3

CLAIM DETERMINATION 

Claim Number: H19001-0001 

Claimant: Pride Keen Limited/Shipowners’ Mutual Protection Indemnity Assoc. 

Type of Claimant: RP

Type of Claim: Limit of Liability

Claim Manager: 

Amount Requested: $1,757,962.60 

Action Taken: Denied

I. EXECUTIVE SUMMARY:

On October 23, 2018, U.S. Coast Guard Sector Guam established Port Heavy Weather 

Condition (PHWC) Yankee in advance of Typhoon Yutu within the ports of Guam and 

Commonwealth of the Northern Mariana Islands (CNMI) which required all vessels greater than 

or equal to 200 GT to depart port or to have obtained written authorization from the Captain of 

the Port (COTP) prior to the establishment of PHWC Yankee to remain in port. In addition, the 

order established that upon setting PHWC Zulu, all ports and marinas would be closed and all 

cargo/bunkering operations within the port must stop.1

 The motor yacht GRAND MARIANA2

which was subject to, and aware of the Order, failed to depart port at the direction of the COTP 

and failed to request a waiver to remain in port.3 On October 26, 2018, the GRAND MARIANA 

grounded and posed a substantial threat to discharge oil into Tanapag Harbor, Saipan, a 

navigable waterway of the United States.4 Sector Guam notified the National Response Center 

(NRC) of the incident.5 Pride Keen Limited, (Pride Keen) the owner and operator of the 

GRAND MARIANA, arrived on-scene and hired Oil Spill Response Operations Company 

(OSROCO) and T&T Marine (T&T) to assess the damage to the GRAND MARIANA and to the 

remove fuel which posed a substantial threat of discharge into Tanapag Harbor.6 Sector Guam 

responded and issued an Administrative Order (Admin Order) to Pride Keen to remove the fuel 

from the GRAND MARIANA by October 27, 2018,7 and provided additional time after Pride 

Keen failed to remove the fuel within the deadline.8 

 

1 CG Sector Guam PHWC Yankee order issued October 23, 2018. PHWC Yankee order was distributed to the 

CNMI port community via email by MSD Saipan. There were five individuals representing the GRAND 

MARIANA on that email distribution to include . . 2 The GRAND MARIANA, VIN 1008437, is a 123.7-foot, 444 GT passenger yacht with a fiberglass hull. It was 

built on September 1, 2003 and is Cayman Islands flagged. See, CG Vessel Critical Profile for the GRAND 

MARIANA I, VIN 1008437. Note, the proper name of the vessel is the GRAND MARIANA. See CG Sector 

Guam response to the NPFC dated September 15, 2020, response to question 5.

3 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 1.

4 Coast Guard Pollution Report Message (CG POLREP) 1 DTG R310705Z Oct 18. 

5 National Response Center Report #1228564, reported on October 25, 2018 at 0700 EST. 6 CG POLREP 1 DTG R310705Z Oct 18.

7 CG Sector Guam Admin Order issued to Pride Keen Limited dated October 26, 2018. The Admin Order required 

Pride Keen to remove the fuel from all tanks, engines, fuel lines and all other sources onboard that contained oil. In 

addition, the Admin Order required Pride Keen to conduct a full environmental impact assessment and provide a 

proposed salvage plan in writing to the cognizant CG on-scene coordinator and territory on-scene coordinator. 8 CG POLREP 2 DTG R020809Z Nov 18.

(b), (b) (6) (b), (b) (6)
4

On November 1, 2018, Sector Guam issued a Notice of Federal Assumption to Pride Keen9

and assumed control of the pollution removal activities as Pride Keen had failed to abate or 

remove the threat of pollution from the GRAND MARIANA.10 

On November 22, 2018, Sector Guam issued an Admin Order to Pride Keen to activate their 

non-tank vessel response plan (VRP) and to provide proof of a valid contract with a competent 

company by November 24, 2018. In addition, Pride Keen was ordered to remove the remaining 

fuel from the GRAND MARIANA and relocate the vessel to a place suitable for disposal or 

repair.11 Pride Keen failed to comply with the requirements of the Admin Order and Sector 

Guam maintained control of the pollution removal activities.

On December 18, 2018, Pride Keen confirmed its pollution and environmental liability 

insurance coverage for the GRAND MARIANA through its insurer, Shipowners’ Mutual 

Protection & Indemnity Association (Shipowners’).12 

On April 10, 2019, Pride Keen finalized a contract with Resolve Marine Salvage & Fire 

(Resolve) to remove the fuel and re-float/remove the GRAND MARIANA.13

On May 10, 2019, Sector Guam terminated the Admin Order issued to Pride Keen dated 

November 22, 2018, as Pride Keen had signed a contract with Resolve to remove the threat of oil 

discharge from the vessel and to either repair, refloat, or dismantle the vessel.14 

On July 10, 2019, Resolve successfully refloated the GRAND MARIANA and towed the 

vessel to a pier for repair.15 

Pride Keen Limited is the owner of the GRAND MARIANA. Shipowners’ provided 

pollution and environmental liability insurance16 and incurred the costs associated with the 

salvage of the GRAND MARIANA. As a result, Shipowners’ along with Pride Keen 

(Claimants), have submitted an entitlement to a limit of liability claim to the CG National 

 

9 CG Sector Guam Notice of Federal Assumption issued to Pride Keen Limited dated November 1, 2018.

10 CG POLREP 2 DTG R020809Z Nov 18. 11 CG Sector Guam Admin Order issued to Pride Keen Limited dated November 22, 2018. The Admin Order 

required Pride Keen to Activate its Vessel Response Plan; produce proof of a valid contract with a competent 

company by 1800 (CHST) on November 24, 2018 to remove the remaining threat of a discharge of oil to the waters 

of the United States – including taking immediate actions necessary to repair, refloat, or dismantle the vessel and 

remove it from its current location and relocate it to a place suitable for disposal or repair; conduct a full 

environmental impact assessment and obtain necessary federal and territory environmental permits to carry out the 

plan; provide any proposed salvage plans or deconstruction/wreck removal plans in writing to the cognizant Coast 

Guard on scene representative and territory on scene coordinator; and provide the Unified Command immediate 

notification of any delays incurred that impact the completion of this project.

12 BlankRome on behalf of Shipowners’ Mutual Protection & Indemnity Association and Pride Keen claim 

submission dated May 14, 2020, page 3. 13 BIMCO Wreckstage contract between Pride Keen, Ltd. and Resolve Marine Salvage & Fire dated April 1, 2019 14 CG Sector Guam Admin Order termination letter issued to Pride Keen dated May 10, 2019. 15 CG POLREP 9 (F) DTG R1005162Z Oct 19 16 Certificate of Insurance No. 56596/902235/520399/4 issued by Yachtowners to Pride Keen Limited with effective 

dates December 21, 2017 – December 21, 2018, providing Pollution & Environmental Liability Insurance in the 

amount of $5,000,000.00.
5

Pollution Funds Center (NPFC) for $1,757,962.60.17 The NPFC has thoroughly reviewed all 

documentation submitted with the claim, analyzed the applicable law and regulations, and 

concluded that Claimants have not demonstrated an entitlement to limited liability for their 

uncompensated removal costs and damages under the Oil Pollution Act (OPA) that exceed their 

limit of liability.18 Specifically, the Claimants have not demonstrated that they are entitled to a 

limitation of liability as the evidence in this case indicates that the incident was proximately 

caused by Pride Keen’s violation of an applicable Federal safety, construction, or operating 

regulation. In addition, Pride Keen failed to report the incident as required by law and failed to 

provide all reasonable cooperation and assistance requested by a responsible official in 

connection with removal activities; or without sufficient cause, to comply with an order issued 

under proper authority. Each of these is an independent basis to deny the claim. 

