DECISIONS OF THE FEDERAL MARITIME COMMISSION 

Second Series 

VOLUME 7 

July 2023 – December 2023 issuance 

FEDERAL MARITIME COMMISSION, OFFICE OF THE SECRETARY, 2024 
 

 

 

Federal Maritime Commission

Washington, D.C. 

June 10, 2024 

Daniel B. Maffei, Chairman 

Rebecca F. Dye, Commissioner 

Louis E. Sola, Commissioner 

Carl W. Bentzel, Commissioner 

Max M. Vekich, Commissioner 

Office of Administrative Law Judges 

Erin M. Wirth, Chief Administrative Law Judge 

Linda S. Harris Crovella, Administrative Law Judge 

Alex M. Chintella, Administrative Law Judge 
 

 

 

 

 

 

The Federal Maritime Commission makes decisions in cases brought by parties who claim they have been 

harmed because of a violation of the legal prohibitions in the Shipping Act of 1984, 46 U.S.C. Chapters 

401-413. The Commission can also determine to investigate a possible violation of the same law. In the

first instance, these claims are heard by an Administrative Law Judge who issues an Initial

Decision. That Initial Decision may become the final decision of the Commission 30 days later. However,

the Initial Decision can be appealed by the parties to the proceedings, or any Commissioner can ask to

review the Initial Decision. In either case, the Commission would then review the Initial Decision and

issue a Final Decision in the case. This publication provides a compendium of Initial and Final Decisions

in these matters and selected other Orders that may be significant or establish a new legal precedent.
 

 

 

TABLE OF CASES REPORTED BY DOCKET NUMBER 

This PDF file contains bookmarks. You can use the bookmark/table of contents feature 

to navigate throughout this file in your PDF viewer. 

Please consult the FMC’s activity logs located at 

https://www2.fmc.gov/readingroom/ProceedingSearch for the most current status of 

any proceeding. 

INFORMAL DOCKETS 

1985(I) Alioune Badara and Dora Mae Ndiaye v. Fleur De Lis 

Worldwide, LLC ...............................................................................................................4 

∗ Notice Not to Review Order, July 25, 2023....................................................4 

1993(I) RGC Coffee Inc., v. Mediterranean Shipping Company ...............................1 

∗ Order Approving Confidential Settlement and Dismissing 

Proceeding, July 19, 2023 ..................................................................................1 

∗ Notice Not to Review, August 22, 2023 .........................................................6 

1994(I) TCW, Inc., v. Mediterranean Shipping Company, S.A.; Mediterranean 

Shipping Company (USA) Inc. .......................................................................................7 

∗ Order Approving Settlement and Dismissing 

Proceeding, August 23, 2023 ............................................................................7 

∗ Notice Not to Review, September 25, 2023..................................................13 

1996(I) Coppersmith Global Logistics Inc., v. ZIM USA Inc. .................................116

∗ Initial Decision, December 11, 2023 ............................................................116
 

 

FORMAL DOCKETS 

22-12 International Longshoreman’s Association v. Gateway Terminals, LLC;

Charleston Stevedoring Co., LLC; Ports America Florida, Inc.; Ceres Marine

Terminals, Inc.; and SSA Atlantic, LLC....................................................................... 29 

∗ Initial Decision, September 29, 2023 ............................................................. 29 

∗ Notice of Commission Determination to Review, October 3, 2023 ......... 66 

22-20 MSRF, Inc. v. HMM Co. Ltd .............................................................................. 85 

∗ Initial Decision, November 22, 2023 ............................................................. 85 

∗ Notice Not to Review, December 26, 2023................................................. 125

22-21 MSRF, Inc. v. Yang Ming Transport Co. ........................................................... 10 

∗ Initial Decision Approving Settlement Agreement, September 7, 2023 .. 10 

∗ Notice Not to Review, October 11, 2023....................................................... 67 

22-27 Globerunners, Inc. v. Hoyer Global (USA), Inc. ................................................ 5 

∗ Notice Not to Review, July 31, 2023................................................................ 5 

23-05 Rahal International Inc. v. Hapag-Lloyd AG, Hapag-Lloyd (America),

LLC, and Hapag-Lloyd USA, LLC, and Hapag-Lloyd AG and Hapag-Lloyd

(America), LLC v. Maher Terminals, LLC, GCT New York LP, and GCT

Bayonne LP...................................................................................................................... 84 

∗ Notice Not to Review, October 30, 2023....................................................... 84 

CHARGE COMPLAINTS 

CC-001 Mediterranean Shipping Company - Investigation for Compliance

with §§ 41104(A) and 41102 of Demurrage or Detention Charges Under

the Charge Complaint Procedures of 46 U.S.C. § 41310 ........................................... 14 

∗ Order Dismissing Charge Complaint and Discontinuing Order to 

Show Cause, September 29, 2023..................................................................... 14 
TABLE OF CASES REPORTED ARRANGED 

ALPHABETICALLY

This PDF file contains bookmarks. You can use the bookmark/table of contents feature to navigate 

throughout this file in your PDF viewer.

Please consult the FMC’s activity logs located at 

https://www2.fmc.gov/readingroom/ProceedingSearch for the most current status of any 

proceeding.

Alioune Badara and Dora Mae Ndiaye v. Fleur De Lis Worldwide, LLC, 

Informal Docket No. 1985(I) ............................................................................................ 4

∗ Notice Not to Review Order, July 25, 2023 .................................................... 4 

Coppersmith Global Logistics Inc., v. ZIM USA Inc., Informal Docket

No. 1996(I) ...................................................................................................................... 116

∗ Initial Decision, December 11, 2023 ...............................................................116

Globerunners, Inc. v. Hoyer Global (USA), Inc., Docket No. 22-27 .......................... 5 

∗ Notice Not to Review, July 31, 2023................................................................ 5 

International Longshoreman’s Association v. Gateway Terminals, LLC; Charleston 

Stevedoring Co., LLC; Ports America Florida, Inc.; Ceres Marine Terminals, Inc.; 

and SSA Atlantic, LLC, Docket No. 22-12 ................................................................... 29 

∗ Initial Decision, September 29, 2023 ............................................................. 29 

∗ Notice of Commission Determination to Review, October 3, 2023 ......... 66

Mediterranean Shipping Company - Investigation for Compliance with §§ 41104(A) 

and 41102 of Demurrage or Detention Charges Under the Charge Complaint 

Procedures of 46 U.S.C. § 41310, Charge Complaint CC-001 ................................... 14 

∗ Order Dismissing Charge Complaint and Discontinuing Order to 

Show Cause ...................................................................................................... 14 

MSRF, Inc. v. HMM Co. Ltd, Docket No. 22-20 ........................................................ 85 

∗ Initial Decision, November 22, 2023 ............................................................. 85 

∗ Notice Not to Review, December 26, 2023 ................................................. 125

MSRF, Inc., v. Yang Ming Transport Co. Docket No. 22-21 ..................................... 10 

∗ Initial Decision Approving Settlement Agreement, September 7, 2023 .. 10 

∗ Notice Not to Review, October 11, 2023....................................................... 67 
Rahal International Inc. v. Hapag-Lloyd AG, Hapag-Lloyd (America), LLC, and 

Hapag-Lloyd USA, LLC and Hapag-Lloyd AG and Hapag-Lloyd (America), 

LLC v. Maher Terminals, LLC, GCT New York LP, and GCT Bayonne LP, 

Docket No. 23-05 ............................................................................................................. 84 

∗ Notice Not to Review, October 30, 2023....................................................... 84 

RGC Coffee Inc., v. Mediterranean Shipping Company, Informal Docket

No. 1993(I) .......................................................................................................................... 1

∗ Order Approving Confidential Settlement and Dismissing 

Proceeding, July 19, 2023 .................................................................................. 1 

∗ Notice Not to Review, August 22, 2023 ......................................................... 6 

TCW, Inc., v. Mediterranean Shipping Company, S.A.; Mediterranean 

Shipping Company (USA) Inc., Informal Docket No. 1994(I) .................................... 7

∗ Order Approving Settlement and Dismissing Proceeding, 

August 23, 2023 .................................................................................................. 7 

∗ Notice Not to Review, September 25, 2023 .................................................. 13 
 

 

 

 

 

 

 

 

 

FEDERAL MARITIME COMMISSION 

Office of the Administrative Law Judges 

RGC COFFEE INC., Claimant 

v. DOCKET NO. 1993(I) 

MEDITERRANEAN SHIPPING COMPANY, Respondent. 

Served: July 19, 2023 

BEFORE: Theresa DIKE, Small Claims Officer. 

ORDER APPROVING CONFIDENTIAL SETTLEMENT AND DISMISSING PROCEEDING

On May 17, 2023, the Secretary of the Federal Maritime Commission issued a Notice of 

Filing of Small Claims Complaint and Assignment (“Notice”), stating that Claimant RGC Coffee 

Inc. (“RGC”) had filed an informal complaint against Mediterranean Shipping Company 

(“MSC”). Claimant alleges that MSC violated 46 U.S.C. § 41102(c) in connection with the 

transportation of its cargo from Cartagena, Colombia to Seattle, Washington. 

The Secretary instructed MSC to file a response to the Claim by June 12, 2023, and to 

indicate whether it consents to the adjudication of the Claim under the informal procedures 

provided at Subpart S of the Commission’s Rules of Practice and Procedure (46 C.F.R. 

§ 502.301-305). The Secretary also assigned the proceeding to the Chief Administrative Law

Judge to designate a Small Claims Officer to adjudicate the proceeding.

Prior to the deadline to submit a response to the complaint, MSC requested and was 

granted additional time extending the deadline to submit its response to July 3, 2023. On 

June 22, 2023, the parties submitted Claimant’s motion to dismiss, together with a copy of their 

settlement agreement. MSC has not yet filed a response to the complaint and did not object to the 

adjudication of this proceeding under the informal procedures. Accordingly, the Chief 

Administrative Law Judge assigned this proceeding to the undersigned for adjudication under the 

Commission’s informal procedures on July 19, 2023. 

Claimant asks that its complaint against MSC be dismissed with prejudice based on a 

settlement agreement between the parties resolving the issues in dispute. Pursuant to the 

Commission’s Rule 72(a)(3): 

[A]n action may be dismissed at the complainant’s request only by order of the

presiding officer, on terms the presiding officer considers proper. If the motion is

based on a settlement by the parties, the settlement agreement must be submitted

7 F.M.C.2d

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with the motion for determination as to whether the settlement appears to violate 

any law or policy and to ensure the settlement is free of fraud, duress, undue 

influence, mistake, or other defects which might make it unapprovable. Unless the 

order states otherwise, a dismissal under this paragraph is without prejudice. 

46 C.F.R. § 502.72(a)(3). Although Rule 72, governing dismissal of Commission proceedings, is 

not applicable to Subpart S proceedings, the undersigned used the rule as guidance for ruling on 

Claimant’s request to dismiss the Claim. 

The Commission’s regulations allow settlements by litigating parties; however, the 

Commission requires that settlement agreements be submitted “for determination as to whether 

the settlement appears to violate any law or policy and to ensure the settlement is free of fraud, 

duress, undue influence, mistake, or other defects which might make it unapprovable.” Maher 

Terminals v. The Port Authority of N.Y. & N.J., 34 S.R.R. 322, 325 (FMC 2016). In reviewing 

settlement agreements, the Commission is guided by its “strong and consistent policy of 

encouraging settlements and engaging in every presumption which favors a finding that they are 

fair, correct, and valid.” Maher Terminals, 34 S.R.R. at 326 (quoting APM Terminals North 

America, Inc. v. Port Authority of N.Y. & N.J., 31 S.R.R. 623, 626 (FMC 2009)). 

“While following these general principles, the Commission does not merely rubber stamp 

any proffered settlement, no matter how anxious the parties may be to terminate their litigation.” 

Old Ben Coal Co. v. Sea-Land Serv., Inc., 18 S.R.R. 1085, 1092 (ALJ 1978). However, if a 

“proffered settlement does not appear to violate any law or policy and is free of fraud duress, 

undue influence, mistake or other defect which might make it unapprovable despite the strong 

policy of the law encouraging approval of settlements, the settlement will probably pass muster 

and receive approval.” Id. at 1093. “[I]f it is the considered judgment of the parties that whatever 

benefits might result from the vindication of their positions would be outweighed by the costs of 

continued litigation and if the settlement otherwise complies with law the Commission 

authorizes the settlement.” Delhi Petroleum Pty. Ltd. v. U.S. Atlantic & Gulf/Australia – New 

Zealand Conf. and Columbus Line, Inc., 24 S.R.R. 1129, 1134 (ALJ 1988). 

The parties agree that “the amount or value of the consideration being exchanged 

pursuant to this Settlement Agreement is the result of negotiation based on the Parties’ 

evaluation of the risks and costs associated with litigation and is accordingly deemed mutually 

just and appropriate by the Parties.” Settlement Agreement at 3. Claimant represents that in 

entering into the settlement agreement it “has relied upon all necessary advice, including from its 

own legal counsel and that the terms of this Settlement Agreement have been completely read 

and explained to it by its advisors and/or attorneys, and that those terms are fully understood and 

voluntarily accepted by it.” Settlement Agreement at 2. 

A review of the settlement agreement, which is signed by all parties, does not show any 

indicia of fraud, duress, undue influence, or mistake, and appears to reflect an arm’s-length 

resolution between the parties. The terms appear to be fair, reasonable, and adequate. 

Accordingly, the parties’ settlement agreement is approved, and this proceeding dismissed with 

prejudice, as requested. 

7 F.M.C.2d
 

 

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3

Although the parties did not explicitly request confidentiality, the Settlement Agreement 

is titled as a “Confidential Settlement Agreement and Release” and “[e]ach party acknowledges 

the confidential nature of the existence and terms and conditions of this Agreement” and hold 

each other responsible for any breach of the confidential information in the Settlement 

Agreement. Settlement Agreement at 2. It is thus presumed that the parties are seeking 

confidentiality for their agreement. “If parties wish to keep the terms of their settlement 

agreements confidential, the Commission, as well as the courts, have honored such requests.” Al 

Kogan v. World Express Shipping, Transportation and Forwarding Services, Inc., 29 S.R.R. 68, 

70 n.7 (ALJ 2000) (internal citations omitted); Marine Dynamics v. R.T.M Line, Ltd., 27 S.R.R. 

503, 504 (ALJ 1996); International Association of NVOCCs v. Atlantic Container Line, 25 

S.R.R. 1607, 1609 (ALJ 1991). The parties’ implied request to keep their settlement agreement 

terms confidential is reasonable and thus granted. 

Upon consideration of the proposed settlement and Claimant’s motion to dismiss its 

Claim, and for the reasons stated above, it is hereby 

ORDERED that the settlement agreement be APPROVED. It is 

FURTHER ORDERED that the request for confidentiality be GRANTED. It is 

FURTHER ORDERED that this proceeding be DISMISSED WITH PREJUDICE. 

Theresa Dike 

Small Claims Officer 

7 F.M.C.2d
 

FEDERAL MARITIME COMMISSION

4

ALIOUNE BADARAAND DORA MAE NDIAYE, Complainants

v. DOCKET NO. 1985(I)

FLEUR DE LIS WORLDWIDE, LLC, Respondent.

Served: July 25, 2023

NOTICE NOT TO REVIEW

Notice is given that the time within which the Commission could determine to review the 

Small Claims Officer’s June 21, 2023, Initial Decision has expired. Accordingly, the decision

has become administratively final. 

William Cody

Secretary

7 F.M.C.2d
 

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FEDERAL MARITIME COMMISSION 

GLOBERUNNERS, INC., Complainant 

DOCKET NO. 22-27 v. 

HOYER GLOBAL (USA), INC., Respondent. 

Served: July 31, 2023 

NOTICE NOT TO REVIEW

Notice is given that the time within which the Commission could determine to review 

the Administrative Law Judge’s June 28, 2023, Initial Decision Approving Settlement 

Agreement has expired. Accordingly, the decision has become administratively final. 

7 F.M.C.2d
 

FEDERAL MARITIME COMMISSION 

6

RGC COFFEE INC., Claimant

v. DOCKET NO. 1993(I) 

MEDITERRANEAN SHIPPING COMPANY, Respondent. 

Served: August 22, 2023 

NOTICE NOT TO REVIEW

Notice is given that the time within which the Commission could determine to review the 

Small Claims Officer’s July 19, 2023, Order Approving Confidential Settlement and Dismissing 

Proceeding has expired. Accordingly, this decision has become administratively final. 

Amy Strauss 

Acting Secretary 

7 F.M.C.2d
 

 

 

 

FEDERAL MARITIME COMMISSION 

Office of the Administrative Law Judges 

7

TCW, INC., Claimant 

v. DOCKET NO. 1994(I) 

MEDITERRANEAN SHIPPING COMPANY, S.A.; 

MEDITERRANEAN SHIPPING COMPANY (USA) INC., 

Respondents. 

Served: August 23, 2023 

BEFORE: Theresa DIKE, Small Claims Officer. 

ORDER APPROVING SETTLEMENT AND DISMISSING PROCEEDING

On May 23, 2023, the Secretary of the Federal Maritime Commission issued a Notice of 

Filing of Small Claims Complaint and Assignment (“Notice”), stating that Claimant TCW, Inc. 

(“TCW”) had filed an informal complaint against Mediterranean Shipping Company, S.A. and 

Mediterranean Shipping Company (USA) Inc. (collectively “MSC”). Claimant alleges that MSC 

violated provisions of the Shipping Act of 1984 in connection with certain invoices they issued 

to Claimant. 

The Secretary instructed Respondents to file a response to the Claim by June 19, 2023, 

and to indicate whether they consent to the adjudication of the Claim under the informal 

procedures provided at Subpart S of the Commission’s Rules of Practice and Procedure 

(46 C.F.R. § 502.301-305). The Secretary also assigned the proceeding to the Chief 

Administrative Law Judge to designate a Small Claims Officer to adjudicate the proceeding. 

Respondents requested and were granted additional time extending the deadline for their 

response to the Claim to August 4, 2023, to allow them to negotiate a settlement with Claimant 

and to finalize the parties’ settlement agreement. On August 3, 2023, Claimant submitted a 

motion to dismiss, indicating that the parties had agreed to resolve their dispute. On August 4, 

2023, Respondents submitted a copy of a confidential settlement agreement between the parties. 

Respondents have not yet filed a response to the Claim and did not object to the 

adjudication of this proceeding under the informal procedures. Accordingly, the Chief 

Administrative Law Judge assigned this proceeding to the undersigned for adjudication under the 

Commission’s informal procedures on August 23, 2023. 

7 F.M.C.2d
 

 

 

 

 

 

 

 

 

 

 

 

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Claimant asks that its complaint against MSC be dismissed based on a settlement 

agreement between the parties resolving the issues in dispute. Pursuant to the Commission’s 

Rule 72(a)(3): 

[A]n action may be dismissed at the complainant’s request only by order of the

presiding officer, on terms the presiding officer considers proper. If the motion is

based on a settlement by the parties, the settlement agreement must be submitted

with the motion for determination as to whether the settlement appears to violate

any law or policy and to ensure the settlement is free of fraud, duress, undue

influence, mistake, or other defects which might make it unapprovable. Unless the

order states otherwise, a dismissal under this paragraph is without prejudice.

46 C.F.R. § 502.72(a)(3). Although Rule 72, governing dismissal of Commission proceedings, is 

not applicable to Subpart S proceedings, the undersigned used the rule as guidance for ruling on 

Claimant’s request to dismiss the Claim. 

The Commission’s regulations allow settlements by litigating parties; however, the 

Commission requires that settlement agreements be submitted “for determination as to whether 

the settlement appears to violate any law or policy and to ensure the settlement is free of fraud, 

duress, undue influence, mistake, or other defects which might make it unapprovable.” Maher 

Terminals v. The Port Authority of N.Y. & N.J., 34 S.R.R. 322, 325 (FMC 2016). In reviewing 

settlement agreements, the Commission is guided by its “strong and consistent policy of 

encouraging settlements and engaging in every presumption which favors a finding that they are 

fair, correct, and valid.” Maher Terminals, 34 S.R.R. at 326 (quoting APM Terminals North 

America, Inc. v. Port Authority of N.Y. & N.J., 31 S.R.R. 623, 626 (FMC 2009)). 

“While following these general principles, the Commission does not merely rubber stamp 

any proffered settlement, no matter how anxious the parties may be to terminate their litigation.” 

Old Ben Coal Co. v. Sea-Land Serv., Inc., 18 S.R.R. 1085, 1092 (ALJ 1978). However, if a 

“proffered settlement does not appear to violate any law or policy and is free of fraud duress, 

undue influence, mistake or other defect which might make it unapprovable despite the strong 

policy of the law encouraging approval of settlements, the settlement will probably pass muster 

and receive approval.” Id. at 1093. “[I]f it is the considered judgment of the parties that whatever 

benefits might result from the vindication of their positions would be outweighed by the costs of 

continued litigation and if the settlement otherwise complies with law the Commission 

authorizes the settlement.” Delhi Petroleum Pty. Ltd. v. U.S. Atlantic & Gulf/Australia – New 

Zealand Conf. and Columbus Line, Inc., 24 S.R.R. 1129, 1134 (ALJ 1988). 

Pursuant to the settlement agreement between the parties MSC will make a one-time 

payment in the amount of $3,330.00 to Claimant, and within 30 days of the filing of Claimant’s 

motion to dismiss the proceeding and the parties’ settlement agreement, MSC and TCW’s 

representatives will meet “to discuss, in good faith, MSC billing practice issues that have been 

raised by TCW, including the use of the shutout under [the Uniform Interchange and Facilities 

Access Agreement] when valid billing disputes exist.” Settlement Agreement at 2-3. 

The parties state that they “are entering into this Settlement Agreement for the purpose of 

making a peaceful resolution between them,” and agree that “any difference between the amount 

7 F.M.C.2d
 

 

 

____________________________________ 

9

of monetary damages sought by any party and the amount or value of the consideration being 

exchanged pursuant to this Settlement Agreement is the result of negotiation based on the 

Parties’ evaluation of the risks and costs associated with litigation and is accordingly deemed 

mutually just and appropriate by the Parties.” Settlement Agreement at 3. Claimant represents 

that in entering into the settlement agreement it “has relied upon all necessary advice, including 

from its own legal counsel and that the terms of this Settlement Agreement have been completely 

read and explained to it by its advisors and/or attorneys, and that those terms are fully understood 

and voluntarily accepted by it.” Settlement Agreement at 2. 

A review of the settlement agreement, which is signed by both parties, does not show any 

indicia of fraud, duress, undue influence, or mistake, and appears to reflect an arm’s-length 

resolution between the parties. The terms appear to be fair, reasonable, and adequate. 

Accordingly, the parties’ settlement agreement is approved, and this proceeding dismissed. 

Upon consideration of the proposed settlement and Claimant’s motion to dismiss its 

Claim, and for the reasons stated above, it is hereby 

ORDERED that the settlement agreement be APPROVED. It is 

FURTHER ORDERED that this proceeding be DISMISSED. 

Theresa Dike 

Small Claims Officer 

7 F.M.C.2d
 

 

FEDERAL MARITIME COMMISSION 

Office of Administrative Law Judges 

10

MSRF, INC., Complainant 

v. DOCKET NO. 22-21 

YANG MING TRANSPORT CO., Respondent. 

Served: September 7, 2023 

ORDER OF: Linda S. Harris CROVELLA, Administrative Law Judge. 

INITIAL DECISION APPROVING SETTLEMENT AGREEMENT1

On August 24, 2023, Complainant MSRF, Inc. (“MSRF”) and Respondent Yang Ming 

Transport Co. (“Yang Ming”) filed a joint motion seeking approval of a confidential settlement 

agreement and dismissal with prejudice of the complaint (“Motion”), with a copy of the 

confidential settlement agreement. 

Using language borrowed in part from the Administrative Procedure Act, Rule 75 of the 

Commission’s Rules of Practice and Procedure gives interested parties an opportunity, inter alia, 

to submit offers of settlement where “time, the nature of the proceeding, and the public interest 

permit.” 46 C.F.R. § 502.75(b); see 5. U.S.C. § 554(c). If dismissal is sought due to a settlement 

by the parties, “the settlement agreement must be submitted with the motion for determination as 

to whether the settlement appears to violate any law or policy and to ensure the settlement is free 

of fraud, duress, undue influence, mistake, or other defects which might make it unapprovable.” 

46 C.F.R. § 502.72(a)(3). “ 

The Commission has a strong and consistent policy of “encourag[ing] settlements and 

engag[ing] in every presumption which favors a finding that they are fair, correct, and valid.” 

Inlet Fish Producers, Inc. v. Sea-Land Serv., Inc., 29 S.R.R. 975, 978 (ALJ 2002) (quoting Old 

Ben Coal Co. v. Sea-Land Serv., Inc., 18 S.R.R. 1085, 1091 (ALJ 1978) (Old Ben Coal)). See 

also Ellenville Handle Works, Inc. v. Far Eastern Shipping Co., 20 S.R.R. 761, 762 (ALJ 1981). 

The law favors the resolution of controversies and uncertainties through 

compromise and settlement rather than through litigation, and it is the policy of 

the law to uphold and enforce such contracts if they are fairly made and are not in 

1 This initial decision will become the decision of the Commission in the absence of review by 

the Commission. Any party may file exceptions to this decision within twenty-two days of the 

date of service. 46 C.F.R. § 502.227. 

7 F.M.C.2d
 

 

 

 

 

11

contravention of some law or public policy. . . . The courts have considered it 

their duty to encourage rather than to discourage parties in resorting to 

compromise as a mode of adjusting conflicting claims. . . . The desire to uphold 

compromises and settlements is based upon various advantages which they have 

over litigation. The resolution of controversies by means of compromise and 

settlement is generally faster and less expensive than litigation; it results in a 

saving of time for the parties, the lawyers, and the courts, and it is thus 

advantageous to judicial administration, and, in turn, to government as a whole. 

Moreover, the use of compromise and settlement is conducive to amicable and 

peaceful relations between the parties to a controversy. 

Old Ben Coal, 18 S.R.R. at 1092 (quoting 15A AM. JUR. 2D Compromise and Settlement § 3 

(1976)). 

“While following these general principles, the Commission does not merely rubber stamp 

any proffered settlement, no matter how anxious the parties may be to terminate their litigation.” 

Old Ben Coal, 18 S.R.R. at 1092. However, if “a proffered settlement does not appear to violate 

any law or policy and is free of fraud, duress, undue influence, mistake or other defects which 

might make it unapprovable despite the strong policy of the law encouraging approval of 

settlements, the settlement will probably pass muster and receive approval.” Old Ben Coal, 18 

S.R.R. at 1093. “[I]f it is the considered judgment of the parties that whatever benefits might 

result from vindication of their positions would be outweighed by the costs of continued 

litigation and if the settlement otherwise complies with law the Commission authorizes the 

settlement.” Delhi Petroleum Pty. Ltd. v. U.S. Atlantic & Gulf/Australia – New Zealand Conf. 

and Columbus Line, Inc., 24 S.R.R. 1129, 1134 (ALJ 1988) (citations omitted). 

“Reaching a settlement allows the parties to settle their differences, without an admission 

of a violation of law by the respondent, when both the complainant and respondent have decided 

that it would be much cheaper to settle on such terms than to seek to prevail after expensive 

litigation.” APM Terminals North America, Inc. v. Port Authority of New York and New Jersey, 

31 S.R.R. 623, 626 (FMC 2009) (citing Puerto Rico Freight Sys. Inc. v. PR Logistics Corp., 30 

S.R.R. 310, 311 (ALJ 2004)). 

The parties, “both sophisticated corporate entities,” state that they “arrived at the 

Confidential Settlement Agreement through arm’s length negotiations and support this motion 

and the relief that it seeks.” Motion at 3. The parties state: 

The Confidential Settlement Agreement does not contravene any law or public 

policy and is neither unjust nor discriminatory. It does not contemplate any 

adverse effects on any third parties or the shipping public. Instead, the 

Confidential Settlement Agreement is a fair and reasonable resolution of the 

disputes between the parties and reflects their desire to resolve their issues 

without the need for costly and uncertain litigation. 

Id. 

7 F.M.C.2d
 

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The parties request that the settlement agreement be kept confidential. Pursuant to 

Commission Rule 5(b), parties may request confidentiality. 46 C.F.R. § 502.5(b); see also 46 

C.F.R. § 502.141(j). “If parties wish to keep the terms of their settlement agreements

confidential, the Commission, as well as the courts, have honored such requests.” Al Kogan v.

World Express Shipping, Transportation and Forwarding Services, Inc., 29 S.R.R. 68, 70 n.7

(ALJ 2000) (citations omitted); Marine Dynamics v. RTM Line, Ltd., 27 S.R.R. 503, 504 (ALJ

1996); Int’l Assoc. of NVOCCs v. Atlantic Container Line, 25 S.R.R. 1607, 1609 (ALJ 1991).

The confidential settlement agreement has been reviewed by the undersigned and the 

request for confidentiality in the settlement agreement is more extensive than traditional 

requests. The undersigned notes that the agreement is only binding on the parties, and nothing in 

the confidentiality provision should be construed as binding on the Commission. Accordingly, 

this confidential settlement agreement will be treated by the Commission in the same manner as 

other confidential settlement agreements, and the Commission will have the opportunity to 

review the settlement agreement prior to its approval becoming final. Given the parties’ request 

for confidentiality, confidential information included in the settlement agreement, and the 

Commission’s history of permitting agreements settling private complaints to remain 

confidential, the parties’ request for confidentiality for the settlement agreement is granted. The 

settlement agreement will be maintained in the Secretary’s confidential files. 

Based on the representations in the joint motion and other documents filed in this matter, 

the parties have established that the settlement agreement does not appear to violate any law or 

policy or contain other defects which might make it unapprovable. The parties are represented by 

counsel and have engaged in arms-length settlement discussions. The proceeding would require 

review of the parties’ briefing and an initial decision would be subject to exceptions or appeals. 

The parties have determined that the settlement reasonably resolves the issues raised in the 

complaint without the need for costly and uncertain litigation. Accordingly, the settlement 

agreement is approved. 

Upon consideration of the motion, the settlement agreement, and the record, and good 

cause having been stated, it is hereby: 

ORDERED that the motion to approve the settlement agreement between Complainant 

MSRF and Respondent Yang Ming be GRANTED. It is 

FURTHER ORDERED that the request for confidential treatment be GRANTED. The 

settlement agreement should be maintained in the Secretary’s confidential files. It is 

FURTHER ORDERED that this proceeding be DISMISSED WITH PREJUDICE.

Linda S. Harris Crovella 

Administrative Law Judge 

7 F.M.C.2d
 

FEDERAL MARITIME COMMISSION

13

TCW, INC., Claimant

v.

DOCKET NO. 1994(I)

MEDITERRANEAN SHIPPING COMPANY, S.A.;

MEDITERRANEAN SHIPPING COMPANY (USA) INC.,

Respondents.

Served: September 25, 2023

NOTICE NOT TO REVIEW

Notice is given that the time within which the Commission could determine to review the 

Small Claims Officer’s August 23, 2023, Order Approving Settlement and Dismissing Proceeding

has expired. Accordingly, this decision has become administratively final.

Amy Strauss

Acting Secretary

7 F.M.C.2d
 

 

 

14

FEDERAL MARITIME COMMISSION 

MEDITERRANEAN SHIPPING 

COMPANY – INVESTIGATION 

FOR COMPLIANCE WITH §§ 

41104(a) AND 41102 OF 

DEMURRAGE OR DETENTION 

CHARGES UNDER THE CHARGE 

COMPLAINT PROCEDURES OF 

46 U.S.C. § 41310 

Docket No. CC-001 

Served: September 29, 2023 

BY THE COMMISSION: Daniel B. MAFFEI, Chairman, Rebecca 

F. DYE, and Carl W. BENTZEL, Commissioners. Louis E. SOLA,

Commissioner, concurring. Max M. VEKICH, Commissioner,

concurring in part and dissenting in part.

Order Dismissing Charge Complaint 

and Discontinuing Order to Show Cause 

This is a charge complaint proceeding under the Shipping 

Act, 46 U.S.C. § 41310. On February 3, 2023, upon charge complaint 

information submitted, the Federal Maritime Commission 

(Commission) issued an Order to Show Cause (OSC) directing 

Mediterranean Shipping Company, S.A. (MSC) to show cause why 

it should not be ordered to refund or waive charges assessed or paid 

for failure to comply with the Shipping Act. 

For the reasons discussed below, the Commission dismisses 

the Charge Complaint against MSC and discontinues the OSC 

proceeding. 

7 F.M.C.2d
I. BACKGROUND

Under the Shipping Act’s charge complaint provision at 46

U.S.C. § 41310, a person may submit to the Commission information 

concerning complaints about charges assessed by a common carrier. 

46 U.S.C. § 41310(a). Once the Commission receives such a 

submission, the agency will promptly investigate whether the charge 

in question is in compliance with section 41104(a) and 41102 of the 

Shipping Act. 46 U.S.C. § 41310(b). 

If the Commission determines that a charge does not comply 

with the Shipping Act, the Commission will promptly order the 

refund of charges paid (or waiver of charges assessed but not yet 

paid). 46 U.S.C. § 41310(c). The Commission may also assess a civil 

penalty under section 41107, in addition to or in lieu of ordering a 

refund. 46 U.S.C. § 41310(d). 

This proceeding was commenced pursuant to the Shipping 

Act’s charge complaint provision at 46 U.S.C. § 41310 and the 

Commission’s order to show cause rule at 46 C.F.R. § 502.91, based 

on information submitted by Complainant SOFi Paper Products 

(SOFi). The Commission received a complaint from SOFi, a party 

billed or assessed for certain charges by MSC. OSC at 3. MSC 

assessed a congestion surcharge in the amount of $1,000 to SOFi 

with respect to bill of lading No. MEDUI0745188 dated July 14, 

2022. MSC claimed to have assessed the surcharge in accordance 

with its published tariff rule. As a billed party, SOFi requested 

justification for the charge, which MSC had not provided as of the 

time of the issuance of the OSC. Id. 

Stating that MSC’s failure to show the reasonableness of the 

surcharge or provide a justification for the surcharge demonstrates 

that the surcharge may constitute an unreasonable action or practice 

in violation of 46 U.S.C. §§ 41102(c) and 41104(a)(14), the 

Commission issued the OSC on February 3, 2023, and directed MSC 

to show cause why the Commission should not order it to refund

charges paid or waive charges assessed, and/or impose a civil 

penalty, under 46 U.S.C. §§ 41310(d) and 41107, for failure to 

comply with 46 U.S.C. § 41102(c) and 41104(a). Id. at 2-4. The 

Commission’s Office of Enforcement (OOE) was named a party to 

the proceeding. Id. at 4.

15

7 F.M.C.2d
II. DISCUSSION

A. Whether MSC is the proper party in this proceeding

MSC claimed that the Commission has issued the Order to 

Show Cause to the wrong party because “MSC did not bill SOFi for 

the congestion surcharge in the amount of $1,000,” and MSC’s 

customer was an NVOCC (which is not a party to this proceeding). 

MSC Response at 10. MSC stated that “while [the NVOCC] had the 

contractual obligation to pay certain rates to MSC, [the NVOCC] had 

its own discretion and contractual arrangement to charge its 

customers, including SOFi.” Id. at 15. MSC further alleged that “[i]f 

there had been a problem with MSC’s congestion surcharge, it would 

be [the NVOCC] as the ‘shipper’ to MSC who could have lodged the 

complaint had it believed the charge to be unreasonable; however, it 

has not done do.” Id. 

The Shipping Act’s charge complaints provision provides as 

follows: 

If the common carrier assessing the charge is acting 

in the capacity of a non-vessel-operating common 

carrier, the Commission shall, while conducting an 

investigation under subsection (b), consider— 

(1) whether the non-vessel-operating common carrier

is responsible for the noncompliant assessment of the

charge, in whole or in part; and

(2) whether another party is ultimately responsible in

whole or in part and potentially subject to action

under subsections (c) and (d).

46 U.S.C. § 41310(e). 

MSC is claiming that it is the wrong party in this proceeding 

because its customer was an NVOCC. Under the Shipping Act’s 

charge complaints provision, however, when the common carrier 

assessing a charge is an NVOCC, the Commission must consider 

whether another party, such as an ocean common carrier, is 

ultimately responsible. The facts demonstrate that MSC acted as the 

ocean common carrier with respect to SOFi’s shipment. As the ocean 

common carrier with respect to the shipment in question, MSC is the 

proper party in this charge complaint proceeding. 

16

7 F.M.C.2d
B. MSC’s petition to dismiss the charge complaint and OSC

On February 24, 2024, MSC filed a Petition to Dismiss the 

Charge Complaint and the Order to Show Cause (Petition to 

Dismiss). In its Petition to Dismiss, MSC stated that “[p]ursuant to 

46 C.F.R. § 502.69, [MSC] hereby petitions for an order dismissing 

with prejudice the Charge Complaint No. 001 and the related Order 

Directing MSC to Show Cause . . . in its entirety.” Petition to Dismiss 

at 1. The Commission, however, waived its rules of practice and 

procedure in 46 C.F.R Subparts A-E, I-L, P, and all other provisions 

not consistent with the OSC. OSC at 5. The Commission’s rule at 46 

C.F.R. § 502.69 is part of the Commission’s rules of practice and

procedure in Subpart E – Private Complaints and Commission

Investigations. Therefore, the provision under which MSC filed its

Petition to Dismiss was specifically waived by the Commission in

this charge complaint and OSC proceeding.

