Cruise lines and consumers: troubled waters

This article examines the legal obstacles faced by plaintiffs who try to litigate consumer complaints against cruise lines. First, the article discusses the passenger contract and the enforceability of forum selection clauses and time limitation clauses under maritime law. Second, the article addresses the issue of whether or not state deceptive trade practices acts are preempted by federal admiralty law. Last, the article concludes that sound arguments may be made in favor of accommodating state consumer protection legislation in the context of general maritime law.

INTRODUCTION

The cruise industry represents the fastest growing segment of the leisure travel industry.(1) It experienced its best year ever in 1998, breaking records for the number of passengers who booked cruises (five million) and for occupancy rates (ninety-one percent).(2) A continued growth rate of around ten percent was expected for 1999.(3)

A building boom in the industry is partially responsible for the growth and rise in profits.(4) Thirty-eight new cruise ships are set for delivery between 1999 and 2002,(5) with most of the ships exceeding 70,000 gross registered tons.(6) Royal Caribbean’s Eagle Project plans to launch three ships over the next five years each of which will weigh in at 142,000 gross registered tons, cost $500 million, and accommodate as many as 3,838 passengers

The growing popularity of cruising as a vacation option also explains in part the industry’s recent growth trend.(10) Cruise lines have responded to consumer demand by offering specialty interests and options. For example, some of the cruise lines, such as Carnival and Disney, cater to families and children,(11) while others, such as Radisson Seven Seas and Crystal, offer a more mature and sophisticated class of service to attract a different adult clientele.(12) In addition to their comfortable position in leisure travel, cruise lines are moving into business travel as well by offering conferencing facilities and meeting space for conventions in the newer ships, and by offering educational opportunities at sea, such as professional certification and continuing education classes.(13) Carnival was the first cruise line to debut a no-smoking ship, the Paradise,(14) as well as the first to let consumers book directly over the Internet.(15)

There are cruises to just about any place a traveler would like to explore, from the Antarctic to the Orient, from the coast of Africa to the Chilean fjords, even around the world, although the Caribbean remains the most popular destination.(16) The number of passengers also has increased in part because of the value that cruise consumers get for their vacation dollar

Although consumers are now embracing cruise lines in record numbers and cruise lines are generating record profits,(19) this apparently symbiotic relationship is in reality a lopsided one which does not favor the passenger. Unlike hotels, restaurants, bars, and recreational facilities on land, cruise lines sail on the wave of federal admiralty law, not state regulatory, tort, or consumer protection laws. Recently, concerns about safety aboard cruise ships have been highlighted by incidents such as the fire aboard Carnival’s Ecstasy, the eighth in the industry over the preceding fifteen year period,(20) and the running aground of Royal Caribbean’s Monarch of the Seas in St. Maarten.(21) Less publicized, but equally troubling have been allegations of sexual assaults on the high seas.(22)

Yet, should the potential for passenger claims for personal injury and property damages in this burgeoning industry be realized,(23) it is federal law which probably controls the outcome. Similarly, should the hope of a dream vacation not be realized,(24) it is federal, not state, law which will likely govern the dispute. Unfortunately, federal law provides little if any relief for complaints about arbitrary changes in the ship’s itinerary(25) or chronic air-conditioning and plumbing problems,(26) for example. Because the consumer’s greatest weapon under state law, deceptive trade practices legislation, may not apply,(27) typically the consumer is forced to accept whatever modest sum the cruise line offers for any inconvenience caused by the substandard quality of its services or facilities.(28) This article will examine the legal obstacles faced by plaintiffs who try to litigate consumer complaints against cruise lines.(29) First, the article will discuss the passenger contract and the enforceability of forum selection clauses and time limitation clauses under maritime law. Second the article will address the issue of whether or not state deceptive trade practices acts are preempted by federal admiralty law. Last, the article will conclude that sound arguments may be made in favor of accommodating state consumer protection legislation in the context of general maritime law.

