Forum Selection -- A Way to Obstruct COSTA CONCORDIA Claims
Although the parent company of the owner of the stricken Costa Concordia is based in Miami, passengers who want to file a lawsuit in U.S. courts over the cruise ship disaster will encounter obstacles in the tickets issued by the cruise line.
That's because of fine print on the tickets purchased and signed by the 3,000-plus passengers before the ship capsized Jan. 13 off the coast of Italy, killing at least 16 and leaving another 16 missing. The ticket contract includes what's known as a "choice of forum" clause stating that lawsuits must be filed in Italy.
In a 1991 case of Carnival Cruise Lines v. Shute, the U.S. Supreme Court held that such a provision in a cruise ticket was enforceable. The result has been that many claims by injured cruise ship passengers have been deterred by the expense of filing a lawsuit in a foreign court.
For a Costa cruise that touches any part of the U.S., the clauses say lawsuits should be filed in federal court in South Florida. Same for Carnival Cruises – which owns Costa – and many other major cruise lines. But for cruises such as the Concordia that involve only foreign travel, the Costa ticket says lawsuits must be brought in Genoa, Italy where much of the subsidiary's operations are based.
The clauses in the cruise industry are not as common in other forms of travel. Lawsuits against airlines, for example, can be brought virtually anyplace they do business for domestic flights; for international flights, lawyers can generally sue in the airline's home location or where the flight departed, among other venues.
Last August, the 11th U.S. Circuit Court of Appeals ruled in favor of a forum clause in a case involving Regent Seven Seas Cruises Inc. A California woman, Nina Seung, fell and broke her leg aboard a cruise ship sailing from Tahiti, then tried to sue in Fort Lauderdale federal court. Her ticket required foreign cruise lawsuits to be filed in Paris, and the appeals court rejected her challenge.
Seung, who was 74 at the time of her accident, said in court papers that the clause essentially barred the door for her.
"I do not have any savings of note right now, I am going further and further into debt each month and because I cannot work, I don't see how I can ever afford this," she said in an affidavit. "So if I am forced to go to Paris, France, I just will not be able to bring my claim."
When the Shute case was decided by the U.S. Supreme Court, lawyers representing injured passengers were discouraged. It was obvious that passengers do not meaningfully agree to the fine print on the back of tickets issued by the cruise line. This is a classic "contract of adhesion," in which one party has never had any choice but to accept the terms, no matter how unconscionable.