In its response to MSC’s Petition to Dismiss, OOE asserted 

that MSC’s Petition to Dismiss is “improper under the procedural 

rules governing this proceeding, is inconsistent with the OSC, and 

should be summarily denied on those grounds.” OOE Response to 

Petition at 2. OOE stated that “the Commission has expressly 

disabled Subpart A, including § 502.12 with regards to the 

applicability of the FRCP, as well as the Subpart E, which [MSC] 

relies upon as the basis for its request.” Id. at 2-3. OOE further stated 

that “[t]his proceeding is instead governed by the Show Cause 

process pursuant to 46 C.F.R. § 502.91, found within Subpart F of 

the Commission’s regulations,” and “[i]nasmuch as the OSC 

supersedes the provisions of Subpart A-E, [MSC]’s Petition is 

improper and should be denied.” Id. at 3.

OOE is correct. The Commission’s OSC expressly waived 46 

C.F.R. § 502.69, pursuant to which MSC filed its Petition to Dismiss.

If a respondent is permitted to file disallowed substantive pleadings,

it may hinder the Commission from “promptly investigat[ing] the

charge with regard to compliance with section 41104(a) and section

41102” as required under the Shipping Act’s charge complaints

provisions at 46 U.S.C. § 41310. MSC’s Petition to Dismiss is

denied.

C. MSC’s motion for confidential treatment for portions of its

response

On February 28, 2023, MSC filed Motion for Confidential 

Treatment for Portions of its Response, and on March 3, 2023, MSC 

filed Amended Motion for Confidential Treatment for Portions of its 

17

7 F.M.C.2d
Response (Motion for Confidential Treatment). MSC stated that its 

Response to the OSC references its ocean agreement with a nonparty, and the submitted ocean agreement includes an attached 

exhibit that is subject to a confidentiality provision that prevents the 

disclosure of its terms. Motion for Confidential Treatment at 1. MSC 

further stated that the contractually agreed upon rates that are 

enclosed to the ocean agreement were privately negotiated between 

MSC and the non-party and are thus confidential. Id. at 1-2. MSC 

alleged that “[d]isclosure of the Rates would damage the commercial 

interests and competitiveness of the parties to the Ocean 

Agreement.” Id. at 2. 

OOE stated that “[d]espite the Commission previously 

waiving the provisions [MSC] relies on to request [confidential] 

treatment, the matter of confidentiality must be addressed to protect 

trade secrets and minimize dangers to private entities.” OOE Reply 

to Respondent’s Answer to OSC (OOE Reply) at 2 (footnote and 

citation omitted). OOE further stated that “[t]he Commission’s own 

regulations regarding service contracts filed with the Commission 

require confidentiality under 46 C.F.R. § 530.4.” Id. OOE, therefore, 

“has no objection to [MSC]’s request that the information and 

materials indicated in its Motion for Confidential Treatment be kept 

confidential, nor does [OOE] object to [MSC] filing both public and 

confidential versions of its Response to Show Cause.” Id.

Although MSC relied on waived provisions in filing its 

Motion for Confidential Treatment, protecting commercial entities’ 

trade secrets and confidential rates information is an important 

consideration. Further, as OOE stated, service contracts are filed with 

the Commission confidentially under the Shipping Act and the 

Commission’s regulations. See 46 U.S.C. § 40502(b)(1) and 46 

C.F.R. § 530.4. In addition, granting MSC’s Motion will not delay

the Commission’s prompt investigation of this charge complaint.

MSC’s Motion for Confidential Treatment for Portions of its

Response is granted.

D. MSC’s petition to file sur-reply

On April 13, 2023, MSC filed a Petition for Leave to File 

Sur-Reply (Petition for Leave) and its attached Sur-reply to the OSC. 

MSC stated that after carefully reviewing OOE’s Reply to MSC’s 

Answer to Order to Show Cause, MSC believes that “a brief response 

to the Reply is necessary to address certain points and matters 

contained in that filing, which could aid the Commission in its 

ruling.” Petition for Leave at 1. MSC’s counsel conferred with the 

OOE and understood that OOE is of the view that the regulations do 

18

7 F.M.C.2d
not give MSC a right to response to the OOE Reply. Id. MSC thus 

filed the Petition for Leave and requested leave to file its Sur-Reply. 

Id. at 2.

On April 19, 2023, OOE filed its Response to MSC’s Petition 

to File Sur-Reply (OOE Response to Sur-Reply). OOE asserted that 

MSC’s Petition for Leave and its enclosed Sur-Reply “is improper 

under the procedural rules governing this proceeding, is inconsistent 

with the OSC, and should be summarily denied by the Commission 

on those grounds.” OOE Response to Sur-Reply at 2. OOE stated that 

the regulation at 46 C.F.R. §§ 502.61-502.75, under which MSC filed 

its Petition for Leave, has been expressly disabled by the 

Commission’s OSC. Id. at 2. OOE alleged that “[p]olicy issues 

reintroduced in [MSC’s Sur-Reply] that were previously raised by 

[MSC] in their earlier Petition and Answer[,] are already before the 

Commission.” Id. OOE further stated that if any new policy issues 

introduced by MSC deserve attention by the Commission, “such 

review will have an opportunity to occur during the penalty phase of 

this proceeding, should the Commission refer this matter to the 

Administrative Law Judge for a hearing on the assessment of a civil 

penalty pursuant to 46 U.S.C. §§ 41107 and 41109.” Id. OOE also 

asserted that MSC “[has] not shown good cause for the significant 

delay such a petition, if granted, would impose upon this proceeding” 

when MSC “had previous opportunity to submit the assertions and 

materials within [MSC’s] sur-reply, as part of their Answer to the 

OSC.” Id. at 2-3. 

Again, OOE is correct. The Commission’s OSC expressly 

waived 46 C.F.R. §§ 502.61-502.75, which is Subpart E of the 

Commission’s rules of practice and procedure. The OSC stated that 

“pursuant to 46 C.F.R. § 502.10, the Commission hereby waives the 

provisions of Subparts A-E . . . of Part 520, and all other provisions 

of the Commission’s Rules of Practice and Procedure except as 

consistent with this Order.” OSC at 5. As with MSC’s Petition to 

Dismiss, if a respondent in a charge complaint proceeding is 

permitted to file expressly disallowed substantive pleadings, it may 

hinder the Commission’s prompt investigation of charges under the 

Shipping Act’s charge complaints provisions at 46 U.S.C. § 41310. 

MSC’s Petition for Leave is denied. 

E. Whether MSC should be ordered to refund charges paid or

waive charges assessed

The Commission ordered MSC to show cause why the 

Commission should not find that MSC’s action in assessing a 

congestion surcharge with respect to bill of lading No. 

19

7 F.M.C.2d
MEDUI0745188 dated July 14, 2022, constitutes a violation of 46 

U.S.C. §§ 41102(c) and 41104(a)(14). OSC at 3-4. The Commission 

further ordered MSC to show cause “why the Commission should 

not promptly order the refund of charges paid by SOFi Paper 

Products with respect to charges that do not comply with § 41102 

and § 41104(a)(14), as provided under § 41310(c).” Id. at 4.

With respect to a refund, the charge complaints provision 

provides that “[u]pon receipt of submissions under subsection (a), if 

the Commission determines that a charge does not comply with 

section 41104(a) or 41102, the Commission shall promptly order the 

refund of charges paid.” 46 C.F.R. § 41310(c). The Commission may 

order a waiver of charges assessed but not yet paid, in addition to 

ordering a refund of charges already paid. 

In its Response to Order to Show Cause dated February 28, 

2023 (MSC Response), MSC stated that the issue of a refund is moot 

because “MSC in fact did make a refund when it sent the check for 

the total amount in the Charge claim of $1,000 to SOFi’s office in 

Florida on February 13, 2023, and that check was confirmed 

delivered to SOFi’s office on the following day by FedEx.” MSC 

Response at 25-27. MSC stated that it sent the refund check “prior to 

any decision by the FMC in respect to SOFi’s complaint,” and 

“MSC’s voluntary action constitutes a full satisfaction of SOFi’s 

rights under 46 U.S.C. § 41310 et seq. and no further demand can be 

made by SOFi to MSC pursuant to the facts of this case.” Id. at 27. 

On March 27, 2023, OOE submitted its Reply to 

Respondent’s Answer to Order to Show Cause (OOE Reply). OOE 

acknowledged that “on February 13, 2023, after the OSC was served, 

MSC issued a check refunding the charges in question, in full, to 

SOFi at its legal business address.” OOE Reply at 2. OOE further 

acknowledges that “[MSC] also submitted evidence that this check 

was cashed by SOFi on March 6, 2023.” Id. at 2-3 (citation omitted). 

Stating “[t]he sole relief authorized to the Complainant under the 

Charge Complaint statutory provisions in 46 U.S.C. § 41310 is a 

refund or waiver” and that the full refund has already been remitted, 

OOE further stated that it does not propose that any further relief be 

ordered to the Complainant under the charge complaint. Id. at 3. 

The Commission agrees with OOE. MSC fully refunded the 

surcharge in question to SOFi (the charge complainant) after the 

Commission initiated this Show Cause proceeding. Accordingly, the 

refund issue is now moot. In addition, as further discussed below, the 

Commission does not find that violations of the Shipping Act were 

20

7 F.M.C.2d
proven in this proceeding. Therefore, SOFi’s charge complaint for 

refund is dismissed. 

F. Whether MSC’s surcharge to SOFi was a violation of the

Shipping Act

1. Whether the Commission may assess a civil penalty in

addition to or in lieu of a refund

After acknowledging that the refund issue is moot because

MSC already refunded the surcharge in question to SOFi, OOE stated 

that “pursuant to the OSC, the Commission may still make a 

determination as to whether the charge was noncompliant and 

whether a civil penalty should therefore [be issued] pursuant to 46 

U.S.C. §§ 41107 and 41109.” OOE Reply at 3. 

MSC claimed that “[a]ccording to the FMC’s policies and 

procedures, as well as its Charge Complaint guidelines and related 

interim procedures, [MSC’s] voluntary refund in full of the charge at 

issue prevents the Commission from taking any further action on this 

Charge Complaint including the imposition of a penalty.” MSC 

Response at 31. MSC further stated that “[a] penalty is also not 

warranted in this matter because [MSC] negotiated in good faith with 

SOFi throughout this proceeding. Good faith that SOFi lacked when 

it breached the settlement by seeking to recover in excess of the full 

amount of its claim.” Id. at 31-32. MSC is incorrect in asserting that 

a penalty under the Shipping Act charge complaints’ penalty 

provision at 46 U.S.C. § 41310(d) may not be assessed once a refund 

or waiver of the charge is made. 

The Shipping Act’s charge complaints provision for penalties

provides that “[i]n the event of a finding that a charge does not 

comply with section 41104(a) or 41102 after submission under 

subsection (a), a civil penalty under section 41107 shall be applied to 

the common carrier making such charge.” 46 U.S.C. § 41310(d). The 

Shipping Act’s penalty provision at section 41107 provides that “[a] 

person that violates this part or a regulation or order of the Federal 

Maritime Commission issued under this part is liable to the United 

States Government for a civil penalty or, in addition to or in lieu of a 

civil penalty, is liable for the refund of a charge.” 46 U.S.C. § 

41107(a) (emphasis added). The Shipping Act’s penalty assessment 

provision at section 41109 also provides that the Commission may 

“assess a civil penalty” or “in addition to, or in lieu of, assessing a 

civil penalty . . . , order a refund of money.” 46 U.S.C. § 41109(a). 

21

7 F.M.C.2d

21
The Commission agrees with OOE that even after a refund or 

waiver of the charge in question, the Commission may still assess a 

civil penalty in a charge complaint proceeding if it finds that the 

charge does not comply with sections 41104(a) or 41102 of the 

Shipping Act. Pursuant to sections 41310, 41107, and 41109 of the 

Act, 46 U.S.C. §§ 41310, 41107, 41109, the Commission may assess 

a civil penalty in addition to or in lieu of a refund in charge complaint 

proceedings under 46 U.S.C. § 41310. Otherwise, common carriers 

could nullify the charge complaint penalty provision at 46 U.S.C. § 

41310(d) by simply refunding or waiving the charge in question, 

even when there might be violations of the Shipping Act. Whether or 

not to impose a penalty under the charge complaint proceeding must 

be determined by the Commission, not by a common carrier’s 

litigation strategy. The Commission disagrees, however, with OOE 

that a violation has been proven in this case. 

2. Whether the congestion surcharge is a violation of 46 C.F.R.

§ 545.5

OOE alleges that MSC’s congestion surcharge to SOFi may 

constitute a violation of 46 U.S.C. §§ 41102(c) and 41104(a)(14). 

OOE Reply at 7. Section 41104(a)(14) of the Shipping Act provides 

that a common carrier shall not “assess any party for a charge that is 

inconsistent or does not comply with all applicable provisions and 

regulations, including [46 U.S.C. § 41102(c)] or [46 C.F.R. part 

545].” Read together with other Shipping Act provisions and OOE’s 

analysis, 46 C.F.R. part 545 in this proceeding refers to the 

Commission’s interpretive rule at 46 C.F.R. § 545.5 entitled 

Interpretation of Shipping Act of 1984 - Unjust and unreasonable 

practices with respect to demurrage and detention. 

The interpretive rule explains that “[t]he purpose of this rule 

is to provide guidance about how the Commission will interpret 46 

U.S.C. 41102(c) . . . in the context of demurrage and detention.” 46 

C.F.R. § 545.5. It further clarifies that “[t]his rule applies to practices

and regulations relating to demurrage and detention for containerized

cargo.” 46 C.F.R. § 545.5(b). The interpretive rule is applicable only

to demurrage and detention charges. The interpretive rule defines

demurrage and detention charges as “any charges, including ‘per

diem,’ assessed by ocean common carriers, marine terminal

operators, or ocean transportation intermediaries (‘regulated

entities’) related to the use of marine terminal space (e.g., land) or

shipping containers, not including freight charges.” Id. There is no

indication that either SOFi or OOE claims that the congestion

surcharge is a demurrage and detention charge. MSC claims that “the

22

7 F.M.C.2d

22
surcharge herein at issue is not either demurrage or detention charge” 

and “[a]ccordingly, Part 545 is inapplicable.” MSC Response at 22. 

Demurrage and detention charges are generally assessed after 

the expiration of free time, which allows shippers and/or consignees 

to use terminal space or shipping containers free of charge for certain 

limited length of time. The amount of demurrage and detention 

charges, including “per diem,” generally depends on the length of the 

use of space or containers after the free time. It does not appear, 

however, that the assessment of the congestion surcharge depended 

on the expiration of any free time. Nor does it appear that the amount 

of the congestion surcharge depended on any period of use. The 

congestion surcharge appears to be assessed equally to all customers 

regardless of free time and length of use of land or containers. Rather 

than specific use of land or containers, it appears that the congestion 

surcharge was assessed for each container with respect to the overall 

flow of transportation. The Commission believes the congestion 

surcharge was not a demurrage and detention charge, and thus not 

subject to the interpretive rule at 46 C.F.R. § 545.5. As the 

interpretive rule at 46 C.F.R. § 545.5 is not applicable to the 

congestion surcharge, the surcharge does not constitute a violation of 

that rule. 

3. Whether the congestion surcharge is a violation of 46 U.S.C.

§ 41102(c)

The Commission now turns to the remaining issue of whether 

the congestion surcharge is a violation of the Shipping Act at 46 

U.S.C. § 41102(c). Section 41102(c) states as follows: 

(c) Practices in Handling Property.—

A common carrier, marine terminal operator, or ocean

transportation intermediary may not fail to establish,

observe, and enforce just and reasonable regulations

and practices relating to or connected with receiving,

handling, storing, or delivering property.

46 U.S.C. § 41102(c). 

OOE stated that the provision “applies to unreasonable 

charges or fees that common carriers, such as MSC, may levy against 

their customers.” OOE Reply at 4. OOE alleged that “[a] lack of 

information regarding what circumstances may either trigger or 

extinguish such a charge is unreasonable and contrary to 46 U.S.C. § 

41102(c)” and “[a]n absence of detail into the justification and the 

timeframe as to when a charge will be levied by a common carrier 

23

7 F.M.C.2d

23
similarly frustrates a party’s ability to contest the charge, engage in 

any substantive decision-making regarding how to avoid it, or to 

compare rates between one carrier and another.” Id. OOE averred 

that “[t]he Commission has held that a charge is unreasonable if it is 

not reasonably related, either to an actual service performed for, or a 

benefit conferred upon, the person being charged.” Id. at 5. OOE also 

alleged that pursuant to the Commission’s regulation, “tariff terms 

must be clear and definite” and “[a] common carrier leaving the 

shipping public to guess as to when and how a surcharge will apply 

renders that charge neither clear nor definite.” Id. at 5 (footnotes 

omitted). 

OOE claimed that “notwithstanding the resolution of the 

refund to SOFi, the issue of MSC’s congestion surcharge remains 

ongoing as further demonstrated by the update to its tariff effective 

February 21, 2023, regarding such charges in the inbound U.S. 

trades.” Id. at 3 (footnote omitted). OOE provided its analysis 

“[g]iven the possibility that the surcharge may have been levied upon 

more of MSC’s customers in addition to SOFi since the enactment 

of the Ocean Shipping Reform Act of 2022 (OSRA 2022).” Id. OOE 

averred that considering MSC’s insistence on actively maintaining in 

its tariff the congestion surcharge that is at the heart of this 

proceeding, “the Commission is presented with an opportunity . . . to 

make a determination as to the reasonableness of MSC’s congestion 

surcharge and whether it may constitute a violation of 46 U.S.C. §§ 

41102(c) and 41104(a)(14).” Id. at 7. OOE further stated that “[s]uch 

an undertaking would arguably be to the benefit of all members of 

the Shipping public who may have been billed by MSC for this 

ambiguous surcharge subsequent to the enactment of OSRA 2022.” 

Id.

MSC claims that “[w]hile the Commission has determined 

that demurrage and detention relate to ‘receiving, handling, storing 

or delivering property[,]’ . . . the charge at issue in this case is not 

demurrage nor detention.” MSC Response at 19-20 (emphasis in the 

original). It also claimed that “the congestion surcharge herein does 

not relate to receiving, handling, storing or delivering property – it 

relates to the transportation of the property,” and “[t]he congestion 

surcharge at issue relates to the water transportation of the cargo, and 

hence falls outside the scope of Section 41102(c).” Id. at 20. MSC 

alleged that “the Commission lacks the legal authority to challenge 

the amount of the charge,” and “MSC is under no legal obligation to 

justify the congestion surcharge any more that [sic] it is required to 

justify other surcharges, such as fuel surcharges, bill of lading 

surcharges, hazardous goods charges, overweight cargo surcharges, 

or other charges.” Id. at 20-21. MSC further alleged that “[a] tariff 

24

7 F.M.C.2d

2
rule imposing a congestion surcharge might potentially be subject of 

a legal challenge on the basis of clarity if the application of the charge 

turned on criteria specified in the tariff rule and those criteria were 

not clear,” but “there is no requirement that tariff rules contain such 

criteria.” Id. at 21. MSC further claimed that “there is no issue of 

clarity here – the charge applies on all cargo subject to the tariff in 

question, and there is nothing ambiguous or unclear in the application 

of the charge.” Id. MSC also claimed that “if the charge had been 

styled as a peak season surcharge or general rate increase, it is highly 

unlikely that this proceeding would have been initiated,” and “[b]y 

focusing on the name of the charge, rather than the clarity and 

application of the charge, the Commission is missing the point and 

elevating form above substance.” Id. 

The Commission need not address these arguments in this 

case. In charge complaint proceedings, the Commission determines 

whether there is a violation with respect to specific charges assessed 

or paid, rather than with respect to a common carrier’s entire practice.

See 46 U.S.C. § 41310(b) (upon receipt of a charge complaint with 

respect to a charge assessed by a common carrier, the Commission 

shall promptly investigate the charge with regard to compliance with 

section 41104(a) and section 41102), 46 U.S.C. § 41310(c) (if the 

Commission determines that a charge does not comply with section 

41104(a) or 41102, the Commission shall promptly order the refund 

of charges paid), and 46 U.S.C. § 41310(d) (in the event of a finding 

that a charge does not comply with section 41104(a) or 41102, a civil 

penalty under section 41107 shall be applied to the common carrier 

making such charge). Here, the Commission finds that the record is 

insufficient to establish that a violation of section 41102(c) occurred 

in this charge complaint proceeding. 

III. CONCLUSION

It is hereby ORDERED that:

(1) MSC’s Petition to Dismiss is DENIED;

(2) MSC’s Motion for Confidential Treatment for Portions of its

Response is GRANTED, and the requested portions of MSC’s

Response are CONFIDENTIAL;

(3) MSC’s Petition for Leave to File Sur-Reply is DENIED;

(4) SOFi’s Charge Complaint against MSC is DISMISSED; and

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7 F.M.C.2d

2
(5) The Charge Complaint and Order to Show Cause proceeding

against MSC is DISCONTINUED.

By the Commission. 

Amy Strauss 

Acting Secretary 

7 F.M.C.2d

26
Commissioner Louis E. SOLA, concurring: 

Although I concur with this ruling, it is imperative to consider 

the multifaceted concerns regarding auxiliary charges across various 

industries. The growing frequency of auxiliary charges is an issue we 

must be prepared to address and set forth frameworks to ensure these 

fees serve the best interests of the shipping industry. 

Commissioner Max M. VEKICH, concurring in part and dissenting 

in part: 

I concur with the Majority’s opinion with respect to parts A, 

B, C, D, E and F.1 and F.2. I disagree with the Majority’s holding in 

F.3 and therefore dissent from the holding of the Majority.

On February 3, 2023, the Commission’s Order to Show 

Cause directed MSC to show cause why the Commission should not 

impose a civil penalty, under §§ 41310(d) and 41107 upon such 

finding of noncompliance with § 41102 and § 41104(a)(14); and 

provided that, in such event, MSC shall have the opportunity for a 

hearing prior to assessment of a civil penalty, as provided under § 

41109(a). Order to Show Cause at 4. 

I disagree with the Majority that the record is insufficient to 

establish a violation of § 41102 (c). I would find MSC’s congestion 

surcharge is in violation of 46 C.F.R. 520.7 (a)(1) since it is neither 

clear nor definite. In as much as the charge does not meet the 

requirements of part 520.7, it is a violation of § 41104 (14). 

Accordingly, I would find a violation of § 41102(c) since I believe it 

is an unreasonable practice to assess a charge pursuant to a tariff 

which does not satisfy tariff requirements and is therefore in 

violation of the Commission’s rules. 

The salient issue in this case is whether the tariff rule 

implemented and assessed by MSC was clear and definite. The 

record supports a finding that it is not. The Majority’s focus on 

whether the record contained sufficient evidence of congestion in the 

port of unloading, or elsewhere, is misplaced. No matter the answer, 

under the tariff rule, the charge would still apply. I don’t believe a 

tariff rule that allows implementation of a congestion charge without 

sufficiently identifying the degree of congestion warranting the 

charge is clear and definite, or, for that matter, reasonable. On its 

face, MSC’s tariff rule requires assessment of the charge even for 

voyages that did not incur congestion and does not include any 

27

7 F.M.C.2d
indication of when the congestion charge would cease to be 

assessed.1 If the charge is assessed in the absence of congestion, then 

I believe that that is an unreasonable practice. Further, there is no 

additional service provided to justify the charge; quite the opposite, 

the charge is assessed when the cargo cannot be delivered as 

scheduled. Under the facts as presented, I believe MSC committed 

a violation when it assessed its congestion charge pursuant to a tariff 

rule that was not clear and definite. Therefore, and consistent with 

the Order to Show Cause, I would initiate a separate penalty 

proceeding to be referred to the Commission’s Administrative Law 

Judge for consideration of penalties. 

I further disagree with the Majority that a charge complaint 

proceeding under § 41310(b) cannot determine whether there is a 

violation of “a common carrier’s entire practice.” Majority opinion 

at 12. The Majority cites to the language of 46 U.S.C. § 41310(b), 

which specifically contemplates the finding of a violation under § 

41102. § 41102(c) is the prohibition against unreasonable or unjust 

common carrier practices. It is illogical that the Commission 

couldn’t review a common carrier’s ‘entire practice’ when § 

41310(b) specifically contemplates investigating compliance with § 

41102 (c). 

1 Although not controlling, I am mindful that MSC assessed the additional $1000 

charge at a time when freight rates had been driven to historic and astronomical 

levels. MSC was not losing money and needing to recoup losses. 

28

7 F.M.C.2d
 

 

29

FEDERAL MARITIME COMMISSION 

Office of Administrative Law Judges 

INTERNATIONAL LONGSHOREMAN’S ASSOCIATION, 

Complainant 

DOCKET NO. 22-12 

v. 

GATEWAY TERMINALS, LLC; CHARLESTON STEVEDORING

CO., LLC; PORTS AMERICA FLORIDA, INC.; CERES MARINE

TERMINALS, INC.; AND SSA ATLANTIC, LLC, Respondents. 

Served: September 29, 2023 

ORDER OF: Linda S. Harris CROVELLA, Administrative Law Judge. 

INITIAL DECISION1 

I. INTRODUCTION

A. Overview

This proceeding began on April 12, 2022, when the Federal Maritime Commission 

(“Commission” or “FMC”) issued a notice of filing of complaint and assignment, indicating that 

Complainant International Longshoremen’s Association (“ILA”) had filed a complaint against 

Respondents Gateway Terminals, LLC (“Gateway”), Charleston Stevedoring Company, LLC 

(“CSC”), Ports America Florida, Inc. (“PAF”), Ceres Marine Terminals, Inc. (“Ceres”), and SSA 

Atlantic, LLC (“SSA”). 

An amended complaint, filed on June 3, 2022, alleges that Respondents are preventing 

“true negotiation over the rates and fees for stevedoring and marine terminal operation services” 

at the Ports of Charleston and Savannah, in violation of the Shipping Act, by operating a joint 

venture under an agreement that violates § 41102(b); are imposing “undue or unreasonable 

prejudice or disadvantage” by eliminating competition in violation of § 41106(2); and are 

refusing to deal or negotiate “with any person,” including with the ILA and its affiliated local 

unions, in violation of § 41106(3). Amended Complaint at 15-20. Respondents filed an answer 

denying the allegations and alleging affirmative defenses, including that the Amended Complaint 

fails to state a cause of action, the ILA has not suffered any damages for which the FMC can 

grant relief, the claims are barred in whole or in part by the doctrine of sovereign immunity, and 

the FMC “lacks subject matter jurisdiction over the claims.” Answer at 12-13. 

1

 This initial decision will become the decision of the Commission in the absence of review by 

the Commission. Any party may file exceptions to this decision within twenty-two days of the 

date of service. 46 C.F.R. § 502.227. 

7 F.M.C.2d
On January 23, 2023, Respondents moved to bifurcate this proceeding into a 

jurisdictional adjudication, followed by a proceeding on the merits if jurisdiction is established 

over at least one Respondent. Motion to Bifurcate at 1-3. This motion was granted on March 9, 

2023 (“Bifurcation Order”), and it was directed that discovery be limited to jurisdictional 

inquiries only, followed by an initial decision as to whether there is jurisdiction to adjudicate the 

Amended Complaint. Bifurcation Order at 4. The Order explained that here, “convenience, along 

with expediting and economizing, are equally well served by requiring the parties to engage in 

limited discovery followed by briefing on the issue of jurisdiction before proceeding to the more 

expansive discovery likely to occur regarding the merits.” Bifurcation Order at 4. Therefore, the 

present decision will solely address whether Respondents are marine terminal operators subject 

to the Commission’s jurisdiction. Because the Commission examines an entity’s MTO status 

based on the specific facility at issue in the dispute, jurisdiction here will be assessed based on 

whether any of Respondents are marine terminal operators specifically at the Port of Savannah 

and/or at the Port of Charleston. 

As discussed more fully below, the evidence does not support a finding that any of 

Respondents are marine terminal operators at either of the relevant ports. None of Respondents 

have been shown to be engaged in “the business of providing wharfage, dock, warehouse, or 

other terminal facilities in connection with a common carrier” at the Port of Savannah or at the 

Port of Charleston. Respondents’ activities at these ports also do not support MTO status based 

on Commission case law, including Louis Dreyfus Corp. v. Plaquemines Port Harbor & 

Terminal Dist., Docket No. 79-45, 25 F.M.C. 59 (FMC July 30, 1982). While certain of 

Respondents may offer essential services at the relevant ports – consisting of container vessel 

stevedoring and gate services – Respondents have not been shown to control access to private 

facilities at the relevant ports to enforce their charges. Moreover, the overall level of control 

exhibited by Respondents at the relevant ports is not sufficient to constitute a “furnishing” of 

terminal facilities there, so as to confer jurisdiction over Respondents. Finally, there is no 

precedence for service providers being deemed to be marine terminal operators solely on the 

basis of their being awarded an exclusive services contract by the port authority/marine terminal 

operator decision-maker. Accordingly, the ILA has not met its burden of establishing that any of 

Respondents are marine terminal operators at the Port of Savannah or at the Port of Charleston. 

Because jurisdiction has not been established over Respondents, this case will not proceed to an 

adjudication on the merits. 

B. Procedural History

On April 12, 2022, the Commission issued a notice of filing of complaint and 

assignment, initiating this proceeding. On May 9, 2022, Respondents filed a motion to dismiss 

ILA’s complaint. ILA moved for leave to file an amended complaint on June 3, 2022. This 

motion was granted on June 23, 2022, and Respondents’ motion to dismiss was denied as moot. 

On July 8, 2022, Respondents filed a motion to dismiss Counts 2, 3, and 4 of ILA’s 

Amended Complaint and to strike ILA’s prayer for reparations. On July 29, 2022, ILA filed an 

opposition to Respondents’ motion to dismiss and on August 12, 2022, Respondents filed a reply 

to ILA’s opposition. 

7 F.M.C.2d

30
On August 18, 2022, an order was issued requesting briefing on the issue of whether or 

not this proceeding or the requested relief implicate state sovereign immunity. Both ILA and 

Respondents filed the requested briefing on September 15, 2022. On September 22, 2022, an 

amicus curiae brief was submitted by Georgia Port Authority (GPA). ILA filed a response to 

Respondents’ state sovereign immunity briefing on September 27, 2022, and Respondents filed a 

response on September 29, 2022. On September 26, 2022, this proceeding was reassigned to the 

undersigned. 

On November 7, 2022, an order was issued denying Respondents’ partial motion to 

dismiss, including their request to strike ILA’s request for award of reparations (“Order on 

Partial MTD”). The Order also accepted GPA’s amicus brief and directed Respondents to file an 

answer to the amended complaint by November 18, 2022. Order on Partial MTD at 2, 7. 

On January 23, 2023, Respondents filed a motion to bifurcate the proceeding “into two 

separate litigations: the first proceeding solely on jurisdictional issues, and the second on the 

merits of the ILA’s claims.” Motion to Bifurcate at 2. A March 9, 2023, Order (“Bifurcation 

Order”) granted Respondents motion “to bifurcate the issue of jurisdiction from the merits of the 

case,” which allowed ILA discovery “limited to how the subject terminals operate at the two 

ports in question.” Bifurcation Order at 4-5. The Order also stated: “even if only one of the 

named Respondents is demonstrated by the jurisdictional discovery to be an MTO, the case will 

proceed to discovery on the merits and the parties will be given an opportunity to submit briefs 

limited to the Shipping Act violations alleged to have occurred.” Bifurcation Order at 4. 

On March 17, 2023, an order on motion to amend schedule was issued. On May 10, 

2023, an order on second motion to amend schedule was issued. A notice of extension of time 

was issued on March 29, 2023, extending the deadline for issuance of an Initial Decision from 

April 12, 2023, to December 12, 2023. 

On May 15, 2023, ILA filed its jurisdictional brief, proposed findings of fact, and 

appendix (exhibits labeled as “CX”). On June 5, 2023, Respondents filed their opposition brief, 

proposed findings of fact, and appendix (exhibits labeled as “Resp. Appx.,” referred to herein as 

“RX”). Respondents then moved for leave to supplement the record on June 13, 2023. A June 20, 

2023, Order granted this motion, accepting a declaration provided by Mr. Joel Britt, Vice 

President of Terminal Operations for South Carolina State Ports Authority (“SCPA” or 

“SCSPA”), and extended ILA’s time allowed to file its response brief by one week. On June 27, 

2023, ILA filed its reply brief and supplemental appendix. 

C. Arguments of the Parties

ILA argues that the Federal Maritime Commission has jurisdiction over Respondents 

insofar as they are, or at a relevant time were, marine terminal operators within the ports of 

Charleston and Savannah; they so qualify because Respondents control access to the port 

terminals and operate terminal facilities in Charleston and Savannah; and efforts to obtain 

evidence of day-to-day operations were hindered because Respondents have refused to provide 

necessary discovery. Brief at 1, 3-27; Reply at 1, 3-22. 

31

7 F.M.C.2d
Respondents assert that ILA has failed to carry its burden of proving by a preponderance 

of the evidence that any of the five Respondents is a marine terminal operator in either the Port 

of Charleston or the Port of Savannah; therefore, the Amended Complaint should be dismissed 

for lack of jurisdiction over each and every Respondent; and Respondents have complied with 

their jurisdictional discovery obligations. Opposition at 1, 13-27, 38. 

D. Evidence

Under the Administrative Procedure Act, an administrative law judge may not issue an 

order “except on consideration of the whole record or those parts thereof cited by a party and 

supported by and in accordance with the reliable, probative, and substantial evidence.” 5 U.S.C. 

§ 556(d); see also Steadman v. SEC, 450 U.S. 91, 98-102 (1981). This initial decision is based on

the pleadings, exhibits, briefs, proposed findings of fact and conclusions of law, and replies

thereto filed by the parties.

This initial decision addresses only material issues of fact and law. Proposed findings of 

fact not included in this decision were rejected, either because they were not supported by the 

evidence or because they were not dispositive or material to the determination of the allegations 

in the complaint or the defenses thereto. Administrative adjudicators are “not required to make 

subordinate findings on every collateral contention advanced, but only upon those issues of fact, 

law, or discretion which are ‘material.’” Minneapolis & St. Louis R.R. Co. v. United States, 361 

U.S. 173, 193-94 (1959). To the extent individual findings of fact may be deemed conclusions of 

law, they shall also be considered conclusions of law. Similarly, to the extent individual 

conclusions of law may be deemed findings of fact, they shall also be considered findings of fact. 

Specific findings of fact are set forth in part two, prior to the analysis and conclusions of 

law in part three, and the order in part four. 

II. FINDINGS OF FACT (“FOF”)

A. Entities

1. The International Longshoremen’s Association (“ILA”) is a labor organization

representing longshore workers, clerks and checkers, maintenance and repair workers,

and other workers employed in related crafts along the East and Gulf Coasts of the

United States, including the Ports of Savannah, Georgia, and Charleston, South Carolina.

Amended Complaint at ¶ 1; Answer at ¶ 1.

2. The ILA represents employees of Respondents Gateway, CSC, Ceres, and SSA at the

Port of Savanna and the Port of Charleston. Amended Complaint at ¶ 7; Answer at ¶ 7.

3. Gateway is a Georgia limited liability company with its principal place of business in

Garden City, Georgia. Amended Complaint at ¶ 2; Answer at ¶ 2. It is now a joint

venture, owned by Southeast Stevedoring Holdings, LLC (“SSH”), which in turn is

owned by Ceres, SSA, and Marine Terminals Corporation - East (“MTCE”). Answer at

¶ 2; RX 365 (Grimes Decl., Gateway VP of Finance).

32

7 F.M.C.2d
4. At present, Gateway is the exclusive provider of container vessel stevedoring and gate

services in the Port of Savannah, based on a license agreement with the Georgia Ports

Authority (“Gateway-GPA Agreement”). CX 587; CX 586-624 (whole agreement).

5. Ceres, SSA, and MTCE combined their respective stevedoring businesses at the Port of

Savannah in 2021, into the pre-existing Gateway entity in order to create the current

Gateway joint venture. CX 11; CX 390 (Second Amended Gateway Operating

Agreement); CX 440 (Ceres & Gateway 2021 Services Agreement); CX 478 (SSA &

Gateway 2021 Services Agreement); CX 537 (MTCE & Gateway 2021 Services

Agreement); RX 380.

6. As described in the Gateway-GPA Agreement, GPA “decided to consolidate the

provision of container vessel stevedoring and gate services by a single entity in the belief

that consolidation would yield positive benefits for the State of Georgia and Terminal

users including . . . improvements related to safety, quality and efficiency of vessel

stevedoring and gate services.” CX 586.

7. Prior to reforming in 2021, Gateway provided gate services at Garden City Terminal and

Ocean Terminal, but it did not offer stevedoring services at the Port of Savannah.

CX 390; CX 459; RX 129.

8. Gateway’s 2014 Operating Agreement with GPA states that GPA owns the Gate

Interchange Facilities at the Port of Savannah and that Gateway had been organized to

manage equipment interchange service at those facilities. CX 249.