 

II. FACTUAL BACKGROUND: 

A. CG Sector Guam

Sector Guam's area of responsibility (AOR) in the Western Pacific includes the 

Commonwealth of the Northern Mariana Islands (CNMI) and is subject to frequent heavy 

weather, including the potential for organized, tropical cyclones classified by maximum 

sustained wind speeds. In the Eastern Hemisphere, these cyclones are called typhoons, and they 

can form and intensify rapidly. Based upon the meteorological conditions in the Sector Guam 

AOR, the typhoon season for the Sector Guam AOR extends from January 1 through December 

31. Therefore, the Sector Guam AOR remains in Port Heavy Weather Condition (PHWC) 

WHISKEY (winds of 39 mph and above possible within 72 hours) as a default condition.19

Changes to PHWCs are communicated throughout the port community though a variety of 

means. Within the CNMI, changes to PHWC are distributed via email to port community 

members from an email distribution list maintained by the CG Marine Safety Detachment 

(MSD) Saipan. That email distribution list is updated upon request from a member of the port 

community or at the discretion of MSD Saipan. Additionally, changes to PHWC are announced 

at briefings in the CNMI emergency operational center. Lastly, MSD Saipan personnel conduct 

port assessments after each PHWC change. Vessels identified in port during this assessment are 

contacted and reminded to make appropriate preparations for heavy weather or to prepare to 

leave port. The vessel owners failing to comply with the direction provided by MSD Saipan are 

subject to COTP orders mandating their compliance.20

Additionally, Apra Harbor/Port of Guam, Tanapag Harbor/Port of Saipan, Port of Rota, and 

the Port of Tinian are not considered safe havens during a typhoon due to their low topography. 

Specifically, these ports do not provide adequate windbreak or barriers against tidal surges; 

 

17 BlankRome on behalf of Shipowners’ Mutual Protection & Indemnity Association and Pride Keen claim 

submission with a sum certain of $1,660,867.79 dated May 14, 2020. See also letter from BlankRome to the NPFC 

dated June 25, 2020, amending the sum certain to $1,758,237.79 after identifying and providing additional 

uncompensated costs in support of their claim. See also letter from BlankRome to the NPFC dated August 14, 2020, 

amending the sum certain to $1,757,962.60 after identifying a mistake within their claim submission. 18 33 U.S.C. § 2703(a) and 33 U.S.C. § 2704(a). 19 CG Sector Guam Heavy Plan dated April 22, 2015. 20 Email from Sector Guam to the NPFC dated October 22, 2020.

7

As a result, Sector Guam issued an Admin Order to Pride Keen which required the removal 

of all fuel from the GRAND MARIANA’s fuel tanks, engines, fuel lines, and any other potential 

sources onboard that may have oil products in them in advance of the impending typhoon and 

prior to shifting to the designated mooring.28 Pride Keen failed to comply with the Admin Order 

as their efforts to remove fuel from the GRAND MARIANA were unsuccessful.29 

Later that day, Sector Guam established PHWC Zulu within the port of Guam and CNMI 

which closed all ports and marinas and stopped all cargo/bunkering operations within the port.30 

On October 24, 2018, the GRAND MARIANA was moved to a mooring within Tanapag 

Harbor, but due to deteriorating weather, it was deemed unsafe for divers to properly moor the 

vessel as desired. As a result, the vessel was anchored within the lagoon with two anchors set 

out to secure her position.31

During the passage of Typhoon Yutu, the GRAND MARIANA broke her moorings within 

Tanapag Harbor and grounded approximately 150 meters off of Micro Beach in Tanapag Harbor, 

Saipan. At the time of the grounding, the GRAND MARIANA contained approximately 15,500 

gallons of fuel.32

On October 27, 2018, Sector Guam returned to PHWC Whiskey within the CNMI following 

the passage of Typhoon Yutu.33

B. Response 

On October 26, 2018, Pride Keen responded and hired OSROCO and T&T Marine to assess 

the damage sustained by the GRAND MARIANA and to remove the 15,500 gallons of fuel 

which posed a substantial threat of discharge into Tanapag Harbor. A survey of the vessel 

confirmed that the vessel was hard aground and identified three cracks in the hull with free 

communication with the sea.

34 

 

Sector Guam responded as the CG Federal On-Scene Coordinator (FOSC) to provide 

oversight of Pride Keen’s spill response.35 Sector Guam issued an Admin Order to Pride Keen 

 26 The GRAND MARIANA, VIN 1008437, is a 123.7-foot, 444 GT passenger yacht with a fiberglass hull. It was 

built on September 1, 2003 and is Cayman Islands flagged. See, CG Vessel Critical Profile for the GRAND 

MARIANA I, VIN 1008437. Note, the proper name of the vessel is the GRAND MARIANA. See CG Sector 

Guam response to the NPFC dated September 15, 2020, response to question 5.

27 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 1. 28 CG Sector Guam Administration Order issued to Pride Keen Limited dated October 23, 2018. 29 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 2. 30 CG Sector Guam PHWC Zulu order issued October 23, 2018. PHWC Zulu order was distributed to the CNMI 

port community via email by MSD personnel. There were five individuals representing the GRAND MARIANA on 

the email distribution to include S. . See email with 

PHWC Zulu order attached dated October 23, 2018.

31 Claimants’ letter to the NPFC dated July 10, 2020, response to question 7. 32 Claim submission dated May 14, 2020. 33 CNMI-FEMA Joint Information Center release dated October 27, 2018. 34 CG POLREP 1 DTG R310705Z Oct 18. 35 Id. 

(b), (b) (6)
8

to remove the fuel from all tanks, engines, fuel lines and all other sources onboard the GRAND 

MARIANA that contained oil by October 27, 2018.36 Pride Keen failed to meet the deadline 

established within the Admin Order and was provided additional time to continue working with 

their insurance company in an effort to secure funding for their oil spill response organization 

(OSRO) and remove the fuel from the vessel. However, even with the extra time provided by 

Sector Guam, Pride Keen’s efforts to remove the fuel from the vessel were unsuccessful as they 

failed to execute a contract with OSROCO and T&T Marine and provided inconsistent answers 

to the FOSC when questioned about their response efforts.37

On November 1, 2018, Sector Guam issued a Notice of Federal Assumption to Pride Keen 

assuming responsibility for the response/removal activities as Pride Keen’s efforts to abate the 

pollution threat or to remove the oil from the GRAND MARIANA were deemed unsatisfactory 

by the FOSC.38

On November 22, 2018, Sector Guam issued an Admin Order to Pride Keen summarizing 

that the owner’s previous actions to abate the pollution threat were unsatisfactory and as a result, 

Sector Guam had assumed responsibility for the response. Additionally, because all the oil had 

not been removed from the GRAND MARIANA,39 the vessel still posed a substantial threat to 

discharge oil into a navigable waterway. Pride Keen ultimately failed to comply with this Admin 

Order, as well.