THE CRUISE CONTRACT

The federal Constitution provides that “the judicial [p]ower shall extend … to all [c]ases of admiralty and maritime [j]urisdiction.”(30) In 1789 the first Congress enacted the Judiciary Act, establishing the exclusivity of federal maritime jurisdiction but reserving common law remedies available in state courts, including new rights granted by statutes rooted in common law.(31) Under the “saving to suitors” clause(32) state courts can hear certain maritime claims, but they generally must apply federal admiralty law.(33) The contract of passage governs the rights and responsibilities of the parties for any cause of action arising out of the voyage.(34) Since the passenger ticket is a maritime contract, it is governed by federal maritime law.(35)

The typical consumer complaint against a cruise line involves misrepresentations about the availability or quality of the services offered, such as those for children, seniors, or handicapped passengers,(36) or misrepresentations concerning what class of service is available.(37) Usually the misrepresentation is contained in the brochures made available to travel agents or sent directly to consumers.(38) Conceivably, material omissions concerning the availability or quality of the services advertised could also form the basis for a consumer complaint.(39)

If the misrepresentation relates to the passenger contract, then federal maritime law controls because the passenger contract is a maritime contract.(40) Since federal admiralty law may not allow for the recovery of attorneys’ fees, treble damages, or punitive damages for negligent misrepresentation,(41) which is likely to be the issue in consumer complaints, it would be best for the plaintiff to argue that the misrepresentation does not relate to the contract, but rather is an independent tort.(42)

Under admiralty law, the location of the tort as well as the maritime nature of the act is determinative on the issue of whether federal maritime law applies.(43) Usually maritime law, not state law, applies if the tort (for example, negligence) occurs on navigable waters,(44) but not if the tort occurs on land.(45) Nevertheless, if the activity conducted on land is deemed to be cruise-related, then maritime tort law may still apply.(46)

It can be argued that any misrepresentations (such as documents sent by the cruise line indicating that certain bathrooms are inaccessible by wheelchair when, in fact, no bathrooms are wheelchair-accessible) made in cruise lines’ literature or by their agents relate to the cruise and navigable waters because the fraud is ultimately carried out on the high seas.(47) If that is the case, then the limited remedies afforded under admiralty law,(48) as contrasted to those available under state consumer protection statues, may not be worth pursuing.

On the other hand, the argument can be made that admiralty law does not presumptively apply simply because the principal business of cruise lines involves navigable waters. Misrepresentations are made by agents on land or contained in brochures printed on land and sent through the postal service.(49) Often these misrepresentations contradict company policy that was set in some land-based corporate setting, albeit carried out on the high seas. Arguably, the deception is complete when reality does not comport with statements made

It is conceivable, however, that a passenger could learn of the falsity of the declarations contained in the marketing literature or made by the agents prior to boarding but after the period has passed for a refund without penalty.(51) In such a case a complaint for misrepresentation or deceptive trade practices would be ripe without the passenger’s ever having boarded the ship. If nothing else, the likelihood of a continuing injury to consumers if the misrepresentations circulate should permit state law, not admiralty law, to apply notwithstanding the fact that the deception may eventually be discovered at sea. Nevertheless, if indeed the false representations are related to the contract of passage, then admiralty law will probably apply, perhaps to the exclusion of proconsumer state remedies.(52) Whether or not the claim for misrepresentation against the cruise line(53) lies in tort or contract, and whether or not state law or federal admiralty law applies, there are two provisions routinely included in the contract between the passenger and the cruise line that present substantial hurdles for the litigation of a consumer complaint. They are forum selection and time limitation.

Maritime Law and Forum Selection Clauses

Forum selection clauses, which provide that any controversy arising out of the cruise contract are to be litigated, if at all, in a certain jurisdiction to the exclusion of all others, are presumptively valid under maritime law. In The Bremen v. Zapata Off-Shore Company(54) the Supreme Court held that a forum selection clause in a contract between an American company and a German company for the towing of an offshore oil rig, which required disputes to be resolved before the London Court of Justice, was valid unless enforcement would be unreasonable and unjust, or the clause was the result of fraud or overreaching.(55) The Court stated that one party’s claim of inconvenience would not be sufficient to invalidate the clause unless it could be established that maintaining the suit in the forum provided for in the contract would be “manifestly and gravely inconvenient” so as to in effect deprive a litigant “of a meaningful day in court.”(56)

Enforcement in Passenger Contracts

While The Bremen involved a commercial contract, a subsequent case extended the rule to contracts between passengers and cruise lines. In Carnival Cruise Lines v. Shute(57) the Court upheld the non-negotiated forum selection clause contained in a cruise contract, and offered three justifications for doing so which have been the subject of spirited criticism.(58) First, the Court observed that because a cruise line carries passengers from many locales, it