9. CSC is a Delaware limited liability company with its principal place of business in

Charleston, South Carolina. Amended Complaint at ¶ 3; Answer at ¶ 3.

10. CSC was formed as a joint venture in 2020 and is also owned by SSH, therefore it is

ultimately owned by Ceres, SSA, and MTCE. CX 204; CX 206.

11. Ceres, SSA, and MTCE combined their pre-existing assets in the Port of Charleston as of

May 4, 2020, in order to create the current CSC joint venture. See, e.g., CX 225

(Transition Services Agreement between CSC and MTCE); RX 379-380.

12. At present, CSC is the exclusive provider of container vessel stevedoring at the Port of

Charleston based on a License Agreement and Master Port Facility License Agreement

with the South Carolina State Ports Authority. CX 212-223 (2020 CSC-SCPA License

Agreement); CX 180-203 (2020 CSC-SCPA Master Port Facility License Agreement).

13. As described in the CSC-SCPA License Agreement, SCPA “has determined that it would

be more efficient for the JV to provide Stevedore Services at the Port rather than having

to transact with three stevedoring entities” and the SCPA desires for the JV to “provide

adequate, competitive, consistent, efficient, optimized, and safe Stevedore Services at the

Terminal in an effort to keep the Port competitive in the United States port market.”

CX 212.

7 F.M.C.2d

33
14. Per the CSC-SCPA License Agreement, CSC is also authorized to “participate, as today,

in the Charleston Gate Company (“CGC”)” such that “CGC will bill the JV for its

services” and “the JV shall negotiate tariff rates for Stevedore Services and CGC fees for

gate services directly with the container lines.” CX 221, Schedule A.

15. As of 2019, the Charleston Gate Company was the gate operator in the Port of Charleston

and SSA, Ceres, and Container Maintenance Corporation (“CMC”) each owned one-third

of the company. CX 170; CX 173; see also RX 274 (Charleston Gate Amended

Operating Agreement, signed October 1, 2015).

16. The 2011 Charleston Gate Operating Agreement indicates that Charleston Gate was

formed for the purpose of hiring and managing labor to perform, at the Port of

Charleston, “certain functions known as ‘TIR Functions,’ which primarily involve

checking containers into and out of the Port and assigning temporary storage locations for

each container.” CX 1038.

17. Ceres Marine Terminals, Inc. (“Ceres”) is a Maryland corporation with its principal place

of business in Nashville, Tennessee. Answer at ¶ 6.

18. SSA Atlantic, LLC (“SSA”) is a Delaware limited liability company with its principal

place of business in Seattle, Washington. SSA also has a place of business located in

Savannah, GA. Amended Complaint at ¶ 5; Answer at ¶ 5.

19. Ports America Florida, Inc. is a Florida corporation with its principal place of business in

Tampa, Florida. Amended Complaint at ¶ 4; Answer at ¶ 4.

20. Prior to Gateway and CSC becoming the exclusive providers of container vessel

stevedoring services at the Ports of Savannah and Charleston, Ceres and SSA provided

container stevedoring services independently at both ports. RX 379 (Mygatt Decl., Ceres

CEO); RX 387-388 (Lokey Decl., SSA Regional VP).

21. Ceres continues to provide stevedoring for cruise ships at the Port of Charleston. RX 383;

CX 1129.

22. SSA continues to provide stevedoring for military and non-containerized cargo at the Port

of Charleston. RX 387; Opposition at 16.

B. Port of Savannah Operations

23. On October 29, 2021, Gateway and the Georgia Ports Authority entered into the

Gateway-GPA Agreement making Gateway the exclusive provider of stevedoring and

gate services in the Port of Savannah, including Garden City Terminal and Ocean

Terminal. CX 586-587. This agreement was to take effect on January 1, 2022, and remain

in effect through December 31, 2031, by default. CX 587-588.

24. The Gateway-GPA Agreement states:

34

7 F.M.C.2d
GPA owns and operates deep-water marine terminal facilities known as 

Garden City Terminal (“GCT”) located in Garden City, Georgia and 

Ocean Terminal (“OT”) located in Savannah, Georgia. GCT and OT are 

collectively referred to as the “Terminal” . . . . [Per Georgia law] GPA is 

granted certain powers to (i) develop and improve seaports of the State of 

Georgia for the handling of waterborne commerce, domestic or foreign, 

(ii) investigate and handle matters pertaining to transportation rates and

rate structures affecting freight and commerce through such ports, and (iii)

to do any other things necessary or proper to foster and encourage the

commerce of the State of Georgia; . . . in the exercise of its powers and

regulatory authority described above, GPA is constantly seeking to

improve Terminal operations and deliver services to Terminal users more

efficiently and effectively; . . . in furtherance of the foregoing, GPA has

decided to consolidate the provision of container vessel stevedoring and

gate services by a single entity in the belief that the consolidation will

yield positive benefits for the State of Georgia and Terminal users

including . . . improvements related to safety, quality and efficiency of

vessel stevedoring and gate services. . . . GPA and Gateway agree to

cooperate in the provision of services in order to achieve certain goals as a

result of the consolidation, including . . . cost savings and greater

productivity.

CX 586. 

25. Section 1 of the Gateway-GPA Agreement states:

GPA designates Gateway as the exclusive provider of container vessel 

stevedoring and gate services at the Terminal, subject to the terms and 

conditions herein. As a result of designating a single provider of container 

vessel stevedoring and gate services (collectively, the “Services”), GPA 

intends to improve the level of service provided to Terminal users related 

to safety and efficiency. Gateway acknowledges and agrees that GPA 

shall continue to be the marine terminal operator for the Terminal 

responsible for the operation of all cranes and container handling 

equipment such as top lifts, and all container yards and intermodal 

container transfer facilities. GPA and Gateway shall coordinate as 

necessary to achieve the objectives of this agreement with respect to the 

services to be performed by each party. For the avoidance of doubt, the 

Parties acknowledge and agree that the exclusive right granted to Gateway 

herein to provide stevedoring services shall apply solely to container 

vessels and shall exclude stevedoring services for non-container vessels. 

GPA shall have the right to grant permission to any other third party to 

provide services for non-container vessels. 

CX 587 (emphasis added). 

35

7 F.M.C.2d
26. Section 3 of the Gateway-GPA Agreement provides: “As a specific condition of this

Agreement, GPA and Gateway agree to adopt and incorporate by reference herein

all rates, rules and regulations not specifically covered in this Agreement, as set

forth in GPA’s Marine Terminal Operator Schedule No. 5-A . . . together with all

changes and revisions thereto issued in the future (the “MTO Schedule”). Gateway

acknowledges the inclusion of such rates, rules and regulations in this Agreement and

agrees to be bound by, and comply in all materials respects with, the requirements set

forth in the applicable provisions of the MTO Schedule.” CX 588 (emphasis added).

27. The Gateway-GPA Agreement further states: “this Agreement and the relationship

created hereby shall not be considered to be a partnership, joint venture, or

employee/employer relationship . . . . The relationship between Gateway and GPA

shall be that of a third-party service provider and marine terminal operator.” CX

589 (emphasis added).

28. Section 8(a) of the Gateway-GPA Agreement provides:

GPA and Gateway have agreed upon certain key performance indicators 

(“KPIs”) related to safety, vessel operations (planning and execution) and 

gate operations, as set forth in Exhibits B, C, and D, that will be used by 

the Parties to measure and evaluate Gateway’s safety record and 

performance of the Services. . . . In the event Gateway fails to achieve one 

or more of the Performance Targets, or Gateway’s performance of the 

Services fails to meet GPA’s goals for safety, productivity and/or 

efficiency based on the KPIs, GPA shall have the right to terminate this 

Agreement . . . . 

CX 589. 

29. The Gateway-GPA Agreement describes a new GPA department, the Marine

Department, formed “for the purpose of coordinating vessel stevedoring work with

Gateway management and GPA personnel from other departments including . . . Yard,

Intermodal, Cranes, Ship Operations and Port Police. The Marine Department will work

closely with Gateway to (i) review planning and execution of vessel stevedoring

operations, (ii) analyze KPIs and Performance Targets, (iii) communicate concerns

among GPA, Gateway and ocean carriers, (iv) ensure safety requirements are being

followed, and (v) investigate opportunities to improve all aspects of vessel and Terminal

Services.” CX 590.

30. Section 9 of the Gateway-GPA Agreement requires Gateway “to adopt and utilize any

and all information technology systems developed by, or on behalf of, GPA related to the

Services” and requires Gateway “to utilize GPA’s terminal operating system (“TOS”) in

the performance of the Services . . . .” CX 590.

31. Exhibit B ¶ 5(a) of the Gateway-GPA Agreement states: “GPA is a marine terminal

operator with deep water facilities handling international cargo . . . . The Terminal

contains ‘Restricted Areas’ . . . and access control requirements are enforced by GPA.

36

7 F.M.C.2d
The Terminal property is a ‘Restricted Area’ requiring all entry to comply with GPA’s 

Facility Security Plan” and “Gateway agrees” to “comply with GPA’s Facility Security 

Plan, to the extent the Facility Security Plan, or any part thereof, is made known to 

Gateway.” CX 609-610. Paragraph 5(c) states “In addition to the terminal security 

surcharge described in the MTO Schedule, GPA reserves the right to recover security 

expenses by way of assessment, if any, applied to all users of GPA’s Terminal facilities.” 

CX 610. Paragraph 5(d) states “Gateway agrees to immediately notify GPA’s Port Police 

Department of any breach of security and/or transportation security incident.” CX 610. 

32. The Gateway-GPA Agreement specifies:

All rates applicable to the Services are set forth in Exhibit A . . . . Gateway 

agrees to comply with all safety rules and requirements related to the 

Services, as set forth in Exhibit B . . . . Gateway agrees to perform vessel 

Services in accordance with the terms and conditions set forth in Exhibit 

C, and gate Services in accordance with the terms and conditions set forth 

in Exhibit D . . . . 

CX 589. 

33. Pursuant to Exhibit A of the Gateway-GPA Agreement, Gateway is authorized to

“invoice ocean carriers for vessel stevedoring services based on rates negotiated and

agreed upon between Gateway and the applicable ocean carrier” and to “invoice ocean

carriers for gate services based on rates negotiated and agreed upon between Gateway

and the applicable ocean carrier.” Further, “Gateway agrees the rates, terms and

conditions offered to ocean carriers for the Services shall be competitive with those

offered to ocean carriers at the Terminal immediately prior to the Effective Date of this

Agreement.” CX 606, Ex. A ¶¶ 1-2, 4.

34. The Gateway-GPA Agreement also makes explicit that “GPA’s regulatory role shall

include reviewing whether Terminal users are being offered commercially reasonable

rates for purposes of GPA and its Terminals for comparable services to those offered to

ocean carriers at GPA’s Terminals immediately prior to Effective Date of this

Agreement.” CX 606, Ex. A ¶ 4. To effect this “Gateway shall direct each of its members

to provide GPA with their rate schedule(s) for the two (2) years prior to the Effective

Date, applicable to vessel and gate services, so that GPA may compare previous rates to

the new rates . . . proposed by Gateway as of the Effective Date of this Agreement.”

CX 606, Ex. A ¶ 4. The agreement further provides:

In the event GPA concludes Gateway is not offering commercially 

reasonable rates for services provided at the Terminal on the Effective 

Date, Gateway agrees it will amend its rates as necessary to satisfy GPA’s 

regulatory concerns. Gateway’s failure to amend its rates as directed by 

GPA pursuant to the immediately preceding sentence, shall be deemed a 

material breach of this Agreement. 

CX 606, Ex. A ¶ 4. 

37

7 F.M.C.2d
35. In addition, the contract provides:

Being the exclusive provider of vessel stevedoring services on the 

Terminals, Gateway agrees to provide to GPA, on a quarterly basis its 

unaudited financial statements and on an annual basis, its audited financial 

statements . . . specific to its operations on the Terminals, and a schedule 

of rates for the Services provided at the Terminals. On an annual basis, 

Gateway shall provide GPA with its contracts with the ocean carriers that 

are applicable to GPA. 

CX 606-607, Ex. A ¶ 6. 

36. Gateway agrees “to apply an annual rate increase for the Services to be effective each

October 1st” and to be calculated as provided in Exhibit A. Any “further rate increase . . .

shall require the express written consent of GPA.” For example, Gateway may “request

to adjust its rates to recover costs incurred through unforeseen circumstances, such as a

pandemic,” provided that once the circumstances have passed, the adjusted rates must

return to the rates in effect at the outset of the circumstances necessitating the adjustment.

CX 606-607, Ex. A ¶ 6.

37. Exhibit C of the Gateway-GPA Agreement states that:

GPA shall designate a certain amount of space near each berth for the 

purpose of storing equipment used by Gateway to provide vessel Services 

. . . . The size and location of the Storage Area shall be determined by 

GPA, after having received comments from Gateway regarding the 

location, size and condition of the proposed area. Except for the 

equipment being stored in the Storage Area, Gateway shall remove all 

other equipment, tools and personal property from the Terminal daily. . . . 

Gateway shall remove all containers and breakbulk cargo from the dock 

facilities at the Terminal prior to the earlier of the arrival of a new vessel 

at berth, or the end of the day. If Gateway is unable to remove breakbulk 

cargo from the dock as a result of any cause, condition or event which is 

beyond the reasonable control of Gateway, then Gateway shall promptly 

notify GPA of the reason therefor, and following receipt of such notice, 

GPA shall work with Gateway to remove the breakbulk cargo from the 

dock as soon as practicable. 

CX 615, Ex. C ¶ 3(a)-(b). 

38. Exhibit D of the Gateway-GPA Agreement states that:

GPA owners certain real and personal properties, including . . . work 

booths, printers, computers, operating systems and other equipment at 

each gate located on Terminal. GPA grants permission to Gateway to 

utilize such facilities in the provision of gate services by recording (i) all 

transfers of equipment, meaning containers and chassis, entering or 

38

7 F.M.C.2d
leaving the Terminal by rail or motor carrier, and (ii) the condition of the 

equipment during each interchange.” 

CX 623, Ex. D ¶ 3; see also CX 459-460 (Gateway’s 2014 Operating Agreement stating 

that GPA owns Gate Interchange Facilities at Garden City Terminal and Ocean Terminal 

and that Gateway would utilize those facilities to “produce all Equipment Interchange 

Receipt and Trailer Interchange Receipt records,” where “the EIR is a receipt issued by 

Gateway acknowledging the transfer of equipment into or out of the terminal by rail or 

truck.”). 

39. Per Exhibit D of the Gateway-GPA Agreement, the GPA sets access standards and gate

hours, which Gateway is contractually obligated to enforce. CX 623. GPA also “reserves

the right to change gate hours based on gate volumes or customer service expectations.”

CX 623. Gateway thus provides access to the terminals pursuant to GPA access

instructions and validates required documentation needed to enter the terminal as

determined by the GPA. CX 623-624; RX 364-367; RX 400; RX 404-405. In addition,

Gateway must provide GPA with monthly reports on its gate performance, based on the

KPIs set forth in the Gateway-GPA Agreement, and GPA may end the contract if

specified KPIs are not met. CX 624 (KPIs for gate performance); CX 589; see also CX

612-613 (KPIs for safety performance); CX 616-619 (KPIs for vessel planning).

40. At the Port of Savannah, gate operations are separate from security services. GPA Police

are responsible for terminal security and GPA controls who enters and exits their facility

through GPA’s security gates, including conducting the security Transportation Worker

Identification Credential (“TWIC”) access control biometric scan to allow access to the

GPA terminals. Reply at 9 n.14; RX 367; RX 398; RX 405-407 (McCarthy Decl., GPA

COO); see also CX 589; CX 610-611; CX 623.

41. Prior to an over-the-road (“OTR”) truck driver arriving at GPA terminals, the trucking

company’s dispatcher accesses a GPA system that interfaces with the GPA Terminal

TOS. The dispatcher creates a PIN for their OTR driver to deliver or receive containers.

Gateway, in its gate services role, makes a determination of whether the assigned PIN

matches the information in the GPA TOS. If there is an issue with the information that

needs to be corrected, the driver is sent to Driver Assistance, operated by GPA, or is

referred to the OTR driver’s dispatcher. RX 404-405; see also CX 1140 ¶ 30.

42. Thus, it is the Port Authority who determines who will be admitted to the Port of

Savannah in a security screening. Afterwards, contractually specified gate services are

provided by Gateway, including inspecting inbound and outbound containers for

compliance with regulatory requirements set by GPA, and inputting and verifying data

about the container as required by GPA, with inconsistent information or problems also

being managed by GPA. RX 364-365; RX 404-407; CX 623-624.

43. While containers are assessed a gate fee by Gateway, truckers and cargo owners are not

charged upon arrival and departure. The fee is negotiated between Gateway and the ocean

carrier and is billed to the ocean carrier on a weekly basis. CX 606 (“Gateway shall

invoice ocean carriers for gate services . . . .”) (emphasis added).

39

7 F.M.C.2d
40

44. Gateway does not, and has no authority to, turn away trucks or cargo for nonpayment.

RX 365; CX 623-624; CX 606; CX 586-622.

45. Gateway does not, and has no authority to, refuse entry to trucks or cargo on economic or

commercial grounds. RX 365; CX 623-624; CX 606; CX 586-622.

46. Prior to its Second Amended and Restated Operating Agreement in 2021, Gateway’s

principal members were SSA, “MTC, d/b/a Ports America Group” and Ceres, although

any qualified stevedoring company that was a new member of the Georgia Stevedore

Association could join its organization. CX 459; CX 461; CX 459-473; CX 399 (SSA

contributed 1/3 interest in Gateway).

C. Port of Charleston Operations

47. On April 8, 2020, the License Agreement between CSC and SCPA was signed (“CSCSCPA License Agreement”), making CSC the exclusive stevedoring company at Wando

Welch, North Charleston, and Hugh Leatherman Terminals at the Port of Charleston.

CX 212; CX 219; CX 221. This agreement took effect as of May 4, 2020, and is set to

terminate on December 31, 2029, if not extended. CX 213; RX 387.

48. The CSC-SCPA License Agreement uses as defined terms “Authority” (South Carolina

State Ports Authority), “JV” (Charleston Stevedoring Company LLC), and “Port” (Port of

Charleston). CX 212.

49. The CSC-SCPA License Agreement states that the SCPA “determined that it would be

more efficient for the JV to provide Stevedore Services at the Port rather than having to

transact with three stevedoring entities” taking into account factors including: (1) “recent

consolidations in the shipping line industry that have created discontinuity between the

three stevedoring entities and inefficiencies at the Port, (2) the larger volume of business

required for three separate stevedoring entities to optimize efficiencies . . . (3) the fact

that each of the three JV partners currently operates with the same workforce, (4) the

inefficiencies for the Authority of working with three stevedoring entities that each have

their own preferences and procedures which complicate marine terminal operations . . .

(6) the duplication of administrative and backroom costs for each of the three stevedoring

entities that further create inefficiencies at the Port, (7) the financial and logistical

challenges currently facing the three stevedoring entities currently operating at the Port,

and (8) the Authority’s desire to utilize, and ensure that there is, a long-term viable

stevedoring operation at the Port that would result in the most economical and efficient

terminal operations[.]” CX 212.

50. Section 2 of the CSC-SCPA License Agreement provides that:

Except as specifically stated herein, all arrangements, services, and 

charges between the parties and use of the Authority’s facilities and 

terminals shall be governed by the rules, regulations, rates and terms of the 

Authority’s then-current Terminal Tariff/Marine Terminal Operator 

Schedule . . . as may be amended from time-to-time [“MTOS”] . . . and the 

MTOS is incorporated by reference and made part of this Agreement. 

7 F.M.C.2d
41

Discounted MTOS rates, services/rates not listed in MTOS, and other 

terms and conditions relating to provision of Stevedore Services are 

outlined in Schedule A attached hereto . . . . 

CX 213. 

51. The CSC-SCPA License Agreement states that “JV will provide Stevedore Services

Directly to ocean carriers pursuant to contracts between JV and such ocean carriers” and

that “JV shall be the sole provider of the Stevedore Services on the Terminal. . . . The

terms and conditions set forth in Schedule A shall apply to such Stevedore Services.”

CX 214.

52. Section 6 of the CSC-SCPA License Agreement requires that CSC “shall fully comply

with . . . all rules and regulations of the Authority, including those in the Authority’s

MTOS . . . .” CX 214.

53. The CSC-SCPA License Agreement states that the “parties shall not in any way or for

any purpose be deemed to be or become partners, joint ventures, or agents with respect to

each other by virtue of this Agreement” and that “[a]ny purported assignment of any

rights or delegation of performance under this Agreement without the written consent of

the Authority is null and void.” CX 215; see also CX 214 (“The parties acknowledge and

agree that neither party is an agent or representative of the other, and all employees or

laborers employed by either party shall be employees of such party at all times and not of

such other party.”).

54. Section 18 of the CSC-SCPA License Agreement provides that the “rights and

obligations set forth under this Agreement are consistent with, and in furtherance of, the

Authority’s purpose and powers of authority as articulated under applicable South

Carolina laws, rules, and regulations, including . . . to improve harbors and seaports, and

create long-range port development to maximize economic benefit to the State of South

Carolina and increase water-borne commerce.” CX 217.

55. Schedule A of the CSC-SCPA License Agreement details:

JV shall have the exclusive right to perform Stevedore Services at the 

Authority and to participate, as today, in the Charleston Gate Company 

(“CGC”) under mutually agreed terms with Container Maintenance 

Company (“CMC”). CGC will bill the JV for its services, and the current 

management of the CGC shall be maintained. 

JV shall negotiate tariff rates for Stevedore Services and CGC fees for 

gate services directly with the container shipping lines. JV acknowledges 

and agrees that rates for Stevedore Services and the Stevedore Services 

provided at the Authority shall be competitive and bear a reasonable 

relationship to accepted norms for cost and profit standards for similar 

services in the South Atlantic port market and will be related to 

productivity routinely achieved on container ships at the Port and other 

relevant costs at the Authority. 

7 F.M.C.2d
42

The Authority and JV shall endeavor to consult with each other and, 

where applicable, develop guidelines and protocols for the safest, most 

efficient, and most competitive Stevedore Services in the South Atlantic 

port market . . . . 

The Authority will provide space as needed and agreed at its Terminals for 

JV equipment required for vessel operations. 

JV shall procure tractor and trailer equipment from current equipment 

providers . . . as long as cost is competitive, and quality is maintained. JV 

shall have the right to provide its own equipment if neither of these 

standards is met after due consultation with those providers. 

. . . . 

The Authority will provide access to its marine terminal operating system 

(“TOS”) on an agreed basis and subject to procedures established between 

the parties. The TOS access fee for the initial 10-year term of this 

Agreement shall be One Dollar ($1.00) per container . . . . 

JV shall evaluate if the activities of the South Carolina Stevedores 

Association relevant to container terminal operations can be incorporated 

into its structure for the purposes of economic, administrative, and 

managerial efficiency, to allow for the provision of the most cost effective 

Stevedore Services. This evaluation must be conducted within 12 months 

of the effective date of this Agreement and a copy provided to the 

Authority. 

JV shall employ highly qualified local management with experience in 

vessel operations, terminal activities, and waterfront labor relations. JV 

local management shall not report to local management in a competing 

maritime port so as to avoid any competitive conflicts. 

JV and the Authority shall meet regularly to review the quality and results 

of Stevedore Services and define areas for improvement. . . . 

The JV may request office space from the Authority but maintains no 

obligation to provide such office space in its facilities unless it is feasible 

to do so in the Authority’s sole discretion. 

Should the JV or any of its members own or operate, or agree to own or 

operate, a marine container terminal in the State of South Carolina outside 

of the Authority’s jurisdiction, the Authority shall have the right to cancel 

this Agreement unilaterally with one hundred eighty (180) days’ prior 

written notice. 

CX 221-223. 

7 F.M.C.2d
56. The CSC-SCPA Master Port Facility License Agreement (“CSC-SCPA Facility

Agreement”) was signed on June 5, 2020. CX 198. It uses as defined terms “Ports

Authority” (South Carolina State Ports Authority), “Licensee” (Charleston Stevedoring

Company LLC), and “Port” (Port of Charleston). CX 180. The CSC-SCPA Facility

Agreement term is five years by default, and the agreement “may be terminated by either

party, for any reason or no reason at all” upon 90 days written notice to the other party.

CX 182.

57. The CSC-SCPA Facility Agreement provides that “the duties of the Ports Authority

include the duty to operate, develop, and improve the Port of Charleston . . . to stimulate

commerce and foster the import, export and distribution of waterborne freight through the

Port, from and to other ports in the United States and around the world; and . . . the Port

Authority has determined that granting Licensee a license to use the Facility in order to

provide stevedoring services at the Terminal necessary and useful to facilitate the

handling and movement of cargo, to, from, and within the Terminal and Port in

generating international waterborne commerce, upon the terms and conditions set forth in

this Agreement, will enhance commerce through the Ports to the advantage of the citizens

of the State of South Caroline.” CX 180.

58. The CSC-SCPA Facility Agreement further provides:

The Port Authority hereby grants to Licensee . . . a license for the use of 

certain land and improvements located at the Terminal [shown on] 

Schedule A [the “Facility”], together with a nonexclusive license to use 

other facilities at the Terminal, as set forth in Section 1.02 of this 

Agreement, for the purposes and upon the terms stated herein. . . . The 

parties agree that this Agreement is a license and not a lease and that no 

estate in real property or other interest in property is created by this 

Agreement. . . . [T]he Port Authority reserves the right in its sole 

discretion to relocate the entire Facility, or any portion of the Facility, 

within the Terminal or Port upon ninety (90) calendar days’ prior written 

notice to Licensee. 

CX 181. 

59. Section 1.02 of the CSC-SCPA Facility Agreement states:

Licensee may use, in common with other users of the Port, passageways 

between the Facility and highways and other public access to Terminal 

facilities, driveways and other facilities made available from time to time 

by the Ports Authority. The Ports Authority shall have the right to change 

the designated common facilities and to designate certain common 

facilities for the exclusive use of one or more users of the Port or Terminal 

so long as such activities do not impair Licensee’s use of the Facility. Use 

of the common facilities shall be on a first-come, first-served basis, and 

subject to such rules and regulations as may be adopted from time to time 

by the Ports Authority, and subject to scheduling of the Ports Authority, 

43

7 F.M.C.2d
which, in its sole discretion it deems necessary or useful for proper 

management of the other facilities on the Terminal and at the Port. 

CX 181. 

60. Section 3.02 of the CSC-SCPA Facility Agreement states:

Except as specifically covered in this Agreement, the use of the Facility 

and Terminal and all matters, arrangements, services, and charges between 

the parties shall be governed by the rules, regulations, rates and terms of 

the Authority’s then-current Marine Terminal Operator Schedule . . . as 

may be amended from time to time, or its successor (“MTOS”). 

CX 182. 

61. The CSC-SCPA Facility Agreement provides that the “Facility shall be used and

occupied by Licensee solely for providing stevedoring services at the Terminal necessary

and useful to facilitate the handling and movement of cargo to, from, and within the

Terminal and Port in generating international waterborne commerce . . . .” CX 183-184.

62. The CSC-SCPA Facility Agreement states that “Licensee and all Licensee’s agents,

employees and contractors shall fully comply with all applicable provisions of the

Maritime Transportation Security Act (“the MTSA”) and all applicable policies,

procedures, and regulations of the Ports Authority and the Department of Homeland

Security pertaining to security and operations at the Port and the Terminal.” CX 184. The

agreement provides as well that “Licensee shall fully comply with all rules and

regulations of the Port Authority, including those in the Ports Authority’s MTOS . . . .”

CX 184.

63. Section 6.01(a) of the CSC-SCPA Facility Agreement states “Licensee shall, at

Licensee’s expense, be responsible for all maintenance and repairs of the Facility.” CX

186. Section 6.02(a) of the agreement provides “Licensee shall not make any material

alterations, renovations, improvements or other installations in, on or to the Facility or

any part thereof (including, without limitation, any alterations of the entrance way(s) or

signs, structural alterations, or any cutting or drilling into any part of the Facility or any

securing of any fixture, apparatus, or equipment of any kind to any part of the Facility) . .

. until Licensee . . . shall have obtained the Ports Authority’s written approval thereof . . .

.” CX 187. Section 6.02(c) states “All improvements and additions made by or for

Licensee shall be deemed part of the Facility, shall remain at the Facility, and shall be

surrendered to the Ports Authority at the expiration or earlier termination of this

Agreement, unless the Ports Authority shall elect to have Licensee remove all or any

portion of such alterations, additions, or improvements . . . .” CX 187.

64. The 2015 Charleston Gate Amended Operating Agreement provides:

the Members have separately operated at the South Carolina State Port 

Authority . . . in their separate operations Members SSA and Ceres have 

each performed certain functions known as ‘TIR Functions,’ which 

44

7 F.M.C.2d
primarily involve checking containers into and out of the Port and 

assigning temporary storage locations for each container; . . . these 

Members have each incurred substantially identical costs in performing 

such TIR Functions; . . . these Members compete for the overall business 

of customers at the Port, but do not compete simply for a customer’s TIR 

Functions; . . . the Members have previously formed this [company] 

known as Charleston Gate, L.L.C. for the purpose of hiring and managing 

labor to perform the TIR Functions at the Port . . . . As the purpose of the 

Company is to hire and manage labor to perform the TIR functions at the 

Port, and these TIR functions primarily involve checking containers into 

and out of the Port and assigning temporary storage locations for each 

container, as well as inspecting and making necessary repairs to 

containers, the powers and duties of the Members shall be limited to those 

powers and duties necessary to accomplish this purpose. 

RX 273-275. 

65. Charleston Gate Company’s gate services consist primarily of performing equipment

interchange functions. In this role, Charleston Gate Company follows the interchange

transaction guidelines issued by SCPA, including to provide documentation to the truck

driver and to update SCPA’s TOS. RX 377; see also Britt Decl. at 5 (filed June 13, 2023

and accepted into evidence by June 20, 2023, Order).

66. Prior to an over-the-road (“OTR”) truck driver arriving at SCPA terminals, the trucking

company’s dispatcher accesses a SCPA system that interfaces with the SCPA TOS. The

dispatcher creates a PIN for their OTR driver to deliver or receive containers. Charleston

Gate makes a determination of whether the assigned PIN matches the information in the

SCPA TOS. Britt Decl. at 8.

67. Charleston Gate Company invoices CSC for the equipment interchange services, and

CSC in turn invoices those who receive the equipment interchange services. Britt Decl. at

5.

68. Specifically, CSC charges a gate fee per vessel throughput for gate services. These fees

are set forth in CSC’s negotiated rate sheets with carriers and are billed to carriers

directly. RX 374 (Haigler Decl., CSC VP).

69. As a sample, a rate sheet between CSC and Hapag Lloyd, effective October 1, 2020 to

September 30, 2021 specified: “Payment terms are 30 days from date of invoice. Any

payment not received within thirty (30) days of receipt of the invoice shall accrue penalty

and interest charges from the thirty first (31st) day at the rate of two percent (1.0%) [sic]

per month, which will apply to any outstanding balance.” CX 254.

70. Prior to CSC, SCPA charged customers directly for gate services. RX 374.

71. At the Port of Charleston, gate services are separate from security services. Screening of

persons and vehicles arriving at the terminal is performed by port police at a SCPA

45

7 F.M.C.2d
46

security gate at the terminal entrance. Reply at 9 n.14; RX 377. If granted access by 

SCPA, Charleston Gate Company afterwards provides contracted gate services. RX 377. 

72. CSC does not, and has no authority to, turn away trucks or cargo for nonpayment.

RX 377; CX 221-223; CX 212-220.

73. CSC also does not, and has no authority to, refuse entry to trucks or cargo on economic

or commercial grounds. RX 377; CX 221-223; CX 212-220.

D. 2019 FMC Submission

74. In 2019, SSA, Ceres, and Ports America Florida (“2019 Parties”) sought to establish a

joint venture, which would serve as the exclusive vessel stevedoring provider across the

Port of Charleston and the Port of Savannah. CX 1103.

75. The 2019 Parties filed their proposed agreement with the Commission in March 2019

(“2019 FMC Submission”). CX 1100. The agreement, titled “Georgia - South Carolina

Marine Terminal Operator Cooperative Working Agreement” proposed the formation of

a new entity, NEWCO, “to provide container marine terminal services and stevedoring in

the ports of Savannah, Georgia and Charleston, South Carolina.” CX 1103. NEWCO was

to be owned in equal one-third shares by Ceres, SSA, and PAF. RX 117.

76. On April 2, 2019, the Commission acknowledged the submission, designating this

proposal as FMC Agreement No. 201293. RX 111.

77. In their 2019 FMC Submission, the parties, SSA, Ceres, and Ports America Florida,

indicated that they were marine terminal operators and that NEWCO would operate as a

marine terminal operator in the Ports of Savannah and Charleston. CX 1103-1104.

78. The 2019 FMC Submission specified:

4.2 NEWCO shall provide marine terminal services and conduct 

container stevedoring, terminal, container freight station, and activities 

incidental thereto, at the Ports. Specifically, the Parties agree that, during 

the term of this Agreement, NEWCO will assume responsibility for 

providing those facilities and services currently provided by the Parties in 

their individual capacity in the Ports, including marine terminal gate 

operations and vessel loading and unloading operations, and the operation 

of equipment and technology related thereto. 

4.3 NEWCO and the Parties expect to enter into long-term license 

agreements with each of the Ports for the use of facilities in those Ports. 

Such agreements will detail the services to be provided by NEWCO . . . 

(e.g., marine terminal gate and vessel loading and unloading operations) 

and those facilities and services which currently are, and will remain, 

under the control of the Ports (e.g., operation and manning of cranes and 

container yard areas) . . . . 

7 F.M.C.2d
CX 1104. 

47

79. SCPA submitted comments in support of proposed FMC Agreement No. 201293, noting

“Each of the partners has consistently expressed concerns to us over the long-term

viability of their stevedoring operations in terms of both profitability and growth potential

. . . .The ocean container carrier industry has consolidated from over 20 carriers to less 

than 10 in the last few years . . . . [W]e believe that a JV stevedoring company in 

Charleston is a logical and compelling response to overall container industry 

consolidation and fully support its establishment.” RX 113-114. 

80. SCPA noted among the benefits of the proposed joint venture the: “Reduction in

overhead from the consolidation of fragmented and less efficient companies;

Enhancement of the interface between terminal operations and the stevedoring operations

through a common and consistent approach to such operations and utilization of a

common system; More predictability in volumes leading to a more capable and effective

organization; . . . . [and] Enhanced integration with Charleston Gate Co. LLC, a joint

venture between the stevedores and Container Maintenance Corp to run our gate

complex. In future, the stevedore JV will incorporate the gate company in its overall cost

structure for invoicing to the lines.” RX 114.

81. On May 9, 2019, the Commission issued a Request for Additional Information. RX 132.

82. The 2019 Parties provided an Initial Joint Response to Request for Additional

Information on June 22, 2019. RX 155; RX 116-130. The response included the

following questions and answers:

8- Although the Parties’ responses to staff’s preliminary questions

Savannah own and control much of the terminal infrastructure, the Parties

assert that their activities are within the Commission’s jurisdiction. Please 

explain in detail how each Party meets the definition of a “marine 

terminal operator” at each of the ports, specifically how each Party 

provides “wharfage, dock, warehouse, or other terminal facilities in 

connection with a common carrier” at each port . . . 

The parties qualify as marine terminal operators in the ports . . . because of 

their operational control and staffing of key terminal infrastructure (i.e., 

the terminal gates), their control over access to the terminal facilities, their 

provision of essential services (including checking, recognized by the 

Commission to be a marine terminal service, as well as yard planning and 

stevedoring), and their assessment and collection of gate fees. 

. . . . 

9. Is it the Parties’ position that each Party’s current activities at the

Ports of Charleston and Savannah are subject to the Commission’s

jurisdiction and the relevant requirements and prohibitions applicable to

7 F.M.C.2d
 

48 7 F.M.C.2d

marine terminal operators under the Shipping Act and the Commission’s 

regulations? Please explain why or why not. 

. . . [I]t is our position that the Parties are marine terminal operators in the 

Ports currently, and will continue to be MTOs going forward after the 

agreement takes effect. While there may be some uncertainty arising from 

a prior agreement filing submitted by the parties in 1998, we do not view 

the opaque disposition of that agreement to be controlling in this case. 

In 1998, the Parties took the position that their operations, and particularly 

their joint control of gate operations, were subject to the Commission’s 

jurisdiction. Accordingly, the Parties filed Agreement No. 201067, 

Gateway Terminals, LLC, which covered the establishment of the 

Savannah gate company. However, at that time a determination apparently 

was made at the Commission that the agreement was not subject to the 

Shipping Act. There appears to be no formal decision or other final agency 

action setting out the reasons for this jurisdictional determination. 

Accordingly, we continue to believe that, if the issue were to be fully 

adjudicated, the Parties’ operations would be found to be within the 

Shipping Act’s scope. 

15. How will NEWCO reduce operational inefficiencies, yard congestion, and

vessel delays at the ports of Savannah and Charleston if the Agreement were to go

into effect?

