Law Offices of Countryman & McDaniel
THE CARGO LETTER 
Air & Ocean Logistics - Customs Broker News
25 March 2003
Part 1 of 1
Good Monday Evening from our Observation Deck......overlooking the officially designated "Cargo City" area and...... Runway 25-Right, at Los Angeles International Airport, voted "Best Cargo Airport in North America." Here's what happened in March 2003. May God protect the American, Australian, British & other Coalition troops in harms way tonight.
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Our corporate sponsor &endash;- Interpool, Inc. -- named again to Forbes "Best 200 Small Companies" List -- for the 2nd consecutive year! --
Michael S. McDaniel, Editor, Countryman & McDaniel, forwarder/broker attorneys at LAX.
INDEX to The Cargo Letter:
OUR "A" Section: Trade, Financial & Inland News***
1. Freight Forwarder Trade Briefs ______________
2. The Cargo Letter Financial Page ______________
OUR "B" Section: FF World Ocean News***
3. Freight Forwarder World Air Briefs ____________
OUR "C" Section: FF World Ocean News***
4. FF World Ocean Briefs _____________________
5. The Cargo Letter Cargo Damage Dispatches _____
**Back By Popular Demand**
OUR "D" Section: FF in Cyberspace***
6. The Cargo Letter "Cyber Ports of Call" _________
OUR "E" Section: The Forwarder/Broker World***
7. New U.S. Transport Related Legal Cases ________
OUR "A" Section: Trade, Financial & Inland News***
1. Freight Forwarder Trade Briefs _____________
***France Opposes Coalition ....... European Union nations approved a plan last week to open up the continent's rail freight market to Int'l competition -- overriding objections from France, Belgium & Luxembourg. Twelve EU nations backed plans to liberalize the market within 5 years, The 3 dissenting nations had sought to protect their domestic operators. Under proposed rules, companies would be free to operate Int'l freight trains starting 2006, breaking up the national monopolies that exist in some EU countries. The plan must be approved by the European Parliament, which could introduce amendments. The EU governments would then have to vote again on the amended version before it could become law. In 2008, the plan would open up domestic routes to competition. That would mean, for example, a German company could transport goods on routes between French cities, a business currently reserved for France's national SNCF rail company. The EU's head office has pushed for opening the railways in an effort to promote more freight traffic by rail & less by trucks, which clog Europe's highways & increase pollution. According to the European Commission, only 9% of freight traffic in the EU is carried by rail, less than half the level 30 years ago. By contrast the American railroad network carries 40% of U.S. goods traffic. >> But does France have a VETO?
***Hong Kong's Boom ........ as it's total exports & imports continued to increase in Jan., compared to the corresponding month in 2002. Hong Kong government statistics show the value of total exports of goods (comprising re-exports & domestic exports) in Jan. rose by 26.7% over the year earlier to US$17.3Bn, after a year-on-year increase of 16.7% in Dec. 2002. Within this total, the value of re-exports increased by 30.3% to US$125.5Bn in Jan., but the value of domestic exports fell by 6.8% to US$9.6Bn. >> Hong Kong Air Cargo Terminals Ltd (Hactl) handled a total of 119,063 tons of cargo in Feb., an increase of 4.7% over the same month last year. >> In 4th quarter of 2002, total ocean cargo throughput in Hong Kong increased by 13% over 2001 to 50.4 million tons. AND FOR THE YEAR -- Hong Kong container port handled 19M TEU in 2002 breaking a world record! [Singapore was #2 at 17M TEU.]
***European Commission Heads East ......... as it has opened an office in Taipei, Taiwan, in a move it says will strengthen relations between the EU & Taiwan in areas such as trade, investment, & economic cooperation. The office will mainly cover economic & trade relations, economic cooperation as well as cultural & information activities. It will, the commission said, contribute to the strengthening of communications with the Taiwanese authorities and other economic & social partners as well as promoting & boosting opportunities for collaboration in areas of mutual interest. In line with the EU's "One China" policy, the office will not be engaged in relations of a diplomatic or political nature.
***Three Pronged Wisdom of The East ....... as UPS has embarked on a new chapter in Asia, branching out from simple package delivery to a more comprehensive supply chain solution. The new "synchronized commerce" approach comprises bundling 3 core aspects of the logistics industry into one; namely, 1.] movement of goods; 2.] information on the goods, & 3.] the funding for those goods. "Synchronized commerce is the next step in the evolution of trade," said UPS Asia Pacific. This new approach is "designed to `streamline customers' operations, grow their businesses, & give Asian businesses the edge to navigate in world markets."
***New Look For UPS ....... as it has unveiled the 1st redesign in more than 40 years of the company's famous "shield & package" logo. UPS said the change reflects significant broadening of capabilities that has occurred in recent years as the company expanded across the globe & introduced a portfolio of new supply chain services. The company will continue to use the color brown for its operations, but the logo change includes elimination of the package with a string bow atop the shield. "UPS is a vastly different company today than most people realize," said UPS Chairman & CEO Mike Eskew. "Today we are bringing our look up to speed with our capabilities." Based on the scale of the project, changing UPS's visual identity may be one of the most significant corporate identity transformations ever. During the course of a year, UPS touches the doorstep of 98% of American homes & reaches customers in more than 200 countries. The logo appears on more than 88,000 vehicles, 257 large jet aircraft, 1,700 facilities around the world, 70,000 drop-off & retail access points, more than 1 million uniform pieces & more than 3 billion packages annually. UPS New Look
***Homeland Recycling Bin ........ as U.S. Customs, now part of the newly formed Bureau of Customs and Border Protection, has proposed to include recycled & recovered components for treatment under NAFTA. The proposed rule would grant recycled components imported by the U.S. from Canada & Mexico NAFTA treatment if the materials satisfy the agreement's rule of origin and if the rule of origin does not include a "regional value content" requirement. The industry has until May 12 to comment on the proposed regulation. For more information, contact Edward M. Leigh of Customs' Office of Regulations & Rulings at (202) 572-8827.
***Crystal Ball ......... as the U.S. Dept. of Transportation has issued a series of short reports to help policymakers respond to changes in freight volumes and traffic patterns in each U.S. state. The state freight profiles aim to help state & local officials with long-range planning to accommodate the huge growth in freight expected during the next 20 years. DOT estimates that the U.S. transportation system will handle cargo valued at almost US$30 trillion in 20 years, compared with US$9 trillion today. Volumes, in tons, will increase nearly 70% from the current 15 billion tons. Int'l freight will double in volume by 2020. The Report
***R.R. Donnelley In The South ........... as it has acquired Momentum Logistics, Inc. (MLI) a Florida-based provider of package distribution services in the Southeastern U.S., for US$17M. MLI's revenues were approximately US$60M in 2002. The acquisition gives R.R. Donnelley Logistics direct access to hundreds of local entry points in the U.S. Postal Service network in the Southeast.
