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Judge Says He’ll Agree to Nearly $43 Million In Shipping Suit

July 15, 1990

TACOMA, Wash. (AP) _ A Japanese company will likely face a $43 million penalty for keeping double books to avoid paying union wages to the Filipino crew of a logging ship, a federal judge said.

An award that size would be the largest wage judgment in maritime history, said Richard Dodson, a lawyer from Louisiana who represented the 21 crew members in U.S. District Court.

A defense lawyer said Saturday the shipping company would appeal the judge’s expected decision in favor of the plaintiffs.

Delica Shipping company officials said the company kept two sets of books on all 10 of the company’s ships for the past eight years. Pine Forest, the company ship involved in the lawsuit, was seized in Tacoma in January and released only after the owner posted a $19 million bond.

″They admitted they cheated,″ Dodson said Friday.

Both sides agreed that crew members were required to sign two sets of monthly wage receipts, one indicating payment according to levels specified in agreements with the International Transport Workers Federation and another showing the actual pay rate.

Forest Pine crew members said they were paid one-fifth the contractual rate after being hired in March 1989. When 13 of the crew asked to leave the ship to pursue wage claims, they were blacklisted from future work, testimony indicated.

Company lawyers argued unsuccessfully that Judge Jack Tanner lacked jurisdiction because no cargo was unloaded in western Washington state.

Under U.S. law, the courts have jurisdiction over wage cases involving foreign ships and crews when their voyages end in U.S. waters.

Defense attorney Joseph Stacey said Saturday that Delica would appeal Tanner’s expected decision against the company.

Stacey said the crewmen were paid about 70 percent of union scale wages, not the 20 percent alleged. He said the case covered about 15 different pay grades and that he could not state actual wage amounts.

Stacey earlier said the crew members knowingly and voluntarily agreed to less pay than required under the union agreement and that what they did receive was still a highly desirable rate for the Philippines.

″The flag-of-convenience vessels have never paid these ITF wages,″ he said. ″In our case, even the ITF never expected anybody to receive ITF wages.″

In a hearing Friday, Dodson asked Tanner to award $150,000 in back pay, $16 million in compensatory and penalty wages and $27 million in punitive damages from Delica.

″I might as well tell you, you’re looking at a judgment near or around that figure,″ Tanner told company lawyers. ″This case cries out for punitive damages in a substantial amount of money, both to punish your client and to deter others from such outrageous, malicious and intentional conduct.″

The judge’s decision was expected later this summer.

The Pine Forest is registered to Delica, a Panamanian corporation. It flies the flag of Vanuatu, a small Pacific island nation, and is operated by Inui Steamship Co. of Japan, a subsidiary of Mitsui Inc.

The ship is chartered by yet another Japanese company to bring logs from the Weyerhaeuser Co. through Tacoma and Longview.

Dodson said the double bookkeeping system boosted profits by $400,000 a year.

He said he had filed a $100 million civil suit against Delica on behalf of 2,000 other crew members. Another Delica ship, the Fir Grove, also is the subject of a civil case after being seized in Coos Bay, Ore.

The Pine Forest case was hailed Friday by Paul Chapman, director of the Center for Seafarers’ Rights at the Seamen’s Church Institute in New York.

″This case represents a systemic problem that is rampant throughout the shipping industry around the world,″ Chapman said. ″Each year thousands of seafarers are cheated out of their earned wages and are virtually blackmailed into signing false wage receipts and unfair contracts.″

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