The media has been abuzz the last several weeks with stories about the Costa Concordia accident. From stories about the ship’s captain, Francesco Schettino, allegedly being hired to work with a coalition of salvage crews in Italy to articles speculating on what the fall out will be for Carnival Corporation, the parent company of Costa Crociere and other cruise lines, the accident has everyone talking about cruise ship safety. All that talk, however, is likely to be of little consolation to the passengers and crew members on the Concordia and their families, since the odds of them being able to litigate their cases in the United States are extremely remote. In the case of the crew members, their employment contracts typically require them to arbitrate any claims they have arising out of their employment, including claims for injuries, in their home country or the country where the cruise line is based (in Costa’s case, Genoa). In the case of injured passengers, they, too will likely be precluded from filing suit in the United States for the injuries they sustained because of the fine print contained in the tickets they purchased before they boarded the ship.
While most of the major cruise lines require passengers who are injured on cruises touching in a United States port to file suit in the jurisdiction where they are headquartered – Miami, in the case of Carnival, Royal Caribbean, and NCL, Seattle, in the case of Holland America- no such protection is afforded passengers on cruises that do not call or touch a US port. In the case of Costa Crociere, the terms of the ticket for cruises outside the United States requires passengers to file suit in Genoa, Italy, which makes it extremely difficult for them to pursue their claims.
The big question going forward, though, is not whether the passengers and crew members injured or killed as a result of the Concordia disaster will be compensated in some fashion – Costa Crociere has reportedly offered to pay $14,000 to passengers who sustained no physical injuries – but whether they will be compensated fairly. Most maritime personal injury attorneys, including myself, believe the answer is no, given the legal hurdles both passengers and crew members face as a result of where they will be required to litigate. This is not to say that both Costa Crociere and Carnival do not have an interest from a public relations standpoint in settling cases involving the Concordia for a fair amount, since their image is critical to attracting new passengers and retaining old ones. However, given the magnitude of the catastrophe and the apparent recklessness of the captain, it seems unlikely that Costa will pay anything close to full value on any of these cases.
For one thing, based on the evidence that has come out so far, attorneys for injured passengers and crew members would almost certainly have a basis to seek punitive damages against Costa. However, such damages are likely unavailable under Italian law, which a court in Italy would probably apply if the cases were tried there. For another, general maritime law in the United States would permit passengers and crew members to seek emotional distress damages, which given the circumstances of this case, would almost certainly be substantial. (It is hard to imagine anyone not being justifiably traumatized by being on board a sinking cruise ship. Think Titanic). It is unclear whether courts in Italy would allow recovery for these damages, but the consensus among maritime attorneys is that even if plaintiffs could bring their cases in Italy – a questionable proposition, since Italian law does not allow for contingent fee representation – the damage awards are likely to be smaller than in the United States.