***"K" LINE Total Logistics Indonesia ....... as this new subsidiary of Japan's "K" Line, has obtained a forwarding license from the Indonesian government, and is scheduled to start operations in the archipelago on April 1.
***Derwent Goes To Phoenix ........ as Derwent Freight Services, an Int'l forwarder headquartered at East Midlands Airport, was purchased byPhoenix Int'l Freight Services Ltd.; the largest privately owned Int'l freight forwarder/NVOCC & Customs broker in North America. Founded in 1978, Derwent has offices at East Midlands, Heathrow, Manchester & Bristol airports. Phoenix was founded in Chicago in 1979, & has a global network of 42 offices, more than 800 employees & sales exceeding US$306M. The companies have been trading partners for 24 years.
Derwent Freight Services
Phoenix Int'l Freight Services Ltd
***Kuehne & Nagel Goes To The Fair .........as it has bought the fairs & events business unit of logistics company Birkart Globistics on March 1. All Birkart Fairs & Events employees based in Renningen, Dusseldorf, Cologne & Nuremberg will be integrated into the German unit of Kuehne & Nagel. Birkart employees based in Atlanta will be transferred to Kuehne & Nagel Inc. >> K&N said ocean volumes in 2002 were up by 20% compared to the previous year, adding the Asia-Pacific region was an important growth engine for the group -- for the company to exceed the 1 million TEU mark for the 1st time.
***Panalpina Has A Vision........ as in coordination with the Swiss Red Cross, it is working to stamp out blindness that comes as a direct result of poverty by providing funding totaling US$395,895 over a period of 3 years for an ophthalmic program in Ghana.
***The Eagle Has Scanned It ....... as Advanced Research & Applications Corp. has received a 5 year contract with the U.S. Customs Service for Eagle cargo inspection systems. The Eagle is designed for inspecting cargo & trucks at seaports & other ports of entry. The primary use by Customs will be to prevent the smuggling of weapons, explosives, drugs & other contraband. However, some nations have expressed interest in such an inspection capability for financial reasons -- to combat duty fraud & prevent the export of stolen goods. Cargo equivalent to more than 300 mm (12 inches) of steel can be penetrated -- a 20-foot sea cargo container can be scanned in less than 30 seconds! The image is immediately available to the inspector. Advanced Research & Applications Corp.
***UPS For Women's Business .......as for the 4th consecutive year, UPS has been named among America's Top Eight Corporations for Women Business Enterprises by the Women's Business Enterprise National Council (WBENC), the leading 3rd-party certifier of businesses owned & operated by women. As part of its outreach to diverse suppliers, UPS mentors smaller companies & counsels other major corporations on how to increase their supplier diversity initiatives. In 2002, UPS spent more than US$131M with minority & women-owned firms. UPS Communty Service
***Schneider Logistics Spreads ...... as its 9th U.S. brokerage office opens in Denver to service its brokerage customers throughout the Rocky Mountain states, including Colorado, Utah, Wyoming, Idaho, New Mexico & the Dakotas.
***No Longer Completely Consolidated ......... as Consolidated Freightways Corp. has signed a letter of intent with CF Canada Acquisition Ltd. to sell the assets of its Canadian subsidiary, Canadian Freightways Ltd. (CFL), & assets of certain of CFL's subsidiaries. The agreement contemplates a purchase price of US$90M, including assumption of liabilities.
***Teamster Deal ........ as s new 5 year U.S. National Master Freight Agreement (MFCA) covering ABF Freight System, Roadway Express, USF Holland & Yellow Transportation received an overwhelming ratification vote -- 85% of 65,000 members -- from the freight membership of the Teamsters Union last week. MFCA is the national trade association representing the unionized general freight carriers. Formed in 1997, MFCA has as its mission to promote economic interests of unionized motor freight carriers. Its TMI Division represents 4 authorized companies in the NMFA negotiations. These carriers serve 2.5 million customers in all 50 states & transport 26.3 million tons of freight over 2.2 billion miles each year. Major features are:
*Wage increases of US$2.25 per hour over the life of the agreement;
* Employers prohibited from subcontracting any work in the U.S. to a Mexican carrier;
* Air conditioning for all city equipment purchased after 4/1/03; and
* Walk-in sleeper cabs for all sleepers purchased after 4/1/03. National Master Freight Agreement
***Hoax Crashes U.S Stock Market ......... as 3 drunken men -- following a fun night in New York on March 10 -- climbed the Williamsburg Bridge as a drunken prank, shutting down the span, sparking an anti-terrorism response & sending the U.S. dollar CRASHING in morning trading on the New York Stock Exchange. Police said they arrested the 3 after they were spotted during morning rush hour climbing the cables of the Williamsburg Bridge linking Manhattan & Brooklyn across the East River. Yes, firing squads are not currently legal.
***Good Morning Swaziland .... as the state-run radio station thought it had its own correspondent in Baghdad covering the war -- until legislators spotted him in parliament on March 28. "Why are they lying to the nation that the man is in Iraq, when he is here in Swaziland, broadcasting out of a broom closet?" MP Jojo Dlamini demanded of Information Minister Mntomzima Dlamini in the House of Assembly on March 31.
2. The Cargo Letter Financial Page ______
**AP Moller -- world's largest shipping group UP as 2002 rose 42% to DKK12.058 billion (US$1.73BN), from DKK8.457 billion in 2001. Net revenue increased slightly to DKK151.579 billion last year, from DKK150.633 billion the year before as shipping revenues hurt by lower rates last year. Liner subsidiary Maersk Sealand's freight volume increased 8%.
**Cathay Pacific Airways. UP with a 2002 net profit of HK$3.983 billion (US$510M), an increase of 500% when compared to its 2001 profit of HK$657 million.
**China Southern Airlines (China's largest) UP with a net profit of RMB576 million (US$69.6M) for the year ended Dec. 31, 2002 -- an increase of 69% over fiscal 2001 when net profit totaled RMB340 million.
**FedEx. UP with increased Q3 earnings of 26% year-over-year for the quarter ended Feb. 28, a net income of US$147M. FedEx contributed an additional US$815M to its U.S. domestic pension plans during 3rd quarter, resulting in total contributions in excess of US$1Bn for the fiscal year.
