Passenger disappearance leads to scrutiny in cruise industry


At every turn in the past two months, Royal Caribbean International has found itself fighting round after round of accusations and aggressive press coverage about disappearing passengers and shipboard crime. And if lawyers and lawmakers have their way, public attention to those issues is likely to increase in the coming months.

Appearing on national television, Richard Fain, Royal Caribbeans CEO, has disputed accusations that the company was insensitive and negligent in its actions following the suspicious disappearance last summer of Connecticut honeymooner George Smith.

Fains appearance was preceded and followed in other venues by the companys lawyers, public affairs executives, the head of fleet operations and the captain of the ship from which Smith disappeared.

Much of the recent media coverage was fueled by a congressional hearing in December into questions about shipboard safety and industry practices stemming from the Smith disappearance. The issue is expected to be revived in early March, when more family members of missing cruise passengers are expected to testify in a second series of congressional inquiries that will embrace wider issues of maritime law, jurisdictional conflicts and regulation of cruise lines.

Cruise industry officials say they are confident about their safety practices, reporting procedures and treatment of customers. But sources within the industry also say that when the smoke clears, the U.S. mass market cruise industry, which has seen substantial growth over the past decade, could end up facing tighter regulatory scrutiny and increased consumer liability.

Although high-profile disappearances such as the cases involving Smith and, later, Merriam Carver, a passenger who went missing from a Royal Caribbean cruise in Alaska, have been painful to the industry, cruise sales have so far shown no signs of withering under bad publicity.

In fact, the cruise industry has used the opportunity to reinforce its claim -- supported by FBI and Coast Guard data -- that cruising is among the safest of travel options. Of the tens of millions of Americans who took cruises in the past five years, only 13 have been lost.

Still, the growing tide of negative publicity is creating potential political problems for the industry as it is forced to answer questions about how cruise ships that dock in U.S. ports are regulated, and by whom.

The cruise industry has a great deal at stake in the growing debate, according to Thomas Dickerson, a New York State Supreme Court justice and author of Travel Law, a widely cited guide to legal issues related to travel. Dickerson said cruise lines have long benefited from treaties and laws that limit their liability to passengers or families who seek compensation for accidents, crimes or other incidents at sea.

Maritime law protects cruise lines; it does not protect consumers, said Dickerson, a former trial lawyer. The bottom line is that maritime law is pro-cruise line, and that comes out in a lot of different ways.

Regulation of cruise operations in the U.S. is governed primarily by complex maritime laws, though there are some other agencies -- most recently, the Department of Homeland Security -- that also affect operators. The Centers for Disease Control and Prevention, for example, requires reporting of health issues and compiles statistics and sanitation ratings on cruise lines. Reports of accidents on the high seas are required by the U.S. Coast Guard for all commercial shipping, and security regulations enacted after 9/11 have increased requirements on reporting passenger and crew identifications at U.S. ports.

Moreover, cruise executives have testified that they meticulously report all criminal incidents at sea to the FBI and to appropriate law enforcement agencies in the country under whose jurisdiction they sail. The incidents they report range from disappearances to allegations of rape, robbery, drug trafficking, assault and murder.

But some federal lawmakers have expressed skepticism about whether all this reporting, both voluntary and mandated, add up to an accurate picture. They are also asking if Congress needs to revisit jurisdictional treaties and traditions that currently leave U.S. citizens subject to foreign laws in disputes or incidents.

Michael Crye, president of the International Council of Cruise Lines, which represents most of the major players in the cruise industry, said he hopes congressional inquiries will pursue the truth as opposed to the perceptions created by media attention.

I believe that there is a very complex, overarching regulation of the cruise ship industry today, dependent upon the jurisdiction where the ships are located, Crye said. I believe that people who go on cruises are very safe, and I believe that any objective look at the record of the cruise industry will come to the same conclusions.

Crye added: Perceived ideas that the cruise industry is loosely regulated and that [lawmakers] need to do something about it would not survive an objective look at the cruise industry today.

A web of laws

Cruise ships typically operate under flags of jurisdictions that range from the Bahamas to countries in Africa and other destinations around the world. It is a practice that can routinely put the cruise operator, and anyone alleging crimes or negligence, under the laws of either the nation whose flag they fly or the country where the company maintains its incorporation.

In addition, the criminal and civil laws of countries being visited may also apply, creating a complicated jurisdictional maze for passengers in need of any kind of legal protections. That situation is prompting lawmakers to take a closer look at what laws apply when something bad happens to a U.S. passenger on a cruise.

Congressional investigators now say they are looking for a more accurate and complete picture of how often allegations of criminal acts (sexual assault ranks highest on the list of reported crimes) disappearances or injuries occur aboard cruise ships.

