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Challenges and Limitations for Cruise Ship Victims

On January 13, 2012, The cruise ship Costa Concordia, with passengers and crew of over 4,000, crashed into a rocky reef near the Tuscany coast of Italy. Reports say the vessel was 2.5 miles off course and the collision caused a gash of exceeding 160′ to the side of the ship. The accident has left at least 13 dead and 70 others injured.

Many victims of this tragedy may be seeking fair compensation for the injuries they sustained in the crash. Others may be seeking compensation for the death of a loved one. What remains unclear, is whether they will ever receive fair compensation for their losses and in which courts they can seek the compensation they deserve.

The Italian cruise ship Costa Concordia — one of the largest ever to be wrecked — is owned by a company called Costa Crociere, which is a subsidiary of the Miami-based Carnival Corp. This would lead many to believe that an injured person could file a claim against the Miami-based corporation here in the United States. However, this is not the case. According to contracts written into the Concordia‘s tickets, any lawsuit related to the cruise ship must be brought in the courts of Genoa, Italy. This was known as a “selection of forum” clause and it is commonly used in contracts by the cruise ship industry. There are exceptions to the clause if the cruise ship travels to U.S. ports, however, the Concordia’s voyage does not meet this exception.

In the past, U.S. citizens have tried to challenge the forum selection clause in cruise lines’ contracts. However, U.S. courts have generally upheld the contacts. Many have argued that the clause makes litigation too expensive and burdensome or that the injuries they have suffered as a result of the cruise lines negligence limit their ability to travel. Despite all of these legitimate reasons for bringing a claim in the U.S., courts have continued to dismiss these cases. It may also be difficult, if not impossible, for the crew members of the Concordia to sue the company for any injuries they received. The crews’ employment contracts contain a clause that requires that they arbitrate any disputes.

Those who are able to successfully file a claim are likely to be shocked to learn that there are limits on what they can recover. Most cruise line tickets contain another clause limiting damages that can be recovered to those permitted by the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea. The Athens Convention limits a cruise line’s liability for injuries and deaths to 46,666 Special Drawing Right (SDR’s). An SDR is an international currency. 46,666 SDR’s are equal to approximately $70,000.

While civil litigation is extremely difficult for victims to pursue, U.S. criminal charges will likely be impossible. Since the accident occurred in Italian waters, U.S. criminal law will not apply. However, Italian law will still apply. The captain of the Concordia was arrested in Italy and is being investigated for abandoning ship and manslaughter.


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