Having multiple stevedores operating in the same facility inevitably introduces 

inefficiencies and disruption. The formation of NEWCO will enable the three 

constituent companies to standardize processes around best practices and leverage 

a single technology platform for the combined operations. . . . 

19. Do either the Georgia Ports Authority of the South Carolina Ports Authority

currently have any oversight on rate setting for gate or stevedoring services at

their facilities? If so, please describe.

Rate setting for stevedoring services currently is performed by the Parties, 

independent of SCPA and GPA oversight. Similarly rates for gate services or TIR 

in Savannah are set by Parties, independent of GPA. In contrast, in Charleston, 

currently SCPA determines the rates for gates services or TIR in Charleston. 

It is expected that NEWCO will establish gate rates for each port in the future, 

with input from each of the port authorities; however, agreements with the port 

authorities have not been finalized or adopted yet. 

Carrier billing is performed by Parties for stevedoring and gate services in 

Savannah, with stevedoring billed by Parties and gate services billed by SCPA in 

Charleston. It is planned that NEWCO would perform both services (stevedoring 
49

and gate services) in both locations, producing billing for both stevedoring and 

gate in Charleston and Savannah, although no formal agreements with the ports 

have been adopted to date. 

. . . . 

30. Please identify any other U.S. ports in which any of the Parties provide

stevedoring and/or gate services, and where another party operates the marine

operator in these instances. 

Container 

Terminals 

Stevedore Gate Operator Marine Terminal 

Operator 

Charleston, SC Ceres, Ports 

America, SSA 

CHS Gate Port Authority 

. . . 

Savannah, GA Ceres, Ports 

America, SSA 

Gateway Port Authority

. . . . 

The role of the Parties in ports such as Savannah and Charleston, where the 

Parties control the gates, is significantly different from their role in ports where 

they have no control over gate operations (and therefore act solely as stevedores) 

such as Norfolk and Houston. In Norfolk and Houston, the Parties’ role is to load 

and unload containers between the vessel and the point of rest. In contrast, in 

Savannah and Charleston, the Parties exercise control over access to the terminal 

itself, as well as playing a significant role in yard planning and moving cargo 

within the facility. This more expansive role requires closer cooperation with the 

port authority, and allows for more efficient and integrated gate/yard/vessel 

operations. 

RX 119-130 (formatting in original). 

83. The Commission’s then-General Counsel Tyler Wood issued an opinion letter on August

6, 2019 (“Opinion Letter”), stating “It is the opinion of OGC that, based on the materials

provided, the Parties to the agreement do not appear to be MTOs as defined by the

Shipping Act of 1984, and that this agreement therefore falls outside of the Commission’s

jurisdiction. This opinion is that of OGC alone and is nonbinding on the Commission.”

RX 157.

7 F.M.C.2d
84. The Opinion Letter reasoned:

The Shipping Act, the Commission’s regulations, and the Plaquemines 

case make clear that an entity must have some level of control over 

physical terminal assets in order to meet the MTO definition; performing 

services alone is insufficient. . . . [T]he fact that the Parties perform 

services at the Ports, including services defined in Commission regulations 

as “marine terminal services,” is not enough to establish that they are 

MTOs under the Act. 

In this case, it appears that the Parties do not exercise sufficient “control” 

over any terminal facilities to render them MTOs under the Shipping Act 

at either Port. Their primary activities consist of stevedoring services 

provided to the carriers, and, as noted by the Parties, the Commission does 

not consider stevedores to be MTOs under the Act. See Final Rule: 

Exemption of Certain Marine Terminal Arrangements, 57 Fed. Reg. 4578, 

4581 n.16 (Feb. 6, 1992) (“The Commission does not assert or claim 

jurisdiction over stevedoring activities.”). And none of the other services 

listed by the Parties involve the exercise of control over terminal facilities. 

Although some of the services described are performed at the gates, which 

might be considered terminal facilities, the Parties’ description indicates 

that the Ports own the gates, and the Gate Companies merely perform 

services at those locations (e.g., inspecting cargo, providing directions to 

truckers). In other words, it does not appear that the services provided by 

the Gate Companies are directly connected to the use of terminal facilities, 

akin to providing wharfage, dockage, or warehousing. . . . Additionally, 

nothing in the information provided by the Parties suggests that they have 

the ability, like the port authority in Plaquemines, to condition access to 

the gates or the terminals on payment of fees for their services.[3] 

For the foregoing reasons, it is the opinion of OGC that the parties to the Georgia 

- South Carolina MTO Cooperative Working Agreement do not appear to be

MTOs under the Act at the Ports and, therefore, the Agreement is not subject to

the Commission’s jurisdiction. . . .

n3. The parties assert that they “control access to the terminal,” but this 

appears to refer to the mere fact that truck traffic must pass through the 

gates to enter the terminal. 

RX 160-161. 

85. The 2019 Parties elected not to appeal the letter and, instead, formally withdrew the

proposed agreement from the Commission’s consideration by letter to the General

Counsel dated September 9, 2019. RX 163. The 2019 Parties then changed course, and

NEWCO was not formed. Instead, separate port-specific JVs were formed at the Port of

Savannah and the Port of Charleston, as detailed above. See, e.g., FOF 4-6, 10-12.

50

7 F.M.C.2d
III. ANALYSIS AND CONCLUSIONS OF LAW

A. Preliminary Issues

1. Status of Ports America Florida

Respondents assert, regarding Ports America Florida, that it operates only in ports in 

Florida, and not in the terminals at issue in this case. Opposition at 13. ILA acknowledges that: 

Ports America Florida, Inc. was named as a respondent in this case because the 

publicly disclosed proposed joint venture agreement (Agreement 2011293) 

included that entity as a contracting party. Discovery has revealed, however, that 

another Ports America affiliate has been a marine terminal operator in the Ports 

for years and is currently the contracting party in the joint ventures as actually 

implemented. Regardless, this brief will show that all the contracting parties were 

marine terminal operators in the Ports at all relevant times before and after the 

joint venture. This brief will use the term “Ports America” to include the Ports 

America affiliate operating in Savannah and Charleston. 

Brief at 1 n.1 (citation omitted). 

This decision only addresses the parties named in the complaint. ILA could have 

amended its filing and added the correct entity. Further, ILA was on notice since at least May 9, 

2022, that Ports America Florida was not operating at the ports at issue in this proceeding. 

Respondents’ Motion to Dismiss at 3-4 (May 9, 2022). However, given the facts already 

developed and the outcome, it is unlikely that naming a different Ports America entity would 

have changed the outcome. 

2. Discovery Issues

ILA asserts that Respondents have refused to provide necessary discovery; and that it has 

received no documents from Ports America Florida. Brief at 3-8; Reply at 18-23. Respondents 

contend they have complied with their jurisdictional discovery obligations. Opposition at 27-37. 

Regarding PAF, as already discussed, ILA is aware that “another Ports America affiliate” 

– not Ports America Florida – “is currently the contracting party in the joint ventures as actually

implemented.” Brief at 1 n.1. Further, ILA was specifically allowed, and has received, discovery

“limited to how the subject terminals operate at the two ports in question.” See Bifurcation Order

at 4. The evidence generated has been both appropriate and sufficient to resolving the

jurisdictional question at issue here. No detrimental impact on the proceedings or on ILA has

been shown. As noted earlier in this proceeding, the reason for addressing jurisdiction ahead of

the merits was to avoid unnecessary discovery in the event that no jurisdiction was found. That

has turned out to be the case.

3. Burden of Proof

ILA asserts that in cases such as this one, where jurisdiction is being decided based on 

affidavits and discovery material without holding an evidentiary oral hearing, the ILA has the 

51

7 F.M.C.2d
burden of making out a prima facie showing of personal jurisdiction over Respondents; and 

conflicts between the facts contained in the parties’ affidavits must therefore be resolved in the 

ILA’s favor. Brief at 8. Respondents contend that ILA must prove its case by a preponderance of 

the evidence; this case is not pending before the Presiding Officer on a motion to dismiss; and 

that nothing in the Commission’s rules or precedent requires an evidentiary hearing to decide a 

contested question of jurisdiction. Opposition at 4-5. 

It is well established that to prevail in a proceeding to enforce the Shipping Act, a 

complainant bears the burden of proving their allegations by a preponderance of the evidence. 

5 U.S.C. § 556(d); 46 C.F.R. § 502.203; Maher Terminals, LLC v. Port Auth. of N.Y. & N.J., 

FMC Docket No. 08-03, 2014 WL 9966245, at *14 (FMC Dec. 17, 2014). Under the 

preponderance standard, a complainant must show that their allegations are more probable than 

not. Crocus Investments, LLC v. Marine Transport Logistics, Inc., Docket No. 15-04, 2021 WL 

3732849, at *3-4 (FMC Aug. 18, 2021) (Order Affirming Initial Decision on Remand). It is 

appropriate to draw inferences from certain facts when direct evidence is not available, and 

circumstantial evidence alone may even be sufficient; however, such findings may not be drawn 

from mere speculation. Waterman Steamship Corp. v. General Foundries, Inc., Docket No. 93-

15, 26 S.R.R. 1173, 1180 (ALJ Dec. 9, 1993), adopted in relevant part, 26 S.R.R. 1424, 1994 

WL 279898 (FMC June 13, 1994). 

The bifurcation order did not raise the question of jurisdiction in the context of a motion 

to dismiss. As was stated in the Bifurcation Order: 

I am mindful that Complainant has the burden to prove that the Commission has 

jurisdiction, and as noted by Judge Wirth and the undersigned, such a determination 

would be clearer after discovery. Consequently, Complainant should be allowed 

discovery on that issue, and a scheduling order that allows for limited discovery on the 

jurisdictional issue, followed by briefing on that issue alone, will be helpful in 

determining whether the Commission has jurisdiction based on facts, rather than 

assertions alone. 

Bifurcation Order at 3. ILA was therefore allowed discovery “limited to how the subject 

terminals operate at the two ports in question.” Bifurcation Order at 4. The Order also stated: 

“even if only one of the named Respondents is demonstrated by the jurisdictional discovery to be 

an MTO, the case will proceed to discovery on the merits and the parties will be given an 

opportunity to submit briefs limited to the Shipping Act violations alleged to have occurred.” 

Bifurcation Order at 4. 

Commission Rules make explicit that for private party complaints, the “Presiding Officer 

will determine whether an oral hearing is necessary.” 46 CFR § 502.62(a)(5). Here, the 

undersigned judge determined that an oral hearing was not necessary. ILA must prove its case by 

a preponderance of the evidence in order to prevail. 

B. Legal Standard for Jurisdiction

The Shipping Act provides that a “person may file with the Federal Maritime 

Commission a sworn complaint alleging a violation of this part.” 46 U.S.C. § 41301(a). Pursuant 

52

7 F.M.C.2d
 

 

to this provision, the Commission has jurisdiction over a complaint alleging that a respondent 

committed an act prohibited by the Shipping Act. See Anchor Shipping Co. v. Aliança 

Navegação E Logística Ltda., Docket No. 02-04, 30 S.R.R. 991, 999, 2006 WL 2007808, at *11 

(FMC May 10, 2006); see also Cargo One, Inc. v. COSCO Container Lines Co., Docket No. 99-

24, 28 S.R.R. 1635, 1645, 2000 WL 1648961, at *15 (FMC Oct. 31, 2000). 

ILA alleges violations of the Shipping Act by Respondents, which it asserts to be marine 

terminal operators. The Shipping Act makes clear that the Commission has jurisdiction over 

marine terminal operators. 46 U.S.C. § 41106 (“A marine terminal operator may not . . . .”); 

46 U.S.C. § 41102(c) (“A common carrier, marine terminal operator, or ocean transportation 

intermediary may not . . . .”). The question to be resolved, therefore, is whether ILA has 

established that at least one of Respondents is a marine terminal operator such that FMC has 

jurisdiction over this proceeding. 

The Shipping Act defines a marine terminal operator (“MTO”) as “a person engaged in 

the United States in the business of providing wharfage, dock, warehouse, or other terminal 

facilities in connection with a common carrier.” 46 U.S.C. § 40102(15); see also 46 C.F.R. 

§ 525.1(c)(13). The Shipping Act does not define “terminal facilities,” however the term is

defined in Commission regulations as:

[O]ne or more structures comprising a terminal unit, which include, but are not

limited to docks, berths, piers, aprons, wharves, warehouses, covered and/or open

storage spaces, cold storage plants, cranes, grain elevators and/or bulk cargo

loading and/or unloading structures, landings, and receiving stations, used for the

transmission, care and convenience of cargo and/or passengers in the interchange

of same between land and ocean common carriers or between two ocean common

carriers.

46 C.F.R. § 525.1(c)(18).2 

The Commission examines an entity’s MTO status based on the specific facility at issue 

in the dispute. Auction Block Co. v. City of Homer, Docket No. 12-03, 2014 WL 5316337, at *5 

(FMC Aug. 12, 2014) (aff’d sub nom. Auction Block v. FMC, 606 Fed. Appx. 347 (9th Cir. 

2015) (affirming the Commission’s interpretation of the definition of ‘marine terminal operator’ 

as calling for a facility-specific analysis); see also Puerto Rico Ports Auth. v. FMC, 919 F.2d 

799, 802-03 (1st Cir. 1990) (“[w]hile PRPA may furnish terminal facilities at San Juan and 

Mayaguez, the Commission properly did not base its jurisdiction on those activities.”). 

What constitutes a marine terminal operator was discussed in a series of cases involving 

harbor fees at Plaquemines Port in Louisiana. The issue was whether Plaquemines Port, which 

neither owned nor operated the port’s marine terminal facilities, was nevertheless a marine 

2

 The term “Marine terminal facilities” is also defined in Commission regulations, but in part 535 

- Ocean Common Carrier and Marine Terminal Operator Agreements Subject to the Shipping

Act of 1984. This decision does not evaluate the propriety of an agreement under the Shipping

Act. Rather, at issue is whether Respondents are marine terminal operators. Therefore, the

definition at 46 C.F.R. § 525.1(c)(18) is the more relevant definition.

53

7 F.M.C.2d
terminal operator. Louis Dreyfus Corp. v. Plaquemines Port Harbor & Terminal Dist., Docket 

No. 79-45, 25 F.M.C. 73, 21 S.R.R. 219 (ALJ Nov. 17, 1981) (“Plaquemines - ALJ”). Key facts 

included that Plaquemines Port had administrative authority and control over the private wharves 

and terminal facilities as a function of Louisiana Law, and Plaquemines Port used this authority 

to assess fees covering such items as police, fire, and ambulance services. Plaquemines - ALJ, 

25 F.M.C. at 85, 124, 126. Plaquemines Port had superimposed its tariff fees upon the charges 

(both contract and tariff) of the private terminal facilities located in the Port. Plaquemines - ALJ, 

25 F.M.C. at 134. Plaquemines Port had also written explicit rules providing it with authority to 

deny entrance to entities who did not pay Plaquemines Port’s tariffs. Plaquemines - ALJ, 

25 F.M.C. at 96 (for example, Item 130, “Penalties for Violation” of the tariff provided: “It shall 

be unlawful for any person, firm, or corporation to utilize or make use of the Plaquemines Port, 

Harbor and Terminal District or any of its facilities without paying to the District the proper toll, 

charge or fee therefore as fixed and specified in this tariff . . . .”). 

The ALJ found Plaquemines Port to be a marine terminal operator, and subject to the 

Commission’s jurisdiction, explaining: “Plaquemines Port conditions the use of these private 

terminal facilities upon the payment to Plaquemines Port of its harbor fee and supplemental 

harbor fee. If these fees are not paid, Plaquemines Port will bar, or attempt to bar, the use of 

these private facilities to the shipping public” adding that in “so conditioning the use of these 

private facilities, Plaquemines Port controls their use, and control is the key factor.” Plaquemines 

- ALJ, 25 F.M.C. at 134 (emphasis added).

The Commission affirmed the ALJ’s finding of jurisdiction over Plaquemines Port, 

similarly highlighting the extent of Plaquemines Port’s control over terminal facilities: 

[I]t is the control of terminal rates and practices which constitutes ‘furnishing’

terminal facilities and confers Commission jurisdiction. Conditioning access to

a port’s private facilities upon the payment of a charge for governmental services

reflects significant threshold control over terminal facilities. . . .

The combination of the Port’s exclusive ability to furnish such terminal services, 

its assessment of selective transfer cargo fees and its control of access to the 

private facilities results in fundamental control over the rates and practices of 

terminal facilities. 

Louis Dreyfus Corp. v. Plaquemines Port Harbor & Terminal Dist., Docket No. 79-45, 25 

F.M.C. 59, 66-67, 21 S.R.R. 1072, 1080 (FMC July 30, 1982) (“Plaquemines - FMC”) (footnotes

omitted; emphases added). In a subsequent case concerning Plaquemines Port, the Commission

reaffirmed its finding of jurisdiction, stating:

To reiterate those findings, the Port is a ‘marine terminal operator’ subject to the 

1984 Act, because its exclusive ability to provide essential health, safety and 

security services to vessels and cargo interests in commercial cargo handling 

transactions, its assessment of selective cargo transfer fees, and its control of 

access to private terminal facilities results in fundamental control over the rates 

and practices of terminal facilities. Further, the Port’s practice of assessing, on the 

basis of cargo transactions, a fee for providing to vessels and cargo essential 

54

7 F.M.C.2d
 

55

health, safety and security services constitutes the furnishing of ‘other terminal 

facilities’ within the meaning of the 1984 Act. 

New Orleans Steamship Assoc. v. Plaquemines Port, Harbor & Terminal Dist., Docket No. 83-2, 

1986 WL 170020, at *5 (FMC Sept. 16, 1986) (“Plaquemines II - FMC”). The DC Circuit 

concurred with the Commission, stating: 

Since the Port assessed a fee for its essential services ancillary to the facilities and 

conditioned access to the private facilities within its jurisdiction upon payment of that 

fee, the FMC found a ‘furnishing’ of the facilities. . . . 

We agree with the FMC that the Port’s combination of offering essential services and 

controlling access to the private facilities amounts to the furnishing of terminal facilities. 

Plaquemines Port, Harbor & Terminal Dist. v. FMC, 838 F.2d 536, 543 (D.C. Cir. 1988) 

(“Plaquemines II - DC Cir.”) The DC Circuit also explained: “The DOJ argues that upholding 

FMC jurisdiction over the Port could result in the FMC controlling the fire and emergency 

services of every waterside city in America. This argument is overstated. Waterside cities will 

not automatically or accidentally fall into FMC jurisdiction. Only if such ports begin to charge a 

fee for their services and to control access to private facilities to enforce their charges will 

today’s decision bring them within the jurisdiction of the FMC.” Plaquemines II - DC Cir., 838 

F.2d at 543 (footnote omitted).

The Commission considered and found marine terminal operator status to be present as 

well in Petchem v. Canaveral Port Authority, where the Canaveral Port Authority had denied a 

tug operator’s application for a non-exclusive franchise. Docket No. 84-28, 1986 WL 170038 

(FMC Mar. 28, 1986) (aff’d sub nom. Petchem v. FMC, 853 F.2d 958 (D.C. Cir 1988)).3

 The 

complainant in that case argued that the Port Authority’s denial of its application for a nonexclusive franchise to provide commercial tug and towing services at Port Canaveral was an 

unreasonable practice violating the Shipping Act. Petchem, 1986 WL 170038, at *1. In Petchem, 

the Commission first looked at whether the respondent, Canaveral Port Authority, was a marine 

terminal operator, and found that it was. However, this status was not based on a “furnishing of 

terminal facilities.” Rather, the Commission found marine terminal operator status based on 

Canaveral Port Authority’s service of common carriers offering cruise transportation to 

passengers. Petchem, 1986 WL 170038, at *4. Having determined that the Port Authority was an 

MTO, the Commission then evaluated whether the activities in question amounted to the 

“furnishing of terminal facilities” for purposes of establishing subject matter jurisdiction. The 

Commission explained “our jurisdiction over Petchem’s complaint ultimately must rest on 

findings that the Port Authority’s control over tug services through its franchise system 

represented furnishing of ‘terminal facilities,’ and that such furnishing was in connection with 

common carrier service at the Port.” Petchem, 1986 WL 170038, at *6 (adding that the “Port 

Authority’s exclusive franchise system for tug operations extends the Port’s furnishing of 

7 F.M.C.2d
56

terminal operations from the pier onto the waters of the harbor.” Petchem, 1986 WL 170038, at 

*12).

The First Circuit subsequently addressed related questions of MTO status in Puerto Rico 

Ports Authority (“PRPA”), evaluating the status of the Puerto Rico Ports Authority, which had 

assessed certain harbor fees against vessels.4 Puerto Rico Ports Auth. v. FMC, 919 F.2d 799, 

802-03 (1st Cir. 1990). The First Circuit reached a different conclusion, however, holding that

PRPA was not an MTO and had not subjected itself to the jurisdiction of the Commission,

through the imposition of a harbor service fee at the Port of Ponce. Puerto Rico Ports Auth., 919

F.2d at 802-03. The Court reasoned that, “[t]o support the exercise of Commission jurisdiction, it

must be determined initially that the one providing the service is a marine terminal operator – in

the business of furnishing wharfage, dock, warehouse, or other terminal facilities in connection

with a common carrier,” emphasizing that “PRPA, under any plausible interpretation, is not in

the ‘business of furnishing wharfage, dock, warehouse, or other terminal facilities in connection

with a common carrier’ at the Port of Ponce” where “PRPA’s sole function at Ponce is to provide

such general harbor services as law enforcement, radio communications, harbor cleaning, and

port captain services.”

The First Circuit also asserted that its decision did not conflict with the DC Circuit’s 

Plaquemines decision, because Puerto Rico Ports Auth. was distinguished on a factual basis, 

stating: 

We believe that the Commission’s reliance on Plaquemines II in the instant case 

is misplaced. The Port in Plaquemines II had complete control over the private 

terminals, including the amount of fee the terminals charged. The Commission 

found that Plaquemines Port administered and controlled all privately owned 

docks and wharves within its geographical jurisdiction. The Port had complete 

control over the fees and charges levied by the owners of private terminal 

facilities. Through its plenary control over the private terminal facilities, the 

Port became a de facto terminal operator. . . . 

Since we conclude that PRPA did not exercise the type of plenary control over Ponce 

terminal facilities that the Port exercised over private terminal facilities in Plaquemines 

II, we need not consider the mode of statutory analysis employed by the Commission and 

the District of Columbia Court of Appeals. 

919 F.2d at 806 (emphases added). In more recent reflections on Plaquemines, the Commission 

has emphasized the criticality of the relevant entity actually exercising control, stating: “An 

essential element in Plaquemines was that Plaquemines Port had actually exercised control by 

implementing a tariff rule that effectively denied access to private facilities as a consequence of 

non-payment.” Lake Charles Harbor and Terminal Dist. v. West Cameron Port, Harbor & 

7 F.M.C.2d
Terminal Dist., Docket No. 06-02, 2007 WL 2468431, at *5-6 (FMC Aug. 2, 2007) (emphasis 

added) (and concluding that “unlike the situation in Plaquemines, it has not been shown that 

[West Cameron Port] is offering essential services and controlling access to private facilities 

through the enforcement of fees.” 2007 WL 2468431, at *6). 

Therefore, in this proceeding, to establish marine terminal operator status at a particular 

port, via a “furnishing of terminal facilities,” two factors are considered: (1) does the entity offer 

essential services; and (2) control, including (a) whether the entity controls access to private 

facilities to enforce its charges and (b) whether the entity exerts significant control. 

In addition, because the Commission examines an entity’s MTO status based on the 

specific facility at issue, Respondents’ MTO status will be assessed by considering activities at 

the specific facilities where they are alleged to have breached the Shipping Act. Auction Block, 

2014 WL 5316337, at *5. Therefore, consideration of MTO status at the Port of Savannah will 

be based on activities at Garden City Terminal and South Terminal, and consideration of MTO 

status at the Port of Charleston will be based on activities at Wando, North Charleston, and 

Leatherman Terminals. 

C. Parties’ Arguments

ILA asserts that as the exclusive provider of stevedoring and checking services, 

Respondents can condition access to the terminals based on payment of their fees; Respondents 

can condition access to the terminals because of their control over the gates; Respondents operate 

terminal facilities in Charleston and Savannah; and Respondents jointly control the terminal 

facilities in Charleston and Savannah with the port authorities. Brief at 9-27; see also Reply at 6-

18. ILA generally argues that Respondents should be found to be marine terminal operators

based on Plaquemines, but also points to Petchem contending that Respondents’ provision of

exclusive services constitutes the furnishing of terminal services, providing the Commission with

jurisdiction. See, e.g., Brief at 11-12; Reply at 7.

Respondents assert that the Shipping Act’s definition of marine terminal operator is 

narrow; the control theory of terminal jurisdiction is inapplicable here; the General Counsel 

correctly applied the relevant precedent; and each of PAF, SSA, Ceres, Gateway, and CSC is not 

a marine terminal operator in either the Port of Charleston or the Port of Savannah. Opposition at 

5-27.

D. Analysis

First, the combination of Respondents’ stevedoring and gate services will be considered 

to evaluate whether such activities establish personal jurisdiction under the control theory as 

applied in Plaquemines and subsequent cases. In particular, Gateway’s activities will be 

discussed at the Port of Savannah, and CSC’s activities will be discussed at the Port of 

Charleston. Because neither of these entities’ activities are found to meet the threshold needed 

for personal jurisdiction, there is no need to discuss in depth the activities of Ceres, SSA, and 

Ports America Florida, since their activities at the relevant ports are less significant (or in the 

case of PAF, non-existent) and display yet far less control, as demonstrated in the findings of 

fact. Second, ILA’s argument that Gateway and CSC’s provision of exclusive stevedoring 

57

7 F.M.C.2d
58

confers jurisdiction will be addressed. Finally, ILA’s allegations that individual Respondents 

operate terminal facilities via warehousing or otherwise will be addressed. 

As a foundational point, both parties cite to documents regarding the 2019 proposed 

MTO agreement, which was submitted to the Commission, but then ultimately withdrawn after 

the general counsel’s determination that parties to the proposed agreement did not appear to be 

MTOs. FOF 75, 83-85. As was stated in multiple earlier orders, that outcome is not 

determinative of the outcome here. June 23, 2022, Order at 3; Bifurcation Order at 2-4. 

Assertions made in 2019, that parties to the submission believed themselves to be marine 

terminal operators does not dispose of the issue. Neither does the general counsel’s 

determination that the parties were not MTOs resolve this question, both because the precise 

agreement under review was never put into effect, and because, as the letter indicated, the 

opinion was that of the general counsel and not binding on the Commission. The general 

counsel’s analysis did, however, highlight key factors, which will be freshly evaluated here in 

light of the facts now developed in the record, including the overall level of control exhibited by 

Respondents and whether Respondents condition access to the terminals based on payment of 

fees for their services. 

As explained below, to the extent that Respondents exercise control, they only do so to 

the extent permitted by the port authorities, who ultimately own and control these facilities. The 

port authorities are not parties, and the ILA cannot undo the agreements between the port 

authorities and their service provider through this Shipping Act complaint, which only names the 

service providers. Indeed, to the extent that ILA members believe the market would be more 

competitive with multiple stevedores at these ports, the decision to consolidate was made by the 

port authorities, not these parties. Moreover, the public port authorities provided considered 

justifications for those decisions. FOF 24, 49. 

1. Stevedoring & Gate Services

To assess whether any of Respondents can be considered MTOs under Plaquemines, at 

the Port of Savannah or the Port of Charleston, two factors are considered: (1) do Respondents 

offer essential services; and (2) control, including (a) whether Respondents control access to 

private facilities to enforce their charges and (b) whether Respondents exert significant control. 

First, looking at Gateway’s activities at the Port of Savannah, there is no dispute that 

Gateway provides exclusive vessel stevedoring and exclusive gate services pursuant to the GPAGateway Agreement. FOF 23. While the agreement assures Gateway the authority to negotiate 

stevedoring and gate services pricing with carriers, it otherwise consistently subjects Gateway to 

the authority of GPA. FOF 25-39. For example, Gateway agrees to adopt and incorporate GPA’s 

Marine Terminal Operator Schedule, other than as specified in the agreement. FOF 26. 

Gateway’s pricing authority is also circumscribed in numerous ways, including GPA’s option at 

the effective date of the agreement to veto any prices it deems not to be competitive, and 

Gateway’s subsequent requirement to “amend its rates as required to satisfy GPA’s regulatory 

concerns” or be deemed in material breach of the agreement. FOF 34. Gateway is further bound 

by the price increase and decrease formulas detailed in the agreement, in addition to having to 

provide all carrier contracts to GPA annually, plus having to provide all rate sheets quarterly. 

FOF 35-36. As well, Gateway is under GPA’s clear authority with regard to metrics. First, 

7 F.M.C.2d
59

Gateway must provide to GPA monthly a long list of metrics covering KPIs for safety, vessel 

operations, and gate services. FOF 28, 39. The GPA-Gateway Agreement then provides that if 

certain KPIs are not met, GPA may cancel the contract at any time. FOF 39. It is also clear that 

the gate services provided by Gateway are not the equivalent of security services. FOF 40. 

Gateway provides access to the terminals pursuant to GPA access instructions, at hours set by 

GPA, and validates required documentation as determined by GPA. FOF 39, 42. Meanwhile, 

security services are handled by GPA’s police, who ultimately determine who may enter and 

leave the port’s terminals. FOF 40. Importantly, while Gateway invoices carriers for stevedoring 

and gate services, Gateway has not been shown to have any kind of authority to exclude truckers 

or carriers for failure to pay fees. FOF 43-45. Neither has Gateway been shown to have so acted, 

in the absence of such authority. FOF 44-45. As the GPA-Gateway Agreement states clearly, no 

partnership, joint venture, or employee/employer relationship is created by virtue of the 

agreement. FOF 28. Rather, GPA is the marine terminal operator and Gateway is a third-party 

service provider. FOF 26, 28. 

Next, looking at CSC’s activities at the Port of Charleston, again there is no dispute that 

CSC provides exclusive vessel stevedoring pursuant to the CSC-SCPA License Agreement. FOF 

51, 55. But unlike at the Port of Savannah, CSC has not also been made the exclusive provider of 

gate services. FOF 55, 64-65. Rather, the Charleston Gate Company continues to provide TIR 

services, consisting of checking containers into and out of the Port and assigning temporary 

storage locations for each container, while CSC’s role allows it to negotiate gate services rates 

with carriers. FOF 55, 64-65. But here, too, the relevant agreements make clear that CSC is 

subject to the authority of SCPA. CSC agrees to adopt and incorporate SCPA’s Marine Terminal 

Operator Schedule, other than as specified in the agreement. FOF 50, 60. CSC is also bound to 

follow all SCPA rules and regulations generally. FOF 60, 62. The agreements further make clear 

that SCPA decides what space CSC may use for vessel stevedoring and can change that at any 

time; and that SCPA owns the facilities, including the gates. FOF 58-59. CSC must also confer 

with SCPA in pursuit of achieving “the safest, most efficient, and most competitive” stevedore 

services in the South Atlantic port market. FOF 55. Also, at the Port of Charleston, there is a 

clear distinction between gate services and security services, the latter of which are handled by 

SCPA’s police. FOF 71. The police perform the initial check at the security gates; afterwards, if 

admitted by SCPA police, Charleston Gate provides gate services. FOF 71. In addition, like 

Gateway at the Port of Savannah, CSC has not been shown to have any kind of authority to 

exclude truckers or carriers for failure to pay fees. FOF 72-73. Neither has CSC been shown to 

have so acted, in the absence of such authority. FOF 72-73. As the agreements further make 

clear, no agency, partnership, or joint venture is created between SCPA and CSC; rather SCPA is 

the marine terminal operator and CSC is a service provider. FOF 50, 52-53, 55. 

a. Do Respondents Offer Essential Services?

Against this factual backdrop, the first question to be asked is whether Gateway and CSC 

offer essential services. As noted, there is no dispute that Gateway provides exclusive vessel 

stevedoring and exclusive gate services at the Port of Savannah and that CSC provides exclusive 

vessel stevedoring at the Port of Charleston. Neither offers an essential “health, safety, and 

security” service as was provided by Plaquemines Port. See, e.g., Plaquemines - FMC, 1986 WL 

170020, at *5 (“[T]he Port’s practice of assessing . . . a fee for providing to vessels and cargo 

essential health, safety and security services constitutes the furnishing of ‘other terminal 

7 F.M.C.2d
 

60

facilities’ within the meaning of the 1984 Act.”) Stevedoring (provided by CSC and Gateway) 

and gate services (provided by Gateway) are nevertheless arguably “essential.” See Canaveral 

Port Authority - Possible Violations of Section 10(b)(10), Unreasonable Refusal to Deal or 

Negotiate Exclusive Tug Arrangements in Port Canaveral, Florida, Docket Nos. 02-02 and 02-

03, 2003 WL 21551810, at *6 (FMC July 8, 2003) (“Canaveral Port Authority”) (where the 

Commission confirmed that the Canaveral Port Authority had offered “an essential service, tug 

and towing” in an application of Plaquemines).5

 This first question is therefore satisfied. The 

second question cannot be answered in the affirmative, however, as discussed below. 

b. Control

The second factor, control, is the key factor to be assessed. See, e.g., Plaquemines - ALJ, 

25 F.M.C. at 134 (in “so conditioning the use of these private facilities, Plaquemines Port 

controls their use, and control is the key factor.”); Plaquemines - FMC, 25 F.M.C. 59, 66-67 (An 

entity need not directly or physically provide terminal services to be deemed an ‘other person’ 

subject to the Act. . . . it is the control of terminal rates and practices which constitutes 

‘furnishing’ terminal facilities and confers Commission jurisdiction.) Whether Respondents 

control access to private facilities to enforce their charges will be considered first, followed by 

whether Respondents exert significant control. 

1. Do Respondents Control Access to Private Facilities

to Enforce Their Charges?

Regarding question one, the evidence shows that neither Gateway nor CSC control access 

to private facilities to enforce their charges. Both Gateway and CSC have authority to “invoice,” 

but not to exclude based on failure to pay such invoices. FOF 33, 43-45, 67, 69, 72-73. This is 

not akin to the situation in Plaquemines, where the presiding officer found that the tariff rules 

written and published by Plaquemines Port allowed the port to “impose civil sanctions, including 

the placing of vessels, owners, agents, and users of Plaquemines Port facilities on a delinquent 

list with consequent denial of further use of the Port or its facilities” for failure to pay 

Plaquemines Port’s tariffs. Plaquemines - ALJ, 25 F.M.C. at 98. Indeed, Plaquemines Port had 

even written into its tariff rules the possibility of criminal sanctions, such that a “failure to pay 

Plaquemines Port the proper toll, charge or fee for use of any facilities” could result in the 

person, firm, or corporation being guilty of a misdemeanor, punishable by a fine or 

imprisonment in the Parish jail, or both. Plaquemines - ALJ, 25 F.M.C. at 131; see also Puerto 

Rico Ports Auth., 919 F.2d at 805 (1st Cir. 1990) (emphasizing that the Plaquemines Port tariff 

provided that any vessel failing to pay the fee would be denied “access to the Port and the 

private facilities within its jurisdiction.”). 

5

 This decision by the Commission granted a joint petition to approve a settlement and 

discontinue proceedings and also modified the analysis utilized to find jurisdiction over the 

Canaveral Port Authority. The Commission explained that upon “further consideration of the 

Commission’s Order in Docket No. 02-02 and the ALJ’s Initial Decision in Docket No. 02-03, 

we have realized that, while the findings of jurisdiction over CPA are correct, the analyses are 

unnecessarily restrictive.” Canaveral Port Authority, 2003 WL 21551810, at *5. 

7 F.M.C.2d
61

By contrast, here, there has been no showing that any of Respondents have the ability or 

authority, or have even attempted, to control access to private facilities to enforce their charges. 

See, e.g., CX 1140-1141 ¶¶ 29-35 (no assertions that Gateway denies entry based on failure to 

pay fees); CX 1127-1128 ¶¶ 27-28 (no assertions that CSC denies entry based on failure to pay 

fees). ILA contends, for example, that “now, in both ports, if a carrier fails to pay either CSC’s 

or Gateway’s gate fees, Respondents have the ability to deny that carrier access to the facility in 

order to transport its cargo on road trucks.” However, ILA provides no valid support for this 

contention. 

ILA notes in its Reply brief: “Respondents claim that the GPA and SCSPA police are 

generally responsible for terminal security, including who enters and exits the facility through 

terminal security gates. But the ILA never argued that Respondents have control over these 

security gates.” Reply at 9 n.14. With agreement over the fact that the relevant port authorities 

control security, including who enters and exits the facility, all that is left pointing to 

Respondents’ “control over access to facilities” is supposition. For example, ILA asserts: “Mr. 

Grimes states that the fact that carriers are billed weekly, rather than daily, for their services is 

somehow indicative that Gateway cannot deny access to carriers who refused to pay their fees. 

But of course Gateway would also be able to deny access to a carrier who does not make its 

weekly payments.” Reply at 8 n.10. Such assertions do not carry ILA’s burden here, and no other 

supportable proof has been referenced. Meanwhile, the GPA-Gateway Agreement takes care to 

describe the limits of Gateway’s authority. See, e.g., FOF 25-39. The CSC-SCPA Agreements 

likewise affirm SCPA’s authority, and the requirement that CSC accede to SCPA rules and 

requirements. See, e.g., FOF 50-55, 58-63. 