**Hanjin Shipping. UP with a profit of US$14.8M for fiscal 2002, as the company climbed its way out of losses in 2001.
**Interpool, Inc. UP & will pay a cash dividend of US$.0625 cents per share for the 1st quarter of 2003. The dividend will be payable on April 15, 2003 to shareholders of record on April 1, 2003. The aggregate amount of dividend is expected to be approximately US$1,700,000.
**Lufthansa. UP with a 2002 net profit of EUR717 million (US$760.2M), a turnaround from its net loss of EUR633 million in 2001.
**Malaysian Airline System (MAS). UP with profit before tax of MYR333.6 million (US$87.8M) for 3rd quarter ended Dec 31, 2002, which compares to a MYR324.9 million loss in the same quarter in 2001. Cargo traffic increased 26.5% year-on-year during 3rd quarter to 587 million load ton kgs.
**Martinair. UP with a net profit of EUR3 million (US$3.3M) in 2002 after a loss of EUR13 million in 2001.
**OOCL DOWN as profit for fiscal 2002, ending Dec. 31, after taxation & minority interests was US$51.7M, a 16 decrease against that recorded for the corresponding period in 2001.
**P&O Nedlloyd. DOWN with a net loss of US$304M for fiscal 2002, which compares to a profit of US$21M in 2001.
**Schenker. UP as internal operating profit rose 21.4% to EUR149.9 million (US$160.1M) in 2002.
**Swiss Int'l Air Lines. DOWN with a US$723M loss for 2002
**TMM (Mexican multimodal group) DOWN with a 4th-quarter net loss of US$12.4M, compared to a net profit of US$1.6M in the year-earlier quarter.
**TT Club. UP as the transport & logistics industry mutual insurer posted a full year after tax surplus of US$10.7M, a dramatic turnaround from a 2001 loss of US$40.2M. The Club says the surplus was supported primarily by a positive technical underwriting result of US$6.6M, an improvement of US$35.5 million, & an increase in investment income. As a result the Club's undiscounted free reserves rose by 27% to US$50.2M.
**United Airlines -- which filed for bankruptcy last Dec. DOWN with a net loss of US$367M in Feb., which works out to a daily loss of US$13.1M. UAL began Feb. with a cash balance of US$1.8Bn, including restricted cash, & reported a decrease in cash of approximately US$300M for Feb., and ended the month with a cash balance of approximately US$1.5Bn. United operates more than 1,700 flights a day throughout the world.
OUR "B" Section: FF World Air News***
3. Freight Forwarder World Air Briefs ___
***IATA Chief's Diagnosis ......... as in his opening speech to the Int'l Civil Aviation Organization (ICAO) 5th Air Transport Conference (ATC5) in Montreal, Canada, Giovanni Bisignani, director general & CEO of Int'l Air Transport Association (IATA), said it was time for the air transport industry to reinvent itself. "Government regulation keeps our industry from changing. This ICAO conference may well represent the last chance to set our industry on the right regulatory track," Mr. Bisignani said. "Airlines should be free to merge & approach the Int'l financial markets for capital. The wave of globalization must eliminate national ownership limits wherever they represent an obstacle to development. These limits are denying airlines the freedom of action given to all other businesses," he said. "IATA has identified 3 obstacles to the change the industry needs: the bilateral system, national ownership rules & the attitude of competition authorities. These are the 3 pillars of stagnation," he said. "What other global business is more fragmented than air transport? We need the economies of scale that mergers or acquisitions can provide with the proper competition supervision. The regulators must take up the challenge of change," Mr. Bisignani concluded.
***Call For Tighter Security ......... as the proposed Air Cargo Security Act (S.165), introduced by Sens. Kay Bailey Hutchison, R-Texas, & Diane Feinstein, D-Calif., -- was approved by the Senate Commerce, Science & Transportation Committee on March 13. It includes calls for the following:
* The Transportation Security Agency would be required to develop a strategic plan to ensure that all air cargo is screened, inspected & secure.
* TSA would also be required to develop a system for regular inspection of air-cargo shipping facilities.
* A "known shipper" database would be created to improve the nation's known shipper program.
* Indirect air carriers, or freight forwarders, could have their certificates revoked if TSA finds that they are not complying with security regulations.
* The current federal security program for indirect air carriers would be reviewed & assessed for possible improvements.
* All-cargo carriers would be required to develop security plans that would be subject to approval by the TSA.
Other cargo amendments made to the legislation by the Senate Commerce Committee include the requirement for a report from the FAA & TSA on blast-resistant cargo containers & allowing cargo pilots to participate in the Federal Flight Deck Officer program.
***Industry Stunned -- Government Threatens Use of Logic ........ as Delta Air Lines will begin testing a new government plan for air security in April that will check background information & assign a specific threat level to everyone who buys a ticket for a commercial flight.
***U.S. Airlines Reeling ...... as an unprecedented financial crisis, compounded by the war in Iraq, places in jeopardy the benefits provided by passenger & cargo air service to the economy, according to a comprehensive study. The study demonstrates that a healthy aviation industry generates some 11.2 million jobs & US$258Bn per year in personal earnings & contributes US$904Bn per year to the nation's economic well-being. The study was conducted for Communities for Economic Strength Through Aviation (CESTA), a national coalition that stresses the importance of reliable air service to the economy & local communities.
***They Hired Too Many........ as some airports will have fewer passenger screeners this spring now that the Transportation Security Admin. (TSA) that hired them last year begins shrinking its work force. As many as 3,000 screeners, or about 1 in 18, could lose their jobs. The head of TSA, James Loy, told Congress that he wants to reduce the number of screeners from 54,000 to 51,000, & that layoff notices could begin going out April 1. By Oct. 2004, the government plans to have 48,000 screeners with reductions through attrition & other steps. Last year, lawmakers capped the TSA's full-time screener positions at 45,000. Despite the cap, the agency hired 9,000 temporary employees, most on 5 year contracts. "Temporary?" The screeners have all worked for less than a year for the government, which began hiring after the Sept. 11 terror attacks & announced a fully federalized screener work force on Nov. 19. U.S. ransportation Security Administration
***It Begins ....... as a national union has signed up 13 federal security screeners from airports around the country who claim to have been denied bargaining rights by the Transportation Security Administration. The screeners joined a national chapter of the American Federation of Government Employees. A national chapter can lobby Congress, file lawsuits & represent workers who have complaints about unfair labor practices, discrimination or safety, but it does not bargain for pay or work conditions. TSA chief James Loy in Jan. banned local bargaining units, saying they would be incompatible with the war on terror. Loy said he needed flexibility to make sudden changes in shift assignments in response to terror threats. The Transportation Security Administration was supposed to be a security agency -- like the military -- not a new union opportunity. What have we done? Bargaining units? Could the business of "security" become secondary?
