Legal Battle to lessen Baltimore Bridge Liability starts


A salvage company from Florida is spearheading the cleanup efforts following the collision between a container ship and the Francis Scott Key Bridge, which has crippled the city’s port. Federal estimates suggest the reconstruction of the bridge and the cleanup could surpass $2 billion, potentially leading to one of the largest marine insurance payouts in history, according to Lloyd’s of London CEO John Neal.

Meanwhile, the ship owner responsible for the destruction of Key Bridge, is pushing to cap its liability at approximately $44 million. According to reports from Bloomberg News, citing legal experts, Grace Ocean, the company owning the vessel, could face damage claims totalling hundreds of millions of dollars. 

On Monday, Grace Ocean, along with Synergy Marine, the operator of the Singapore-flagged container ship Dali, jointly filed a petition stating that the bridge collapse was not their fault, and they should not be held accountable for any resulting loss or damage. One of the main legal debates revolves around whether the ship owners will invoke "general average," an ancient principle that would distribute losses proportionately among cargo owners and other stakeholders. 

This tactic was utilized by Evergreen Marine in 2022 when the Ever Forward container vessel got stuck in the Chesapeake Bay, necessitating weeks of dredging and tug services. As legal battles ensue, cleanup efforts have commenced, and measures to minimize disruptions are underway. Demolition crews have started cutting the collapsed steel trusses, and salvagers have cleared a path for barge traffic to resume. According to ship tracking data on the Bloomberg Terminal, the Port of Virginia is poised to handle a significant portion of the diverted shipments. The Small Business Administration is establishing a second recovery center locally to provide additional federal assistance to affected businesses. 

The Department of Transportation is offering $60 million in immediate funding, and President Joe Biden is scheduled to visit Baltimore on Friday, 5th April 2024. Lee Klaskow, a senior logistics analyst with Bloomberg Intelligence, anticipates that Baltimore-bound vehicles and cargo will be redirected to ports in Philadelphia, the New York area, or Norfolk, Virginia. He predicts a short-term disruption lasting six to 12 weeks, with a possibility of exceeding 12 weeks. Klaskow believes that once the channel is clear, freight will resume, and while supply chains may feel an impact, it will not be as significant as past disruptions like those caused by the pandemic or diversions avoiding the Red Sea.



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