2. Do Respondents Exert Significant Control?

Fundamentally, Gateway and CSC have not been shown to evidence the significant level 

of control required. See, e.g., Plaquemines – FMC, 25 F.M.C. at 66-67 (“Conditioning access to 

a port’s private facilities upon the payment of a charge for governmental services reflects 

significant threshold control over terminal facilities” and the “combination of the Port’s 

exclusive ability to furnish such terminal services, its assessment of selective transfer cargo fees 

and its control of access to the private facilities results in fundamental control over the rates and 

practices of terminal facilities”) (emphases added); see also Puerto Rico Ports Auth., 919 F.2d at 

806 (stating that Plaquemines Port “had complete control over the fees and charges levied by the 

owners of private terminal facilities. Through its plenary control over the private terminal 

facilities, the Port became a de facto terminal operator” and concluding that “PRPA did not 

exercise the type of plenary control over Ponce terminal facilities that [Plaquemines] Port 

exercised over private terminal facilities”) (emphases added). Instead, based on the facts 

developed, it is clear that GPA and SCPA remain in control as marine terminal operators, and 

that status is made evident by the agreements themselves. Gateway and CSC are granted 

sufficient authority to perform their designated stevedoring and gate services functions, but their 

authority is bounded. They have not been shown to have been provided with any authority of 

significance beyond that. 

Certainly, Gateway and CSC’s roles at the respective ports do not support a “de facto 

marine terminal operator status” for either. This is particularly the case because control needs to 

have been exercised. Lake Charles Harbor, 2007 WL 2468431, at *5 (“An essential element in 

7 F.M.C.2d
62

Plaquemines was that Plaquemines Port had actually exercised control by implementing a tariff 

rule that effectively denied access to private facilities as a consequence of non-payment.” 

(emphasis added)). Gateway and CSC are authorized to provide services as designated in 

agreements with relevant port authorities, following rules and procedures established by port 

authorities. They must follow MTO tables, except as otherwise specified in agreements. See, e.g., 

FOF 26, 31, 50, 52, 60, 62. GPA’s control even includes the option to veto Gateway’s pricing 

with carriers over vessel stevedoring and gate fees under certain conditions. FOF 34. SCPA, on 

the other hand, did not assure themselves an ability to veto CSC pricing. However, under the 

agreement, CSC is forced to commit to be market competitive and for its pricing to “bear a 

reasonable relationship to accepted norms for cost and profit standards for similar services in the 

South Atlantic port market” and to “be related to productivity routinely achieved on container 

ships at the Port.” FOF 55. 

In Plaquemines, the determination that Plaquemines Port was a marine terminal operator 

did not rest on an ability to set prices alone. The outcome hinged on the ability of Plaquemines 

Port to exclude entry to port facilities for nonpayment of tariffs. See, e.g., Plaquemines - FMC, 

25 FMC at 66 (Plaquemines Port “has imposed utilization of its services and payment of its fees 

as an unavoidable appurtenance of all private terminal facilities.”). As discussed above, none of 

Respondents have any authority, ability, or history of being able to exclude entry to port facilities 

for nonpayment of their fees. Gateway and CSC stand as service providers, chosen by their 

respective port authorities, GPA and SCPA. These port authority decision-makers concluded that 

port operations would be improved by instituting an exclusive container vessel stevedoring 

provider for reasons of efficiency, sustainability, and other enumerated factors. See, e.g., FOF 

24, 49. That Gateway and CSC offer container vessel stevedoring at the behest of the port 

authorities does not establish a significant level of control by Gateway or by CSC. Neither does 

Gateway’s selection as the exclusive gate services provider advance ILA’s arguments where the 

actual gate services provided are limited, under control of GPA decisions, rules, and regulations, 

and where GPA police is the entity empowered to restrict terminal entrance. See, e.g., FOF 24-

45. ILA’s arguments with respect to gate services are also contradicted by the facts, for example,

ILA contends “Respondents cannot deny that Gateway and CSC have full operational control

over gate facilities as the ‘exclusive providers’ of gate operation services in the Ports.” Reply at

8 (emphasis added). Yet, as ILA acknowledges elsewhere in its briefing, “the Charleston Gate

Company performs gate service at the Port of Charleston.” Brief at 16; see also FOF 15, 55. In

short, the evidence supports precisely what the contracts describe – that Gateway and CSC are

third party service providers, serving at the discretion of the port authorities, which port

authorities remain in control as the marine terminal operators. See, e.g., FOF 23-45, 47-63.

It is noteworthy that the record contains no complaints from truckers or ocean carriers 

regarding stevedoring or gate fees, stevedoring or gate practices, or any lack of access to any 

facilities at the Port of Savannah or the Port of Charleston. In River Parishes Co. v. Ormet 

Primary Aluminum Co., the Commission was evaluating whether the marine terminal operator’s 

grant of an exclusive contract for assist tugboat services at Burnside Terminal violated the 

Shipping Act. Docket No. 96-06, 1999 WL 125991, at *1 (FMC Feb. 3, 1999). The Commission 

held that the complainant had failed to meet its burden of proof on the merits, also observing: 

[T]he vessels calling at Burnside do indeed require assist tug service, and they

appear satisfied with the service they are receiving. While in Gulf Container Lines

7 F.M.C.2d
63

the complainant was a customer of the terminal, here the complainant is an 

erstwhile competitor with the terminal’s service in question, and it is difficult at 

best to assess what the customers (of both tug and terminal) have to complain 

about the sole provider system if the cost to them is lower and the service the 

same. In Gulf Container Lines, the complainant argued that the services being 

forced upon it were unwanted, unneeded and of very poor quality. Here customers 

are not complaining about the service. It is therefore unnecessary for us to 

speculate about the concerns of vessel interests if they do not register any 

complaints.” 

1999 WL 125991, at *33 (citation omitted). 

While the lack of trucker and ocean carrier complaints here is not dispositive, it 

reinforces the need for ILA to provide evidence supporting such claims as “if a carrier does not 

agree to gate fees in Savannah or Charleston it is then otherwise forced to select another port . . . 

to ship its cargo.” Reply at 15; see also Brief at 12. Here, the evidence presented shows that none 

of Respondents have a level of control analogous to that expressed in Plaquemines; rather, what 

Respondents can provide is limited, while the port authorities’ control is assured across the 

breadth of the relationship. 

If it had been established that any of Respondents furnished terminal facilities, it would 

also have been necessary for ILA to establish that such relevant facilities were provided in 

connection with a common carrier, to perfect marine terminal operator status. Lake Charles 

Harbor, 2007 WL 2468431, at *7. However, since ILA has not carried its burden of persuasion 

regarding any of Respondents either furnishing or operating terminal facilities, the question of 

whether terminal facilities are provided in connection with a common carrier need not be 

addressed. 

2. Exclusive Stevedoring

ILA advances as a separate argument that jurisdiction can be supported entirely based on 

the exclusive provision of stevedoring by Gateway and CSC at the Ports of Savannah and 

Charleston, respectively. Brief at 11-13. It points to Petchem and Canaveral Port Authority, 

asserting these cases support the proposition that “once a carrier is required to use a particular 

entity for a marine terminal service, access to the terminal becomes conditioned on that entity, 

and the entity is considered a marine terminal operator.” Brief at 11. However, ILA’s argument 

does not acknowledge key distinctions made by the Commission across these and similar cases. 

In the Commission’s assessment of jurisdiction over Canaveral Port Authority (“CPA”), 

the key question was not whether CPA itself was a marine terminal operator; “CPA had 

conceded it was a marine terminal operator.” Canaveral Port Authority, 2003 WL 21551810, at 

*5 (emphasis added). Rather, CPA argued that the Commission did not have jurisdiction over

CPA’s specific activities in question – its towing operations. Canaveral Port Authority - Possible

Violations of Section 10(B)(10), Unreasonable Refusal to Deal or Negotiate, Docket 02-02, slipop at 2 (FMC Feb. 24, 2003). In the present case, by contrast, it is the initial question – whether

any of Respondents are in fact marine terminal operators – that is at issue. As the First Circuit

reasoned in Puerto Rico Ports Authority, “To support the exercise of Commission jurisdiction, it

7 F.M.C.2d
64

must be determined initially that the one providing the service is a marine terminal operator – in 

the business of furnishing wharfage, dock, warehouse, or other terminal facilities in connection 

with a common carrier. Only then may a court turn to the second half of the jurisdictional inquiry 

under 10(d)(1) and determine whether certain activities are related to or connected with 

receiving, handling, storing, or delivering property.” 919 F.2d 799, 803 (“Contrary to the parties’ 

assertions, however, those activities alone are not sufficient to confer jurisdiction on the 

Commission.”). 

Further, the entity deemed to have “furnished” terminal facilities in Petchem and 

Canaveral Port Authority is not the analog to the Respondent joint ventures – Gateway and CSC 

– but rather is the analog to the Port Authorities – GPA and SCPA. In Canaveral Port Authority,

the Commission found jurisdiction over the decisionmaker, CPA, who had “usurped the right of

carriers to choose their tug operator” by deciding that Seabulk would have an exclusive

franchise. 2003 WL 21551810, at *5-6. It was the Port Authority of Georgia and the Port

Authority of South Carolina State that decided to institute an exclusive stevedore at their

respective ports, not Gateway and CSC (the JVs selected as exclusive stevedores). See also

Marine Repair Services of Maryland, Inc. v. Ports America Chesapeake, LLC, Docket No. 11-

11, 2013 WL 9808672, at *13 (ALJ Jan. 10, 2013) (denying complainant’s claims, including its

challenge of PAC’s “exercise of its contractual right of exclusivity,” explaining that the adoption

of complainant’s position “would call into question the enforceability of all ‘quiet enjoyment’

leases of space in marine terminals regulated by the Commission and would require that their

exclusivity provisions be affirmatively justified by the parties to the leases[,]” concluding:

“[s]uch an expansion of Commission precedent is unsupported by applicable law.”) (admin. final

March 20, 2013).

Finally, the Commission has been explicit in stating that it does not assert jurisdiction 

over stevedoring activities. Final Rule, Exemption of Certain Marine Terminal Arrangements, 57 

Fed. Reg. 4578, 4581 n.16 (Feb 6, 1992) (“The Commission does not assert or claim jurisdiction 

over stevedoring activities”). Thus, it would be a particular stretch to deem Respondents here 

marine terminal operators (and thus subject to Commission jurisdiction) on the basis of their 

stevedoring activities. 

3. Other Arguments

ILA makes a number of other assertions, seemingly intentioned to demonstrate 

Respondents’ status as MTOs via a classic definition. For example, ILA contends “CSC and 

Gateway are so interconnected with the Ports Authorities and are so involved in the day-to-day 

operations of the Ports’ terminal facilities (and the services connected therewith) that they share 

joint operational control with SCSPA and GPA over the Ports’ terminal facilities.” Reply at 11; 

see also Reply at 15-16 (asserting that “office space leased by Respondents, among the other 

extensive property leased or licensed to Respondent, further illustrates Respondents’ extensive 

presence at the terminals and their involvement with the day-to-day operations of the terminal 

facilities”). However, coordination is not the equivalent of control. While the factual record 

supports that there is coordination and communication between the port authorities and 

Gateway/CSC, such coordination and communication does not change the fundamental power 

dynamic. As developed in the factual record, Gateway and CSC perform their designated and 

limited functions; they can otherwise make requests and recommendations, but ultimately the 

7 F.M.C.2d
port authorities decide matters pertaining to marine terminal operations. See, e.g., FOF 24-41, 

49-62.

ILA also points to evidence specific to Respondents other than Gateway and CSC, for 

example asserting that SSA operates an off-pier warehouse in Charleston; and claiming that 

Respondents “misunderstand what the office space, training areas, yard space, and other marine 

terminal facilities leased by Respondents on the terminals show.” Reply at 13, 15; see also Reply 

at 6 n.6 (where ILA contends Respondents “lease or license large swaths of the terminal facilities 

in both Savannah and Charleston (including gate booths, yard space, office buildings, 

warehouses, training areas, and the use of dockage, wharfage, and other terminal areas as needed 

to perform their stevedoring and gate services).”). 

These and other examples ILA points to either are not sufficiently supported with facts or 

are not relevant to the outcome. For example, an entity having office space or space to store 

supplies used by the entity itself does not constitute that entity’s furnishing of marine terminal 

facilities. As for ILA’s off-pier warehouse argument, ILA has not provided the legal support 

necessary to establish that these activities are sufficient to find an entity to be a marine terminal 

operator under the Shipping Act. Further, without reliable evidence to support them, statements 

in declarations to the effect that an entity “maintains complete control over the marine terminal” 

or that it “completely controls the shipping and storage yards within the terminals, as well as all 

movements of cargo throughout the yard” are not proof of the same. See, e.g., CX 1120-21; CX 

1126; see also CX 1132; CX 1139. 

ILA has not established by a preponderance of the evidence that any of the named 

Respondents herein are marine terminal operators, and accordingly, its claim is denied. 

IV. ORDER

Upon consideration of the record herein, the arguments of the parties, the findings and

conclusions set forth above, and the determination that ILA has not carried its burden of 

demonstrating by a preponderance of the evidence that any of Respondents are marine terminal 

operators, it is hereby 

ORDERED that the claims against each of the Respondents be DENIED. It is 

FURTHER ORDERED that ILA’s Amended Complaint against each of Respondents be 

DISMISSED WITH PREJUDICE. It is 

FURTHER ORDERED that any other pending motions or requests be DISMISSED AS 

MOOT. It is 

FURTHER ORDERED that this proceeding be DISCONTINUED. 

Linda S. Harris Crovella 

Administrative Law Judge 

65 7 F.M.C.2d
 

 

 

 

 

FEDERAL MARITIME COMMISSION 

INTERNATIONAL LONGSHOREMAN’S ASSOCIATION, 

Complainant 

v. DOCKET NO. 22-12 

GATEWAY TERMINALS, LLC; CHARLESTON STEVEDORING

CO., LLC; PORTS AMERICA FLORIDA, INC.; CERES MARINE

TERMINALS, INC.; AND SSA ATLANTIC, LLC, Respondents. 

Served: October 3, 2023 

NOTICE OF COMMISSION DETERMINATION TO REVIEW

Notice is given that, pursuant to 46 C.F.R. § 502.227, the Commission has determined to 

review the Administrative Law Judge’s September 29, 2023, Initial Decision in this proceeding. 

Amy Strauss 

Acting Secretary 

66 7 F.M.C.2d
 

 

FEDERAL MARITIME COMMISSION 

67

MSRF, INC., Complainant 

v. DOCKET NO. 22-21 

YANG MING TRANSPORT CO., Respondent. 

Served: October 11, 2023 

NOTICE NOT TO REVIEW

Notice is given that the time within which the Commission could determine to review the 

Administrative Law Judge’s September 7, 2023, Initial Decision Approving Settlement Agreement 

has expired. Accordingly, this decision has become administratively final. 

Amy Strauss 

Acting Secretary 

7 F.M.C.2d
 

 

 

 

 

 

 

68

FEDERAL MARITIME COMMISSION 

MARINE TRANSPORT LOGISTICS, INC., 

Complainant, 

Docket No. 22-23 

CMA CGM, S.A., 

Respondent. 

Served: October 30, 2023 

BY THE COMMISSION: Daniel B. MAFFEI, Chairman, 

Rebecca F. DYE, Louis E. SOLA, Carl W. BENTZEL, Max 

VEKICH, Commissioners. Commissioner BENTZEL, concurring. 

Commissioner VEKICH, concurring. 

Order Affirming Denial of Motion 

This case is before the Commission on an appeal of an Order 

of the Administrative Law Judge (ALJ) denying a motion by 

Respondent CMA CGM, S.A. (CMA) for a Letter of Request to 

French authorities under the Hague Evidence Convention. CMA, a 

common carrier headquartered in Marseille, France, claims that 

French law bars it from providing any documents in response to the 

requests of Complainant Marine Transport Logistics, Inc. (MTL) 

under ordinary Federal Maritime Commission (FMC) procedures, 

7 F.M.C.2d
 

 

 

Marine Transport Logistics, Inc. v. CMA CGM, S.A. 2 

and it asserts that instead Hague Convention procedures must be 

used. 

For the reasons set forth below, we deny the appeal and 

affirm the ALJ’s Order. CMA has failed to show that the ALJ abused 

her discretion in rejecting CMA’s unprecedented demand that it be 

permitted to provide no documents in response to MTL’s discovery 

requests except through Hague Convention procedures, in a case 

that involves the shipment of containers from a U.S. port by CMA’s 

U.S. subsidiary. CMA remains free to make objections as to specific 

requests or documents, on foreign law or other grounds. 

I. BACKGROUND

On September 7, 2022, MTL, a Non-Vessel Operating 

Common Carrier (NVOCC), initiated this case with a Complaint 

alleging that CMA-CGM (America), L.L.C. (CCA), a VesselOperating Common Carrier, had violated 46 U.S.C. § 41102(c) of 

the Shipping Act of 1984 in connection with the handling of eight 

containers. Complaint; Order on Respondent’s Motion for Letter of 

Request and Extension of Time, March 28, 2023 (Order) at 2-3. An 

Amended Complaint adding CCA’s parent company, CMA, was 

filed on December 9, 2022, and on December 29 the ALJ issued an 

order, following a joint motion, permitting the amendment of the 

case caption to list only CMA as the Respondent. Order at 2. In the 

December 29 order, the ALJ noted that as part of the joint motion, 

CMA had agreed to be responsible for the actions of CCA “and to 

make available any discovery sought regarding actions by CCA.” 

Id. 

On March 9, 2023, CMA filed a Motion for Extension of 

Time and for Compliance with French Law and the Hague 

Convention. Order at 1. That Motion argued that CMA could not 

provide documents in response to MTL’s pending document 

requests until CMA had obtained the approval of French authorities 

under French law. Id. at 1-2. With its motion CMA provided a letter 

from the French Ministry of Finance regarding the requirements of 

69

7 F.M.C.2d
Marine Transport Logistics, Inc. v. CMA CGM, S.A. 3 

French law, but CMA did not provide a copy of the document 

requests with which it was refusing to comply. Id. at 1, 3. On March 

16, MTL filed a Response to CMA’s motion that did not expressly 

oppose the Motion, but did raise objections. MTL emphasized that 

CMA had not produced any documents at all, not even basic 

“demurrage related documents,” and that MTL had consented to the 

substitution of CMA for its U.S. subsidiary as respondent in the case 

in part based on CMA’s assurance that that change would not affect 

compliance with discovery requests. Order at 1-2; MTL Motion 

Response at 1-2. In a March 16 Motion for Leave to Reply that the 

ALJ treated as a reply, CMA argued that the French legal 

requirements would apply even if its U.S. subsidiary was the only 

respondent in the case. Order at 2; CMA Motion Reply at 2. 

The ALJ denied CMA’s Motion in its March 28, 2023 Order. 

The ALJ concluded that CMA had failed to justify its refusal to 

produce documents in response to a request made under FMC 

procedures. Order at 3-4. The Order noted that although the parties 

had not provided the actual requests at issue, in light of the 

Complaint’s allegations they likely related to container shipments 

from a U.S. port arranged by two U.S. companies, and that CMA 

had failed to show, as it had to, that use of the Hague Convention 

was actually necessary in this case. Id. at 3. The ALJ relied on the 

factors identified in Societe Nationale Industrielle Aerospatiale v. 

United States District Court for the Southern District of Iowa, 482 

U.S. 522, 543-44 & n.28 (1987), particularly the interests of the 

United States, the importance of the discovery to the case, the 

connection of the materials at issue to the United States, and the 

apparent lack of such a connection to France. Order at 4. 

CMA appealed the ALJ’s Order on April 7, 2023, submitting 

its filing as an Appeal from Discovery Ruling Addressed to Persons 

and Documents Located in a Foreign Country under 46 C.F.R. § 

502.150(d) (Appeal). On April 14, MTL filed a very short Response 

(Appeal Response), which incorporated by reference its short March 

16 Response to CMA’s initial Motion. Appeal Response at 1. The 

Appeal Response again raised objections to CMA’s requested relief 

70

7 F.M.C.2d
 

 

 

 

Marine Transport Logistics, Inc. v. CMA CGM, S.A. 4 

but did not directly state that MTL opposed it. Id. MTL did note that 

its document requests were really directed at materials held by 

CMA’s U.S. subsidiary, CCA. Id. The regulation under which 

interlocutory appeals are normally filed is section 502.221, as the 

ALJ noted in her July 27, 2023 Order staying the case pending this 

appeal, and that section requires a motion, which was not filed here. 

In any event, the ALJ appears to have permitted the appeal to 

proceed. The Appeal and Appeal Response were timely filed under 

section 502.150(d). 

On appeal, CMA claims that because the ALJ’s March 28 

Order requires production of documents that are “owned and/or 

located in France,” Appeal at 1, and that are “owned by CMA and 

reside on servers located in France,” Order at 3, the Order is 

inconsistent with French law, and such materials must instead be 

produced through Hague Convention procedures. Appeal at 1-3, 6-

8. CMA relies heavily on the Supreme Court’s ruling in

Aerospatiale and the factors that are evaluated in conducting the

“comity analysis” described in that case. Id. at 14-19.

II. DISCUSSION

A. Standard of Review

The Commission reviews discovery orders under an abuse 

of discretion standard. The Commission's rules do not expressly 

address the standard of review in this context. See Rana v. Franklin, 

FMC No. 19-03, 2022 WL 1744905, at *4 (FMC May 25, 2022); 

Kawasaki Kisen Kaisha, Ltd. v. Port Auth. of N.Y. & N.J., FMC No. 

11-12, 2014 WL 7328475, at *7-8, 2014 FMC LEXIS 35, at *18-19

(FMC Nov. 20, 2014). However, “for situations which are not

covered by a specific Commission rule, the Federal Rules of Civil

Procedure will be followed to the extent that they are consistent with

sound administrative practice.” 46 C.F.R. § 502.12. “In reviewing

district courts’ orders on discovery, the United States Courts of

Appeal apply an abuse of discretion standard because a ‘narrowly

circumscribed’ scope of review is consistent with district courts’

71

7 F.M.C.2d
 

 

 

 

Marine Transport Logistics, Inc. v. CMA CGM, S.A. 5 

‘considerable discretion in managing discovery’ and their ‘broad 

discretion to impose sanctions for discovery violations under Rule 

37.’” Rana, 2022 WL 1744905, at *4 (quoting Parsi v. Daioleslam, 

778 F.3d 116, 125 (D.C. Cir. 2015)) (additional citations omitted). 

B. Ordering CMA to Respond to Document

Discovery Through Ordinary Commission

Procedures Was Not an Abuse of Discretion

In the March 28 Order, the ALJ acted well within her 

discretion in rejecting CMA’s arguments as insufficient to justify 

blanket non-compliance with discovery requests in FMC 

proceedings. Order at 3-4. In her decision, the ALJ relied on cases 

establishing that the party seeking to avoid discovery under the 

Federal Rules of Civil Procedure in this context must show that 

Hague Convention procedures are necessary, see Luminati Networks 

Ltd. v. Code200, Civ. No. 19-396, 2021 WL 2819457, at *2, 2021 

U.S. Dist. LEXIS 128634, at *10 (E.D. Tex. Feb. 1, 2021), because 

a foreign law “actually bars the production or testimony at issue,” 

Alfadda v. Fenn, 149 F.R.D. 28, 34 (S.D.N.Y. 1993). And, the ALJ 

noted, even where evidence is physically located in a foreign nation, 

the Hague Convention does not deprive federal courts of authority 

to order foreign entities before them to produce that evidence. 

Aerospatiale, 482 U.S. at 539-40. It is worth noting that CMA does 

not question the FMC’s jurisdiction over it. In addition, the Supreme 

Court emphasized in Aerospatiale that Hague Convention 

procedures are not mandatory or exclusive, but an optional method 

to obtain evidence where a particular situation calls for it. Id. at 540-

41. 

The ALJ proceeded to evaluate CMA’s request under the 

five factors identified in Aerospatiale and concluded that all of the 

factors weighed against the request. Order at 4. Specifically, the 

factors are: (1) the importance to the litigation of the information 

requested; (2) the degree of specificity of the request; (3) whether 

the information originated in the United States; (4) the availability 

of alternative means of securing the information; and (5) the extent 

72

7 F.M.C.2d
 

 

 

Marine Transport Logistics, Inc. v. CMA CGM, S.A. 6 

to which noncompliance with the request would undermine 

important interests of the United States, or compliance with the 

request would undermine important interests of the state where the 

information is located. See 482 U.S. at 543-44 n.28. The ALJ did 

not address each factor individually, but emphasized that the 

discovery requested was important to the case, especially since no 

documents had been provided; that CMA’s refusal to produce any 

material was overbroad; that there was no indication the requested 

documents originated in France or were created by French citizens; 

that CMA was a party to the case and an FMC-regulated entity that 

could produce the documents through its U.S. subsidiary; and that 

permitting CMA to refuse to produce any documents in response to 

MTL’s request would “undermine important interests of the United 

States.” Order at 4. 

The ALJ’s overall analysis of the precedent applicable to 

CMA’s request is correct. In particular, CMA did not show that use 

of the Hague procedures is necessary. Despite CMA’s assertions 

that the requested documents are “located in France,” Order at 3, 

there is no specific claim here (much less persuasive evidence) that 

the documents are unavailable in the United States from CMA’s 

U.S. subsidiary. And CMA has not shown that the mere presence of 

copies of documents in France would be sufficient to bar ordinary 

discovery here. The U.S. Complainant MTL states that it dealt with 

CMA’s U.S. subsidiary with regard to the shipments at issue, which 

went from a U.S. port to nations other than France, and as the ALJ 

noted, there remains no indication that these shipments went to 

France or included involvement by French residents. Id. at 3. As the 

ALJ also noted, and CMA later confirmed, the documents sought 

include bills of lading, emails, and other common transport-related 

documents related to the shipments. Id.; Appeal at 16. CMA 

presented no reason to the ALJ that these materials would not be 

present in the United States. 

The ALJ’s overall evaluation of the Aerospatiale factors is 

also correct. Basic document discovery is obviously important to 

FMC litigation like this case (factor 1), and the conduct of litigation 

73

7 F.M.C.2d
 

 

7 

74

Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

regarding alleged violations of federal law clearly serves important 

interests of the United States, while it is difficult to see how 

reasonable discovery of the documents at issue here would impair 

important interests of France (factor 5). In addition, while it seems 

possible that some responsive documents did not originate in the 

United States, the ALJ was provided with no specific showing that 

most or even any of them did (factor 3). It seems clear that most or 

all responsive documents are available through the alternative 

means of CMA simply producing them, whether through its U.S. 

subsidiary or not, in the ordinary course (factor 4). The ALJ was 

unable to analyze the specificity of the document request (factor 2) 

because CMA failed to provide a copy of the request with its 

Motion. Although this failure would appear be a waiver of any CMA 

claim regarding factor 2, a review of the requests that CMA did 

belatedly provide with its Appeal indicates that five of the seven 

requests focus on the eight specific containers described in the 

Complaint, with only the last two requests seeking documents about 

similar complaints made to CMA and CMA revenue from 

demurrage- and detention-related charges. See Appeal Exhs. 4-5. 

CMA did not show that such requests had to be pursued using Hague 

Convention procedures. 

CMA has pointed to no prior FMC proceeding in which the 

FMC or any court has denied all ordinary document discovery on 

the basis that CMA urges here. On the contrary, district courts are 

free to deny requests like the one CMA makes here. See, e.g., 

Luminati Networks, 2021 WL 2819457 (denying a request for 

issuance of a Hague Convention letter where most of the five 

Aerospatiale factors weighed against the request). Moreover, the 

ALJ here cited a recent case in which a Florida district court had 

denied a stay that CMA’s U.S. subsidiary had requested on a 

comparable basis. Order at 3, citing De Fernandez v. CMA CGM 

S.A., Civ. No. 21-22778, 2022 WL 2713737 (S.D. Fla. July 12,

2022). That case involved claims by Cuban exiles under the HelmsBurton Act and the potential application of French and European

Union “blocking statutes,” so the context was somewhat different.

But in evaluating a request by CMA’s U.S. subsidiary to stay the

7 F.M.C.2d
 

 

 

 

8 

75

Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

case on the grounds that the blocking statutes prevented CMA itself 

from participating, the court did undertake a comity analysis under 

Aerospatiale, finding that the balance of international interests 

weighed against the requested stay. See 2022 WL 2713737, at *9-

11. And the court noted that U.S. courts have long been skeptical of

claims that such blocking statutes present any real risk to French

nationals, as they had been enacted to protect those nationals from

overseas discovery and to give them “tactical weapons and

bargaining chips in foreign courts.” Id. at *6 (citations omitted).

In fact, the apparent role CMA has played in efforts to obtain 

discovery from its U.S. subsidiary in this case is a point supporting 

the ALJ’s decision. As MTL notes, its discovery requests are 

directed at documents maintained by that subsidiary, Appeal 

Response at 1 – something CMA does not appear to dispute. It is 

true that CMA, the French parent, was substituted as the only 

Respondent here, with MTL’s consent. But as the ALJ noted, the 

December 29, 2022 Order allowing that substitution makes clear 

that CMA had agreed to “make available any discovery sought 

regarding actions by” its subsidiary. Order at 2. 

MTL also notes that CMA produced the same type of 

material sought here in response to MTL’s complaint in FMC case 

18-07, with no apparent reference to French authorities or

prosecution as a result. Appeal Response at 1. The respondent in that

case was CMA’s U.S. subsidiary. The parties settled the case after

an exchange of initial discovery. See FMC No. 18-07, Feb. 18, 2020

Initial Decision Approving Settlement. Here, CMA was put on

notice of MTL’s argument about FMC 18-07 by MTL’s Response

to CMA’s Motion. See Motion Response at 2-4. Yet CMA has

provided no specific explanation as to why the prior case was

different, including in its Motion Reply. CMA has generally argued

that it only became aware of more stringent French legal

requirements earlier this year. Order at 2; Appeal at 3-4.

In any event, even without resort to Hague Convention 

procedures, CMA can still object to specific requests or documents 

7 F.M.C.2d
 

 

9 

76

Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

as beyond the reach of permissible discovery under FMC rules. As 

to discovery, the Shipping Act directs the FMC to follow the Federal 

Rules of Civil Procedure to the extent possible, 46 U.S.C. § 

41303(a)(2), and the FMC has established extensive rules of practice 

and procedure at 46 C.F.R. § 502. In particular, section 502.141(e) 

provides the general standards for permissible discovery, as well as 

limitations on the frequency and extent of discovery. And section 

502.141(j) provides for protective orders. In short, the FMC’s 

existing procedures provide ample protection from impermissible 

discovery requests, and CMA remains free to invoke the relevant 

provisions, like any other party before the Commission. 

C. CMA’s Arguments on Appeal Do Not Show an

Abuse of Discretion

In its Appeal of the ALJ’s March 28 Order, CMA argues 

primarily that the use of Hague Convention procedures is required 

or at least advisable in this case. Appeal at 10-19. But as the ALJ 

correctly found, CMA has not established the need for such 

procedures here, Order at 3-4, and its arguments on appeal, though 

extensive, are unavailing. Once again, CMA cites no direct 

precedent for the determination it seeks foreclosing ordinary 

document discovery in an FMC proceeding, or indeed in any 

comparable federal agency proceeding. Nor does CMA provide 

evidence showing that all, or even any, of the specific documents 

MTL seeks are unavailable in the United States. 

CMA asserts that the French law on which it relies applies 

even to documents “to be produced by” its U.S. subsidiary if those 

documents are “owned” or controlled by CMA, so its position is that 

French law would bar production under the FMC’s ordinary 

procedures even if the U.S. subsidiary was the only respondent in 

this case. Appeal at 6-8. CMA does not specifically contend that the 

7 F.M.C.2d
 

 

 

 

 

10 

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Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

law would bar even production of documents held in the United 

States about CMA’s U.S. activities, although that view would 

appear to be a logical extension of its position. But CMA cites no 

U.S. authority applying the French law to completely bar such 

discovery under the Federal Rules of Civil Procedure or in 

proceedings before a federal agency. CMA also claims that criminal 

penalties are possible if production would cause substantial harm to 

essential French interests, yet it concedes that the materials sought 

here would be very unlikely to implicate that standard, and it 

provides no example of such a prosecution. Appeal at 6. 

CMA does note that the court in the De Fernandez case, 

cited by the ALJ, later granted a request for use of a Hague 

procedure, Appeal at 8-9 & n.9, but the Order CMA cites expressly 

did not foreclose ordinary discovery of materials located in the 

United States. On the contrary, the Order stressed that use of the 

Hague procedure it permitted was for the “limited purpose” of 

getting documents or information “originating in and located in 

France” — a standard that CMA has not shown is met here as to any 

specific document, much less as to every document responsive to 

MTL’s requests. See Appeal Exh. 8, Order Granting Defendants’ 

Memorandum Supporting Request for International Assistance and 

Appointment of a Commissioner, De Fernandez, Civ. No. 21-22778 

(S.D. Fla. Apr. 6, 2023) (Doc. 128) at 2. The De Fernandez court’s 

Order also made clear that it did not relieve any party of its discovery 

obligations under the Federal Rules, “including production of 

documents and information within the possession, custody or 

control of Defendant CMA CGM (America) LLC and any agents or 

representatives of CMA CGM S.A. (France) located in the United 

States or any other jurisdiction not subject to the French Discovery 

laws or Blocking Statute.” Id. at 4. CMA is subject to similar 

discovery obligations under the FMC’s rules. 

CMA argues broadly that the Commission lacks the power 

to forego use of Hague Convention procedures as described in the 

Aerospatiale case because the FMC is not a federal court, Appeal at 

10-12, but CMA provides no authority actually saying that. Instead,

7 F.M.C.2d
 

 

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Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

it only provides general statements making the obvious points that 

the agency is not a court and that its powers are defined by Congress. 

Moreover, as noted above, those powers do authorize the FMC to 

order discovery and direct it to follow the Federal Rules to the extent 

possible, 46 U.S.C. § 41303(a)(2) — as CMA admits, Appeal at 14 

n.13 — and the FMC has established extensive rules of practice and

procedure that protect parties appearing before it, at 46 C.F.R. § 502.

CMA also argues that the use of a procedure for consultation 

through the U.S. Department of State described in 46 U.S.C. § 

41108(c)(2) is required here, Appeal at 12-14, but that claim is 

incorrect. As an initial matter, although CMA asserts that the 

procedure is required, it also says that the procedure is actually 

“unnecessary” if the agency simply follows a Hague procedure as 

CMA urges. Section 41108(c)(2) provides that if a common carrier 

resisting an FMC discovery order “alleges that information or 

documents located in a foreign country cannot be produced because 

of the laws of that country, the Commission shall immediately notify 

the Secretary of State of the failure to comply and of the allegation 

relating to foreign laws.” The statute then directs that the Secretary 

of State “shall promptly consult with the government of the nation 

within which the information or documents are alleged to be 

located” to help the FMC obtain the material. CMA cites no case 

precedent mandating use of the section 41108(c)(2) procedure. 

In any event, CMA’s claims are not clear and developed 

enough to require a consultation under 46 U.S.C. § 41108(c)(2) at 

this stage. In particular, CMA provides no clear showing that 

specific requested documents or categories of documents are 

“located” in France only, as section 41108(c)(2) would require so as 

not to permit parties to evade discovery simply by sending 

documents overseas, or that the documents are unavailable in the 

United States. 

7 F.M.C.2d
 

 

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Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

2. CMA Has Failed to Show That

Aerospatiale Requires the Use of Hague

Procedures Here

CMA argues that comity requires use of Hague Convention 

procedures in this case, relying on Aerospatiale and an analysis of 

the factors it identified. Appeal at 14-19. But a core feature of that 

case is that Hague procedures are not mandatory, 482 U.S. at 540-

41, and as the ALJ found, the relevant factors actually weigh against 

the use of such procedures here, Order at 4. 

In addressing the importance of the requested documents to 

the litigation (factor 1), CMA claims that MTL “already has most” 

of the documents it seeks. Appeal at 16. But CMA does not mention 

the demurrage-related documents MTL specifically mentioned 

needing, Motion Response at 3-4; Order at 2, nor the last two MTL 

requests, which seek certain information beyond the eight containers 

at issue, see Appeal Exhs. 4-5. In any event, vague claims that a 

litigant “already has most” of the documents it requests in discovery 

do not establish that the documents sought are unimportant to the 

litigation. CMA has not shown that the ALJ’s determination that the 

documents are important, especially since CMA has produced none, 

Order at 4, was an abuse of discretion. 

CMA argues that the ALJ mistakenly believed that the 

specificity factor (factor 2) referred to the CMA’s own request for 

Hague procedures, but that the proper analysis, of the specificity of 

MTL’s document requests, shows them to be “not at all specific” 

but “blunderbuss” and therefore appropriate for Hague procedures. 