On November 23, 2018, Pride Keen sought reconsideration of Sector Guam’s November 22, 

2018, Admin Order. In that reconsideration letter, Pride Keen acknowledged its obligations to 

fund the response effort, but relayed its understanding that once the USCG assumed control of 

the response on November 1, 2020, Pride Keen was required to “stand down” on the response 

“unless and until the Coast Guard and its hired contractor had completed that portion of the 

project or notified [Owner] otherwise.” Pride Keen therefore sought clarification of its 

obligations pursuant to the Notice of Federal Assumption and subsequent Administrative 

Orders.40

On November 24, 2018, Sector Guam responded to Pride Keen’s letter in which they 

reiterated the intent of their Admin Order which was to afford Pride Keen the opportunity to 

assume responsibility for the remaining pollution removal, to include removing the vessel from 

its current location. Otherwise, removal of pollutants via destruction of the vessel in-situ would 

be requested. Additionally, Sector Guam’s order to Pride Keen’s to activate their VRP was 

explained as an effort to assist Pride Keen in meeting the expectations of the order. Specifically, 

Pride Keen’s VRP plan had detailed information about the capabilities and resources of Pride 

 

36 CG Sector Guam Admin Order issued to Pride Keen Limited dated October 26, 2018. The Admin Order required 

Pride Keen to remove the fuel from all tanks, engines, fuel lines and all other sources onboard that contained oil. In 

addition, the Admin Order required Pride Keen to conduct a full environmental impact assessment and provide a 

proposed salvage plan in writing to the cognizant CG on-scene coordinator and territory on-scene coordinator. 37 CG POLREP 2 DTG R020809Z Nov 18. 38 CG Notice of Federal Assumption issued to Pride Keen on November 1, 2018. 39 Between November 1 – November 24, 2018, the OSRO working on behalf of the Coast Guard recovered 

approximately 14,445 gallons of fuel from the GRAND MARIANA and demobilized from the site with the 

understanding that it would return daily to remove any oiled sorbents from within the accommodation spaces or 

engine room. Approximately 1,000 gallons of fuel remained onboard the vessel. See, POLREP 7 R122317Z Dec 

2018.

40 Claim submission dated May 14, 2020. 
9

Keen’s pre-determined, contracted oil spill removal organization and the contracted salvage, 

marine firefighting and lightering company. However, and throughout the response to the 

casualty, there were several questions by various Pride Keen representatives relating to general 

response operations, expectations and requirements that were clearly outlined within Pride 

Keen’s VRP. 

Throughout the response the Coast Guard continually reminded Pride Keen’s representatives 

of its obligations to activate their VRP and to contact the qualified individual (QI) identified 

within their VRP but Pride Keen failed to do so. In its November 24 letter, the Coast Guard again 

reiterated these basic principles of incident response. The letter closed with the Coast Guard 

reminding that it will continue to abate the pollution threat, up to and including requesting 

permission to destroy the vessel in-situ unless Pride Keen could demonstrate its ability to take 

over the response and salvage operations pursuant to their VRP and federal requirements.41

On November 25, 2018, Pride Keen sought further clarification of the Sector Guam’s 

November 24, 2018, letter and explained that the basis for its inability to implement the Vessel 

Response Plan was an underlying coverage dispute with its insurer. Pride Keen went on to 

request some leeway from the USCG in light of the difficulties it faced in securing the requisite 

contracts because the responders listed in Pride Keen’s VRP would not respond without security 

posted by the insurer and requested it be authorized to proceed with a local salvor.42

On December 18, 2018, Pride Keen confirmed its insurance coverage for the GRAND 

MARIANA through Shipowners’ to Sector Guam.43 However, Sector Guam remained in control 

of the response as Pride Keen had neither activated their VRP nor did they present the FOSC 

with a salvage plan that was acceptable by regulatory standards.44 

On January 4, 2019, Sector Guam authorized Pride Keen to deviate from their VRP to tender 

multiple salvage companies.45

On April 10, 2019, Pride Keen finalized a contract with Resolve to remove the fuel and refloat/remove the GRAND MARIANA.46 

On May 10, 2019, Sector Guam terminated the Admin Order issued to Pride Keen dated 

November 22, 2018, as Pride Keen had signed a contract with a Resolve to remove the threat of 

oil discharge from the GRAND MARIANA and to either repair, refloat, or dismantle the 

vessel.47 

On July 10, 2019, Resolve successfully refloated the GRAND MARIANA and towed the 

vessel to a pier within Saipan harbor.48

 

41 Letter from CG Sector Guam to Pride Keen Limited dated November 24, 2018. 42 Claim submission dated May 14, 2020. 43 Id. 44 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 8. 45 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 11. 46 BIMCO Wreckstage contract between Pride Keen, Ltd. and Resolve Marine Salvage & Fire dated April 1, 2019. 47 CG Sector Guam Admin Order termination letter issued to Pride Keen dated May 10, 2019. 48 CG POLREP 9 (F) DTG R1005162Z Oct 19.
10

C. Responsible Party and the Claim 

Pride Keen Limited is the owner of the GRAND MARIANA. Shipowners’ provided 

pollution and environmental liability insurance49 and incurred the costs associated with the 

salvage of the GRAND MARIANA. Shipowners’, along with Pride Keen, have submitted an 

entitlement to a limited liability claim to the NPFC for $1,757,962.60.50

III. LEGAL DISCUSSION:

 A. Adjudication of OSLTF Claims

When adjudicating claims against the OSLTF, the NPFC utilizes an informal process 

controlled by 5 U.S.C. § 555.51 As a result, 5 U.S.C. § 555 (e) requires the NPFC to provide a 

brief statement explaining the basis for a denial. This determination is issued to satisfy that 

requirement. 

 During the adjudication of claims against the OSLTF, the NPFC acts as the finder of fact. In 

this role, the NPFC considers all relevant evidence and weighs its probative value when 

determining the facts of the claim. If there is conflicting evidence in the record, the NPFC will 

make a determination as to what evidence is more credible or deserves greater weight, and finds 

facts based on the preponderance of the credible evidence. 

B. Responsible Party Claims 

 Under the OPA, a responsible party is liable for all removal costs and damages resulting from 

either an oil discharge or a substantial threat of oil discharge into a navigable water of the United 

States.52 Further, a responsible party’s liability is strict, joint, and several.53 In the case of a 

vessel, the responsible party includes any person owning, operating or demise chartering the 

vessel.54 When enacting OPA, “Congress explicitly recognized that the existing federal and 

states laws provided inadequate cleanup and damage remedies, required large taxpayer subsidies 

for costly cleanup activities and presented substantial burdens to victim’s recoveries such as... 

burdens of proof unfairly favoring those responsible for the spills.”55 OPA was intended to cure 

these deficiencies in the law. 

 

49 Certificate of Insurance No. 56596/902235/520399/4 issued by Yachtowners to Pride Keen Limited with effective 

dates December 21, 2017 – December 21, 2018, providing Pollution & Environmental Liability Insurance in the 

amount of $5,000,000.00.