Clearly, not all of the debate is likely to be reasoned and rational. Emotional issues raised by Smiths disappearance plus other cases that are expected to come up in the congressional hearings could drive legislation seeking tighter controls on cruise lines -- something the industry wants to avoid.

Industry leaders and experts in maritime law say that similar consumer-protection issues involving cruise lines have surfaced hundreds of times in state court proceedings in the past 10 years, but without the emotionally charged national spotlight fueled by the Smith disappearance.

But while passengers have sued cruise lines in U.S. courts for incidents ranging from assault to disappearances to spider bites, plaintiffs lawyers complain that their clients rights have been narrowly limited. Foreign and U.S. maritime laws, these lawyers say, typically protect cruise lines more than they protect passengers.

U.S. Reps. Christopher Shays (R-Conn.) and Mark Souder (R-Ind.), who called the initial hearing in December in response to the Smith case, said they remain concerned about how cruise lines deal with passenger safety and security.

When something like this occurs, Shays said, you begin asking who owns the cruise line? Where are they based? Where are they coming from? Where are they flagged? Where are the employees coming from?

Those are all issues we have never really addressed in Congress. We have looked at environmental issues, but not taken a good look at security. Someone has to take the lead here, because a lot of Americans travel on cruise ships.

In public comments and testimony, cruise line officials say Congress should be pleased with the industrys safety record. But Shays, who became involved because George Smiths family is a constituent, said he needs more information before deciding whether to examine cruise line regulation and jurisdictional questions more closely.

Lawyers who practice maritime law say that cruise passengers are routinely required to sign liability waivers that restrict their right to sue cruise lines for negligence or injury. The waivers, these lawyers say, are presented to passengers in the form of tiny print on the backs of tickets, similar to the legal disclaimers on the backs of some airline tickets, and typically limit damage claims against cruise lines to economic loss.

Crimes, accidents reported differently

Nancy Nelson, a Jacksonville, Fla., travel agent, is among former passengers demanding more openness and accountability on the part of cruise lines. Nelson says Royal Caribbean was uncooperative when she tried to find out what happened to her husband on a diving excursion in 2001.

Nelson, who once specialized in cruise sales, had won a free trip aboard a Royal Caribbean ship to the Bahamas in a sales promotion. She and Bob Nelson, her husband of 32 years, sailed in November 2001. While she was shopping in Nassau, Bob failed to surface on a dive excursion. No one ever saw him again.

In her lawsuit against the cruise line, Nelson alleges that her husband was an experienced diver and that he was abandoned under water by a dive master during an excursion that went wrong. When the dive was aborted because of difficult seas, other divers were recovered, the suit alleges, but Nelson was left behind when the dive boat left the area, and no head count was taken.

The suit asserts that the same incident was also a near disaster for others who had trouble getting back to the dive boat in rough seas. Nelsons lawsuit, filed by Miami lawyer Greg Anderson, who usually defends cruise lines in liability claims, also alleges that rescue efforts were negligible.

Anderson said he took Nancy Nelsons case because he felt she had been mistreated by Royal Caribbean after it resisted her efforts to get information and help related to her husbands disappearance. Anderson said he thought the case offered a potential test of maritime law, which he says severely restricts passengers from holding cruise lines responsible for accidents, crimes and disappearances.

Although Royal Caribbeans policy is to report all disappearances to the FBI, the company did not report Nelsons disappearance. Michael Sheehan, a spokesman for Royal Caribbean, said that was because the case was treated as an accidental drowning rather than an unexplained disappearance, and thus the cruise line reported it to the Coast Guard for the purposes of a belated rescue attempt.

Sheehan said Bob Nelson was not actually a missing person. We knew he had been the victim of a tragic accident, so there was no question of whether a crime had been committed. Under such circumstances, he said, an FBI report would have been unwarranted.

Presumed accidental drownings aside, Captain Bill Wright, who heads up Royal Caribbeans fleet operations, and Greg Purdy, the lines security director, both said it is the companys policy to report missing passengers to law enforcement.

For persons overboard, Purdy said, maritime responsibilities for reporting are done by maritime casualty reports, and a portion of that form asks that you characterize the nature of the incident. And if that person overboard is a U.S. citizen, it is also reported to the FBI.

Wright agreed.

If it is a U.S. citizen who is missing and off the ship, who presumably fell overboard, we would inform the FBI, he said.

Wright and Purdy said cruise lines are held to strict standards that dont exist for other parts of the travel industry, such as hotels, resorts or even airlines. Purdy noted that cruise lines also verify the identity of every passenger and provide government officials with manifests and photos of everyone on board, including crew members.

A $75,000 settlement

Diligent reporting of incidents, Royal Caribbean officials said, reflects an industrywide commitment to passenger safety and security and makes reporting of incidents a logical extension of companies public safety concerns.