Appeal at 16-17. First of all, the ALJ had no means of analyzing the 

specificity of MTL’s requests in her March 28 Order, since CMA 

failed to provide them until its April 7 Appeal. Leaving aside 

CMA’s potential waiver on this point, it is true that the ALJ’s 

discussion of the Aerospatiale factors includes a statement that 

CMA’s request to “block all discovery related to these containers is 

overbroad.” It seems possible that this statement was related at least 

in part to factor 1 and was meant to emphasize that the need for 

7 F.M.C.2d
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Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

discovery is great in a situation where none has been provided. But 

in any event, a review of the actual MTL requests does not support 

CMA’s claim that they are so broad as to call strongly for Hague 

procedures. Appeal Exhs. 4-5. As noted above, five of the seven 

requests focus closely on documents related to the eight specific 

shipments at issue, with only the last two seeking several years of 

documents regarding similar complaints made to CMA and CMA 

revenue from demurrage- and detention-related charges. In light of 

the above, and the weight of the other factors, any perceived error 

here would be harmless. 

Turning to factor 3, where the information at issue 

originated, CMA asserts vaguely that “[s]ome of the requested 

documents most likely originated in the United States,” while 

“[o]thers did not,” but that this is irrelevant because all that matters 

under French law is that the documents are “owned by” CMA. 

Appeal at 18. However, as the ALJ noted, the record contains no 

indication that the requested materials originated in France. Order at 

4. Nor does CMA claim that any of the requested documents are

unavailable in the United States. And a claim that CMA can avoid

producing materials that originated in or are maintained in the

United States simply because copies may exist in France, or because

a French company may be viewed as “owning” the documents,

could easily undermine FMC and other federal discovery

procedures. CMA provides no support in United States law for such

a position, and in fact one of its own authorities, the De Fernandez

Order, is to the contrary. See Appeal Exh. 8 at 2, 4.

With regard to factor 4, the availability of alternative means 

of securing the information, CMA argues that the Hague procedures 

provide a good alternative. Appeal at 18. However, the ALJ properly 

understood this factor to involve whether there is an alternative to 

the Hague procedures, and as she noted, “CMA is a party to this 

proceeding, is an FMC-regulated entity, and is the most appropriate 

entity to provide these documents, although its American subsidiary 

could also provide the documents.” Order at 4. In other words, the 

available alternative is that CMA simply produces responsive 

7 F.M.C.2d
 

 

 

 

 

 

 

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Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

material under ordinary FMC discovery procedures. 

Finally, with regard to the balance of interests of the United 

States and the “state where the information is located” (factor 5), 

CMA faults the ALJ for not fully explaining her conclusion, and it 

claims that in any case French interests prevail here, relying on 

precedent describing France’s interests in protecting its citizens and 

controlling access to information within its borders. Appeal at 18-

19. It is true that the ALJ did not provide a direct explanation of her

determination that “noncompliance with the [document] request

would undermine important interests of the United States.” Order at

4. But those interests are easy to discern from the context. As the

Order made clear, CMA is claiming the right to provide no

documents whatsoever in response to a request by the complainant,

in an adjudication at the federal agency charged with enforcing U.S.

maritime law, using the ordinary discovery procedures detailed in

that agency’s regulatory structure, as mandated by Congress. In

terms of the French interests at stake, it is difficult to see how any

important French interests are implicated by the disclosure of

materials related to eight containers shipped from the United States

by U.S. companies to ports outside France. Indeed, CMA has not

even shown that the materials are “located” outside the United

States, much less in France.

CMA does point to one other FMC case, Docket No. 21-05, 

in which a Hague procedure was attempted, suggesting that shows 

Hague procedures are appropriate in FMC matters and do not impair 

U.S. interests. Appeal at 19-20 nn.16-17. However, the use of a 

Hague procedure in that pending case (in which a Swiss court denied 

a request for documents from the ALJ on the basis that the request 

was “outside the scope of the Convention,” FMC 21-05, January 13, 

2023 Initial Decision on Default at 1) was the result of a joint motion 

of the parties. It provides no support for CMA’s position that such a 

course is mandatory in the current case. 

Finally, CMA emphasizes what it considers to be the speed 

and ease of the Hague procedures. Appeal at 20. But even if the 

7 F.M.C.2d
 

 

 

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Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

Commission were to accept such assurances, that would not be a 

basis for CMA to avoid the FMC’s own well-established discovery 

procedures. 

III. CONCLUSION

The Commission hereby: 

(1) DENIES Respondent CMA’s April 7, 2023

Appeal from Discovery Ruling Addressed to

Persons and Documents Located in a Foreign

Country; and

By the Commission. 

Amy Strauss 

Acting Secretary 

Commissioner BENTZEL, concurring: 

I concur with the sentiments and frustration expressed by 

Commissioner Vekich, and would further suggest that we explore 

the potential for process that would explicitly require regulated 

entities to consent with Commission process as a condition to 

operating in FMC regulated trades. 

Commissioner VEKICH, concurring: 

Although the ALJ did not impose sanctions against the 

Respondent, I believe doing so may have been warranted in this 

7 F.M.C.2d
 

 

 

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Marine Transport Logistics, Inc. v. CMA CGM, S.A. 

proceeding. The Federal Rules of Civil Procedure are followed by 

the Commission to the extent that they are consistent with sound 

administrative practice. 46 C.F.R. § 502.12. Federal Rule 26(g) 

provides that where an attorney without adequate justification 

makes discovery responses or objections that are legally 

unwarranted or interposed for an improper purpose, such as 

needlessly causing delay or increasing costs, a court “must” 

impose an appropriate sanction, which “may include an order to 

pay the reasonable expenses, including attorney’s fees, caused by 

the violation.” Further, Federal Rule 37 provides for comparable 

sanctions for unjustified failures to cooperate with discovery in 

particular contexts, including motions to compel and failures to 

comply with court orders. Outside of the discovery context, 

Federal Rule 11 provides that a court may impose comparable 

sanctions on an attorney in the event of filings made for an 

improper purpose or that are legally unwarranted. 

Litigants before the Commission are entitled to discovery to 

prove their allegations. Respondent’s argument that the Hague 

Convention bars it from providing any document discovery in a civil 

proceeding before the Commission except through the Convention’s 

procedures raises serious concern. Respondent caused substantial 

delay and additional litigation expense to the Complainant which, in 

my view, may have been based on frivolous arguments. I believe 

the Commission should consider whether the arguments advanced 

by the Respondent warrant sanctions. 

7 F.M.C.2d
 

 

FEDERAL MARITIME COMMISSION

84

RAHAL INTERNATIONAL INC., Complainant 

v. 

HAPAG-LLOYD AG, HAPAG-LLOYD (AMERICA), LLC, AND

HAPAG-LLOYD USA, LLC, Respondents 

AND 

HAPAG-LLOYD AG AND HAPAG-LLOYD (AMERICA), LLC, 

Third-Party Complainants 

v. 

MAHER TERMINALS, LLC, GCT NEW YORK LP, AND GCT 

BAYONNE LP, Third-Party Respondents. 

DOCKET NO. 23-05

Served: October 30, 2023

NOTICE NOT TO REVIEW

Notice is given that the time within which the Commission could determine to review the 

Administrative Law Judge’s September 27, 2023, decision to grant Respondent Hapag-Lloyd 

USA, LLC’s Motion for Summary Judgment and order that the complaint against Hapag-Lloyd 

USA, LLC be dismissed has expired. Accordingly, the corresponding portion of the Order on

Motion for Summary Judgement and Motion to Dismiss has become administratively final.

Amy Strauss

Acting Secretary

7 F.M.C.2d
 

 

 

 

FEDERAL MARITIME COMMISSION 

Office of Administrative Law Judges 

85

MSRF, INC., Complainant 

v. DOCKET NO. 22-20 

HMM CO. LTD., Respondent. 

Served: November 22, 2023 

ORDER OF: Linda S. Harris CROVELLA, Administrative Law Judge. 

INITIAL DECISION1

I. INTRODUCTION

A. Overview

Complainant MSRF, Inc. (“MSRF”) commenced this proceeding by filing a complaint 

alleging Respondent HMM Co. Ltd. (“HMM”) had violated the Shipping Act of 1984, as 

amended (“Shipping Act”). MSRF alleges that HMM “refused to provide MSRF enough 

commitments in its advance service contracts, instead providing only a fraction of the space 

MSRF needed at substantially higher prices;” and “refused to provide MSRF more than 

approximately 9 of the promised 25 FEUs of . . . allotted space, forcing MSRF to make alternate 

transportation arrangements with other common carriers at substantially higher spot market 

prices;” meanwhile reselling “the capacity allotted to MSRF . . . to other shippers on the same 

spot marked at substantially higher rates than those to which it agreed in the service contract;” all 

in violation of 46 U.S.C. §§ 41102(c) and 41104(a)(2), (5), (9), and (10). Complaint at 5-7. 

HMM filed an answer denying the allegations and raising affirmative defenses, including 

lack of jurisdiction; failure to state a claim under which relief may be granted; failure to allege 

essential elements under the various sections of the Shipping Act alleged; that the service 

contract at issue “contains Complainant’s exclusive remedies;” the Federal Maritime 

Commission (“Commission” or “FMC”) does not have “the authority to award damages for a 

breach of contract claim;” HMM’s conduct was reasonable; third parties were responsible for 

any alleged damages; and “Complainant has failed to mitigate its damages.” Answer at 8-9. 

date of service. 46 C.F.R. § 502.227. 

7 F.M.C.2d
 

 

86

In its briefing, MSRF indicates that it is no longer pursuing Count III of the complaint, 

alleging that HMM violated 46 U.S.C. § 41104(a)(5). Brief at 1, n. 1.2 It is less clear whether 

MSRF continues to pursue Count IV, where it alleges that HMM violated 46 U.S.C. § 

41104(a)(9). Therefore, for sake of completeness, Count IV of the complaint will be discussed 

briefly below, after Count I, alleging a violation of § 41102(c); Count II, alleging a violation of § 

41104(a)(2); and Count V, alleging a violation of § 41104(a)(10).3

MSRF filed the complaint after the June 16, 2022, changes to the Shipping Act alleging 

violations occurring prior to the modifications to the Shipping Act. In the Ocean Shipping 

Reform Act of 2022 (“OSRA 2022”), Congress modified section 41104(a)(10) prohibiting ocean 

common carriers from: “unreasonably refus[ing] to deal or negotiate, including with respect to 

vessel space accommodations provided by an ocean common carrier.” Pub. L. No. 117-146, §7, 

136 Stat. 1272, 1274 (2022). This change does not apply to this proceeding and is not discussed. 

In addition, in September of 2022, the Commission issued a Notice of Proposed Rulemaking 

(“NPRM”) regarding the definition of unreasonable refusal to deal or negotiate with respect to 

vessel space accommodations provided by an ocean common carrier. NPRM, Definition of 

Unreasonable Refusal to Deal or Negotiate with Respect to Vessel Space Accommodations 

Provided by an Ocean Common Carrier, Docket No. 22-25, 87 Fed Reg. 57674, 2022 WL 

4356068 (September 21, 2022). As well, in June of 2023, the Commission issued a Supplemental 

Notice of Proposed Rulemaking (“SNPRM”) on the same subject-matter. SNPRM, Definition of 

Unreasonable Refusal to Deal or Negotiate with Respect to Vessel Space Accommodations 

Provided by an Ocean Common Carrier, Docket No. 22-25, 88 Fed Reg. 38789-01, 2023 WL 

3973368 (June 14, 2023). The proposed rules have not been adopted, and are therefore not 

applicable to this proceeding, although comments made by the Commission regarding historical 

context and cases is discussed to a limited extent in the analysis. 

As elaborated more fully below, none of MSRF’s claims are successful. MSRF entered 

into a service contract with HMM, which was amended 14 times, yet MSRF’s claims primarily 

rely on the service contract as originally enacted, prior to the amendments. Many of the 14 

amendments were at the initiation or for the benefit of MSRF, including the addition of shipping 

lanes and the continuation of 2021 prices during the contract extension. The duration of the 

service contract was extended by amendment, and through the end of the contract, HMM carried 

almost double the minimum quantity commitment of cargo (“MQC”). MSRF fails to 

acknowledge the ongoing communication and negotiation between parties that led to the 

amendments from which MSRF derived a substantial financial benefit. MSRF does not claim 

7 F.M.C.2d
 

 

 

(and the evidence also does not support) that any kind of collusion or undue pressure led it to 

agree to these amendments. 

MSRF has not met its burden of establishing that HMM engaged in unjust or 

unreasonable conduct; provided service in the liner trade not in accordance with the rates, 

charges, classifications, rules, and practices contained in a tariff or a service contract; refused to 

deal or negotiate; or gave undue or unreasonable preference or advantage to another. Because 

none of MSRF’s claims are successful, it is unnecessary to evaluate MSRF’s damages 

calculations. 

B. Procedural History

On August 19, 2022, the Commission issued a notice of filing of complaint and 

assignment, initiating this proceeding. On September 13, 2022, HMM filed an answer to the 

complaint. On September 26, 2022, the case was reassigned to the undersigned. On October 6, 

2022, a scheduling order issued. 

On November 29, 2022, MSRF filed a motion requesting an extension of time for the 

parties to complete the depositions of fact witnesses, to which HMM consented. On November 

30, 2022, the extension of time was granted. 

On December 15, 2022, the parties filed a joint motion for entry of a confidentiality 

stipulation and a proposed protective order (“Protective Order Motion”). On January 4, 2023, an 

order granting the confidentiality stipulation and protective order issued. On January 13, 2023, 

an amended scheduling order issued. 

On April 21, 2023, MSRF filed a motion for summary decision, in addition to its 

proposed findings of fact, appendix, and a motion for confidential treatment.4

 On April 24, 2023, 

the undersigned issued an order sua sponte, accepting MSRF’s motion for summary decision as 

its initial brief. On May 12, 2023, HMM filed its opposition brief, proposed findings of fact, 

response to MSRF’s proposed findings of fact, appendix, and a motion for confidential 

treatment. On May 24, 2023, MSRF filed a reply brief, response to HMM’s proposed findings of 

fact, and motion for confidential treatment. 

On May 26, 2023, an order to correct filings issued due to both parties over-designating 

testimony and documents as confidential, as well as designating as confidential information that 

it had previously made public. The parties were ordered to resubmit confidential and public 

appendices, proposed findings of fact, missing table of contents and confidential request table, if 

not previously submitted, and supplemental motions for confidentiality. 

On June 5, 2023, HMM filed a motion to strike portions of MSRF’s reply brief, or 

alternatively, for leave to file a sur-reply, asserting that MSRF improperly raised both new facts 

4

 The email to which these filings were attached indicated that a Motion for Summary Judgment 

was also attached, but it was not. The missing motion was then provided attached to an email 

dated April 24, 2023. 

87

7 F.M.C.2d
 

 

and new arguments in its reply brief. On June 9, 2023, MSRF filed an opposition to HMM’s 

motion to strike, but assented to HMM filing a sur-reply. 

On June 9, 2023, MSRF submitted the requested filings, including a corrected public and 

confidential version of its appendix (exhibits labeled as “CX”), a corrected response to HMM’s 

proposed findings of fact, and a supplemental motion for confidential treatment. Also on June 9, 

2023, HMM submitted the requesting filings, including a corrected public and confidential 

version of its appendix (exhibits labeled as “RX”), proposed findings of fact, a table of contents 

for its appendix, and a revised motion for confidential treatment. 

On June 12, 2023, an order issued denying HMM’s motion to strike and allowing HMM 

to file a sur-reply. On June 22, 2023, HMM filed a sur-reply. 

C. Arguments of the Parties

MSRF asserts that from May to December 2021, HMM only provided MSRF with 9 of 

25 containers agreed in the service contract and although “HMM claims it fulfilled its obligations 

by later providing the necessary containers after this time period, MSRF was damaged by 

HMM’s failure to provide space when it needed it the most;” HMM violated 46 U.S.C. § 

41102(c) because its refusal to provide MSRF with the agreed upon cargo space between May 

2021 and April 2022 was not in accordance with standard shipping practices; HMM violated 46 

U.S.C. § 41104(a)(2) because by refusing to provide MSRF with the agreed upon minimum 

quantity of cargo space from May 2021 to April of 2022, HMM failed to provide service that 

was in accordance with the classifications, rules, and practices contained in the Service Contract; 

HMM violated 46 U.S.C. § 41104(a)(10) because MSRF requested, during multiple occasions, 

cargo space to ship containers from certain ports in Asia into the United States, but in almost 

every single instance where MSRF attempted to deal or negotiate for space, HMM refused to 

provide the space requested; HMM waived its opportunity to exercise the arbitration clause in 

the service contract by actively participating in the present litigation without asserting their right 

to arbitrate; and an award should be entered in favor of MSRF and against HMM in the amount 

of $228,171.52. Reply Brief at 3-8, 11-12; Brief at 1-5. 

HMM contends that MSRF fails to articulate cognizable claims under the Shipping Act; 

the record is devoid of evidence supporting any of MSRF’s claims; MSRF’s claims are no more 

than breach of contract claims; HMM did not breach the service contract and carried almost 

double the minimum quantity commitment; MSRF’s claims should be denied because the parties 

agreed to arbitrate breach of contract claims; there was no violation of 46 U.S.C. §§ 41102(c), 

41104(a)(2), 41104(a)(9), or 41104(a)(10); and MSRF has failed to support the alleged damages. 

Opposition at 8, 11-17; Sur-Reply at 3-4, 8, 11, 12. 

D. Motions for Confidential Treatment

7 F.M.C.2d

88
 

89

“take care to limit any such designation to specific material that qualifies for such protection” 

when designating material as protected under the confidentiality provision. Id. at 7. On January 

4, 2023, an order entering confidentiality stipulation and protective order was issued. The 

following requests for confidential treatment were subsequently received: MSRF’s motion for 

confidential treatment of certain materials filed April 21, 2023; HMM’s motion for confidential 

treatment of certain materials filed May 12, 2023; MSRF’s motion for confidential treatment of 

certain materials filed May 24, 2023; MSRF’s supplemental motion for confidential treatment of 

certain materials filed June 9, 2023; and HMM’s revised motion for confidential treatment of 

certain materials filed June 9, 2023. 

Both parties over-designated testimony and documents as confidential in their initial 

filings and did not show good cause to treat such wholesale redacted material as confidential in 

their motions for confidential treatment. As a result, on May 26, 2023, the parties were ordered 

to review the Initial Order instructions regarding how to file confidential material and the need to 

demonstrate by motion for confidential treatment “good cause by demonstrating that the 

information is a trade secret or other confidential research, development, or commercial 

information.” Order to Correct Filings at 2 (emphasis omitted). The Order to Correct Filings 

reiterated how to properly mark exhibits and how to designate confidential information in their 

briefs, proposed findings of fact, and responses to proposed findings of fact. In addition, the 

parties were ordered not to designate portions of documents that they had already made public in 

other filings that were not under a protective or confidentiality order. It was noted that “[s]uch 

wholesale redaction means that the public will be unable to determine if the parties’ dispute is 

similar to one they may have,” and “if all exhibits and all witness testimony with the exception 

of one declaration and portions of a few emails are considered confidential, the undersigned will 

be unable to issue a public decision that adequately addresses the facts at issue in this case.” Id. 

at 1-2. 

In its Supplemental Motion for Confidential Treatment, MSRF asserts that its revised 

filings “only [seek] to keep confidential the contents of the Service Contract and Amendments to 

the Service Contract, the Damages Spreadsheet, and the booking information in the Service 

Contract.” MSRF Supplemental Motion for Confidential Treatment at 1-2. In support of its 

motion, MSRF contends that “[t]his information must remain confidential because it contains 

sensitive pricing information and other commercially sensitive rates and terms.” Id. at 2. 

However, the revised filings continue to contain inconsistencies in confidential 

designation, for example, indicating that a number is confidential, while the same number in 

word form is not (See Declaration of David Reich (“Reich Decl.”), CX 3); indicating that certain 

terms of the Service Contracts and amendments thereto are confidential, yet including a link to a 

New York Times article in the public version of its Reply Brief where Mr. Reich disclosed some 

of those same terms during an interview (See link at page 4 of Reply Brief,5 also attached as 

Exhibit 4 to Complainant’s Reply Brief, but not referenced as included in either party’s 

appendix); and, redacting the minimum quantity of forty-foot equivalent units (“FEUs”) in the 

public version of its Reply Brief while including the originally contracted amount in the 

5 https://www.nytimes.com/2022/05/04/business/shipping-container-shortage.html 

7 F.M.C.2d
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Complaint and Brief (See Reply Brief at 5; Complaint at 3 ¶ 11 and 5-6 ¶¶ 25 and 26; Brief at 1, 

3 and 4). 

To be clear, only those items that constitute “a trade secret or other confidential research, 

development, or commercial information” within the meaning of 46 C.F.R. § 502.141(j)(1), as so 

stated in the revised motion, and which are not already in the public domain, will be accorded 

confidential treatment for purposes of this decision. 

Respondent asserts in its Revised Motion for Confidential Treatment that “HMM does 

not have a position on whether the material designated by Complainant should be accorded 

confidential treatment, but for its part HMM does not seek to designate any transcript material or 

correspondence as confidential.” HMM Revised Motion for Confidential Treatment at 2. HMM 

further stated that “[t]he only document HMM seeks to designate as confidential is the Service 

Contract because of its commercial sensitivity, including rate details and other terms that are 

unique to that agreement.” Id. HMM seeks confidential designation for the Service Contract and 

the amendments to that contract, found at RX 7-200. In addition, it seeks to designate the rate 

column in HMM’s summary table at RX 325 as confidential. HMM asserts that both the Service 

Contract and amendments and the rate column in the summary table contain non-public rates, 

terms, and other sensitive commercial information as well as references to the same sensitive 

commercial information. Id. at 3. 

46 C.F.R § 502.5(b), requiring parties to justify confidential treatment by motion, states 

in part: 

This motion must identify the specific information in a document for which protection is 

sought and show good cause by demonstrating that the information is a trade secret or 

other confidential research, development, or commercial information pursuant to § 

502.141(j)(1)(vii). The burden is on the party that wants to protect the information to 

show good cause for its protection. 

46 C.F.R § 502.5(b). The parties’ revised motions for confidentiality significantly limit the 

material for which they now request confidential treatment. However, as noted, some 

designations continue not to be consistent with the motion or are inconsistently applied in the 

revised filings. For example, HMM’s revised motion is properly limited to seeking confidential 

treatment regarding the Service Contract and its amendments because those documents contain 

“rates, terms, and other sensitive commercial information.” However, some of those terms and 

rates have been disclosed in public versions of filings or in other public forums. Indeed, some 

terms from the Service Contract were disclosed publicly prior to the date that the Protective 

Order Motion was filed, which was nearly four months after the complaint was filed, and several 

months after the answer was filed. As an example of information that has been made public, 

HMM’s minimum quantity commitment to MSRF of 25 containers from Asia to the United 

States is available in numerous places including in the Complaint, the public version of HMM’s 

appendix, and in a New York Times article. See, e.g., RX 216; Reply Brief, Exh. 4. Additional 

portions of the service contract are also now public because of their inclusion in proposed 

findings of fact filings and in public versions of party appendices, including deposition 

transcripts. See, e.g., CRPFF at ¶ 41, RX 215. 

7 F.M.C.2d
 

 

 

 

 

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Further, the parties make no good argument for why phrases like “additional lanes” or 

“Asia to US” would constitute information that is a “trade secret or other confidential research, 

development, or commercial information,” as those phrases are utilized here in context. See, e.g., 

RPFF at ¶ 30-33; CRPFF at ¶ 32.6

 There is similarly no confidential information contained in the 

effective or expiration dates of amendments, nor in the fact of the service contract being 

extended by ten weeks. See, e.g., RPFF at ¶ 33. 

Otherwise, to the extent that the parties’ confidential designations are consistent with 

their motions and have not been made public by previous filings or in publicly available exhibits, 

they are reasonable. But, once information is made public, it cannot be later designated as 

confidential. 

This decision will strive to minimize reference to rates, terms, and other sensitive 

commercial information regardless of whether it is in the public domain. However, to the extent 

that these contradictions exist, information is not accorded confidential treatment throughout this 

decision in those instances when it impacts the readability of the decision and where it has 

already been made public. For clarity, any data or statement detailed or made explicit in this 

decision is not confidential. 

Accordingly, to the extent that rates or terms have not already been made public, it is 

hereby ordered that the revised motions requesting confidentiality be GRANTED IN PART. To 

the extent that information has been inconsistently designated by the parties as confidential or 

not sufficiently supported, the revised motions requesting confidentiality are DENIED IN 

PART. The parties are not required to refile any of their public filings. 

E. Evidence

Under the Administrative Procedure Act, an administrative law judge may not issue an 

order “except on consideration of the whole record or those parts thereof cited by a party and 

supported by and in accordance with the reliable, probative, and substantial evidence.” 5 U.S.C. 

§ 556(d); see also Steadman v. SEC, 450 U.S. 91, 98-102 (1981). This initial decision is based on

the pleadings, exhibits, briefs, proposed findings of fact and conclusions of law, and replies

thereto filed by the parties.

This initial decision addresses only material issues of fact and law. Proposed findings of 

fact not included in this decision were rejected, either because they were not supported by the 

evidence or because they were not dispositive or material to the determination of the allegations 

in the complaint or the defenses thereto. Administrative adjudicators are “not required to make 

subordinate findings on every collateral contention advanced, but only upon those issues of fact, 

law, or discretion which are ‘material.’” Minneapolis & St. Louis R.R. Co. v. United States, 361 

U.S. 173, 193-94 (1959). To the extent individual findings of fact may be deemed conclusions of 

6

 These are also marked as public in filings by the parties. See, e.g., Reply Brief at 7; RX 213; 

RX 217; RX 219. 

7 F.M.C.2d
 

 

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law, they shall also be considered conclusions of law. Similarly, to the extent individual 

conclusions of law may be deemed findings of fact, they shall also be considered findings of fact. 

Specific findings of fact are in section two, prior to the analysis and conclusions of law in 

part three, and the order in part four. 

II. FINDINGS OF FACT (“FOF”)

A. Entities

1. MSRF is a Delaware corporation, with its principal place of business located in Illinois,

which manufactures and imports gourmet foods and gifts. Complaint at ¶ 12; RPFF at ¶

1; CRPFF at ¶ 1.

2. MSRF relies on David Reich, its founder, and Rochi Mirasol, manager of international

logistics, to procure and manage ocean carrier services in transporting MSRF’s goods to

and from the United States. RPFF at ¶ 2; CRPFF at ¶ 2; RX 204; RX 259.

3. HMM is a vessel-operating ocean common carrier as that term is defined by 46 U.S.C. §

40102(18) and is organized under the laws of the Republic of Korea. Answer at ¶ 13; RPFF

at ¶ 3; CRPFF at ¶ 3.

B. 2021-2022 Contract Year

4. During the 2021-2022 period, MSRF had service contracts with four ocean carriers. RX

205; RX 230; RX 210; RPFF at ¶ 4; CRPFF at ¶ 4.

5. Specifically, during the 2021-2022 contract period, MSRF contracted with Yang Ming

and two other ocean carriers, in addition to contracting with HMM. RX 205; RX 230; RX

210; RPFF at ¶¶ 5-7; CRPFF at ¶¶ 5-7.

6. During the negotiation period for the 2021-2022 ocean shipping contract season, MSRF

encountered difficulty securing space commitments from ocean carriers. RX 230-231;

RPFF at ¶ 8; CRPFF at ¶ 8.

7. MSRF entered into negotiations with HMM in early 2021 for a new service contract,

which contemplated the delivery of containers from Asia to the United States under

certain lanes, and the delivery of containers from the United States to Asia under certain

lanes. RX 205; RPFF at ¶ 10; CRPFF at ¶ 10.

8. The negotiation of the new service contract took place during the COVID-19 pandemic

when market conditions had been disrupted and ocean shipping services were

experiencing significant constraints, colloquially called the “supply chain crisis.” RX

215; RX 356; RPFF at ¶ 11; CRPFF at ¶ 11.

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9. Among other things, the supply chain crisis included shortages of shipping containers,

chassis to carry them, workers at all levels, and significant port backlogs in Asia and the

United States West Coast. See, e.g., RX 215; RX 230-231; RX 263; RPFF at ¶ 12;

CRPFF at ¶ 12.

10. When negotiating the new service contract with HMM, MSRF was aware of the supply

chain crisis and the limitations imposed thereby on the transportation of goods. RX 230-

231; RPFF at ¶ 13; CRPFF at ¶ 13.

C. Initial 2021-2022 HMM Service Contract

11. The negotiations between MSRF and HMM culminated in Service Contract US2124083,

which duration was set from May 1, 2021 through April 30, 2022 (“Service Contract”).

RX 7-18; RPFF at ¶ 21; CRPFF at ¶ 21.

12. The Service Contract has two separate sections, the first covering Asia to the United

States and the second covering United States to Asia. RX 8; RX 15. MSRF alleges only a

violation of the Shipping Act as it relates to the Asia to United States services.7 RPFF at ¶

24; CRPFF at ¶ 24.

13. Per the Service Contract, HMM’s minimum quantity commitment to MSRF was 25 FEUs

from Asia to the United States. RX 8; RX 216. This was reflected in Section 4 of the

Service Contract. RX 8; see also RX 15.

14. Paragraph 14 of the Service Contract provides that after a contract agreement has been

filed with FMC, the parties may enter into subsequent amendments to this agreement,

with an electronic signature and confirmed via e-mail confirmation. RX 14; see also RX

216 (Marisol Dep., “Q. [I]n sum and substance [Paragraph 14] requires any amendments

to the contract to be in writing, signed and confirmed by email, correct? A. Yes.”); RX

373 (“After this initial filing HMM will just require your E-signature for any further

amendments. Meaning [you] just reply with your approval.”).

15. The Service Contract specifically incorporated Rule 208-A of Tariff HDMU-047 by

reference in Section 5 (Service Commitment), Section 7 (Liquidated Damages), Section

11 (Records), and Section 13 (Governing Tariff). RX 8; RX 13; RX 14 (“This contract

incorporates by reference (A) HDMU-047, essential terms tariff (Service Contract

Rules)”); RX 215; RPFF at ¶ 26; CRPFF at ¶ 26.

16. MSRF was aware that the tariffs were incorporated into the Service Contract at the time

the Service Contract was entered into. RX 216; RPFF at ¶ 27; CRPFF at ¶ 27.

17. However, MSRF did not obtain a copy of the tariff or review it prior to executing the

Service Contract. RX 216; RPFF at ¶ 28; CRPFF at ¶ 28.

7 Because MSRF’s allegations only concern the Asia to United States services, references in this 

decision to the MQC will refer to the Asia to United States portion of the Service Contract only, 

unless otherwise specified. 

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18. Tariff Code HDMU-047 Rule No. 208-A states that the “term Carrier means Hyundai

Merchant Marine Co., Ltd. [HMM].” RX 1.

19. Tariff Code HDMU-047 Rule No. 208-A, paragraph 5, states:

The Shipper agrees to tender for shipment on vessels of the Carrier during 

the term of this Contract the Minimum Quantity Commitment of cargo 

specified in Appendix to this Contract. However, the Carrier shall have the 

right to cancel the Contract by giving a written notice of such cancellation 

any time after the Minimum Quantity Commitment has been satisfied. . . . 

In consideration for Merchant’s MQC, Carrier shall provide container 

equipment for booked shipments and shall accept each shipment timely 

offered by Merchant in order to meet Merchant’s MQC : provided that 

carrier shall have no obligation with respect to cargo tendered in excess of 

an amount equal to 10% of the annualized MQC during any of the 

sequential 30 day periods covered by this contract first of which 

commences with the effective date of the contract. 

RX 2 at ¶ 5. 

20. In her deposition, Ms. Marisol was asked:

Q. So doesn’t that mean that of the 25 Asia to U.S. containers that HMM

undertook to carry under this Service Contract, that those containers

needed to be spaced out on a monthly basis with about 10 percent each

month?

A: Correct. 

Q: . . . [T]hat is an agreement by MSRF to provide no more than about 

two containers per 30-day period, right? 

A: Yes. 

The Carrier agrees to make available during the term of this Contract 

vessel capacity & container equipment adequate to carry (1) the Minimum 

Quantity Commitment of cargo and (2) at the Carriers option any 

additional cargo tendered by the Shipper during the term of this Contract. 

The Shipper agrees that as far as possible cargo committed under this 

Contract will be shipped evenly throughout the duration of the contract. 

The Shipper agrees to give fourteen (14) days booking notice, if possible, 

but in general not less than seven (7) days notice to the carrier. 

RX 2-3 at ¶ 7(a). 

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applicable during the time service to or from the port or point is not 

provided. 

RX 3 at ¶ 7. 

25. Tariff Code HDMU-047 Rule No. 208-A, paragraph 8, states:

(a) If the Shipper fails to tender the Minimum Quantity Commitment

specified in Appendix to this Contract, and per the Article (7)(b) the

Carrier shall invoice the Shipper and the Shipper agrees to pay deficit

charges on the difference between the quantity of cargo actually

shipped and the Minimum Quantity Commitment at the rate of U.S.

$250 per FEU. The total amounts due hereunder shall be paid directly

to the Carrier within thirty (30) days following notification by the

Carrier.

(b) If the Carrier fails to fulfill its service commitment in clause hereof

during the Contract term, the Shippers remedy options shall be either

(1) reduction of the Minimum Quantity Commitment by the quantity of

cargo tendered but not carried and/or (2) extension of the Contract

terms as specified in Clause (7)(b). The Carrier shall not be liable to the

Shipper for any direct, consequential or other damages under this

Contract, except as set forth in clause 7 nor shall any liabilities or

obligations of the Shipper to the Carrier be subject to any offset or

credit by virtue of any moneys which the Shipper may claim are due

him under this Contract or otherwise.

RX 3-4 at ¶ 8. 

26. Tariff Code HDMU-047 Rule No. 208-A, paragraph 13, provides:

(a) This Contract is subject to early termination prior to the expiration

date as follows: (1) by either Party with a thirty (30) days written

notice after the MQC or adjusted MQC has been satisfied; . . . . 

(b) Termination or expiration of this Contract shall not relieve or release

either Party from any rights, liabilities, or obligations that have

previously accrued under law or the terms of this Contract.

RX 4-5 at ¶ 13. 

27. Tariff Code HDMU-047 Rule No. 208-A, paragraph 18, states:

In case of a dispute, the carrier and the shipper each agree to submit the 

matter under dispute to arbitration each appointing an arbitrator and the 

two so chosen shall select an umpire which shall constitute the Arbitration 

committee. All data requested in connection with the matter in dispute 

shall be made available. Decision of two or more of the said Committee 

shall be binding on the parties and the arbitration shall me made under and 

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pursuant to the terms and conditions of the United States Arbitration Act . 

. . . Arbitration shall be held in Dallas, Texas, U.S.A. Cost of arbitration, 

including reasonable attorneys fees, may be assessed against one or more 

party(ies), at the discretion of the arbitrators. 

RX 6 at ¶ 18. 

D. 2021-2022 Service Contract Amendments & Performance

28. The Service Contract was amended a total of fourteen times. RX 19-200.

29. Service Contract Amendments 1 through 5 added additional lanes at the request of

MSRF. RX 19 (Amend. 1, effective May 7, 2021); RX 32 (Amend. 2, effective June 3,

2021); RX 45 (Amend. 3, effective June 7, 2021); RX 58 (Amend. 4, effective June 15,

2021); RX 71 (Amend. 5, effective June 22, 2021); RPFF at ¶ 30; CRPFF at ¶ 30.

30. Service Contract Amendments 6 and 7 added surcharges for certain lanes. RX 84

(Amend. 6, effective July 9, 2021); RX 97 (Amend. 7, effective August 4, 2021); RPFF

at ¶ 31; CRPFF at ¶ 31.

31. Service Contract Amendments 8 through 11 added additional lanes at MSRF’s request.

RX 110 (Amend. 8, effective August 9, 2021); RX 123 (Amend. 9, effective November

1, 2021); RX 136 (Amend. 10, effective November 2, 2021); RX 149 (Amend. 11,

effective August 4, 2021); RPFF at ¶ 32; CRPFF at ¶ 32.

32. As of Service Contract Amendment 11, the contract was set to expire April 30, 2022. RX

156.

33. By mid-April 2022, 10.125 FEUs had been carried by HMM constituting nine bookings

made by MSRF. CX 206 (bookings under US2124083); RX 273; RX 275.

34. MSRF never formally invoked paragraph 7(b) of Tariff Code HDMU-047 Rule No. 208-

A, to make an election. RPFF at ¶ 40; CRPFF at ¶ 40; RX 218 (Mirasol Dep., “Q: So no

notice was given under paragraph 7B . . . by MSRF, right? A: No, we do not do that with

any of our Service Contract.”)

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37. The morning of April 29, 2022, HMM account executive Christopher McDonald emailed

Ms. Mirasol, writing:

Management has directed me to advise MSRF that the s/c US2124083 will 

be extended for 10 weeks to meet the original 25F MQC. Please confirm 

by reply ASAP if you will accept this extension for filing. 

Additionally there is an extra loader on PF2/PS3 wk 20. Would MSRF be 

interested in taking advantage of this opportunity to use the extra loader? 

RX 388. 

38. Ms. Mirasol replied at 2:25 PM on April 29, 2022, writing: “Yes go ahead.” RX 388. Mr.

McDonald responded at 2:45 PM, writing: “Laura will work it up to send over for review.