***They're Not That Dense ......... as The U.S. Dept. of Transportation has agreed to a request from several shipper organizations for a 90-day extension of the comment period on a petition by Int'l airlines to change how they set freight rates. In early Feb., the IATA filed papers requesting to change regulated formulas for calculating rates based on a shipment's density. The High Tech Airfreight Shippers Coalition, the National Industrial Transportation League, the Health & Personal Care Logistics Conference & the National Small Shipments Traffic Conference asked DOT to extend the normal 21-day comment period. The DOT said the complexity of the issues raised by IATA's application warranted extra time to thoroughly review the matter. The new deadline for submitting responses is May 29.
***UPS Questions New DP Deal For Airborne ....... as it has asked the government to investigate the planned acquisition of Airborne Inc. by German postal service Deutsche Post AG's DHL express mail arm. Atlanta-based UPS said in a filing with the U.S. Dept. of Transportation that the US$1.05Bn deal reached last week raises questions about the degree of control that Deutsche Post is able to exert on the domestic express package & cargo market. Europe's biggest mail company agreed to pay US$21.25 a share under the takeover agreement, which excludes Seattle-based Airborne's aircraft unit. Partially privatized Deutsche Post has spent billions on acquisitions to build DHL Worldwide Express into a global delivery service & reduce its dependence on its German mail business, where it faces growing competition because of deregulation. It has long sought a foothold in the U.S. and says Airborne, the No. 3 overnight package delivery service in the U.S., completes its Int'l network. The company said Airborne's airline will be renamed ABX Air & remain in the hands of its existing shareholders because of U.S. laws prohibiting foreign control of domestic airlines. But UPS, the world's largest shipping carrier, said the government should look into whether Deutsche Post means what it says on the ABX Air issue. It is calling for a public hearing. >> Also watching the deal is the Teamsters Union which represents more than 9,000 Airborne workers. This number includes approximately 800 pilots employed by ABX Air throughout the U.S., & approximately 8,000 drivers & dock workers under the National Master Freight Agreement & other freight contracts at Airborne Express.
***Less BA ........ as in response to the mounting financial toll the Iraq war is having on British Airways, Europe's largest carrier has decided to ax 3,000 staff earlier than intended and is to reduce its flight schedule in the coming months. The company said it plans to cut 13,000 staff by Sept. instead of March 2004 as originally planned. BA will also be lowering its capacity by 4% through to the end of May. BA has suspended flights to Kuwait & Tel Aviv.
***The Shrinking American ....... as the world's largest airline, has reduced its international flying schedule for April by 6% in response to the conflict in the Middle East. American said it did not know what -- if any -- employment impact these flight reductions may create. Selected flights to Europe & Latin America will be canceled but no city will lose service altogether, the airline said, adding it will not immediately cut any domestic flights in the U.S. Domestic capacity for April has been scheduled to be slimmed down 7%.
***JAL Cuts ....... as Japan Airlines will eliminate 3,600 ground crew jobs, or 7%of its work force, over 3 years. The biggest Japanese airline company also slashed by 66% its profit forecast for the fiscal year ending this month. The downward revision to $68M from its Nov. forecast of a profit of $205M was based on expectations for sluggish demand in the Int'l passenger business because of fears about a then possible (now real) war in Iraq.
***Even Bigger Hit In Northwest ........ as it is to reduce its system-wide flight schedule by 12%, as measured on an available seat mile basis. It will also remove 20 aircraft from service & cutback staffing. The company said these actions are due to the war in Iraq. Northwest said it will also reduce its overall staffing level by about 4,900 employees.
***Aloha HA? ........ as Hawaiian Airlines Inc. is the latest airline to duck under the Chapter 11 umbrella as it undergoes restructuring. HA said it has taken this voluntary step in order to complete reorganization it began several months ago to restore the company's long-term financial health. Meanwhile, tickets will be honored, maintenance & service will continue at the highest levels, the company said.
***Goodbye Long Beach ........ as Polar Air Cargo has moved its corporate headquarters to Purchase, New York. Roughly 60 employees are based at its new location, which also houses its parent company's Atlas Air Holdings headquarters. Meanwhile, Polar's sales & marketing offices remain at its former headquarters at Long Beach, California.
***Arrow Air Hits Another Target ....... as the oldest FAA-certified all-cargo airline in the U.S., has reached an agreement to acquire the assets of Air Global Int'l (AGI) & absorb key management from its former competitor. Arrow is a leading all-cargo carrier for Central American & Caribbean service, while AGI holds a dominant market share in Latin America's "deep south," including Brazil, Chile, Colombia & Ecuador.
***Fly Me ........ as defunct National Airlines wants to sell its few remaining assets to an Alaskan air cargo company for a Nevada-based charter operation. The deal would let Anchorage-based Northern Air Cargo fly 2 freight & passenger charters a week for an unnamed U.S. oil corporation between Houston & eastern Russia -- via Anchorage. A federal bankruptcy judge in Las Vegas has given the companies until March 12th to complete the deal. Northern Air Cargo has been around since 1956. It once flew a DC-6 originally owned by Howard Hughes. Las Vegas-based National ceased operations in Nov. 2002 -- after spending almost 2 of its 3.5 years in Chapter 11 bankruptcy protection. National's most valuable remaining assets are its FAA & U.S. Dept. of Transportation operating certificates, operating manuals, & its trademark. The price is US$350,000.
***The "Cargie" Awards Handed Out ....... as Atlas Air was honored at the Asian Freight & Supply Chain Awards ceremony on March 19, 2003, winning the award for Best Air Charter Operator, Worldwide. The awards, sponsored by CargoNews Asia, are given after a vote by the magazine's readers. Polar Air Cargo was a finalist Best Air Cargo Carrier - North America was awarded to FedEx -- with Polar Air Cargo a finalist in the category.
***First Time Award Goes Forward ........ as the Airforwarders Assn. (AFA)/Air & Expedited Motor Carriers Assn. (AEMCA) selected Forward Air as the 1st ever recipient of the AFA/AEMCA Vendor of the Year Award. In announcing the selection, Mr. Brandon Fried, Chairman of the AFA, said, "Forward Air has demonstrated a significant reputation for quality and service consistency making us proud to select them as our 1st AFA/AEMCA Vendor of the Year." Forward Air is a high-service-level contractor to the air cargo industry providing time-definite service in the U.S. & Canada.
***War Bucks ...... as KLM Cargo, Martinair Cargo & others have introduced a war surcharge of US$0.11 per actual kg. of freight. The surcharge, already in effect, applies on routes to/from the Middle East & Asia Pacific.
