Owner and Operator of Ship Plead Guilty in a Federal Court in Louisiana to Environmental and Safety Crimes

Louisiana – Empire Bulkers Limited and Joanna Maritime Limited, related companies based in Greece, pleaded guilty today to knowing violations of the Act to Prevent Pollution from Ships and the Ports and Waterways Safety Act related to the Motor Vessel Joanna.

The guilty pleas were entered on May 24, 2022, before U.S. District Court Judge Mary Ann Vial Lemmon in federal court in New Orleans, Louisiana. If the proposed plea agreement is approved by the Court, the companies will be fined $2 million ($1 million each) and placed on probation for four years, subject to the terms of an environmental compliance plan that includes independent ship audits and oversight by a Court Appointed Monitor.

“Deliberate violation of environmental and safety laws pose a serious threat to U.S. ports and waters, as well as to those working on ships,” said Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “These corporations knowingly engaged in dangerous and deceitful misconduct that warrants robust enforcement of the law.”

“This prosecution sends a clear and deterrent message that those who cut corners and break the law will be vigorously prosecuted,” said U.S. Attorney Duane Evans for the Eastern District of Louisiana. “These companies will be under close supervision going forward.”

Empire Bulkers and Joanna Maritime admitted in their guilty pleas to knowingly falsifying the ship’s Oil Record Book, a required log that concealed overboard discharges of oil-contaminated waste in violation of MARPOL, an international treaty to which the United States is a party. According to a joint factual statement filed in court, the criminal violation of the Act to Prevent Pollution from Ships was discovered by a U.S. Coast Guard inspector who noticed that a valve handle used to sample the oil content of overboard discharges was out of position during a March 2021 inspection in New Orleans. While the sample being evaluated by the Oil Content Monitor was being diluted with fresh water, an internal metal piece allowed for overboard discharges.

A Coast Guard advisory issued in 2008, as well as a notice from the monitor’s manufacturer, warned about this specific method of fooling the Oil Content Monitor. Overboard discharges are only permitted if they pass through an Oily Water Separator and are measured by the Oil Content Monitor to have an oil concentration of less than 15 parts per million without dilution. The entries in the Oil Record Book relating to overboard discharges that were presented to the Coast Guard falsely indicated that the discharges occurred through 15 ppm equipment.

The ship owner and operator also admitted that the discharge entries in the Oil Record Book were co-signed by an engineer who had nothing to do with the operations and had no knowledge of their accuracy.

During the same inspection, the Coast Guard discovered an unreported safety hazard. Following the arrival of the Coast Guard, ship representatives requested permission to maneuver from the Bonnet Carre Anchorage to the CCI Buoys further upriver, where cargo operations were scheduled. During the voyage, Coast Guard inspectors traveling with the ship noticed drops of oil in the engine room. They followed the oil trail that led to the purifier room. When the Coast Guard entered the purifier room, they discovered that the discharge line from the pressure relief valves had been disconnected and crimped shut, effectively disabling both pressure relief valves.

The safety relief valves on fuel oil heaters perform an important safety function by allowing pressure to be released and oil to be diverted to a waste oil tank. The defendants admitted in court papers that the plugging of the relief valves and the large volume of oil leaking from the pressure relief valve created hazardous conditions that were not immediately reported to the Coast Guard in violation of the Ports and Waterways Safety Act. According to the factual statement, a fire or explosion in the purifier room could have been catastrophic, resulting in a loss of propulsion, loss of life, and pollution.