50 Original claim submission with a sum certain of $1,660,867.79. Subsequently, the claimants amended the sum 

certain twice. The first time to $1,758,237.79 and then to $1,757,962.60. 51 The court in Bean Dredging, LLC v. United States, 773 F. Supp. 2d 63, 75 (D.D.C. 2011), characterized the 

informal adjudication process for OSLTF claims with the following: “[W]hile the OPA allows responsible parties to 

present a claim for reimbursement to the NPFC, they do not confer upon such parties a right to a formal hearing, a 

right to present rebuttal evidence or argument, or really any procedural rights at all, see 33 U.S.C. §§ 2704, 2708, 

2713, an entirely unremarkable fact given that Congress’ overarching intent in enacting the OPA was to ‘streamline’ 

the claims adjudication process . . . .” See also, Taylor Energy Company LLC v. U.S., 2020 WL 6075693 (D.D.C. 

2020).

52 33 U.S.C. § 2702(a). 53 See, H.R. Conf. Rep. No. 101-653, 102, 1990 U.S.C.C.A.N. 779 (August 1, 1990). 54 33 U.S.C. § 2701(32)(A). 55 Apex Oil Co., Inc. v. United States, 208 F. Supp. 2d 642, 651-52 (E.D. La. 2002)(citing S. Rep. No. 101-94 

(1989); 1990 U.S.C.C.A.N. 722.).
11

 Notwithstanding the above, under limited circumstances the OSLTF may reimburse a 

responsible party for its uncompensated removal costs and damages. In order to receive OSLTF 

reimbursement a responsible party must show an entitlement to either a defense or limited 

liability under the OPA. Specifically, 33 U.S.C. § 2708(a) (emphasis added) provides that: 

The responsible party for a vessel or facility from which oil is discharged, or which poses the 

substantial threat of a discharge of oil, may assert a claim for removal costs and damages 

under section 2713 of this title only if the responsible party demonstrates that--

(1) the responsible party is entitled to a defense to liability under section 2703 of this title; or 

(2) the responsible party is entitled to a limitation of liability under section 2704 of this title. 

 Under the plain meaning of 33 U.S.C. § 2708(a), a responsible party must demonstrate that 

either a defense or limited liability applies before the OSLTF can reimburse removal costs or 

damages. Consistent with this statutory requirement, the OSLTF’s claims regulations also 

require all claimants to carry the burden of proving an entitlement to reimbursement. 56 

Therefore, just like any other claimant, a responsible party must prove an entitlement under the 

OPA before receiving reimbursement from the OSLTF. If a responsible party fails to establish 

an entitlement to compensation from the OSLTF, or fails to establish the elements by a 

preponderance of the credible evidence, the NPFC must deny the claim.57 

 

56 See, 33 CFR 136.105(a)(“The claimant bears the burden of providing all evidence, information, and 

documentation deemed necessary by the Director, NPFC, to support the claim.”); and 33 CFR 136.105(e)(6) 

(requiring that each claim include evidence to support the claim).

57 OPA’s legislative history supports NPFC’s conclusion that a responsible party has the burden of showing an 

entitlement to OSLTF compensation under 33 U.S.C. § 2708. As explained in the House Conference Report on 

OPA: 

Section 1008 of the House bill allows a responsible party or the owner of oil on a tank vessel, or a 

guarantor for that responsible party or owner of oil, to assert a claim for removal costs and 

damages only if the responsible party or owner can show that the responsible party or owner has 

a defense to liability, or is entitled to a limitation of liability. In the latter case, a claim may be 

submitted only to the extent amounts paid by the responsible party or owner, or by a guarantor on 

the responsible party's or owner's behalf, exceeds the applicable limit on liability. 

H.R. Conf. Rep. 101-653, 110, 1990 U.S.C.C.A.N. 779 (August 1, 1990) (emphasis added). See also, Apex Oil Co., 

Inc. v. United States, 208 F.Supp.2d 642 (E.D. La., 2002)(claimant failed to carry its burden of proof with respect to 

the “act of God” defense); International Marine Carriers v. OSLTF, 903 F.Supp. 1097 (S.D. Tex. 1994)(claimant 

must show elements of a “third party” defense by a preponderance of the evidence); Bean Dredging, LLC v. United 

States, 773 F.Supp.2d 63, 86 (D.D.C. 2011)(the responsible party “had the burden of proof of establishing its 

entitlement to reimbursement on the administrative level” ...); and Water Quality Ins. Syndicate v. United States, 

632 F.Supp.2d 108, 113-114 (D. Mass. 2009)(holding that Water Quality Insurance Syndicate must prove that its 

insured was entitled to limited liability when making a claim against the OSLTF under 33 U.S.C. § 2708). 

Placing the burden of proof on a responsible party claimant seeking compensation under 33 U.S.C. § 2708 is 

consistent with the general rule that a party seeking relief bears the burden of proving an entitlement to that relief. 

Requiring a responsible party claimant to prove its entitlement to OSLTF compensation is also consistent with the 

general rule that a party with particular knowledge of the facts ought to bear the burden of proving those facts. As 

the owner and operator of GRAND MARIANA, Pride Keen had unique access to the facts surrounding this incident 

because it was in control of the operations resulting in the discharge and had dominion and control over the 

discharging vessel. This unique access to the discharging vessel makes Claimants peculiarly well positioned to 
12

C. Limitation of Liability

 Under 33 U.S.C. § 2704 (a), a responsible party may limit its liability for removal costs and 

damages. However, OPA’s limited liability will not apply if the incident was proximately 

caused by the responsible party’s willful misconduct, gross negligence, or violation of a federal 

regulation.58 Also, under 33 U.S.C. § 2704 (c)(2), limited liability will not apply when the 

responsible party fails: 

(A) to report the incident as required by law and the responsible party knows or 

 has reason to know of the incident; 

(B) to provide all reasonable cooperation and assistance requested by a 

responsible official in connection with removal activities; or

(C) without sufficient cause, to comply with an order issued under subsection (c) 

 or (e) of section 1321 of this title or the Intervention on the High Seas Act (33 U.S.C. 

 1471 et seq.). 

Claimants assert that they are entitled to limited liability under 33 U.S.C. § 2704 (a). If 

successful, Claimants would be permitted under 33 U.S.C. § 2708 to recover from the OSLTF 

their compensable removal costs and damages that exceed the applicable OPA limit of liability. 

Before the OSLTF can reimburse any costs or damages, Claimants must carry their burden of 

proving an entitlement to limited liability59

When submitting a limit of liability claim against the OSLTF, a responsible party must show 

that the exceptions to limited liability in 33 U.S.C. § 2704 (c) do not apply even though this 

burden of proof may require proof of a negative contention, (i.e., the incident was not 

proximately caused by the responsible party’s willful misconduct, gross negligence, or 

regulatory violation). “It is a familiar common-law rule that, where a right to relief is grounded 

on a negative assertion of a right, the burden of proving the negative rests on the party asserting 

the right.”60 This is not an impossible burden to carry. 61 A responsible party will meet its burden 

 actually know or discover the facts surrounding the incident. Placing the burden of proof on a responsible party and 

its insurers seeking compensation under 33 U.S.C. § 2708 incentivizes full disclosure of all relevant facts by 

Claimants who are well positioned to know or learn what happened during an OPA incident. 

58 33 U.S.C. § 2704 (c)(1). 59 See, 33 U.S.C. § 2708. 60 United States v. Grogg, 9 F.2d 424, 426 (W.D. Va. 1925). 61 The treatise, Corpus Juris Secondum, explains how a party can prove a negative contention with the following:

The party whose contention requires proof of a negative fact generally has the burden of evidence 

to prove that fact, except as the rule may be modified by the fact that the evidence as to such issue 

is peculiarly within the adverse party’s knowledge or control. In deciding, however, what 

quantum of evidence shall be deemed sufficient, the practical limitations on proof imposed by the 

nature of the subject matter or the relative situation of the parties will be considered.