***Gas Bucks ........ as American Airlines Cargo increased its fuel surcharge to US$0.20 per kg for most U.S.-origin Int'l shipments & select domestic U.S. moves, as of March 24. Cargolux, the Belguim-based carrier, raised its fuel surcharge to US$0.21 per kg.for all cargo shipments, based on actual weight. Northwest Airlines Cargo is to increase its fuel surcharge of US$0.05 to US$0.20 per pound based on actual weight for all domestic & Int'l moves beginning on April 1. Lufthansa Cargo & KLM are also now at EUR0.20 per Kg.
***Ameriflight Fleet Expands ...... as Aviation Services, an aircraft charter management service, & Ameriflight, the air cargo carrier, have agreed to a "joint transportation initiative." Under this agreement, Aviation Services will develop charters for Ameriflight's fleet in 5 southwestern states & Mexico. Aviation Services will also market surplus capacity when available on certain Ameriflight scheduled flights in the same region. Headquartered in Burbank, California, Ameriflight was founded in 1968 & grew from a small intrastate cargo service to become the leader in the FAR 135 cargo industry. Operating out of 10 U.S. bases, the company has a fleet of 180 aircraft flying over 115,000 hours a year to serve 250 communities in the U.S., Canada & Mexico. Ameriflight
***FedEx PandaEx ....... as the carrier is donating its services to bring 2 giant pandas from Beijing, China to the Memphis Zoo in Memphis, Tennessee on April 7, 2003. Le Le, a 4 year-old male panda, & Ya Ya, a 2 year-old female panda, will travel onboard a custom-decaled FedEx Express MD-11 jet, known as "The FedEx PandaExpress," during the Trans-Pacific journey. The pandas are part of an education & conservation program between China & the U.S.
***For The Birds ....... as a shoebox-sized labeled as containing the West Nile virus exploded at the FedEx office near Port Columbus Int'l Airport on Mar. 19, and about 50 workers were evacuated. Fire officials said dry ice used to preserve tissue samples containing live virus may have caused the package to burst. The package contained brain & kidney tissue from a bird that had tested positive for the virus. The material was in transit to a researcher at the University of Texas. The virus was live but the samples were frozen and unlikely to become airborne.
***Take My Wife, Please? ........ as a Bakersfield man whose wife mysteriously disappeared after an American Airlines flight into Dallas-Fort Worth Int'l in Dec. 2001 has settled his lawsuit against the airline. Joe Dabney agreed to end his legal battle after lengthy settlement negotiations in federal court in Fresno. Dabney had sought US$10M from the airline, but terms of the agreement were not disclosed. Dabney & his 70-year-old wife, Margie, landed at Dallas-Fort Worth Dec. 5, 2001. They were separated after they walked through a passageway & she hasn't been seen since. Dabney, a retired cab driver & construction worker who attended the settlement conference in a wheelchair, accused the airlines of "losing" his wife of 34 years. Dabney & his wife, who suffers from Alzheimer's disease & diabetes, had requested escort service because of her health & his need for a wheelchair. Dabney contended no attendant was provided for his wife & he was wheeled away "towards another gate by an attendant who spoke no English and would not stop to listen" to him regarding his wife.
***Follow That Car! ..... as Michael O'Leary, head of Irish-based budget airline Ryanair, has come up with a novel way to beat Dublin's notorious traffic jams -- his own taxi license. Tired of crawling through the Irish capital's frequent gridlocks, multimillionaire O'Leary has bought a taxi license which allows him to drive his luxury Mercedes saloon in restricted bus lanes.
OUR "C" Section: FF World Ocean News***
4. FF World Ocean Briefs ____________________
***United Nations Conference on Trade & Development Report ...... as UNCTAD has just released its Review of Maritime Transport, 2002 . The report discusses main developments in world maritime transport. It notes that while world output grew by 1.3% in 2001, world merchandise exports decreased by 1.5%, with world seaborne trade decreasing by 1%. Meanwhile, the world merchant fleet grew by 2.1%. The Report
***Carriers & NVOCCs "Eyeball To Eyeball" On Confidentiality .......... as ocean carriers & consolidators/NVOCCs, are both collaborators & competitors, -- they have never been the best of friends. That relationship is becoming even more tenuous as trade groups representing carriers and consolidators publicly disagree over U.S. Customs' proposed changes to its 24-hour advance manifest rule. In comments filed with U.S. Customs, the National Customs Brokers and Forwarders Assn. of America, Inc. (NCBFAA) strongly supported adoption of its proposed confidentiality rule provided that it is substantially broadened. The proposal would authorize NVOCCs & other parties to request that the identity of the U.S. importers & consignees could remain confidential. One effect of the 24 Hour Advanced Manifest Rule is that NVOCC house bill of lading data has become subject to disclosure and review by the public for the 1st time. In its comments, the NCBFAA noted that public disclosure of NVOCC house bill of lading information was an unintended consequence of the 24 Hour Rule & that release of this data raises legitimate concerns about terrorism & theft; similarly the NCBFAA noted that giving steamship lines access to this data provides them with additional opportunities to improperly use the information to back-solicit customer accounts. Review the NCBFAA position paper
***Matter of Trust ........ as the European Commission has started its investigation into liner conferences' antitrust immunity and is asking for views. An EC statement says: "The Commission wants to ascertain whether this immunity, which allows companies to fix prices & limit supply, still produces the benefits expected and continues to be justified." Shipping companies are unlikely to be reassured by Competition Commissioner Mario Monti's words. He said: "Most of the world's trade is carried out by sea. It is, therefore, high time to examine whether the exceptionally generous antitrust immunity, which benefits shipping companies when they operate in liner conferences, is in line with today's market conditions. Most significantly, the Commission will want to see whether the Liner Conference Regulation results in reliable & efficient scheduled shipping services that meet the requirements of transport users, as was the legislator's initial aim."
***It's Official ....... as the U.S. FMC has issued its updated, inclusive OTI list, including ocean freight forwarders, NVOCCs & non-U.S.-based NVOCCs who have complied with FMC requirements. FMC OTI List
***TACA Jump ......... as the Trans-Atlantic Conference Agreement (TACA) will implement increases to their eastbound tariff starting April 15. For traffic from & via Pacific Coast ports, TACA members will add a charge of US$240 per 20-foot dry van container, US$300 per 40/45-foot dry container, US$400 per 20-foot reefer container, & $US500 per 40-foot refrigerated container. Members of TACA are Atlantic Container Line, NYK Line, Hapag-Lloyd, OOCL, Mediterranean Shipping Co., P&O Nedlloyd, & AP Moller Maersk Sealand.