In the Nelson case, the trial court eventually ruled in favor of Royal Caribbean, upholding the cruise lines liability waivers. Rather than prolong the case through an appeal, the company settled for $75,000, Anderson said. He complained Royal Caribbean dragged the case out by failing to provide reports about Bob Nelsons disappearance, resulting in two years of litigation and discovery.

Its still hard to talk about this after all I have been through, Nancy Nelson said. But I want to talk to anyone who wants to listen at this point, because people need to know what happened to me and what can happen to them.

Without the reports from Royal Caribbean, she said, I couldnt even get access to his death benefits for three years. Its been a horrible and frustrating experience.

Sheehan declined to comment on Nelsons allegations involving delayed reports.

Anderson offers the case as evidence that maritime law must be changed.

Its a scandal, really he said. No rational human being with any sense of compassion could look at the Death on High Seas Act and general maritime law as it applies to passengers and say that significant changes do not need to be made.

Anderson said he hopes further congressional hearings will raise some difficult questions for cruise lines.

These maritime laws come from a time when America was trying to promote shipping and compete with the British and the Dutch, Anderson said. Most of the statutes date to 100 years ago [and were] never designed for an age of modern cruise ships with multiport agendas, carrying thousands of people on purely pleasure trips.

The good news for plaintiffs lawyers -- and the bad news for cruise lines -- he said, is that the federal courts understand the problems and have carved out exceptions where they can.

Among those exceptions is the recent U.S. Supreme Court ruling requiring cruise ships docking in U.S. ports to abide by the Americans With Disabilities Act. And lower courts in Florida recently ruled that cruise lines can be held liable for claims related to sexual assault of passengers by crew members, a decision that is forcing closer background checks for workers.

Anderson said that in each case, the cruise companies very aggressively ... are protecting the law that protects them, and that leaves consumers with little recourse.

People who are getting killed, injured, raped, you name it, are your average vacationer, and it usually only happens to one or maybe two at a time, Anderson said. They are not mass disasters, and so far no senators daughter has been raped ... and no large political contributor has been killed on a cruise ship. Until that happens, Congress probably will not act to protect passengers.

Sheehan refused to discuss recent rulings or settlements, and Fain declined to be interviewed for this article. But the ICCLs view of the maritime laws in question is that they have lasted in some cases for centuries not because of lobbying or other political pressures but because they work.

Maritime law is the original international law, and it has built up over 200 years, said the ICCLs Crye.

Some things may be antiquated, and some things get added all the time. Because it is international law, it may be more conservative in some respects than some of the recent statutes in this country, but nothing is there specifically for the cruise ship industry.

Moreover, he said, the cruise lines liability is determined not just by maritime laws but more frequently by simple contract law.

Just as with an airline, or bus line, there is a contract for carriage, and it stipulates that you may be sued, Crye said. And the same is true for the cruise industry. You cant read the print on airline tickets, but it is there.

Dickerson, who compiled a report for the New York Bar Association in 2004 listing litigation brought against the cruise industry under maritime law, concludes that passengers should make sure they read the fine print.

Tougher standards considered

Shays remains skeptical about assurances that cruise lines report all crimes against U.S. citizens to the FBI, to other jurisdictions and to all appropriate agencies. He said he wants more information before determining if additional hearings by his House Subcommittee on National Security, Emerging Threats and International Relations are warranted and whether more cruise oversight is needed generally.

One of the issues I want to understand is how good a security system do companies have on these ships, Shays said. Some of these ships have 2,000 to 3,000 people onboard, and I think it is important to know what qualifications their security folks have. Do they know how to investigate, interrogate and protect the crime scene? I think we are going to invite the cruise lines to come back and talk to us about that.

Where the investigation might ultimately lead remains to be seen, Shays said.

It may be government action is needed; it may involve treaties, multilateral or bilateral. It may be just getting the industry to toughen standards a bit and have some uniformity, he said.

Industry officials broadly dispute suspicions that incidents of potential embarrassment to cruise lines are under-reported.

The U.S. Coast Guard did a comprehensive safety review of cruise lines in 1995, some 500 pages of analysis, and their opinion was that the cruise industry is among the safest forms of transportation you will find anywhere, said Crye.

In addition, Crye said, cruise lines have been not only accurate but diligent about reporting incidents, accidents and criminal allegations, and that data captured by the FBI, which opened 305 cases involving all commercial shipping in the past five years, show relatively few incidents directly related to ships carrying passengers.

The cases they have opened in the past five years are a pretty good record of what has occurred, Crye said. But even if there was a serious crime involving a U.S. citizen that occurred on board a cruise ship and was not reported to FBI by the cruise industry, it would be reported by someone else, you can be sure.

To contact reporter Dan Luzadder, send e-mail to [email protected].


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