The court will more promptly discharge a litigant from the burden of evidence where the 

proposition is a negative one, and the burden of evidence is sustained by proof which renders 

probable the existence of the negative fact, nothing in the nature of a demonstration being 

required.

31A C.J.S. Evidence § 200 (2015)(internal footnotes omitted)(emphasis added).
13

by showing that it is more likely than not that the incident was not proximately caused by willful 

misconduct, gross negligence, or a regulatory violation. 

 

 The quantum of proof required from a responsible party seeking OSLTF reimbursement will 

vary depending upon the facts of the case. Nevertheless, a responsible party should not be 

required to conclusively disprove every possible contention supporting unlimited liability. 

Rather, a responsible party will generally satisfy its burden by showing that OPA’s exceptions to 

limited liability probably do not apply. For example, the NPFC does not require detailed proof 

of compliance with federal regulations that have no apparent connection to the oil spill. 

Therefore, in some cases a responsible party’s regulatory compliance could be shown by 

generalized evidence establishing a probability that no regulatory violation occurred. However, 

if the facts of an OPA incident raise the issue of whether the incident was proximately caused by 

a regulatory violation, then a responsible party must carry its burden of proving compliance with 

the specific regulation at issue. If a responsible party fails to carry its burden of proof, then the 

claim should be denied.62

When analyzing whether a responsible party has met its burden of proof, it is important to 

note that the terms “gross negligence” and “willful misconduct” have distinct meanings under 

the OPA.63 The NPFC defines those terms as follows:64 

 

62 Bean Dredging, LLC v. United States, 773 F.Supp.2d 63, (D. D.C. 2011)(affirming NPFC’s determination 

denying limited liability based upon the responsible party’s failure to show compliance with a specific regulation).

63 Because OPA does not define the terms “gross negligence” or “willful misconduct”, these terms should be given 

their plain and ordinary meaning. “Gross negligence” is ordinarily distinguished from “willful misconduct” in that 

“gross negligence” is a lesser standard that does not require recklessness and “willful misconduct” generally refers 

to intentional misconduct that can sometimes be established with proof of recklessness. See, Restatement (Third) of 

Torts: Phys. & Emotional Harm § 2 Recklessness, cmt. a (2010). See also, W. Page Keeton, et al., Prosser and 

Keeton on the Law of Torts § 34, at 212 (5th ed. 1984)(“’gross negligence’ falls short of a reckless disregard”); 57a 

Am. Jur. 2d Negligence § 231 (2016)(“A distinction is frequently made between gross negligence and willful, 

wanton, or reckless conduct. While the jurisdictions adopting this distinction consider gross negligence substantially 

and appreciably higher in magnitude than ordinary negligence, it is still not equivalent to wanton or willful conduct, 

and it does not encompass reckless behavior.”)(footnotes omitted).

The structure of OPA’s liability and compensation regime supports giving different meanings to the terms 

“gross negligence” and “willful misconduct”. As discussed above, under 33 U.S.C. § 2712(b) a claimant may not 

receive OSLTF reimbursement for removal costs or damages caused by the claimant’s “gross negligence or willful 

misconduct”. Also, 33 U.S.C. § 2704(c)(1) precludes limited liability for oil spills caused by the “gross negligence 

or willful misconduct of” the responsible party. If Congress had intended for “gross negligence” to have the same 

meaning as “willful misconduct” under the OPA, there would have been no reason to deny OSLTF reimbursement 

and limited liability for both types of conduct. Moreover, the use of the disjunctive term “or” in both 33 U.S.C. § § 

2704 (c)(1) and 2712(b) further suggests that “gross negligence” is a separate and distinct type of wrongdoing from 

“willful misconduct”. See, 1A N. Singer, Statutes and Statutory Construction § 21:14, p. 189-190 (7th 

ed.2007)(“The disjunctive ‘or’ usually, but not always, separates words or phrases in the alternate relationship, 

indicating that either of the separated words or phrases may be employed without the other. The use of the 

disjunctive usually indicates alternatives and requires that those alternatives be treated separately.”).

The statutory language used by Congress to impose liability on an OPA guarantor also supports giving “gross 

negligence” a different meaning from “willful misconduct” Under 33 U.S.C. § 2716 (f)(1)(C), a guarantor can only 

avoid liability when “the incident was caused by the willful misconduct of the responsible party.” In contrast, a 

claimant will be denied OSLTF reimbursement and unlimited OPA liability will be imposed on a responsible party 

for either “gross negligence” or “willful misconduct”. The fact that OPA only provides guarantors with a defense 

for “willful misconduct”, but not “gross negligence” shows that Congress intended for the two phrases to have 

separate meanings. If it were otherwise, an OPA guarantor would be exonerated from liability for either “gross 

negligence” or “willful misconduct” just like 33 U.S.C. § § 2704 (c)(1) and 2712(b). See, In re Oil Spill by Oil Rig 

Deepwater Horizon, 21 F.Supp.3d 657, 734 (E.D. La. 2014)(“Because only ‘willful misconduct’ creates this 
14

Gross Negligence: Negligence is a failure to exercise the degree of care which a person of 

ordinary caution and prudence would exercise under the circumstances. A greater degree of 

care is required when the circumstances present a greater apparent risk. Negligence is “gross” 

when there is an extreme departure from the care required under the circumstances or a 

failure to exercise even slight care.65

Willful Misconduct: An act, intentionally done, with knowledge that the performance will 

probably result in injury, or done in such a way as to allow an inference of a reckless 

disregard of the probable consequences.66

 [guarantor’s] defense, OPA treats ‘willful misconduct’ as distinct from, and more egregious than, ‘gross 

negligence.’”). See also, 2A N. Singer, Statutes and Statutory Construction § 46:6, p. 249-252 (7th ed.2007)(“The 

same words used twice in the same act are presumed to have the same meaning. Likewise, courts do not construe 

different terms within a statute to embody the same meaning. ... In like manner, where the legislature has employed 

a term in one place and excluded it in another, it should not be implied where excluded.”).

 

64 See, In re Kuroshima Shipping S.A., 2003 AMC 1681, 1693. See also, Water Quality Insurance Syndicate v. 

United States, 632 F.Supp.2d 108, 113-114 (D. Mass. 2009)(relying on NPFC’s definition of “gross negligence”); 

and Water Quality Insurance Syndicate v. United States, 522 F.Supp.2d 220, 228-29 (D.D.C. 2007)(holding that 

“willful” misconduct under the OPA could also be established by a series of negligent acts that amount to 

recklessness). 

65 Under the OPA, a finding of “gross negligence” requires proof of a departure from the standard of care beyond 

what would constitute ordinary negligence because simple negligence is established by showing a failure to exercise 

the degree of care that someone of ordinary prudence would exercise in the same circumstance. See generally, 

United States v. Ortiz, 427 F.3d 1278, 1283 (10th Cir. 2005). “Taken at face value, [gross negligence] simply means 

negligence that is especially bad.” Restatement (Third) of Torts (Physical and Emotional Harm) § 2 Recklessness, 

cmt. a (2010). “[M]ost courts consider that ‘gross negligence’ ... differs from ordinary negligence only in degree, 

and not in kind.” W. Page Keeton, et al., Prosser and Keeton on the Law of Torts § 34, at 212 (5th ed. 1984). See 

also, Milwaukee & St. P.R. Co. v. Arms, 91 U.S. 489, 495 (1875)(“’Gross negligence’ is a relative term. It is 

doubtless to be understood as meaning a greater want of care than is implied by the term ‘ordinary negligence;’ but, 

after all, it means the absence of the care that was necessary under the circumstances...”). 