We will need a reply for esig approval and filing, but then that should get this completed

today.” RX 387.

39. Ms. Trometer emailed Ms. Mirasol at 4:12 PM on April 29, 2022, writing:

Attached service contract will reflect the MQC showing 25 FEU with an 

expiration date of 7/8/22. 

Please review and reply with your approval for FMC Filing.. this will 

serve as your E-signature. 

RX 386 (punctuation as in original). 

40. Mr. McDonald sent a follow-up email at 4:39 PM April 29, 2022, writing “Hi Rochi, We

need your approval by reply today as soon as possible so we can get it filed today. Thank

you.” RX 386. Ms. Mirasol replied at 9:47 PM writing “Yes, I already accepted it on my

first email below. If I need to sign, I am not in my laptop now. Go ahead & file it.” RX

386.

41. Amendment 13 formalized the extension of the term of the Service Contract by ten

weeks, to July 8, 2022. RX 175 (Amend. 13, effective April 29, 2022); RPFF at ¶ 33;

CRPFF at ¶ 33.

42. Following Amendment 13, MSRF requested a final amendment to add an additional

service lane, which change was formalized by Amendment 14. RX 188 (Amend. 14,

effective June 16, 2022); RPFF at ¶ 34; CRPFF at ¶ 34; RX 224.

43. Although HMM did not have to agree, HMM accepted MSRF’s request to add an

additional lane and agreed to Amendment 14. RX 188; RPFF at ¶ 45; CRPFF at ¶ 45.

44. All the Service Contract Amendments were signed by MSRF and HMM and were filed

with the FMC. RX 19-200; RPFF at ¶ 35; CRPFF at ¶ 35.

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45. The term of the Service Contact, as amended, concluded on July 8, 2022. RX 188; RPFF

at ¶ 47; CRPFF at ¶ 47.

46. HMM carried a total of 46.875 FEUs on behalf of MSRF from Asia to the United States

during the term of the Service Contract. CX 206; RX 273-274; RPFF at ¶ 48; CRPFF at ¶

48.

47. HMM therefore accepted bookings requested by MSRF in excess of the 25 MQC

required under the Service Contract, even though HMM was not required to provide

excess capacity under the Service Contract. CX 206; RX 273-274; RX 1-6; RPFF at ¶ 54;

CRPFF at ¶ 54; RX 8; RX 176; RX 189.

48. These 46.875 FEUs were carried by HMM over the course of 24 bookings made by

MSRF. RX 273; CX 206.

49. Of this total, 10.125 FEUs had been carried by HMM up through the end of April 2022,

and 37.875 FEUs were carried by HMM during the extension of the Service Contract,

pursuant to Amendment 13. CX 206; CRPFF at ¶ 53; RX 224.

50. In Ms. Mirasol’s deposition, Amendment 13 was discussed as follows:

Q. So amendment No. 13 was signed, right?

A. Yes.

Q. And it . . . extended the term of the Service Contract by ten weeks, right?

A. Correct.

Q. So for May 1, 2022, through July 8, 222, MSRF was able to ship containers

under this Service Contract but at 2021 rates, correct?

A. Yes.

RX 220. 

51. During the Service Contract’s extended term, MSRF described its benefit of shipping at

HMM’s 2021-2022 rates during June of 2022 favorably, saying that “[p]aying below $5k

for the base freight all the way to Chicago, is like winning a casino jackpot.” RPFF at ¶

55; CRPFF at ¶ 55; RX 331; see also RX 224 (Marisol Dep., “Q. So you understood the

ability to ship these containers in 2022 at 2021 rates was a significant benefit to MSRF,

right? A. Correct. Q. And MSRF took advantage of that, correct? A. We did, yes.”).

52. MSRF acknowledged that the Service Contract extension provided a significant benefit

and that MSRF took advantage of the low rates during the extended term by shipping

over 46 FEUs instead of only 25 FEUs provided for in the MQC. RPFF at ¶ 57; CRPFF

at ¶ 57.

53. MSRF also stated that it wished HMM would provide a further extension of the Service

Contract beyond the term, because of the savings MSRF was experiencing at the time.

RPFF at ¶ 56; CRPFF at ¶ 56; RX 331; RX 224.

7 F.M.C.2d
54. Specifically, on June 24, 2022, Ms. Mirasol emailed Mr. Reich and others, stating “I wish

Hyundai [HMM] will extend this SC after July 31st. Paying below $5K for the base

freight all the way to Chicago, is like winning a casino jackpot.” RX 331; RX 224; see

also RX 224 (Mirasol Dep., Q. “[T]hat’s $180,000 approximate savings, right? A. I

would say, yeah.”)

55. MSRF acknowledged that HMM did not refuse to negotiate with MSRF. RX 208

(Mirasol Dep., “Q. Did HMM refuse to negotiate with MSRF? A. No.”).

56. MSRF acknowledged that it initiated many of the amendments, and that HMM provided

a benefit to MSRF via the addition of lanes. RX 219 (Marisol Dep., “Q. This Service

Contract was amended, correct? A. Yes. Q. And who initiated those amendments? Who

sought those amendments? A. Usually it’s me. Q. . . Isn’t it fair to say that many of the

amendments either add lanes or service provisions . . . to what had been initially agreed?

A. Yes. Q. And isn’t it fair to say that the addition of lanes provided a benefit to MSRF?

A. Correct.”); see also RX 271 (Reich Dep., “Q. So is it fair to say that amendment 14, at

least the part that we’ve looked at, adds an additional lane so that MSRF could meet a

customer need? A. Yes.”).

57. Email correspondence between MSRF and HMM demonstrates that the two companies

communicated and negotiated regarding the MQC, additional lanes, freight rates,

surcharges added, and the contract extension. See, e.g., RX 353-357; RX 359-370; RX

386-390.

58. Email correspondence also demonstrates examples of reasons provided to MSRF for

HMM’s inability to accept certain requests for space. For example, a November 3, 2021,

email from Ms. Trometer to Ms. Mirasol referenced “ongoing vessel space issues across

the board.” Reply Brief, Exh. 2 (HMM0015923). In a series of July 2021 emails between

MSRF and HMM, HMM also described a lack of space on a particular route for certain

dates, and HMM encouraged MSRF to “request booking for week 35 or beyond as Vessel

space will fill up quickly once India able to accept bookings.” Reply Brief, Exh. 1

(HMM0034807-34814).

59. There is no indication that reasons provided by HMM for its inability to accept certain

requests for space were false. See, e.g., Reply Brief, Exhs. 1-2.

60. There is no evidence of duress or undue pressure by HMM concerning the Service

Contract’s amendments. See, e.g., RX 353-357; RX 359-370; RX 386-390.

III. ANALYSIS AND CONCLUSIONS OF LAW

A. Preliminary Issues

1. Jurisdiction

MSRF contends that the Commission has jurisdiction over its claims because it alleges 

violations of the Shipping Act, including “that HMM engaged in unreasonable and unjust 

shipping practices and regulations by arbitrarily refusing to provide MSRF with the agreed upon 

99

7 F.M.C.2d
shipping container space when MSRF needed it the most.” Reply Brief at 8. Citing to Cargo 

One, Inc. v. COSCO Container Lines Co., Ltd., 28 SRR 1635, 1645 (2000), MSRF asserts “that

‘where the alleged violation raises issues beyond contractual obligations, the Commission will 

likely presume . . . that the matter is appropriately before the agency.’” Reply Brief at 8-9. MSRF 

further contends that the Commission has a duty to protect the public by ensuring that service 

contracts are implemented in accordance with the Shipping Act, even though another forum may 

be available to the parties under the terms of their service contract to resolve some of their 

disputes. Reply Brief at 9. 

HMM argues that the Commission does not have subject matter jurisdiction over this 

case because the allegations merely assert a breach of contract for which “ʻthe exclusive remedy 

is . . . an action in an appropriate court.’” Opposition at 16 (citations omitted). Further, HMM 

argues that the Commission should defer to an arbitration clause in the service contract that 

requires their disputes be arbitrated in Dallas, Texas applying Korean law, because the 

Commission has long followed the federal policy favoring enforcement of arbitration agreements 

in contracts. Id. at 16-17. 

Under 46 U.S.C. § 41301(a), any “person may file with the Federal Maritime 

Commission a sworn complaint alleging a violation” of the Shipping Act. In addition, § 40502 of 

the Shipping Act governs service contracts (formerly Section 8(c) of the 1984 Act), and 

subsection (f) provides that “[u]less the parties agree otherwise, the exclusive remedy for a 

breach of a service contract is an action in an appropriate court.” Pub. L. 109-304, §7, Oct. 6, 

2006, 120 Stat. 1533. This exclusive remedy language is unchanged in meaning from the 

previously cited 8(c) that is discussed in the cases below, and through the period at issue is this 

case (the section on service contracts was formerly cited as 46 U.S.C. §1707). 

Discussion of the FMC’s jurisdiction in cases where breach of contract is raised in 

conjunction with allegations of Shipping Act violations is best understood by examining the 

evolution of the case law and in particular, the Commission’s holdings in several cases discussed 

below. 

In Vinmar, Inc. v. China Ocean Shipping Co., Docket No. 91-43, 26 S.R.R. 420 (FMC 

July 29, 1992), an early case that examined the Commission’s jurisdiction in breach of contract 

cases, the Commission discussed whether the limitations of Section 8(c) of the 1984 Act 

precluded its jurisdiction to award remedies for a breach of contract, while retaining its 

jurisdiction to “institute...an investigation and assess civil penalties if a violation was found.” Id. 

at 424. After examining the legislative history and finding no explanation for “what Congress 

intended by the ‘exclusive remedy’ limitation in Section 8(c),” the Commission stated: 

This leads the Commission to conclude that Congress placed the limitation in Section 

8(c) in order to limit the Commission’s jurisdiction to award remedies that would 

otherwise be available in a breach of contract action if the matter were brought before a 

court. Where, as here, the alleged conduct under a service contract would constitute a 

breach of contract as well as a violation of one or more of the prohibited acts, the 

limitation in Section 8(c) requires the aggrieved party to proceed in a breach of contract 

action. 

100

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Id. at 424 (emphasis in original). As the Commission noted in a separate case, the “issue then 

becomes whether the provision in section 8(c) that the ‘exclusive remedy for a breach of contract

. . . shall be an action in an appropriate court” deprives the Commission of jurisdiction to hear 

this case.” DSR Shipping Co. v. Great White Fleet, Ltd., Docket No. 91-54, 26 S.R.R. 627, 631, 

1992 WL 366152, at *5 (FMC Oct. 2, 1992). In Vinmar, the Commission found that “[i]t is 

reasonable and appropriate to assume that Congress placed the limitation in Section 8(c) to 

prevent the Commission from adjudicating actions that might otherwise have been filed under 

Section 11(a) of the 1984 Act[;]” which “permits any person to file a complaint with the 

Commission ‘alleging a violation of this Act, other than Section 6(g), and may seek reparation 

for any injury caused to the complainant by that violation.’” 26 S.R.R. at 424. The Commission 

in DSR Shipping further noted that while complainant DSR cited to the 1984 Act in its 

complaint, “the claims are ultimately based on rights and obligations under the service contract.” 

DSR Shipping, 1992 WL 366152, at *6. 

The Commission revisited Vinmar and the 8(c) limitation to its jurisdiction that it found 

in DSR Shipping in another case, Cargo One, Inc. v. COSCO Container Lines, Co., Docket No.

99-24, 28 S.R.R. 1635, 2000 WL 1648961 (FMC Oct. 31, 2000) (Order Vacating the

Administrative Law Judge’s Order Denying Respondent’s Motion to Dismiss and Remanding

the Proceeding to the Administrative Law Judge). In Cargo One, unlike Vinmar and the line of

cases that preceded Cargo One, the Commission found that it is appropriate to assert jurisdiction

over Shipping Act violations, regardless of whether they may overlap with breach of contract

claims that could be addressed in an appropriate court. The Commission stated:

The Vinmar rationale has been applied to subsequent complaint cases involving potential 

breach actions, resulting in dismissals . . . . While the Commission in Vinmar was 

expressly concerned with giving meaning to each section of the Shipping Act, in effect, 

that decision and those that followed significantly narrowed the scope of the right to file 

complaints under section 11, and substantially limited an injured party’s ability to obtain 

reparations for violations arising from service contract-related disputes.

Cargo One, 2000 WL 1648961, at *12. Here, the parties disagree on whether the complainant 

alleges, and the evidence supports, violations of the Shipping Act, or merely alleges breach of 

contract claims couched as Shipping Act violations. The Commission’s test as set forth in Cargo 

One is applicable and helpful: 

We believe the more appropriate test is whether a complainant’s allegations are 

inherently a breach of contract claim, or whether they also involve elements peculiar to 

the Shipping Act. We find that as a general matter, allegations essentially comprising 

contract law claims should be dismissed unless the party alleging the violation 

successfully rebuts the presumption that the claim is no more than a simple breach of 

contract claim. In contrast, where the alleged violation raises issues beyond contractual 

obligations, the Commission will likely presume, unless the facts as proven do not 

support a claim, that the matter is appropriately before the agency.

2000 WL 1648961, at *14 (footnote omitted). Carrying that rationale forward in the context of 

overlapping breach of contract claims that had been arbitrated under the parties’ arbitration 

clause prior to complainant filing a private complaint before the FMC, the Commission found: 

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Anchor’s complaint contains allegations specific to the Shipping Act such as: unfair or 

unjustly discriminatory practices, undue or unreasonable preferences, and undue or 

unreasonable prejudice or disadvantage. The Commission has an interest in ensuring that 

service contracts are used in a manner that complies with the Shipping Act and the 

Commission’s regulations, so that it can be certain that the public and the shipping 

industry are protected. This interest outweighs the intentions of two private parties, as set 

forth in the arbitration clause of their service contract. 

Anchor Shipping Co. v. Aliança Navegação E Logística Ltda., Docket No. 02-04, 30 S.R.R. 991, 

999, 2006 WL 2007808, at *10 (FMC May 10, 2006). The Commission further found that “the 

exception that the Cargo One test provides, that claims primarily contractual in nature should be 

dismissed, is inapplicable because Anchor alleges certain violations that are particular to the 

Shipping Act. Thus, Anchor’s complaint was prematurely dismissed.” Id.

Similarly, in Global Link, the Administrative Law Judge (“ALJ”) found that the 

Commission had jurisdiction over the complaint: 

The [service] contract governs the parties’ relationship for transportation of cargo by 

water between ports or points in Asia and ports or points in the United States (2012 

Service Contract Annex B), transportation for which Hapag-Lloyd would operate as a 

common carrier and Global Link a shipper within the meaning of the Act. Some of the 

alleged violations alleged in the Complaint “involve elements peculiar to the Shipping 

Act.” Therefore, the Commission has jurisdiction over . . . the Complaint alleging that 

Hapag-Lloyd, a common carrier, violated sections 41104(10), 41104(3), and 41102(c) of 

the Shipping Act. 

Global Link Logistics, Inc. v. Hapag-Lloyd AG, Docket No. 13-07, 33 S.R.R. 512, 2014 WL 

5316345, at *13 (ALJ April 17, 2014) (citations omitted), proceeding dismissed due to 

settlement, 2015 WL 3955128 (FMC April 14, 2015). 

HMM further argues that all MSRF’s claims emanate from a breach of contract allegation 

and as such, should be addressed through the Service Contract’s arbitration clause. Opposition at 

16-17. MSRF responds that HMM waived its opportunity to arbitrate the dispute between the

parties by participating in the FMC proceeding that MSRF brought.

The parties’ arbitration clause does not preclude the Commission’s jurisdiction over 

Shipping Act claims. The D.C. Circuit has found that “a mandatory arbitration clause does not 

negate a Federal agency’s independent regulatory duty....” Anchor Shipping, 2006 WL 2007808, 

at *8 (citing Duke Power Co. v. Federal Energy Regulatory Commission, 864 F2d 823 (D.C. Cir 

1989)) (Federal Energy Regulatory Commission “was not precluded from retaining its 

jurisdiction...despite the presence of an arbitration clause in the agreement among the utilities.” 

Anchor Shipping, at 997). Relying on these and other cases, the Commission in Anchor Shipping

vacated the ALJ’s order dismissing the complaint, even though the complainant had already 

secured a sizable arbitration award, finding that “[t]he arbitration clause in the parties’ service 

contract does not outweigh the Commission’s duty to protect the public by ensuring that service 

contracts are implemented in accordance with the Shipping Act.” 2006 WL 2007808, at *9. 

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MSRF raises allegations that are “peculiar to the Shipping Act” in the Complaint, 

including that HMM violated § 41102(c), § 41104(a)(2), (9), and (10). Cargo One, 2000 WL 

1648961, at *14. While inartful in its choice of language, MSRF sufficiently “rebut[s] the 

presumption that the claim[s] involve[] no more than a simple breach of contract” so as to 

warrant review of the elements that must be proved to support each alleged violation. Anchor 

Shipping, 2006 WL 2007808, at *4. Accordingly, the Commission has jurisdiction over these 

claims. 

2. Burden of Proof

To prevail in a proceeding to enforce the Shipping Act, a complainant bears the burden of 

proving their allegations by a preponderance of the evidence. 5 U.S.C. § 556(d); 46 C.F.R. §§ 

502.203; Maher Terminals, LLC v. Port Auth. of N.Y. & N.J., Docket No. 08-03, 2014 WL 

9966245, at *14 (FMC Dec. 17, 2014). Under the preponderance standard, a complainant must 

show that their allegations are more probable than not. Crocus Investments, LLC v. Marine 

Transport Logistics, Inc., Docket No. 15-04, 2021 WL 3732849, at *3-4 (FMC Aug. 18, 2021) 

(Order Affirming Initial Decision on Remand). It is appropriate to draw inferences from certain 

facts when direct evidence is not available, and circumstantial evidence alone may even be 

sufficient; however, such findings may not be drawn from mere speculation. Waterman 

Steamship Corp. v. General Foundries Inc., Docket No. 93-15, 26 S.R.R. 1173, 1180 (ALJ Dec. 

9, 1993), adopted in relevant part, 26 S.R.R. 1424, 1994 WL 279898 (FMC June 13, 1994). 

3. Remaining Claims

In its Brief, MSRF states it is no longer pursing Count III of the Complaint, which 

alleged a violation of 46 U.S.C. § 41104(a)(5). However, rather than also clarifying that it is no 

longer pursing Count IV of the Complaint alleging that Respondent HMM violated 46 U.S.C. § 

41104(a)(9), MSRF continues to list Count IV in its Brief, but then omits any discussion of it in 

its Reply Brief. Brief at 1 (stating that MSRF “moves for a summary decision on Counts I, II, IV, 

and V” and “MSRF is no longer proceeding on Count III (violation of 46 U.S.C. 41104(a)(5).”)); 

but see Reply Brief at 3 (citing only to alleged violations of 46 U.S.C.§§ 41102(c), and 

41104(a)(2) and (a)(10)). Accordingly, Complainant’s allegation brought under § 41104(a)(5) is 

dismissed. Because Complainant did not make clear whether it is continuing to pursue the 

allegation that Respondent HMM violated 46 U.S.C. § 41104(a)(9), this will be discussed briefly 

below, along with the other claims remaining, falling under §§ 41102(c), 41104(a)(2), and 

41104(a)(10). 

B. Discussion

1. Section 41102(c) - Just and Reasonable Regulations and Practices

MSRF asserts that the Service Contract required MSRF to tender a minimum quantity of 

25 FEUs of cargo for shipment by HMM from Asia to the United States; however, between May 

2021 and April 2022, HMM refused to provide MSRF with the agreed allotments of space; 

HMM’s refusal to provide MSRF with the agreed upon cargo space between May 2021 and 

April 2022 was not in accordance with standard shipping practices; and this “forced MSRF to 

7 F.M.C.2d
make alternate transportation arrangements with other common carriers at substantially higher 

spot market prices or forgo shipping its cargo altogether.” Reply Brief at 5.

HMM contends that 46 U.S.C. § 41102(c) is not applicable to the transportation of 

property; MSRF does not state what regulation or practice is allegedly unjust or unreasonable on 

the part of HMM; nor does MSRF show that any allegedly violative practice occurred on a 

normal, customary, or continuous basis. Opposition at 11-12; Sur-Reply at 4. 

During the period covered by the Complaint’s allegations, Section 41102(c) stated that a 

“common carrier, marine terminal operator, or ocean transportation intermediary may not fail to 

establish, observe, and enforce just and reasonable regulations and practices relating to or 

connected with receiving, handling, storing, or delivering property.” 46 U.S.C. § 41102(c). 

The elements that must be established to prove a Section 41102(c) claim were specified 

by the Commission on December 17, 2018, as follows: 

46 U.S.C. 41102(c) is interpreted to require the following elements in order to 

establish a successful claim for reparations:

(a) The respondent is an ocean common carrier, marine terminal operator, or

ocean transportation intermediary;

(b) The claimed acts or omissions of the regulated entity are occurring on a

normal, customary, and continuous basis;

(c) The practice or regulation relates to or is connected with receiving, handling,

storing, or delivering property;

(d) The practice or regulation is unjust or unreasonable; and

(e) The practice or regulation is the proximate cause of the claimed loss.

Final Rule: Interpretive Rule, Shipping Act of 1984, 83 Fed. Reg. 64478, 64479 (Dec. 17, 2018); 

46 C.F.R. § 545.4. After determining that there is “a practice relating to and connected with the 

receiving, handling, storing, or delivering of property,” it may be assessed whether the practice is

“unjust and unreasonable.” California Stevedore & Ballast Co. v. Stockton Port Dist., Docket No. 

898, 7 F.M.C. 75 (FMC Jan. 25, 1962). Therefore, the question of whether the practice at issue 

relates to the receiving, handling, storing or delivering of property will be addressed, prior to 

assessing the reasonableness of HMM’s conduct.

As discussed below, HMM is undoubtedly a common carrier, and it is also established 

that the practice or regulation at issue relates to or is connected with the receiving, handling, 

storing, or delivering of property. However, MSRF has not carried its burden of demonstrating 

that any unjust or unreasonable practice has occurred. Therefore, there is no need to address 

whether the acts or omissions are occurring on a normal, customary, and continuous basis, nor is 

there a need to address whether the practice or regulation is the proximate cause of the claimed 

loss. 

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a. Common Carrier

The Shipping Act defines a common carrier to be a person that: 

(i) holds itself out to the general public to provide transportation by water of

passengers or cargo between the United States and a foreign country for

compensation;

(ii) assumes responsibility for the transportation from the port or point of receipt

to the port or point of destination; and

(iii) uses, for all or part of that transportation, a vessel operating on the high seas

or the Great Lakes between a port in the United States and a port in a foreign

country.

46 U.S.C. § 40102(7). The parties agree that HMM is a vessel-operating common carrier 

(“VOCC”) as that term is defined by 46 U.S.C. § 40102(18). FOF 3. This element is not in 

dispute and is met. 

b. Receiving, Handling, Storing, or Delivering of Property

The crux of MSRF’s reasonableness argument is that between May 2021 and April 2022, 

HMM refused to provide MSRF with the agreed allotments of space.8

 Then in terms of whether 

this relates to the receiving, handling, storing, or delivering of property, MSRF argues that 

“Section 41102(c) is clearly applicable to the transportation of property because it applies to 

‘common carriers’” and “the Shipping Act defines a ‘common carrier’ as a person that provides 

transportation by water of cargo between the U.S. and a foreign country for compensation.”

Reply Brief at 4 (emphasis and citations omitted).9 

HMM contends in response that Section 41102(c) “does not relate to the transportation of 

property” citing to Altieri v. Puerto Rico Ports Authority, 7 F.M.C. 416, 419 (1962) among other 

cases. Opposition at 12. 

8

 Brief at 2 (“HMM failed to perform under the service contract with MSRF which is a violation 

of various statutes by not providing the requisite number of forty-foot equivalent units . . . to ship 

cargo as provided in the service contract.”); Reply Brief at 3 (“HMM’s conduct towards MSRF 

was unreasonable and unjust under [Section 41102(c)] . . . because HMM refused to provide the 

agreed upon cargo space that MSRF requested and needed between May and April of 2022” and 

HMM failed “to provide service (the agreed upon cargo space) that was in accordance with the 

rules and practices contained in the underlying Service Contract.”); Reply Brief at 4 (“HMM’s 

refusal to provide MSRF with the agreed upon cargo space between May 2021 and April 2022 

was not in accordance with standard shipping practices.”) 

9

 MSRF also argues “there is no doubt that HMM violated Section 41102(c) of the Shipping Act 

by failing to observe just and reasonable practices relating to the storing of MSRF’s cargo” but 

does not explain how the ‘storing of cargo’ relates to its allegations. Reply Brief at 5 (emphasis 

added). 

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Whether the practice at issue is considered to be ‘transportation’ or ‘allocation of space,’ 

in either instance, there is good reason to conclude that this does relate to the receiving, handling 

storing, or delivering of property. Section 41102(c) was previously numbered as Section 

10(d)(1). The Commission’s reflections in the context of 10(d)(1) are therefore instructive. In 

Cargo One, complainant’s claims included a 10(d)(1) claim that COSCO had “fail[ed] to receive 

containers tendered by Complainant at service contract rates, den[ied] container space aboard 

eastbound vessels . . . contrary to what was agreed under the service contract, and fail[ed] to 

respond to and rectify complaints from Cargo One regarding the problems with the use of the 

service contract.” Cargo One, 2000 WL 1648961, at *1. In evaluating whether the violations 

alleged by complainant were properly before the Commission, the Commission concluded: 

Given the specificity the Shipping Act provides with respect to the types of 

complaints a person may not bring (i.e., only section 6(g)), and given the 

specificity as to types of relief available for various violations of the Prohibited 

Acts, we believe that Congress did not intend that the section 8(c) “exclusive 

remedy” language would nullify the sections 10 and 11 rights of complainants to 

bring suit on any matter tangentially or even substantially related to service 

contract obligations. Moreover, if parties were not meant to obtain reparations for 

violations of section 10 stemming from transportation under service contracts, it 

is likely that the statute would have clearly limited either the types of proceedings 

which can be initiated by private complainants, or the availability of reparations. 

Cargo One, 2000 WL 1648961, at *12 (emphasis added). The Commission further assessed 

“Congress’ intention that the Commission is the appropriate forum for resolving allegations of 

violations of certain section 10 Prohibited Acts, even if they arise from transportation governed 

by a service contract” concluding that to “find otherwise would give little or no meaning to those 

provisions of section 10, as well as to the right to file a complaint seeking reparations under 

section 11.” Cargo One, 2000 WL 1648961, at *12 (emphasis added). 

There is as well good reason to conclude that space allocation is within the ambit of 

“receiving, handling, storing or delivering of property.” As one indication, space allocation is 

core to a freight forwarder’s role, and the Supreme Court has held that “[b]y the nature of their 

business, independent forwarders are intimately connected with” the activities listed under 

section 17, that is, “the receiving, handling, storing or delivering of property.” United States v. 

American Union Transport, 327 U.S. 437, 442, 449 (1946) (“The forwarder must arrange for 

necessary space with the steamship companies”); see also 46 U.S.C. § 40102(19) (“The term 

‘ocean freight forwarder’ means a person that . . . dispatches shipments from the United States 

via a common carrier and books or otherwise arranges space for those shipments on behalf of 

shippers”) (emphasis added). 

Altieri, cited by HMM, further supports that allocation of space is a practice related to or 

connected with the “receiving, handling, storing or delivering of property.” In particular, Altieri 

distinguishes between generalized “unreasonable practices” and “practices intended to fall within 

the coverage of this section,” i.e. “shipping practices.” 7 F.M.C. at 419. Given the choice 

between these two buckets, space allocation of cargo is more accurately deemed a “shipping 

practice” appropriately assigned to the “special expertise of the Agency.” Id. at 419. 

Accordingly, MSRF has satisfied this element of a § 41102(c) violation. 

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c. Reasonableness

The core of MSRF’s reasonableness argument is that the Service Contract required 

MSRF to tender a minimum quantity of 25 FEUs of cargo for shipment by HMM from ports in 

Asia to the United States; but between May 2021 and April of 2022, “HMM refused to provide 

MSRF with a paucity of the agreed allotments of space;” MSRF then points to specific email 

exchanges with HMM and argues “in each instance, HMM gave no explanation for their failure 

to provide MSRF with the space requested – they simply refused thereby breaching the terms of 

the Service Contract.” Reply Brief at 4-5. MSRF does not point to any cases in support of its 

reasonableness argument. 

HMM asserts in response that MSRF has failed to adduce any evidence that HMM acted 

in an unreasonable manner related to MSRF’s property during transportation or otherwise; since 

the MSRF Brief does not cite to any evidence that HMM acted unreasonably in “receiving, 

handling, storing, or delivering” MSRF’s property, this allegation is unsustainable; MSRF’s 

alleged evidence shows only that HMM twice could not immediately provide space as requested 

by HMM, with the same port of origin, over the entire term of the Service Contract; it is 

incorrect that “HMM gave no explanation” for its inability to provide space, as the email 

correspondence clearly shows this lane and load port had limited capacity, long lead times for 

bookings, and that HMM was experiencing “ongoing vessel space issues across the board;” 

MSRF fails to show or even allege with specificity that HMM adopted a regulation or practice 

consistent with the Commission’s definition of “practice;” and even if it were true that HMM did 

not meet the MQC under the Service Contract (although in fact HMM shipped nearly double the 

MQC) finding that such a breach violated the Shipping Act would render 46 U.S.C. § 40502(f) 

meaningless. Opposition at 11-12; Sur-Reply at 4-8. 

At the outset, the proponent of the proposition that a practice is unreasonable, here 

MSRF, “bears the burden of proving that proposition, including the burden of producing 

evidence adequate to persuade the Commission. Respondent is not required to show that the 

practice is reasonable.” All Marine Moorings, Inc. v. ITO Corp. of Baltimore, Docket No. 94-10, 

1996 WL 264720, at *13 (FMC May 15, 1996); see also Seacon Terminals, Inc. v. Port of 

Seattle, Docket No. 90-16, 26 S.R.R. 886, 898 (FMC Apr. 14, 1993). Once a prima facie case of 

unreasonableness is raised, however, the burden of producing evidence justifying the practices 

shifts to Respondent. Id. 

The terms “unjust” or “unreasonable” are not defined in the Shipping Act. However, the 

Commission has recently discussed reasonableness as it relates to the establishment of the 

demurrage and detention rule. While this case is not about demurrage and detention, the 

Commission’s discussion is nevertheless useful: 

The main thrust of the rule is that although demurrage and detention are valid 

charges when they work, when they do not, there is cause to question their 

reasonableness. This derives from the well-established principle that to pass 

muster under section 41102(c), a regulation or practice must be tailored to meet 

its intended purpose, that is, ‘‘fit and appropriate for the end in view.’’ The 

Commission determined that because the purpose of demurrage and detention are 

to incentivize cargo movement, it will consider in the reasonableness analysis 

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108

under section 41102(c) the extent to which demurrage and detention are serving 

their intended purposes as financial incentives to promote freight fluidity. 

Final Rule: Interpretive Rule on Demurrage and Detention Under the Shipping Act, Docket No. 

19-05, 85 Fed. Reg. 29638, 29651 (May 18, 2020) (citations omitted). In California Stevedoring

& Ballast Co., the Commission similarly considered whether the practice or regulation served its

intended purpose and what the impact of the practice was on the general public and the shipping

community. California Stevedoring & Ballast Co. v. Stockton Port District, 7 F.M.C. 75, 81

(Jan. 25, 1962) (evaluating the reasonableness of a stevedoring structure).

In another case, the Commission provided the following explanation: 

In a common carriage context, a common carrier . . . provides services to the 

general public. When analyzing whether a common carrier’s . . . regulations and 

practices are just and reasonable, it is relevant to consider the usual course of 

conduct of the common carrier . . . and also the course of conduct of other 

common carriers . . . under similar circumstances. When examining, however, 

whether a common carrier . . . failed to “observe and enforce” the established just 

and reasonable regulations and practices, one must inevitably consider whether 

there has been a failure or failures to observe and enforce the established 

regulations and practices with respect to particular shippers or specific 

transactions. If a common carrier . . . failed to establish just and reasonable 

regulations and practices or the established regulations and practices are unjust or 

unreasonable, section 10(d)(1) analysis may end there, as failing to establish just 

and reasonable regulations and practices itself would constitute a violation of the 

section. If a common carrier . . . has in fact established just and reasonable 

regulations and practices, the relevant question then becomes whether it has 

observed and enforced the regulations and practices. 

Yakov Kobel v. Hapag-Lloyd A.G., Docket No. 10-06, 2013 WL 9808671, at *9 (FMC July 12, 

2013) (Order Vacating Initial Decision in Part and Remanding for Further Proceedings). 

The Commission has also emphasized the degree to which assessments of reasonableness 

turn on the facts of the case at hand. See, e.g., All Marine Moorings, 1996 WL 264720, at *13 

(“Our decisions have emphasized various commercial, physical and competitive factors affecting 

our view of what is reasonable in these individual cases.”). 

Here, the facts make clear under any assessment that MSRF has not carried its burden of 

demonstrating any unreasonable practice or regulation by HMM. What has been established is 

that MSRF entered into a service contract with HMM, including a minimum quantity 

commitment of 25 FEUs from Asia to the United States. FOF 11, 13. HMM and MSRF 

subsequently amended this service contract a total of fourteen times, frequently at the initiation 

of MSRF, and for the benefit of MSRF, for example to add additional lanes. FOF 28-31, 36, 41-

44, 56. The thirteenth amendment, agreed to by both MSRF and HMM, extended the end of the 

service contract term by ten weeks, to July 8, 2022. FOF 37-41, 44. By July 8, 2022, HMM had 

carried more than 46 FEUs for MSRF from Asia to the United States, nearly twice the 25 FEU 

MQC. FOF 13, 45-47. MSRF agreed that the service contract extension provided a significant 

7 F.M.C.2d
 

 

 

 

 

 

 

 

109

benefit to MSRF, which MSRF took advantage of. FOF 50-52. Indeed, MSRF acknowledged 

wishing that HMM would provide a further extension of the Service Contract, because of the 

savings MSRF was experiencing at the time through shipping at HMM’s 2021-2022 rates during 

June of 2022. FOF 50-51, 53. 

No arguments made by MSRF support this factual history being unreasonable or unjust 

towards MSRF. MSRF contracted with HMM and this contract was more than fulfilled. It is 

inconsistent and untenable for MSRF to accept amendments, benefit by them, and then complain 

about their execution. There have been no allegations – and no evidence presented – of duress or 

undue pressure exerted by HMM concerning the Service Contract’s amendments. Brief at 1-5; 

Reply Brief at 1-12; FOF 60. Indeed, MSRF described the benefit of the contract extension, 

writing that “[p]aying below $5k for the base freight all the way to Chicago, is like winning a 

casino jackpot.” FOF 51, 54. 

Although HMM exceeded the Service Contract’s MQC, MSRF points to a handful of 

instances when no space was available leaving from a particular port at a particular time. Reply 

Brief at 5; but see FOF 58-59. However, HMM did not agree to fulfill every shipment request 

submitted, in any lane, at any time. MSRF has not carried its burden of producing evidence 

adequate to persuade that HMM has engaged in a practice that is unjust or unreasonable. 

Therefore, MSRF’s claim under Section 41102(c) is denied. 

2. Section 41104(a)(2) - Service Not in Accordance with Rates, Charges,

Classifications, Rules, and Practices

MRSF asserts that HMM failed to provide service that was in accordance with the 

classifications, rules and practices contained in the Service Contract because it refused to provide 

MSRF with the agreed upon minimum quantity of cargo space from May 2021 to April of 2022; 

HMM had already breached the terms of the Service Contract prior to providing MSRF with 

more than the agreed upon 25 FEUs of shipping space; and, even though “HMM provided MSRF 

with the agreed upon minimum quantity of cargo space in 2022 does not erase their breach of the 

Service Contract in 2021.” MSRF further argues that HMM violated this section “because its 

own tariff rules require HMM to accept an amount equal to 10% of the annualized MQC for each 

sequential 30 day (sic) period of the contract. HMM Rule 208-A of Tariff HDMU-047.” Reply 

Brief at 6, 7. 

HMM contends that Section 41104(a)(2) does not create jurisdiction for Shipping Act 

claims before the Commission without “extraordinary aspects of the allegation [that] distinguish 

it substantially from a contract claim;” MSRF fails to state, under 46 U.S.C. § 41104(a)(2), what 

“rates, charges, classifications, rules, and practices contained in a tariff published or a service 

contract” were violated; MSRF cites no specific rate, rule, practice or action on the part of HMM 

which would fall into any one of these categories; rather MSRF states in conclusory fashion that 

HMM violated this Section of the Shipping Act by failing “to provide service that was in 

accordance with the classifications, rules, and practices in the Service contract because it refused 

to provide MSRF with the agreed upon minimum quantity of cargo space;” thus MSRF’s 

argument again conflates a breach of contract claim with a violation of almost every component 

of 46 U.S.C. § 41104(a)(2). Sur-Reply at 8-9 (citations omitted). 

