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An OW Bunker Saga Case Summary

By Gary Seitz
Gellert Scali Busenkell & Brown, LLC
Philidelphia, PA · USA
Tel: +1 215-238-0011


A brief summary of a recent case of note.  In its decision rendered January 14, 2019 in the case of NUSTAR ENERGY SERVICES, INCORPORATED v. M/V COSCO AUCKLAND, IMO NO. 9484261, the US Court of Appeals for the Fifth Circuit again concluded a creditor did not have a lien against a vessel since the “facts showed no more than that the vessel’s agents were aware of the physical (bunker) supplier’s identity—not that the physical supplier acted “on the order of” the vessel’s agents.”

“This lawsuit is the latest round in the maritime litigation spawned by the collapse of OW Bunker, formerly the world’s largest supplier of fuel for ships. In federal courts across the country, OW’s subcontractors have asserted maritime liens on the ships to which they physically delivered fuel. If successful, these claims would allow them a full recovery rather than the pennies on the dollar they would likely receive in bankruptcy court. But the subcontractors are not alone in their pursuit of maritime liens—OW’s largest secured creditor has also staked a claim. Our ruling in an earlier OW Bunker case means that the subcontractor here does not possess liens on the vessels it supplied because it was not acting on the orders of the vessels or their agents. And because it does not have liens, we conclude that it is not able to appeal a ruling that the secured creditor does hold liens.”

Here is a link to the full case decision.