Gross negligence should be determined based upon the same objective reasonable-person standard as ordinary 

negligence, and therefore requires no showing of any mental state or scienter. The facts of each case must control 

the degree of care required to prevent an oil spill. As a result, a greater degree of care will be required when the 

facts of a case establish an increased risk. See e.g., Water Quality Ins. Syndicate v. United States, 632 F.Supp.2d 

108, 112 (D. Mass. 2009). See also, W. Page Keeton, et al., Prosser and Keeton on the Law of Torts § 34, at 208-09 

(“As the danger becomes greater, the actor is required to exercise caution commensurate with it.”). 

66 When deciding whether “willful misconduct” has been established under the OPA, courts have relied upon 

FWPCA cases analyzing the same issue. See generally, Water Quality Ins. Syndicate v. United States, 522 

F.Supp.2d 220, 229-30 (D.D.C. 2007). Relying on FWPCA authorities when interpreting the OPA is consistent 

with Congress’ legislative intent that OPA’s definitions should have the same meaning as those same terms have 

been given under the FWPCA. See, H.R. Conf. Rep. 101-653, reprinted in 1990 U.S.C.C.A.N. 779. Under both 

OPA and the FWPCA, proof of recklessness will establish “willful misconduct”. For example, in Tug Ocean 

Prince, Inc. v. United States, 584 F.2d 1151, 1162-63 (2nd Cir. 1978), the court considered whether the vessel 

owner’s willful misconduct precluded limited liability for an oil spill under the FWPCA. In its analysis, the court 

defined “willful misconduct” as follows:

[A]n act intentionally done, with knowledge that the performance will probably result in injury, or 

done in such a way as to allow an inference of reckless disregard of the probable consequences. 

[citation omitted]. If the harm results from an omission, the omission must be intentional, and the 
15

IV. ANALYSIS OF CLAIMANTS’ CLAIM:

After a review of the information provided by the Claimants within their claim submission, 

the additional information provided by the Claimants in support of their claim, and the 

information it obtained independently, the NPFC concludes that the facts demonstrate that claim 

can, and must, be denied as several exceptions found at 33 U.S.C. 2704(c) apply to the 

responsible party. 

The NPFC specifically finds that:

1. This incident was proximately caused by Pride Keen’s violation of applicable Federal 

safety, construction, or operating regulation.67 

2. The RP did not report this incident as required by law.68

3. The RP did not provide all reasonable cooperation and assistance requested by a 

responsible official in connection with removal activities.69

4. The RP failed or refused, without sufficient cause, to comply with an order issued 

under 33 U.S.C. § 1321(c) or (e).70

Each exception provides an independent basis to deny the claim. As such, the claim is denied. 

A. Violation of a Federal Safety Regulation 

The regulations implementing the Ports and Waterways Safety Act71 are codified at 33 CFR 

Part 160. Specifically, 33 CFR 160.105 requires “[e]ach person who has notice of the terms of 

 

actor must either know the omission will result in damage or the circumstances surrounding the 

failure to act must allow an implication of a reckless disregard of the probable consequences. 

[citation omitted]. The knowledge required for a finding of willful misconduct is that there must 

be either actual knowledge that the act, or the failure to act, is necessary in order to avoid danger, 

or if there is no actual knowledge, the probability of harm must be so great that failure to take 

the require action constitutes recklessness. Id. (emphasis added).

The test for determining “willful misconduct” under the OPA is an objective test, not a subjective test. Thus, a 

determination of “willful misconduct” under the OPA does not always require proof of specific intent to harm. 

Rather, “willful misconduct” can be established with facts showing recklessness. These concepts are illustrated in 

Safeco v. Burr, 551 U.S. 47, 57 (2007) where the Court analyzed how a statute should be construed when its 

standard for liability turns on a finding of willfulness. In that case, the Court concluded that “where willfulness is a 

statutory condition to civil liability, we have generally taken it to cover not only knowing violations of a standard, 

but reckless ones as well, [citations omitted]. This construction reflects common law usage, which treated actions in 

‘reckless disregard’ of the law as ‘willful’ violations.” Id. See also, Fryer v. A.S.A.P., 658 F.3d 85, 91 (1st Cir. 

2011), quoting Safeco, 551 U.S. 47, 57 (2007)(“In a series of decisions beginning in 1985, the Supreme Court has 

repeatedly held that, ‘where willfulness is a statutory condition of civil liability, ... [the term] cover[s] not only 

knowing violations of a standard, but reckless ones as well.”). 

67 33 U.S.C. § 2704(c)(1)(B). 68 33 U.S.C. § 2704(c)(2)(A). 69 33 U.S.C. § 2704(c)(2)(B). 70 33 U.S.C. § 2704(c)(2)(C). 71 At the time of the incident, codified at 33 U.S.C. § 1221 et seq. Three of the specified reasons behind the passage 

of the Act are relevant in this determination: (l) [to] reduce the possibility of vessel or cargo loss, or damage to life, 
16

an order issued under this subpart must comply with that order.” Pride Keen failed to comply 

with two of Sector Guam’s COTP orders dated October 22, 2018 and October 23, 2018, 

respectively. 

The October 22 COTP Order established PHWC X-RAY which required all vessel masters to 

prepare for PHWC Yankee which the COTP estimated would be issued on October 23, 2018. 

Vessels are required to depart port upon the setting of Port Heavy Weather Condition Yankee, as 

detailed within the Sector Guam Heavy Weather Plan. As the GRAND MARIANA was not in an 

operational status at the time, it was clearly not prepared, nor was it preparing, to depart port as 

mandated by the October 22 COTP Order. Notably, when MSD Saipan attended the GRAND 

MARIANA on October 22 it noted that it appeared unable depart port in advance the typhoon. 

As a result, MSD Saipan issued a Notice of Federal Interest (NOFI) to Pride Keen advising them 

of the GRAND MARIANA’s substantial threat to discharge oil into Saipan Harbor and of Pride 

Keen’s responsibilities and financial liability in the event of an oil spill from their vessel.72

While the violation of the October 22 Order is important for context, ultimately the violation 

of the October 23 COTP Order was the proximate cause of the incident. The October 23 Order 

established PHWC Yankee and required all commercial vessel greater than or equal to 200 GT – 

which would include the GRAND MARIANA - to depart port or to have obtained written 

authorization from the COTP in advance of PHWC Yankee to remain in port. 

The NPFC asked the Claimants why the GRAND MARIANA failed to depart port at the 

direction of the COTP. The Claimants responded that it did not believe the GRAND MARIANA 

had to depart port, notwithstanding the Order, as she was not capable of safely outrunning the 

Typhoon.73 The NPFC notes that there was no discussion between the GRAND MARIANA and 

the COTP, nor did the GRAND MARIANA appeal the Order. 