7 F.M.C.2d
During the period covered by the Complaint’s allegations, Section 41104(a)(2) stated

that: 

A common carrier, either alone or in conjunction with any other person, directly 

or indirectly, may not . . . (2) provide service in the liner trade that is - (A) not in 

accordance with the rates, charges, classifications, rules, and practices contained 

in a tariff published or a service contract entered into under Chapter 405 of this 

title, unless excepted or exempted under section 40103 or 40501(a)(2) of this title;

46 U.S.C. § 41104(a)(2). To prove a violation of Section 41104(a)(2), MSRF must establish that 

HMM is a common carrier that failed to provide service in accordance with the classifications, 

rules and practices contained in its published tariff or service contract. 

a. Common Carrier

Section 41102(a) governs the activities of common carriers, so to violate it, an entity 

must be a common carrier within the meaning of the Shipping Act. The parties do not dispute 

this, and as found above, HMM is a common carrier within the meaning of the Shipping Act, so 

the first element is met.

b. Provide Service in Accordance with Classifications, Rules, and

Practices Contained in a Service Contract or Tariff

MSRF and HMM agreed to a service contract, the terms of which were amended multiple 

times pursuant to paragraph 14 of the Service Contract. FOF 11-14, 28-32, 36, 41-44. MSRF’s

contention that “HMM failed to provide service that was in accordance with the classifications, 

rules and practices contained in the Service Contract because it refused to provide MSRF with 

the agreed upon minimum quantity of cargo space from May 2021 to April of 2022” does not 

recognize the multiple amendments reached between the parties as modifications to the Service 

Contract. Id. No authority is provided supporting that the terms of an initial service contract 

should be considered independent of or without reference to amendments. Because the Service 

Contract includes the amendments in accordance with paragraph 14, it is not apparent what 

“rates, charges, classifications, rules, and [or] practices” HMM failed to follow, and MSRF does 

not identify them. 

In addition to the terms in the Service Contract and subsequent amendments, the contract 

incorporated by explicit references Rule 208-A of Tariff HDMU-047, which states in part: 

In consideration for Merchant’s MQC, Carrier shall provide container equipment 

for booked shipments and shall accept each shipment timely offered by Merchant 

in order to meet Merchant’s MQC : provided that carrier shall have no obligation 

with respect to cargo tendered in excess of an amount equal to 10% of the 

annualized MQC during any of the sequential 30 day periods covered by this 

contract first of which commences with the effective date of the contract. 

FOF 19. MSRF’s assertion that HMM violated Section 41104 (a)(2) by not accepting 10% of the 

annualized MQC it offered for shipment during each sequential 30-day period fails to consider 

the entirety of the tariff rule to which it points. Specifically, paragraph 7(b), states:

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(b) In the event that the Minimum Quantity Commitment set forth in Appendix

is not fulfilled due to Carriers inability to supply space or container equipment

for causes not covered in Article 10, on any particular vessel of the Carrier after

giving fourteen (14) days booking notice then, upon the Shippers written request

within seven (7) working days of such occurrence together with essential

supporting documents which are later confirmed to be accurate, shipper may elect

one of the following options.

(i) The Carrier will adjust the contractual Minimum Quantity

Commitment set forth in Appendix by the actual quantity of cargo

tendered but not carried on the Carriers vessel or on a pro-rate

basis, whichever lower. Such pro-rate basis shall be defined as the

Minimum Quantity Commitment divided by the Carriers total

number of sailings during the term of the Contract.

(ii) If the Shipper does not elect to reconcile the shortage by reducing

the minimum quantity commitment set forth in Appendix with

aforementioned method, then such shortage will be reconciled

upon expiration of the contract by extending the term of the

Contract by {Contract Duration times (x) number of TEUs that

was tendered to Carrier per Article (7)(a) herein but failed to be

carried divides (/) Total MQC}. The extension of Contract term

must be filed in writing on or before the expiration date with FMC

as per 46 CFR 530.8. In no case will the extension exceed ten (10)

consecutive weeks.

FOF 23 (emphases added). Because MSRF did not elect option (i), the shortage was addressed as 

provided above in option (ii), by extending the term of the contract for 10 weeks. FOF 34, 37-41. 

The parties discussed the extension and agreed to extend the term of the contract by electronic 

mail dated April 29, 2022, per the terms of the tariff rule. FOF 22, 37-41, 44, 50. 

MSRF has not established that HMM acted “not in accordance” with the rates, charges, 

classifications, rules, and practices contained in the service contract. Accordingly, there is no 

violation of this section. 

3. Section 41104(a)(9) - Undue or Unreasonable Preference or

Advantage

MSRF appears to have abandoned this allegation in its reply brief. See Reply Brief at 3 

(where MSRF leaves out the section in a list of violations it alleges) and Reply Brief at 4-8 

(where MSRF replies to the HMM’s opposition brief and does not include a discussion of this 

section). 

During the period covered by the Complaint’s allegations, Section 41104(a)(9) stated that 

a common carrier may not: 

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(9) for service pursuant to a service contract, give any undue or unreasonable

preference or advantage or impose any undue or unreasonable prejudice or

disadvantage with respect to any port;

46 U.S.C. § 41104(a)(9). 

As described above, HMM is a common carrier, satisfying the first element, and in 

relation to MSRF, HMM provided service pursuant to a service contract, satisfying the second 

element. However, no evidence was provided to establish that HMM gave a preference or 

advantage or imposed a prejudice or disadvantage regarding use or avoidance of any port to the 

detriment of MSRF. Accordingly, the third element fails and the allegation that HMM violated 

Section 41104(a)(9) is dismissed. 

4. Section 41104(a)(10) - Refusal to Deal

MSRF asserts that HMM violated Section 41104(a)(10) by refusing to provide the 

promised vessel space pursuant to the terms of the Service Contract; between May 2021 and 

April 2022, “MSRF requested, during multiple occasions, cargo space to ship containers from 

certain ports in Asia into the United States . . . but in almost every single instance where MSRF 

attempted to deal or negotiate for space, HMM refused to provide the space requested;” and “[a]s 

such, HMM’s conduct was unreasonable because it refused to deal or negotiate with MSRF 

regarding vessel space accommodations from May 2021 to April of 2022.” Reply Brief at 7-8. 

MSRF does not argue that HMM refused to deal and negotiate for a service contract, but asserts 

that each time MSRF attempted to book space with HMM and HMM failed to provide it, HMM 

violated § 41104(a)(10). Reply Brief at 7-8. MSRF offers no case authority to support its 

position that the May 2021 to December 2021 period when it alleges it most needed and sought 

to book space, or even the original contract duration of May 2021 to April 2022, should be 

considered separate instances of HMM refusing to bargain. Although it complains of conduct 

occurring during the May 2021 to December 2021 period (and alternately May 2021 to April 

2022), MSRF cites to the amended language of § 41104(a)(10), Brief at 3, which did not take 

effect until June 16, 2022. Pub. L. No. 117-146, §7, 136 Stat. 1272, 1274 (2022). 

HMM asserts that “[t]here is no precedent which would suggest that a failure to satisfy 

the MQC under a Service Contract, if that were to occur, would amount to a Shipping Act 

violation;” “[t]he allegation that HMM refused to deal with MSRF is ludicrous because the 

gravamen of MSRF’s complaint is that HMM breached the very Service Contract negotiated by 

MSRF;” and MSRF admitted “that HMM had not refused to negotiate.” Sur-Reply at 12, 15; 

Opposition at 14. 

During the period covered by the Complaint’s allegations, Section 41104(a)(10) stated 

that: 

A common carrier, either alone or in conjunction with any other person, directly 

or indirectly, may not . . . (10) unreasonably refuse to deal or negotiate; 

46 U.S.C. § 41104(a)(10). 

7 F.M.C.2d
 

 

To establish a violation of Section 41104(a)(10), MSRF must establish that HMM is a 

common carrier, that refused to deal or negotiate, and that such refusal was unreasonable. New 

Orleans Stevedoring Co. v. Bd. Of Commissioners of the Port of New Orleans, Docket No. 00-

11, 29 S.R.R. 1066, 1070, 2002 WL 33836158 (FMC June 28, 2002), aff’d sub nom. New 

Orleans Stevedoring Co. v. FMC, 80 Fed. Appx. 681 (D.C. Cir. 2003) (a common carrier should 

“refrain from ‘shutting out’ any person for reasons having no relation to legitimate 

transportation-related factors.”); Canaveral Port Authority, 2003 WL 723336, at *13, *18 

(“Refusals to deal or negotiate are factually driven and determined on a case-by-case basis,” but 

the burden of persuasion remains with the complainant to show that the refusal to deal or 

negotiate was unreasonable). 

The discussion of the elements below does not include the June 2022 amendment to 46 

U.S.C. § 41104(a)(10) because the conduct complained of occurred prior to the amendment 

enacted by OSRA 2022. However, to the extent that the Commission refers to historical bases on 

which it relies in the current rulemaking effort regarding § 41104(a)(10), the proposed 

rulemaking is referenced. 87 Fed Reg. 57676-57677; 88 Fed Reg. 38789-38808. Prior to the 

OSRA 2022 Shipping Act amendments and the proposed rulemaking that is underway, Section 

41104(a)(10) did not include the language, “including with respect to vessel space 

accommodations provided by an ocean common carrier,” but as the Commission’s discussion of 

the history below shows, shippers securing transportation of their cargo has been the focus of 

Section 41104(a)(10). 

a. Common Carrier

HMM’s status as a common carrier has been established and is not in dispute. 

Accordingly, MSRF has proved this element. 

b. Unreasonably Refuse to Deal or Negotiate

The Commission was tasked by Congress with the implementation of OSRA 2022 “to 

define unreasonable refusal to deal or negotiate with respect to vessel space accommodation 

provided by an ocean common carrier.” FMC Seeking Public Comment on Unreasonable Refusal 

to Deal Proposed Rule, posted at https://www.fmc.gov/fmc-seeking-public-comment-onunreasonable-refusal-to-deal-proposed-rule/ on September 13, 2022. The Commission sought 

public comments to its proposal to establish a definition of “vessel space accommodations” and 

the elements that must be met to establish “an unreasonable refusal to deal with respect to vessel 

space accommodation....” Id. As noted in the beginning of this section, the conduct alleged by 

MSRF in the case sub judice occurred prior to OSRA 2022. 

In its notice of supplemental proposed rulemaking regarding the amendment 

to §41104(a)(10), the Commission stated: 

In the Commission’s history, many cases found the essence of the prohibition on 

unreasonable refusals to deal or negotiate in contravention of the amended section 

41104(a)(10) and its predecessors to be the imposition by a common carrier of 

an unreasonable impediment to a shipper’s access to common carriage. Such 

impediments can take many forms, and no legislation or regulatory process can 

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predict or attempt to encompass every possible scenario in which an unreasonable 

refusal to deal or negotiate might occur. Thus, the caselaw is instructive when 

considering new legislation. Commission determinations will be factually driven 

and determined on a case-by-case basis. 

SNPRM, 88 Fed Reg. at 38791 (emphasis added). 

In determining whether the prohibition of § 41104(a)(10) prior to OSRA 2022 applies to 

a refusal to deal and negotiate individual attempts to book space after a service contract is in 

place, as MSRF urges, it is instructive to consider the Commission’s statement regarding the 

temporal difference between § 41104(a)(10) and (a)(3)10: 

The restrictions that 46 U.S.C. 41104(a)(3) and (a)(10) impose on ocean carriers 

are distinct but closely related. Both provisions address refusals by ocean 

common carriers to accommodate shippers’ attempts to secure overseas 

transportation for their cargo. The distinction between the conduct covered by 

these two provisions is timing, more specifically whether the refusal occurred 

while the parties were still negotiating and attempting to reach a deal on service 

terms and conditions (negotiation stage) or after a deal was reached (execution 

stage). If the refusal occurred at the negotiation stage, 46 U.S.C. 41104(a)(10) 

would apply. If the refusal occurred at the execution stage, after the parties 

reached a deal or mutually agreed on service terms and conditions, then 46 U.S.C. 

41104(a)(3) would apply. 

88 Fed Reg. at 38791. Where the negotiation stage ends and the execution stage begins is 

somewhat murky and, after reviewing the comments submitted by stakeholders in the shipping 

community regarding ocean carrier practices which lead to failure to transport cargo, the 

Commission further stated:

Comments . . . highlight the fallacy of presuming that as a practical matter, it will 

always be feasible to draw a discernible line between unreasonable refusals 

covered by section 41104(a)(10) as distinguished from those covered by section 

41104(a)(3). . . . What these concerns mean as a practical matter is that discerning 

whether a common carrier has unreasonably refused cargo or vessel space 

accommodations is not a simple binary question of determining what prevented 

the shippers’ cargo from actually being loaded aboard an outbound vessel. That 

10 MSRF did not plead a violation of § 41104(a)(3) – and the facts here do not warrant it – 

which, prior to the OSRA 2022 amendments, provided that “A common carrier, either alone or in 

conjunction with any other person, directly or indirectly, may not . . . retaliate against a shipper 

by refusing, or threatening to refuse, cargo space accommodations when available, or resort to 

other unfair or unjustly discriminatory methods because the shipper has patronized another 

carrier, or has filed a complaint, or for any other reason.” 46 U.S.C. § 41104(a)(3). OSRA 2022 

amended § 41104(a)(3) to state that a common carrier shall not “unreasonably refuse cargo space 

accommodations when available, or resort to other unfair or unjustly discriminatory methods.” 

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question may be bound up with an unbroken series of interactions and 

communications that cannot always be neatly separated in the negotiation stage 

(covered by 46 U.S.C. 41104(a)(10)) and the execution stage (covered by U.S.C. 

41104(a)(3)) of the parties’ interactions. 

Id. at 38795-38796. While the above statements could be read to consider each attempt at 

booking an individual negotiation that is independently actionable under § 41104(a)(10), the 

facts in this case do not support finding a refusal to negotiate. Here, the interactions between the 

parties demonstrate continued negotiations at each stage of the relationship, culminating in 14 

amendments to the Service Contract by mutual agreement of the parties and movement of nearly 

double the MQC. FOF 28-31, 36, 41-44, 51-54. Indeed, contrary to its claims, MSRF admitted 

that HMM did not refuse to negotiate with MSRF. FOF 55. 

Some of the reasons provided to MSRF for HMM’s inability to accept certain requests 

for space were “ongoing vessel space issues across the board,” and space filling up quickly due 

to high demand, requiring early booking. FOF 58. The COVID-19 pandemic disrupted ocean 

shipping services, and MSRF acknowledged that the supply chain crisis created significant port 

backlogs in Asia and the United States and limited the transportation of goods. FOF 8-10. There 

was no evidence presented that the reasons HMM could not provide space at various times were 

false. FOF 59. An inability to provide sufficient space for these reasons is not evidence of an 

“imposition by a common carrier of an unreasonable impediment to a shipper’s access to 

common carriage.” Supra at 88 Fed Reg. 389792. Rather, the evidence demonstrates that HMM 

continued negotiating with MSRF to address the shortfall, including by agreeing to additional 

lanes, offering a contract extension, and ultimately accommodating more than the MQC. FOF 

31, 37-44, 46-47, 49, 57. 

Taking into consideration the arguments of the parties and the facts particular to this case, 

MSRF has not established that HMM unreasonably or unjustly refused to deal or negotiate. 

IV. ORDER

Upon consideration of the record herein, the arguments of the parties, the findings and

conclusions set forth above, and the determination that HMM, Co. Ltd. did not violate the 

Shipping Act, it is hereby 

ORDERED that Complainant MSRF, Inc.’s and Respondent HMM, Co. Ltd.’s 

respective revised motions for confidentiality be GRANTED IN PART and DENIED IN 

PART. It is 

FURTHER ORDERED that MSRF’s Complaint against HMM be DENIED. It is 

FURTHER ORDERED that this claim be DISCONTINUED. 

Linda S. Harris Crovella 

Administrative Law Judge 

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7 F.M.C.2d
FEDERAL MARITIME COMMISSION

Office of the Administrative Law Judges

COPPERSMITH GLOBAL LOGISTICS INC., Claimant

v. 

ZIM USA INC., Respondent. 

DOCKET NO. 1996(I) 

Served: December 11, 2023 

BEFORE: Theresa DIKE, Small Claims Officer. 

INITIAL DECISION1

I. INTRODUCTION AND SUMMARY OF DECISION

Claimant Coppersmith Global Logistics Inc. (“Coppersmith”) initiated this proceeding by

filing a Claim against ZIM USA Inc. (“ZIM”) at the Federal Maritime Commission (“FMC” or 

“Commission”) alleging that ZIM violated 46 U.S.C. § 41102(c) of the Shipping Act and the 

Commission’s Regulations at 46 C.F.R. § 545.4 by collecting a double payment for the same

demurrage charge from Coppersmith and failing to refund the overpayment. Claimant asks for 

reparations in the amount of $8,095, which it alleges ZIM owes it for the overpayment.

2

A. Background and Procedural History

Coppersmith, a customs brokerage and freight forwarding company, received notice from 

its Chicago branch office that ZIM was withholding release of its client’s shipment against a 

$48,718 past due balance owed by Coppersmith. Included in the balance was a demurrage charge 

of $8,095 assessed against shipments belonging to Coppersmith’s client, Janel Group LLC

(“Janel”). Coppersmith states that Janel had not previously received notice of the demurrage

charges, and that once notified of the charges it immediately paid the charge. In the interim, 

because Coppersmith wanted to secure prompt release of its client’s cargo, it paid ZIM the 

$48,718 invoice charges, intending to later dispute the charges and request a refund where 

appropriate. When, according to Coppersmith, ZIM never refunded the $8,095 which it had 

twice been paid, despite acknowledging receipt of Janel’s payment, and after repeated requests

1

 Pursuant to 46 C.F.R. § 502.304(g), this decision will become final unless the 

Commission elects to review it within 30 days of service. 2 As discussed infra, in a later filing, Claimant stated that ZIM agreed to also refund it for 

other overpayments, bringing the total owed to $19,915, but Claimant did not ask to amend its 

request for reparations to that amount, rather than the $8,095 it requested in its Claim. 

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from Coppersmith for a refund, Coppersmith filed this Complaint with the Federal Maritime 

Commission (“FMC” or “Commission”), seeking reparations for the double payment. 

Coppersmith alleges that ZIM’s failure to refund the double payment constitutes a violation of 

section 41102(c). 

On August 3, 2023, the Commission issued a Notice of Filing of Small Claims Complaint 

and Assignment (“Notice”), instructing ZIM to file a response to the Claim by August 28, 2023, 

and to indicate whether it consented to the use of the Commission’s informal procedures at 

Subpart S for adjudication of the complaint. The Commission also assigned this proceeding to 

the Chief Administrative Law Judge (“Chief ALJ”) to designate a small claims officer (“SCO”) 

to adjudicate the proceeding. On August 28, 2023, ZIM filed a response to the complaint and 

consented to the use of the informal procedures. On August 30, 2023, the Chief ALJ assigned 

this proceeding to the undersigned for adjudication. 

Pursuant to 46 C.F.R. § 502.301(a) and (e) of the Commission’s Rules, which authorize 

the SCO in a Subpart S proceeding to request, if deemed necessary, additional documents or 

information from the parties, on September 6, 2023, an Order to Submit Discovery Requests 

(“Order”) was issued directing the parties to submit any discovery requests that would aid them 

in establishing their claims and defenses, and upon review, the SCO would incorporate any of 

their requests deemed appropriate and relevant to the SCO’s forthcoming request for additional 

information. No party submitted a request. On October 10, 2023, a Request for Additional 

Documents and Information (“Request”) was issued, directing the parties to provide certain 

information and documents by October 24, 2023, and permitting any party wishing to file a 

response to the opposing party’s submission to do so by October 31, 2023. On October 23, 2023, 

Coppersmith submitted answers to the Request (“C. Supp. Info”), while ZIM submitted its 

response on October 24, 2023. (“R. Supp. Info”). Neither party submitted a reply to the other’s 

response. The record is now complete. 

As discussed in greater detail below, Claimant Coppersmith fails to demonstrate that all 

elements required to find a violation of section 41102(c) and recover reparations under section 

545.4 are present in this case as Respondent is not a regulated entity. Nevertheless, in its Verified 

Answer Respondent ZIM commits to refund the $8,095 overpayment to Coppersmith and asserts 

that it has refunded the amount due. 

B. Argument of the Parties

1. Coppersmith’s Arguments

Coppersmith states that it paid ZIM’s past due invoice, including the $8,095 assessed 

against Janel’s shipments, to obtain immediate release of its withheld cargo, intending to later 

review ZIM’s invoice “to verify [its] validity, dispute the charges and request a refund where 

warranted.” Complaint pg. 1 at ¶ III. Coppersmith states: 

7 F.M.C.2d

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118

formal refund request as well. We’ve even tried to have them offset with ocean 

freight and that didn’t work. 

Complaint pg. 2 at ¶ III(B). Coppersmith states that “[t]here was no injury, and no additional 

funds are required other than what is owed.” Complaint pg. 2 at ¶ V. 

Coppersmith further asserts that ZIM “agree[d] to pay all charges owed to us which 

would include not only this refund but others which total 19,915 . . . and still the refund has not 

been paid.” C. Supp. Info. pg. 1 at no. 4. Coppersmith submitted emails containing 

communications with ZIM, in which ZIM informed Coppersmith that it would issue a refund for 

the overpayments. Coppersmith maintains that it never received a refund from ZIM and that the 

alleged conduct by ZIM constitutes a violation of section 41102(c). 

2. ZIM’s Arguments

ZIM admits that it received duplicate payments from Coppersmith and Janel for the 

detention charges assessed against Janel’s shipments and also admits that it has not refunded the 

double payment to Coppersmith. Answer pg. 1 at ¶ IV. In addition, ZIM acknowledges that 

Coppersmith is entitled to a refund from it for the overpayment. Answer pg. 1 at ¶ V. ZIM agrees 

with Coppersmith’s statement that “there was no injury and that no monies in excess of the 

claimed $8,095 are owed” and states that “on August 25, 2023, [it] notified Claimant of its intent 

to refund the monies, subject to completion of routine administrative documentation.” Answer 

pg. 2 at ¶¶ VII – VIII. However, ZIM “denies that Claimant made ‘repeated requests for 

[Respondent] to do so’” or that “Claimant ‘made a formal refund request’ or ‘tried to have them 

offset with ocean freight.’” Answer pg. 1 at ¶ IV. Further, ZIM denies that it committed any 

violations of the Shipping Act. Answer pg. 2 at ¶ VI. 

ZIM asserts that it “forwarded payment of the claimed amount, $8,095 by check dated 

10/24/2023. Payment was forwarded via UPS, Tracking No. 1Z50V8720191647501.” R. Supp. 

Info pg. 1 at No. 1. 

ZIM explains regarding the double payment: 

Claimant, Coppersmith Global Logistics, Inc. was not charged twice. Claimant, 

acting in its capacity as a Non-Vessel Operating Common Carrier, was the 

Shipper of Record for twelve (12) consignments transported from Laem Chebang, 

Thailand, and discharged at the port of Houston, Texas, in May, 2021. (See 

Respondents Answer, Exhibit A). Following delivery of the cargoes at the port of 

Houston, Claimant - or its underlying receiver - interchanged the cargoes out and 

then returned each to the port of Houston and subsequently received Invoices for 

accrued Detention, totaling $8,095.00 (See Respondents Answer, Exhibit B; see 

also, Claimant’s Complaint, dated July 28, 2023). 

A payment of $23,663.17 was received from Coppersmith, along with remittance 

instructions, on August 10, 2022. Those instructions extended to payment of the 

$8,095 at issue in this matter. 

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119

Prior to that time, Respondent received a payment of 8,095.00 from Andre 

Prostinc that did not include remittance details or payment instructions. As 

Respondent had no active account under Andre Prostinc’s name, the funds were 

posted to a temporary account to allow us to determine how to apply those funds. 

On September 16, 2022, Respondent informed Claimant that the $8,095.00 

payment from Andre Prostinc had been located and moved to the Coppersmith 

account. In that same communication, Claimant was informed that the account 

was “almost eligible for a refund,” indicating that in accordance with ZIM policy, 

overdue invoice payments would need to be cleared before a refund could be 

issued; a Statement of Account was attached to that communication (See 

Attachment B). 

R. Supp. Info pgs. 1 - 2 at no. 2. ZIM asserts that it did not issue a refund to Claimant prior to its

initiation of this litigation because “Claimant’s accounts were not, during the period of

September 2022 to July 2023, brought into Terms.” R. Supp. Info pg. 2 at no. 3.

II. PERTINENT FACTS ESTABLISHED BY THE RECORD (“PF”)

1. Claimant Coppersmith is a customs brokerage and freight forwarding corporation, with

its principal place of business in El Segundo, California. Complaint pg. 1 at ¶ I.

2. Respondent ZIM‘s corporate name is ZIM American Integrated Shipping Services Co.

LLC. Answer pg. 1 at ¶ II.

3. ZIM is the General Agent for ZIM Integrated Shipping Services Ltd (“ZIM Israel”), a

vessel-operating common carrier (“VOCC”) located in Israel. Answer Pg. 1 at ¶ II.

4. ZIM is not an ocean common carrier. Answer Pg. 1 at ¶ II.

5. ZIM Israel, the VOCC that transported the shipments in question, is not a party in this

litigation. Complaint pg. 1.

6. Claimant was listed as consignee and notify party on bills of lading issued by ZIM Israel,

including for the shipments at issue, shipped from the Port of Laem Chabang, Thailand,

to the Port of Houston, Texas. R. Supp. Info pg. 1at no. 2; Answer Ex. A.

7. When Janel’s shipments arrived in Houston, for reasons undisclosed by the parties, they

accrued demurrage totaling $8,095.00. R. Supp. Info pg. 1 at no. 2; Answer Ex. B.

8. On August 8, 2022, Coppersmith was notified by its Chicago branch office that ZIM was

withholding one of Coppersmith’s VIP customer’s shipments against a $48,718.00 past

due balance owed by Coppersmith. Complaint pg. 1 at no. III.

9. The past due invoice included demurrage charges in the amount of $8,095.00, assessed

against shipments belonging to Janel, Coppersmith’s customer. Complaint pg. 1 at no. III.

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10. On August 8, 2022, Coppersmith notified Janel of the past due demurrage charges and

Janel’s employee, Andre Prostinc, immediately made payment to ZIM in the amount of

$8,095. Complaint pg. 1 at no. III; R. Supp. Info pg. 1 at no. 2.

11. Andre Prostinc did not indicate that the payment was for the Janel shipments and ZIM

had no active account under Andre Prostinc’s name. R. Supp. Info pg. 1 at no. 2.

12. On August 10, 2022, Coppersmith made a payment in the amount of $23,663.17 to ZIM,

along with remittance instructions indicating that the payment included the charges on the

Janel shipments. R. Supp. Info pg. 1 at no. 2.

13. On September 16, 2022, ZIM notified Coppersmith that it had moved the payment from

Andre Prostinc to the Coppersmith account but that, according to “ZIM policy, overdue

invoice payments would need to be cleared before a refund could be issued.” R. Supp.

Info pg. 1 - 2 at no. 2.

14. On August 3, 2023, the Commission notified ZIM that Coppersmith had filed a Claim

against it and instructed it to file a response to the Claim by August 28, 2023. Notice at

pg. 1.

15. On August 25, 2023, ZIM sent an email to Coppersmith stating in pertinent part:

After review of your account and file, ZIM will issue a refund for 

the $8,095 duplicate payment on your account. To begin the 

processing, please complete the attached forms and return them to 

me at your earliest convenience. 

Coppersmith Supp. Ex. 1 (Email from ZIM employee, Martin Adrienne dated August 25, 

2023, 3:00 PM, to Coppersmith and ZIM employees). 

16. On August 25, 2023, Coppersmith responded, stating in pertinent part:

I already did 2 requests for the amounts owed as they’re from 

different customers. See attached emails to James and Cameron 

which went unanswered. We also have a dispute that has yet to be 

resolved. See below; DLAX1670099996 - $2500 

ZIMULIS70008574 - ZIMU2896596 100022437. This was for 

demurrage and the gate ticket was sent to ZIM disputes with our 

claim showing we picked up the container on time. So along with 

the attached emails you owe us a total of $19,915. There is about 

$3000 more outstanding but it’s been so long that I have to go back 

into my emails to find it. 

Coppersmith Supp. Ex. 1 (Email from Coppersmith dated August 25, 2023, 3:42 PM, to 

Coppersmith and ZIM employees). 

17. On August 31, 2023, ZIM responded:

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121

I am initiating the refund payment process for $19,915. ZIM issues 

all payments via ACH and therefore I need your banking 

information. Please complete the attached forms for us to set your 

account up for payments. 

Coppersmith Supp. Ex. 2 (Email from ZIM employee, Martin Adrienne dated August 31, 

2023, 2:20 PM, to Coppersmith and ZIM employees). 

18. Coppersmith completed the required forms but had not yet received a refund at the time it

submitted its response to the Request for information issued to the parties on October 23,

2023, as part of the proceeding. C. Supp. Info pg. 1 at no.1.

19. ZIM states that it “forwarded payment of the claimed amount, $8,095.00 by check dated

10/24/2023. Payment was forwarded via UPS, Tracking No. 1Z50V8720191647501.” R.

Supp. Pg. 1 at no. 1.

20. Official notice is taken of UPS records showing that on October 25, 2023, a package

identified as tracking No. 1Z50V8720191647501 was received by someone named

“Jackson” at El Segundo, California, the location of Coppersmith’s principal place of

business.

https://www.ups.com/track?loc=en_US&Requester=NES&tracknum=1ZA8E582044765

8148/trackdetails (accessed on December 8, 2023).

III. DISCUSSION

A. Controlling Authority

ZIM states that it is the General Agent for ZIM Israel, a vessel-operating-common 

carrier, which transported the shipments at issue. A vessel-operating-common carrier is defined 

under the Shipping Act as “a person that -- (A) in the United States, dispatches shipments from 

the United States via a common carrier and books or otherwise arranges space for those 

shipments on behalf of shippers; and (B) processes the documentation or performs related 

activities incident to those shipments.” 46 U.S.C. § 40102(19). 

A “common carrier” is a person that – 

(i) holds itself out to the general public to provide transportation by water of

passengers or cargo between the United States and a foreign country for

compensation;

(ii) assumes responsibility for the transportation from the port or point of receipt to

the port or point of destination; and

(iii) uses, for all or part of that transportation, a vessel operating on the high seas or

the Great Lakes between a port in the United States and a port in a foreign country

. . . . 

46 U.S.C. § 40102(7). 

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Coppersmith alleges that ZIM’s failure to refund the double payment gives rise to a 

violation of section 41102(c) which provides: “A common carrier, marine terminal operator, or 

ocean transportation intermediary may not fail to establish, observe and enforce just and 

reasonable regulations and practices relating to or connected with receiving, handling, storing, or 

delivering property.” 46 U.S.C. § 41102(c). 

Pursuant to section 545.4 of the Commission’s regulations, in order to establish a 

successful claim for reparations” under section 41102(c), the claimant must demonstrate that: 

(a) The respondent is an ocean common carrier, marine terminal operator, or

ocean transportation intermediary;

(b) The claimed acts or omissions of the regulated entity are occurring on a

normal, customary, and continuous basis;

(c) The practice or regulation relates to or is connected with receiving, handling,

storing, or delivering property;

(d) The practice or regulation is unjust or unreasonable; and

(e) The practice or regulation is the proximate cause of the claimed loss.

46 C.F.R. § 545.4. 

B. Evidence and Burden of Proof

“In all cases governed by the requirements of the Administrative Procedure Act, 5 U.S.C. 

556(d), the burden of proof is on the proponent of the motion or the order.” 46 C.F.R. § 502.203. 

Thus, a claimant alleging a violation of the Shipping Act bears the burden of proving its 

allegations against the respondent. The term, “burden of proof” is understood to mean “the 

burden of persuasion.” Director v. Greenwich Collieries, 512 U.S. 267, 276 (1994). The party 

bearing the burden of persuasion must prove its case by a preponderance of the evidence. See 

Steadman v. SEC, 450 U.S. 91, 102 (1981). When the party with the burden of persuasion 

produces sufficient evidence (characterized as a prima facie case), the burden of production 

shifts to the other party to produce evidence rebutting that case. In re South Carolina State Ports 

Auth. for Declaratory Order, 27 S.R.R. 1137, 1161 (FMC 1997). See also Steadman, 450 U.S. at 

101 (“Where a party having the burden of proceeding has come forward with a prima facie or 

substantial case, he will prevail unless his evidence is discredited or rebutted.”). When direct 

evidence is unavailable, inferences may be drawn from certain facts and circumstantial evidence 

may be sufficient so long as the fact finder does not rely on mere speculation. Waterman S.S. 

Corp v. General Foundries, Inc., 26 S.R.R. 1173, 1180 (ALJ 1993) adopted in relevant part, 

26 S.R.R. 1424, 1994 WL 279898 (FMC June 13, 1994). If the evidence produced by both 

parties is evenly balanced, the party with the burden of persuasion will not prevail. Greenwich 

Collieries, 512 U.S. at 281. 

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C. Coppersmith Fails to Demonstrate that ZIM Violated Section 41102(c)

Coppersmith does not dispute that it owed demurrage charges in the amount of $8,095, to 

ZIM on behalf of its customer, Janel. Similarly, ZIM does not dispute that it received an 

overpayment from Coppersmith in the amount of $8,095, for the demurrage charges and that 

Coppersmith is entitled to a refund from ZIM for the overpayment. Answer pgs. 1-2 at IV-VIII. 

Nevertheless, Coppersmith’s section 41102(c) claim fails because it does not satisfy the 

threshold requirements to establish a violation of section 41102(c) and recover reparations under 

section 545.4. 

To succeed in a claim for reparations under section 41102(c), the claimant must show 

that: 

1) the respondent is an ocean common carrier, marine terminal operator, or

ocean transportation intermediary;

2) the alleged illegal conduct is “occurring on a normal, customary, and

continuous basis;”

3) the alleged practice or regulation relates to or is connected with receiving,

handling, storing or delivering property;

4) the alleged practice or regulation is unjust or unreasonable; and,

5) the alleged practice or regulation in question is the proximate cause of the loss

the claimant alleges it suffered.

See 46 U.S.C. § 41102(c) and 46 C.F.R. § 545.4. To prevail, all five elements must be proven. 

Respondent ZIM is not an ocean common carrier, marine terminal operator, or ocean 

transportation intermediary, the first element required under section 545.4 to file a successful 

claim. ZIM denies that it is an ocean common carrier and asserts that rather, it is “the General 

Agent” for ZIM Israel, the ocean common carrier that transported the shipments at issue. Answer 

Pg. 1 at ¶ II; PFs 3 and 4. Coppersmith did not dispute ZIM’s denial, and the evidence of record 

does not contradict ZIM’s defense. 

The Commission has found that an agent for a VOCC can be subjected to FMC 

jurisdiction if it is named as a respondent in an FMC proceeding along with its principal VOCC. 

TCW, Inc. v. Evergreen Shipping Agency (AM.) Corp., FMC Docket No. 1966(I), 2022 WL 

18068977 at *1 (FMC Dec. 29, 2022). However, ZIM Israel, the VOCC principal, is not named 

as a party in this proceeding. Complaint pg. 1, PF 5. Accordingly, Coppersmith fails to satisfy 

the first element under section 545.5. Because all five elements under section 545.4 must be 

demonstrated to prevail in a section 41102(c) claim and Coppersmith fails to demonstrate the 

first element, it is not necessary to determine whether the other elements are satisfied in this case. 

Moreover, ZIM represents that it sent a refund check to Coppersmith for $8,095.00, the 

amount Coppersmith requested as reparations. R. Supp. Pg. 1 at no. 1; PF 19. Curiously, the 

parties did not seek to dismiss this proceeding prior to the issuance of this Initial Decision, which 

is what would normally be expected to happen when a respondent makes a complainant whole 

by paying its claimed damages. While ZIM did not provide a copy of its refund check as 

evidence, the tracking number it sent as proof of the refund indicates that a package was 

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delivered to the location of Coppersmith’s principal place of business (PF 20) at El Segundo, 

California, and Coppersmith did not dispute ZIM’s contention that it has now refunded the 

double payment to Coppersmith. 

Accordingly, Coppersmith’s section 41102(c) claim is dismissed. While it only requested 

reparations in the amount of $8,095 in its Claim, Coppersmith indicates that the actual refund 

amount owed to it by ZIM is $19,915, and the evidence shows that ZIM committed to refund that 

amount to Coppersmith. PF17. If it has not yet done so, ZIM is urged to refund the full amount 

owed to Coppersmith to avoid further litigation on this issue. 

IV. CONCLUSION

Claimant Coppersmith fails to demonstrate that Respondent ZIM violated section

41102(c), as alleged. Accordingly, it is hereby ORDERED that Coppersmith’s request for 

reparations be DENIED and its complaint be DISMISSED WITH PREJUDICE. 

Theresa Dike 

Small Claims Officer 

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FEDERAL MARITIME COMMISSION

125

MSRF, INC., Complainant

v. DOCKET NO. 22-20

HMM CO. LTD., Respondent.

Served: December 26, 2023

NOTICE NOT TO REVIEW

Notice is given that the time within which the Commission could determine to review the 

Administrative Law Judge’s November 22, 2023, Initial Decision has expired. Accordingly, this 

decision has become administratively final.

Mary Thien Hoang

Acting Secretary

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