***Asia/South Africa Jump ...... as the 12-member lines of the G8 (Asia/South Africa) Forum will raise rates this summer. The group said rates will rise by US$200 per TEU for full container loads & US$10 per RT for LTL shipments starting July 1. Member Lines of the Asia/South Africa Forum are CMA CGM, Compania Sud Americana de Vapores SA, COSCO, Evergreen, Kien Hung Shipping Co., K Line, Maersk Sealand, Malaysia Int'l Shipping Corp., MOL, NYK, P&O Nedlloyd, & Safmarine.
***Parting Gift ....... as the Caribbean Shipowners Assn., a carrier group in the U.S./Caribbean container trade, plans to introduce a Customs entry charge of US$25 per entry for shipments destined for the U.S., effective April 6. Member carriers of the Caribbean Shipowners Assn. are Bernuth Lines, CMA CGM, Crowley Liner, Interline, Maersk Sealand, Seaboard Marine, SeaFreight Line & Tropical.
***Coast Guard's New Job -- "Operation Liberty Shield"....... as attacks at home & war abroad have transformed the U.S. Coast Guard from an agency focused primarily on search & rescue to a force shielding Americans from would-be terrorists. New rapid-response teams now intercept suspicious ships by lowering guardsmen from hovering helicopters. Vessels protect 170 vulnerable sites, from landmarks like the Statue of Liberty to nuclear plants. A national intelligence database now allows officers to identify suspect cargo far from shore. The 36,000 men & women of the Coast Guard - up 2,000 after the Sept. 11, 2001, attacks -- are on their highest alert since World War II. Another 3,000 Guard reservists have been called to active duty. Though it has roots dating to 1790, the modern Coast Guard was formed in 1915 from an amalgam of agencies that enforced maritime & customs laws. Over the years its mission has expanded, taking on responsibilities from drug enforcement to environmental & fisheries protection. On March 1, the Coast Guard was transferred from the Dept. of Transportation to the new Dept. of Homeland Security. While Guard officials insist they have not abandoned other duties, their mission is far more focused now on protecting the nation's 361 commercial seaports & 120,000 miles of coastline & inland waters. Despite a boost in the Guard's budget from US$5.6Bn last year to the current US$6.2Bn level, some say this is insufficient. Nearly everyone says the task is daunting. Read about "Operation Liberty Shield."
***War Is Optional ....... as with the outbreak of the Iraq War the Int'l Transport Workers' Federation has warned shipowners about the rights of seafarers called upon to work in areas of conflict, including their right not to enter danger areas. It says the ITF's approved agreements lays down strict conditions for companies sending vessels into defined 'war zones'. ITF says seafarers must be kept fully informed of proposed entry into the war zone & have the right not to enter the zone, in which case they must be returned home at the company's expense if they refuse.
***Pinkerton On Guard ....... as it has been awarded a primary consulting contract with the Ports of Seattle & Tacoma to help manage Operation Safe Commerce (OSC) demonstration projects. OSC is a federally funded program designed to provide a test-bed for new security techniques that increase the security of container shipments -- from point of origin to point of destination. The Ports of Tacoma & Seattle, Los Angeles & Long Beach & New York/New Jersey -- the nation's top 3 major load centers -- are each working with private & public entities to develop project proposals to identify supply chain vulnerabilities & develop improved methods & technologies to ensure container cargo security. Each project proposal represents a unique approach, or solution, for OSC.
***Port of Shanghai Suffers Terrorists ....... as it has experienced a drop in its growth rate coinciding with the implementation of U.S. Customs' 24-hour rule last month. Feb. saw the port's growth rate fall 23.4% compared with Jan., with exports to the U.S. valued at US$1.27Bn. The reduction in port activity in Feb. might have been caused by the implementation of the 24-hour rule, port watchers said, as shippers tried to get their goods to the U.S. before the rule kicked in, and the traditional rush to get goods out before Chinese New Year, which also fell at the start of Feb.
***UK Ocean Security ......... Videotel Marine Int'l has launched 'Shipboard Security', a distance-learning course produced in association with The West of England Ship Owners Insurance Services. The course is specially designed for training ship security officers in accordance with the new ISPS code. Under the ISPS code, every vessel over 500 gross tons & trading internationally is required to have a trained ship security officer on board. Videotel & the West of England have been working closely with IMO, the U.S. Coast Guard, industry bodies & shipping companies to develop the training course to help the maritime industry meet the new training requirements in an efficient & cost-effective way. The course enables shipowners to demonstrate that they are meeting security responsibilities & the mandatory requirements set out in the ISPS code. Videotel Marine Int'l
***Pay Panalpina To Pay Piper ....... as it has warned shippers that it will start charging for each manifest it processes for cargo destined for the U.S. following introduction of U.S. Customs' 24-hour rule in early Feb. The rule stipulates that exporters must send as accurate a manifest as possible to Customs 24 hours prior to freight being brought aboard U.S. bound vessels. Failure to do so could mean fines for lines as well as shippers & freight being held up at ports. "Full compliance is a prerequisite to ensure smooth & reliable transport of shipments on behalf our customers," a Panalpina spokesperson said. The company said it expects to levy a fee of US$40 to US$60 per manifest.
***Dig Deeper For Panama Canal Authority ....... as it is considering an increase in the US$400 per vessel security surcharge it levies to transit the Panama Canal as a result of a dramatic rise in the cost of insuring the waterway & mounting security demands.
***New Darwin Award ....... as Northern Australian city of Darwin, in a bid to increase its share of Asian trade, is in the process of upgrading its port facilities & constructing a US$800M rail link to markets in the S. of the country. The new track will connect with the existing national rail network in Alice Springs in central Australia. Darwin city officials said they hope to attract time sensitive goods bound for Sydney & Melbourne as the new facilities will shave a few days off current direct shipping route times. Annual container throughput at Darwin is currently several thousand TEU, but is expected to increase to 50,000 TEU in 5 years with the new infrastructure.
***Higher Price of Cabotage ........ as U.S. Customs issued a rule increasing for inflation the maximum civil penalties for certain cabotage violations. Effective immediately, the penalty for illegal carriage of passengers between U.S. ports increases from US$200 per passenger to $300. The maximum penalty for illegal towage in U.S. waters increases from US$1,000 against the owner or master to US$1,100 and the penalty against the towing vessel increases from US$50 per ton of the vessel towed to US$60 per ton. This said, a new federal law that gives Norwegian Cruise Line an exclusive right to operate 3 foreign-built cruise ships in Hawaii has triggered a fierce attack from Senator John McCain (R-Ariz), but senior Washington sources doubt whether he can overturn the law.
