C. § 636(b)(1)(B). 

109 28 U.S.C. § 636(b)(1)(C). 110 Id. 111 See Hilliard v. Kincheloe, 796 F.2d 308 (9th Cir. 1986).

Case 3:22-cv-00027-SLG-KFR Document 87 Filed 01/25/23 Page 22 of 22