 

The NPFC also asked Sector Guam why it thought the GRAND MARIANA failed to depart 

port at the direction of the COTP. Sector Guam responded that the GRAND MARIANA was 

unable to get underway due to lack of necessary crew manning. Specifically, Pride Keen’s 

captains and crew were shared among the four, local GRAND MARIANA vessels, and lacked 

sufficient captains to get their fleet underway.74 Sector Guam also attributed the GRAND 

 

property, or the marine environment; (2) [to] prevent damage to structures in, on, or immediately adjacent to the 

navigable waters of the United States or the resources within such waters; (3) [to] insure that vessels operating in the 

navigable waters of the United States shall comply with all applicable standards and requirements for vessel 

construction, equipment, manning, and operational procedures. 33 U.S.C. § 1221(c).

72 MSD Saipan Notice of Federal Interest issued to Pride Keen Limited dated October 22, 2018. In addition, on the 

same day, MSD Saipan issued a Notice of Federal Interest to Pride Keen for the substantial threat of oil discharge 

posed by the GRAND MARIANA II as this vessel had also failed to depart port in advance of Typhoon Yutu. See

email from Sector Guam to the NPFC dated October 8, 2020. 

73 Pride Keen had actually requested permission to leave the GRAND MARIANA alongside the pier but that request 

was denied by the Commonwealth Port Authority and Pride Keen was directed to move their vessel to anchor. See, 

CG Sector Guam response to the NPFC dated July 28, 2020, response to question 2.

74 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 1. As evidence to this 

statement, Pride Keen’s GRAND MARIANA II also failed to depart Tanapag Harbor in advance of Typhoon Yutu 

and as a result, broke her moorings and grounded in Tanapag Harbor. See, CG Sector Guam response to the NPFC 

received August 31, 2020, but mistakenly dated September 30, 2020, response to question 5. The GRAND 

MARIANA II, VIN 71134, is a 115-foot, 295 GT passenger yacht with a fiberglass hull. It was built on January 1, 

1988 and is flagged in the Marshall Islands. See, CG Vessel Critical Profile for the GRAND MARIANA II, VIN 

71134. Lastly, CG Sector Guam issued two Administrative Orders to the Pride Keen and two Captain of the Port 

18

one.81 VRPs are reviewed and approved by the Coast Guard; and any amendments to the plan 

must also be approved by the Coast Guard.82 Absent an approved amendment, any deviation 

from the VRP (to include a deviation from using the identified QI) must be specifically approved 

by the Captain of the Port.83 

The NPFC asked Sector Guam about the absence of Pride Keen’s QI. Sector Guam 

responded that Pride Keen did not bring in the QI designated within their VRP at any point 

during the response, which would have helped streamline the response and ensure the cleanup 

actions were conducted in accordance with the VRP. Specifically, Sector Guam contacted Mr. 

Aaron Meadows-Hill, Manager at ECM Maritime Services (ECM),84 who stated that the owners 

or owners’ representative told him that his services as QI would not be required, as they had 

representatives on scene. Sector Guam repeatedly directed Pride Keen activate the QI identified 

within their VRP85 and summarized that a lack of a QI in the critical beginning stages delayed 

and muddled the response process. Representatives from Pride Keen, Phoenix Marine Services, 

and Imperial Pacific International were all part of initial interactions with the USCG, but none 

had the pollution response or salvage experience expected of a QI.86

The NPFC asked Claimants why they did not provide the QI identified within their VRP. 

The Claimants responded that the QI identified within their response plan was ECM but they 

were not on site in Saipan. Because ECM was not based on Saipan, Pride Keen wanted local 

involvement in the response effort.87

 Despite the regulations and several discussions between the Captain of the Port and Pride 

Keen to use their identified QI (or alternate QI) as outlined in the VRP, Pride Keen failed to do 

so. Pride Keen continued to use a non-approved QI which is not only in discord with federal 

regulations, it also significantly contributed to the dysfunctional response to this incident by the 

responsible party. There is no evidence in the record, nor does Pride Keen provide any, that it 

requested a deviation from the VRP – and if a request had been made – that it had been approved 

by the Captain of the Port. As such, and specifically based on the repeated demands of the Coast 

Guard to use its identified QI, Pride Keen did not – and the NPFC finds that Pride Keen did not 

provide all reasonable cooperation and assistance as requested as that term is used in 33 U.S.C. 

2704(c). The lack of reasonable cooperation and assistance is a reason that this claim is denied. 

D. Failure or refusal, without sufficient cause, to comply with an order issued under 

 33 U.S.C. § 1321(c) or (e)

Sector Guam, as the FOSC, issued three orders under the authority of 33 U.S.C. § 1321. 

Pride Keen failed to comply with any of them. Where cause was provided as a reason for noncompliance, the NPFC finds that the cause was insufficient as discussed below. 

 

81 See generally, 33 CFR 155.5035. 82 33 CFR 155.1065; 33 CFR 155.1070. 83 Or the President. 33 CFR 155.5012. 84 ECM Maritime Services, LLC, was designated as the QI and Incident Management Team within Pride Keen’s 

NTVRP approved by the CG on April 17, 2017 and valid thru April 17, 2022. Specifically, there were 16 

individuals identified as ECM QIs within the approved NTVRP. See, GRAND MARIANA NTVRP. 85 Letter from CG Sector Guam to Pride Keen dated November 24, 2018. 86 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 3. 87 Claimants’ letter to the NPFC dated July 10, 2020, response to question 12.
19

Admin Order dated October 23, 2018 

Pride Keen failed to comply with Sector Guam Admin Order dated October 23, 2018, which 

required the removal of fuel from the GRAND MARIANA prior to Typhoon Yutu. In an effort 

to better understand the events leading up to and following the grounding of the GRAND 

MARIANA, the NPFC asked the Claimants why Pride Keen failed to comply with the Admin 

Order and remove the fuel from their vessel. The Claimants responded that the fuel delivery 

point and transfer manifold on the GRAND MARIANA was not set up to transfer fuel ashore as 

OSROCO had expected and, after trying for several hours, it was finally confirmed that 

OSROCO could not pump out fuel in this way. Ultimately no fuel was removed from the 

GRAND MARIANA. Thereafter, the only options were to remove each tank lid to extract the 

fuel directly or cut/modify the fuel transfer manifold, both of which were complex steps and 

likely to be unsuccessful given the tight time frame and the approaching typhoon.88

The NPFC also asked Sector Guam why it believed Pride Keen failed to remove the fuel 

from the GRAND MARIANA. Sector Guam stated that the crew of the GRAND MARIANA 

lacked the skills and knowledge needed to remove the fuel from the vessel and as such, it was 

unable to do so. Specifically, the crew could not figure out how to properly align the system to 

pump fuel out of the vessel in the time required prior to the storm making landfall. The pumping 

was going too slow in order to remove the pollution threat from the vessel before having to 

secure the pumping operations, evacuate the crew and equipment, secure the vessel mooring, and 

enable all personnel to seek shelter before the impending typhoon’s arrival.89

The failure of the responsible party to either adequately acquire the proper contractor or 

ensure its crew was properly trained to remove fuel from its vessel is not sufficient cause to fail 

to comply with the Admin Order. As such, this is a reason that the claim must be denied. 