***Hamburg Sud's Fast Buy ....... as the Germany based marine transport & logistics management organization is purchasing Taiwan's Kien Hung Shipping Co.'s liner business. The companies that both parties intend to conclude negotiations & hand over the business to Hamburg Sud by ApriL 1. After 20 years, Kien Hung said it had decided it was too difficult for the company to sustain itself as a small operator due to the volatility of the business.
***QM2 In The Water ...... as Cunard's new RMS Queen Mary 2, the largest liner ever, entered the water for the 1st time March 12 as she was floated from her building dock to a finishing basin at the Alstom Chantiers shipyard. This milestone signifies the final stages of construction for the US$800M liner prior to her maiden voyage on Jan. 12, 2004.
***MOL On The Straight & Narrow ...... as the Japan carrier has launched a pure car truck carrier (PCTC), the M/V Courageous Ace, with a new, energy-saving design that the company says demonstrates its commitment to the environment. The bow is rounded & beveled along the bow line to reduce drag in head winds. Wind channels along the sides of the vessel at the top of the garage deck help the ship maintain a straight course. This new design allows a higher service speed, as conventional car carriers are susceptible to wind resistance & leeway, a wind effect that pushes the vessel from the side. Additionally, improved fuel efficiency in the new vessel conserves energy & reduces emissions. Courageous Ace is 1st of 6 newly designed PCTCs to be launched over the next year. It is 198 meters long, beam of 32.2 meters, has a draft of 34.6 meters &displaces 57,000 GT -- with a capacity of 6,400 passenger cars.
***The Muttons of War ...... as lucrative livestock trade between Australia & the Middle East could be affected by the Iraq War. A Singapore Shipping Times report says that a ship carrying 60,000 live sheep originally destined for various Middle East Gulf ports is being diverted to Oman & the UAE. Higher insurance premiums are also affecting the trade according to the industry marketing organization Meat & Livestock Australia (MLA). 'If it (the war) doesn't get over quickly or if problems erupt across the region, it will start to make a difference (to the entire trade),' MLA said. Australia is the largest livestock exporter in the world & ships around US$345M worth of live slaughter animals to the Middle East region a year, mainly involving 6.5 million sheep & almost 320,000 live cattle.
***Another Capt. Cook Execution? ..........a U.S. federal jury found Capt. Ronald Cook, a Canadian citizen, guilty of illegally dumping trash bags full of asbestos into the Gulf of Mexico & elsewhere. He had been hired to lead a crew performing demolition on an old ferry boat, the Muskegan Clipper, as it sailed from San Diego, California, through the Panama Canal to Mobile, Alabama. The ship was eventually to be transformed into a riverboat gambling casino. In order to save time & costs, the crew bagged up the demolition debris, including plastic garbage bags full of asbestos, and threw it overboard into the Pacific Ocean, Gulf of Mexico & Caribbean Sea at the direction of Cook. Dissenting crew members photographed the others as they threw the asbestos & trash into the sea. The exact amount of asbestos that was removed from the Muskegon Clipper, a U.S. registered vessel, & dumped overboard is unknown. Witnesses reported that "hundreds" of bags were dumped. It is assumed that a significant amount was discharged, as the asbestos removal contract was estimated to cost between US$600,000 & US$1.7M. Sentencing is pending.
***Free Shoes ....... as thousands of Nike basketball shoes are drifting through the Pacific toward Alaska after spilling from a container ship off N. California. Our pal Dr. Curtis Ebbesmeyer is an oceanographer who tracks sneakers, toys & other flotsam across the sea. He says there's a hitch to finding free shoes -- Nike didn't tie the laces & beachcombers may be challenged to find mates. But he says the effort is worth it because the shoes have only been adrift a few months. A beachcomber told Ebbesmeyer about the shoe spill after finding 2 new blue & white EZW men's shoes washed up near Queets on Washington's Olympic Peninsula in Jan. Unfortunately, they were 2 left foot shoes in size 10 and a half & 8 and a half. Ebbesmeyer believes cargo lost Dec. 15th during storm off Cape Mendocino, including 3 x 40ft containers each carrying 5,500 shoes. Vessel identity pending.
***USS Midway - Coming Soon ...... as she will begin her final tour of duty on the South side of Navy Pier in San Diego. She will mark San Diego's 1st major new visitor attraction in more than 20 years. She'll serve as cornerstone of the revitalized North Embarcadero, gateway to downtown. She'll join the S/V Star of India & other historic & visitor attractions along the waterfront. Towing will begin for the great ship to San Diego from Bremerton Washington later this summer. She will stop on the way & be spruced up for her debut in San Diego in Fall 2003! USS Midway Homecoming
***This Month In U.S. Naval History
*1800 - USS Essex becomes the 1st U.S. Navy vessel to pass the Cape of Good Hope.
*1814 - HMS Phoebe & Cherub capture USS Essex off Valparaiso, Chile. Before capture, Essex had captured 24 British prizes during the War of 1812.
*1848 - USS Supply reaches the Bay of Acre, anchoring under Mount Carmel near the village of Haifa, during expedition to explore the Dead Sea & the River Jordan.
*1854 - Commodore Matthew Perry opens treaty negotiations with Japan.
*1862 - Ironclad ram CSS Virginia destroys USS Cumberland & USS Congress.
*1941 - President Franklin D. Roosevelt signs the Lend-Lease Act.
*1942 - Motor Torpedo Boat Squadron 3 (PT boat), Lt. Cmdr. John Bulkeley leaves the Philippines to take Gen. Douglas MacArthur to Australia.
*1945 - Use of 1st Navy landing craft to cross the Rhine River at Bad Neuenahr.
*1958 - Battleship USS Wisconsin (BB 64) is decommissioned, leaving Navy without active battleship for the 1st time since 1895.
5. The Cargo Letter Cargo Damage Dispatches
**Back By Popular Demand**
We're sorry, but there were so many sinkings, explosions, pirate attacks, fires, cargo mishaps, & other disasters at sea that we do not have room to print even the highlights this month. A leaking P&O cruise ship M/V Pacific Sky with history of structural problems -- returned to port after taking on 165 tons of water! A major sea battle in Sri Lanka on March 10! Many people lost their lives at sea this month!!
But you can read all this month's disaster news at our special Internet web feature which provides full details of each event -- our Vessel Casualties & Pirate Activity Database. Bookmark the site and visit every day! Updated twice daily.
SPECIAL NOTE: Please view the dramatic new pictures at our special "Gallery of Cargo Loss" website feature.
NEW PHOTO FEATURE: "Thrice Bitten" -- The 2003 story of M/V Tricolor."
