If survivors and families of those who died in Thursday’s duck boat sinking on Table Rock Lake plan to take the boat operator to court, they should file suit quickly, one maritime-law attorney said Monday.
“It is very important for the families to try to file their lawsuits first in state court,” said New York City-based attorney Daniel Rose.
A U.S. Navy veteran, Rose is an expert maritime lawyer who represented victims of a 2005 incident on New York State’s Lake George. On Oct. 2 of that year, 47 tourists were riding in a canopy tour boat, the Ethan Allen, which capsized, killing 20, according to a USA TODAY Network report (/story/news/local/michigan/2015/10/02/ethan-allen-10th-anniversary/73155552/).
The boat operator settled claims, and the National Transportation Safety Board later found that the 40-foot boat was dangerously unstable and should have carried only a quarter as many passengers as were on board.
Cases like the Table Rock Lake duck boat tragedy or the Ethan Allen sinking may seem like clear instances when courts might award high amounts of damages to survivors and families of the deceased, but Rose said federal statute has a “nuanced” effect on how lawsuits could play out.
Another maritime-law expert, Philadelphia-based attorney Robert Mongeluzzi, agreed. “These are sophisticated actions involving maritime law, limitation of liability and products liability, and they need somebody who’s actually done those before.”
Lawyers hold this opinion because an 1851 law, the Shipowner’s Limitation of Liability Act, often caps damages to no more money than the salvage value of the sunken vessel.
The law also allows shipowners to file “limitation proceedings,” which can consolidate plaintiffs claims resulting from a boat disaster into just one federal court case.
“It’s going to be a big issue straight out of the box,” Rose, in New York, told the News-Leader on Monday.
“Why would the law protect shipowners in this way?
It goes back to a time when the United States was trying to build up its merchant marine fleet to compete on the world stage.
“The law was intended to bolster a fledgling maritime shipping industry,” Rose explained. “Congress was trying to encourage people to buy vessels and improve the maritime system. This was 1850, there was no insurance for maritime vessels. The incentive was that if you go ahead and buy a vessel, we’re going to protect you if anything goes wrong.”
Mongeluzzi said, “It was basically to shield shipowners before the advent of radio telecommunications from liability due to decisions made by captains, sometimes tens of thousands of miles and years away.”
Times have changed, but the law has not.
“Fast-forward two centuries, it’s still on the books,” Rose said. “It comes up in every one of these major high-profile disasters.” When the Titanic sank, the Limitation Act came into play. Same in 2010, with the Deepwater Horizon oil spill. “Throughout two centuries,” Rose said, “the maritime lobby, (boat) owners, insurers, they’ve all lobbied heavily to keep the law on the books.”
The advantage the law provides for boat owners and insurers is obvious.
Rose said, “Clearly the value of a duck boat, even in a new condition, would be significantly less than the multimillion-dollar verdicts which would surely result (from a lawsuit).”
How much does a duck boat cost?
Mongeluzzi estimated duck boats are worth $100,000 to $150,000 when they’re in working condition. Boston Red Sox pitcher Jake Peavy paid $75,000 for one in 2013, the Boston Herald and Boston Business Journal reported (https://www.bizjournals.com/boston/blog/mass roundup/2013/11/jake-peavy-duck-boat-how-much.html).
“A sunken duck boat is virtually worthless,” he said. Contrast that with duck boat settlements that have become public. Mongeluzzi – who has repeatedly called duck boats “sunken coffins” – represented families of two Hungarian tourists who died in a 2010 Philadelphia duck boat incident.
In that case, plaintiffs reached a $15 million settlement with Herschend Family Entertainment and K-Sea Transportation, the operator of a tugboat involved in the incident, CNN reported in 2015 (https://www.cnn.com/2012/05/09/justice/pennsylvania-duck-boat-settlement/index.html). The rest of the passengers on the boat split $2 million.
Herschend sold Ride the Ducks to Florida-based Ripley Entertainment in December 2017, as the News-Leader previously reported. Ripley Entertainment – whose revenues are estimated between $34 million and $54 million per year, according to databases Gale Global Business Insights and D & B Hoovers – is a subsidiary of Canada-based Jim Pattison Group, which touts “$10.1 billion in sales” per year on its website.
“It’s kind of like an ace in the hole for them,” Rose said, referring to boat owners generally. “In a case like this, depending on what available insurance may exist, it’s usually an insurance company, oftentimes in London because that’s the center of the maritime insurance business, who says ‘we’ve got this defense, let’s use it.'”
“It’s going to take some digging” to learn what kind of insurance policy covered Ripley Entertainment’s duck boat, Rose said. “Unfortunately, we see a lot of times that operators just skimp on that point,” he said, speaking generally.
Mongeluzzi, in Philadelphia, said, “I would expect that Ripley’s would have extensive insurance, and if they did not, would certainly have considerable assets to be able to pay any judgment.”
The News-Leader reached out to a Ripley’s Entertainment spokeswoman for comment Monday afternoon but has not yet heard back.