Admin Order dated October 26, 2018 

Pride Keen failed to comply with Sector Guam Admin Order dated October 26, 2018, which 

required the removal of fuel from the tanks, engines, fuel lines, and any other potential sources 

onboard the GRAND MARIANA. At this point, the vessel posed a substantial threat of discharge 

and it was required to activate its VRP. Initially it appeared that GRAND MARIANA activated 

its VRP, but ultimately it did not. It failed to use its identified QI as required and it failed to 

execute the required contracts (or provide financial security) with its identified OSRO to ensure 

cleanup. 

The NPFC asked the Claimants why they failed to timely provide the requisite funding to an 

OSRO to continue cleanup. The Claimants responded that the grounding occurred on October 

25, 2018, and Pride Keen activated its response plan by calling T&T Marine. However, T&T did 

not submit an action plan to Pride Keen until October 30, 2018. The plan was very basic and 

was insufficient for Shipowners’ to determine what the proposed costs would be and why the 

operation was proposed to take 19 days. Shipowners’ immediately inquired as to why more 

 

88 Claim submission dated May 14, 2020. 89 CG Sector Guam email to the NPFC dated July 28, 2020, response to question 2.
20

information was not included in T&T’s plan and T&T advised that a more detailed plan would 

be forthcoming. 

 Additionally, on October 31, 2018, T&T advised Shipowners’ that, in fact, a more 

detailed plan would not be provided and T&T intended to submit its preliminary action plan to 

USCG with more information to be provided following subsequent site visits. T&T also made a 

security demand to Pride Keen and Shipowners’ for $750,000.00. Upon receipt of that request, 

and in light certain coverage issues between Shipowners’ and Pride Keen, Shipowners’ advised 

Pride Keen to post security directly, and Pride Keen took steps to do so. T&T then imposed a 

deadline on Pride Keen to post security by 10:00 a.m. on November 1, 2018, failing which they 

would demobilize. Pride Keen was unable to post security in less than twenty-four hours, and 

T&T indicated it would demobilize as a result.90

 When asked by the NPFC, Sector Guam stated that Pride Keen (through their various 

representatives) failed to activate their VRP despite being directed to do so several times. As a 

matter of courtesy, the FOSC granted extra time that was requested by Pride Keen to comply 

with this Admin Order; however despite the extension, Pride Keen neither activated their VRP 

nor executed a contract with an OSRO to begin pollution remediation. The only reason Pride 

Keen provided for failing to comply this order was the cost of the operation.91

 Despite the federal regulations requiring it to do so and the FOSC repeated requesting – 

and ultimately Ordering – Pride Keen to activate its VRP, it failed to do so. The lack of the 

ability to properly contract, provide adequate financial security, or secure funding are not 

sufficient causes for the non-compliance with this Admin Order. As such, this is a reason the 

claim must be denied. 

Admin Order dated November 22, 2018 

Pride Keen failed to comply with Sector Guam’s Admin Order dated November 22, 2018, 

which required among other things, to activate their VRP. After a month of dilatory action or 

inaction by the responsible party, the FOSC ultimately ordered it to activate its VRP, which 

should have been done on October 26 – but still had not been. 

 Upon receipt of Sector Guam’s Admin Order dated November 22, 2018, Pride Keen sought 

reconsideration in which they acknowledged its obligations to fund the response effort. Pride 

Keen explained its (mis)understanding that once the USCG assumed control of the response on 

November 1, 2018, Pride Keen was required to “stand down” on the response “unless and until 

the Coast Guard and its hired contractor had completed that portion of the project or notified 

[Owner] otherwise.”92 This is a surprising contention as Sector Guam continually encouraged 

 

90 Claimants’ letter to the NPFC dated July 10, 2020, response to question 9. 91 Pride Keen should have been aware of and promptly responded to T&T’s security demand. See, Clause 15, 

Payment, Security, Interest & Fees of T&T/OSROCO’s contract with Pride Keen dated March 26, 2018, in which 

Pride Keen was notified of the potential for security for any projects likely to exceed $100,000.00 in costs and 

acknowledged by Pride Keen by their signature on the contract. 

92 Claim submission dated May 14, 2020. Additionally, and in a separate letter, Pride Keen explained that the basis 

for its inability to implement the Vessel Response Plan was an underlying coverage dispute with its insurer. Pride 

Keen went on to request some leeway from the USCG in light of the difficulties it faced in securing the requisite 
21

Pride Keen to activate their VRP and hire a contractor to assume the response.93 Pride Keen 

further explained that the basis for its inability to implement the VRP was an underlying 

coverage dispute with its insurer. Pride Keen requested some leeway from the USCG in light of 

the difficulties it faced in securing the requisite contracts because the responders listed in Pride 

Keen’s VRP would not respond without security posted by the insurer and requested it be 

authorized to proceed with a local salvor.94

On December 18, 2018, Pride Keen confirmed its insurance coverage for the GRAND 

MARIANA through Shipowners’ to Sector Guam.95 However, Sector Guam remained in control 

of the response as Pride Keen had neither activated their VRP nor did they present the FOSC 

with a salvage plan that was acceptable by regulatory standards.96 

On January 4, 2019, Sector Guam authorized Pride Keen to deviate from their VRP to tender 

multiple salvage companies.97

On April 10, 2019, Pride Keen finalized a contract with Resolve to remove the fuel and refloat/remove the GRAND MARIANA.98 

On May 10, 2019, Sector Guam terminated the Admin Order issued to Pride Keen dated 

November 22, 2018, as Pride Keen had signed a contract with a Resolve to remove the threat of 

oil discharge from the GRAND MARIANA and to either repair, refloat, or dismantle the 

vessel.99 

The six months it took the RP to activate its VRP is inexcusable and none of the reasons 

provided by Pride Keen provide sufficient cause for the noncompliance with this Admin Order. 

Specifically troublesome is Pride Keen citing the continued lapse in insurance coverage between 

Pride Keen and its OSRO as a reason for noncompliance as one of the primary purposes of a 

VRP is the requirement that an OSRO to be always available through contract or other approved 

means. Since none of the explanations provided by Pride Keen rise to sufficient cause for noncompliance with the Admin Order, this is a reason to deny the claim. 

V. CONCLUSION: 

The Claimants have not demonstrated that they are entitled to a limitation of liability as the 

evidence in this case indicates that the incident was proximately caused by Pride Keen’s 

violation of an applicable Federal safety, construction, or operating regulation. In addition, Pride 

Keen failed to report the incident as required by law and failed to provide all reasonable 

cooperation and assistance requested by a responsible official in connection with removal 

 contracts because the responders listed in Pride Keen’s NTVRP would not respond without security posted by the 

insurer and requested it be authorized to proceed with a local salvor. 93 Letter from CG Sector Guam to Pride Keen dated November 24, 2018. 94 Claim submission dated May 14, 2020. 95 Id. 96 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 8. 97 CG Sector Guam response to the NPFC dated July 28, 2020, response to question 11. 98 BIMCO Wreckstage contract between Pride Keen, Ltd. and Resolve Marine Salvage & Fire dated April 1, 2019. 99 CG Sector Guam Admin Order termination letter issued to Pride Keen dated May 10, 2019.
22

activities; or without sufficient cause, to comply with an order issued under proper authority. 

Each of these is an independent basis to deny the claim. 

Based on a comprehensive review of the record, the applicable law and regulations, and for 

the reasons outlined above, the claim is denied. 

 

Claim Supervisor: 

Date of Supervisor’s review: November 10, 2020

Supervisor Action: Denied

 

(b), (b) (6) (b), (b) (6)