NOTE: The historic dangers of carriage by sea continue to be quite real. Shippers must be encouraged to purchase high quality marine cargo insurance from their freight forwarder or customs broker. It's dangerous out there.
OUR "D" Section: FF in Cyberspace***x
6. The Cargo Letter "Cyber Ports Of Call"
Here are our suggested world wide web sites of the week for your business, your information and your amusement..............
Saying Thanks To U.S. Service Personnel
In Memory of Veterans
American Airlines Cargo ..... release of new web site & new tracking features by PDA or cell phone.
"America at Work" Poll ...... majority of American workers do not believe the current conflict poses a direct threat to their job security.
California World Trade Report
FTL Carrier Survey ........ as the Technology & Maintenance Council and the Center for Transportation & Logistics at the Massachusetts Institute of Technology are working together to collect information to allow a better understanding of the impact package bidding by truckload carriers has on the marketplace. Take the survey.
Int'l Furniture Products Shippers Association
Logoitis In Company Advertising
New Rules of Media Buying
Oil Price Information Service ........ free war-time briefing service.
Singapore ........ past present & future.
Tips For Buying Vehicle Insurance
U.S. Mexican & Canadian Associations Unite On Customs Issues
World Trade Point Federation ......... new website serves as a global e-business marketplace -- an UNCTAD creation -- primarily targets small & medium enterprises in developing countries, disadvantaged by structural & geographic factors, and seeks to help them integrate & take advantage of Int'l trade opportunities.
Donald Smith Marine Models
Global Transport Analyzer
Jobs In Logistics Inc. ......... reports annual 50% sales increase, for the 2nd year. Even though recruitment in USA & Canada lower in 2002, significantly more logistics related jobs were listed. Resume database increased from 15,000 to 40,000 resumes of logistics, supply chain, transportation, freight forwarding & distribution professional candidates.
Keller-Soft Transport Security Program Customizer ....... build a customized security program. For US$149, get: audit checklists, policies to guide your company & training tools to instruct employees.
Logistics Management Magazine ....... FREE subscription.
PeopleNet Automated Messaging ....... automates communication across the supply chain.
Sendum Wireless Tracking Devices
Coalition of New England Companies For Trade ........... April 10 & 11 2003 7th Annual Northeast Trade & Transportation Conference, Hyatt Hotel, Goat Island, Newport, RI
Distribution/Computer EXPO ........ May 21-22 & Seminars, May 20, in Chicago. Largest exhibition of software & systems for supply chain, warehousing, logistics, distribution transportation. New this year are classroom-style demos of over 30 products.
FMC Seminar - "Overview of Responsibilities of Vessel Operators, Ocean Transportation Intermediaries & Maritime Shipping Services Users in U.S. Foreign Trades." Opportunity for Q&A. NO CHARGE. Please indicate intent to attend, preferably by e-mail. Wed., April 30, 2003 -- 10:00 a.m. until 12:00 noon at Port of Tacoma.
Free Trade Area of The Americas (FTAA) ........... 20-21 Nov., Miami, Florida, an important marker in the negotiations among the 34 FTAA members to remove tariffs, trade barriers, & promote regional economic development & integration in the Western Hemisphere.
Int'l Cargo Security Summit ........ July 16th & 17th, 2003, Chicago
Los Angles Harbor Transportation Club .......... April meeting will feature Stephanie Williams, VP Legislation & Regulatory Affairs, California Trucking Assn. -- "The Intermodal Reform Act. " 6PM, Thursday April 3rd 2003, The Reef Restaurant, Port of Long Beach, CA
Los Angeles Transportation Club ............ April 8, 2003 Executive Series Speaker Donald Snyder, Import Export Logistics Manager, Mattel Toys, Marriott Norwalk Hotel, Norwalk, CA.
Port of Brisbane "Beef" Seminar ...... Source to Sea on April 28.
Seatrade London Int'l Maritime Convention .........16-18 Sept. 2003, ExCeL, London, UK
Transportation Claims, Loss Prevention & Security ....... this Division of the American Trucking Associations' Safety & Loss Prevention Management Council will hold its annual conference from March 31-April 1 at the Adam's Mark Hotel in Charlotte, NC.
China Shipping & Logistics Conf. -- Yangtze River Delta Outlook ......... 9-10 April, 2003, Shanghai Hilton, PR China
World Maritime Technology Expo ......... Oct. 2003, San Francisco.
Image of Brazilian Oil Platform P-34 ......... 50 miles off Rio de Janeiro, Brazil, taken from 423 miles in space on Oct. 15, 2002 by Space Imaging's IKONOS satellite. Salvage ships worked to repair listing offshore oil rig. The US$200 million offshore rig heeled over after electrical failure caused oil stored aboard to flow to one side.
Enjoy Virtual Spring
U.S. Dept., of Homeland Hilarity
Weapons of Mass Destruction Int'l Locator
OUR "E" Section: The Forwarder/Broker World****
7. New U.S. Transport Related Legal Cases _____
Norfolk & Western Railway Co. v Ayers
U.S. Supreme Court
March 10, 2003
Industry Personal Injury: Railroad employees suffering from asbestosis may recover for mental anguish based on fear of developing cancer. The employees were exposed to asbestos due to negligence on the part of the railroad company employer. When they subsequently developed asbestosis they sued, seeking damages not only for the asbestosis, but also for anguish due to the fear of developing cancer. The court held that, so long as a well-grounded fear of developing cancer was proven, such mental anguish was a recoverable damage element. The case is significant to the U.S. transport & maritime industry because the statutory basis for personal injury recovery for crew members follows the principles for recovery by railroad workers.
Jessica Howard Ltd. Vs. Norfolk Southern Railway Co...
U.S. Court of Appeals for the Second Circuit
Jan. 10 2003
Damages: Absent special circumstances or contractual provisions to the contrary, the usual measure of damages for goods lost in maritime transit is the cost of replacement at the destination. In the instant case, plaintiff consignee contracted for shipment of ladies garments from Shanghai to New Jersey. The goods were lost while in the custody of defendant railroad. Defendant argued that allowing plaintiff to recover for anything other than the cost of replacement of the goods in Shanghai would improperly permit plaintiff to garner its lost profit, which is not a consequential damage. The court held that market price at destination of the goods shipped is the usual measure of the value of the promised performance & is not collateral to the intermodal shipment contract.
Written from wire stories, the Associated Press, Reuters, Hong Kong Shipping News Lloyds & other world sources.
The Cargo Letter Correspondents:
Michael S. McDaniel Esq, Editor (Countryman & McDaniel)
David Schuchman -- Interpool Corp. -- Webmaster of The Cargo Letter Archive
Cameron W. Roberts, Esq. (Countryman & McDaniel)
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