The Court stated that while such clauses would be “subject to judicial scrutiny for fundamental fairness,” there was no evidence in the case at hand that accession to the clause was the result of fraud or overreaching or that the plaintiffs did not have notice of the clause.(62) The Court emphasized that the forum selection clause allowed disputes to be resolved by a contractually selected court of competent jurisdiction, that it did not limit any claim for negligence, and that enforcement of the clause would not violate the Limitation of Vessel Owner’s Liability Act.(63) The dissent, on the other hand, argued that the language of the Act was broad enough to encompass forum selection clauses so that they should be null and void, and that even in the absence of such a statute, passengers would not have notice about the existence of such a clause adequate enough to require them to sue in a distant forum.(64)

In sum, if a personal injury case against a cruise line lies within a court’s admiralty jurisdiction, the court will enforce a forum selection clause even if, as in Shute, it requires a Washington state plaintiff to litigate in Florida, pursuant to a forum selection clause which was printed on the passenger’s ticket and neither mailed nor received until the transaction was complete. The passenger will not have had meaningful notice and will not have had an opportunity to shop around for another cruise line, although in reality the latter would not be very meaningful given the pervasive usage of the clauses in the industry.(65) Judge Posner characterized this situation as being a prime case for “stretching the concept of fraud in the name of unconscionability … and perhaps no stretch was necessary.”(66)

So confident are cruise lines regarding the validity of forum selection clauses in light of the Supreme Court’s positive pronouncement, that they have threatened to move for sanctions against plaintiffs bringing suit in a forum other than that specified in the contract,(67) or to counterclaim against plaintiffs for breaching the contract of passage by not bringing suit in the specified forum.(68) Courts, however, still scrutinize forum selection clauses on fundamental fairness grounds, for both procedural and substantive unconscionability. To this end, courts use the reasonable communicativeness standard, which employs a two-prong analysis focusing on the facial clarity of the ticket and its language, as well as the extrinsic circumstances surrounding its purchase.(69) Courts have held that forum selection provisions can be reasonably communicated to friends, relatives or agents, including travel agents,(70) and that a passenger’s failure to either read or understand the provision does not preclude its enforcement.(71)

Courts today enforce most contractual provisions in cruise agreements

Another aspect of fundamental fairness is the inconvenience of litigation in a distant forum. Plaintiffs bear a heavy burden of proof in order to invalidate a forum selection clause on these grounds, and concerns about cost, distance, disability, or age are not considered tantamount to depriving litigants of their day in court.(75) While Shute involved litigation in the most distant location within the United States, other courts have held that forum selection clauses which require passengers to litigate claims in other countries are fundamentally fair as well.(76)

Typically, courts are not persuaded by arguments about inconvenience for the purpose of opposing dismissal of the case based upon the forum selection clause.(77) Because most forum selection clauses require litigation in a state court, or alternatively most plaintiffs select a state court to commence litigation, enforcement of the clause results in a dismissal of the case. For litigation to continue, the plaintiff would need to re-file in the forum named in the contract. On the other hand, if the suit were filed in federal court in the state required by the contract, and the court was considering a motion to transfer the case from a proper venue to a more convenient venue,(78) arguments about inconvenience may be more persuasive.(79)

The final caveat the Supreme Court reserved in Shute about fundamental fairness concerned the selection of the forum in bad faith, “as a means of discouraging passengers from pursuing legitimate claims.”(80) The Court concluded that there was no evidence of bad faith because Carnival’s principal place of business was in the selected forum and many of its cruises departed from Florida ports.(81) Subsequently, in evaluating this aspect of fairness, lower courts have examined whether the forum was selected in bad faith so as to avoid litigation, or whether the forum was a practical choice given the business operations of the cruise line.(82)

Arguments against Enforcement in Consumer Complaints

Even if a consumer complaint about misrepresentations sounds in maritime law, and federal substantive law regarding forum selection clauses is applicable, the result reached in Shute may or may not be controlling for several reasons. First, the Court emphasized in Shute that such forum selection clauses were subject to judicial scrutiny for “fundamental fairness.”(83) Unlike personal injury cases such as Shute, cases of consumer fraud typically involve small amounts of money in dispute. To require consumers to travel great distances to pursue their remedy would be manifestly unjust and fundamentally unfair, and in essence would deny them their substantive right to relief, the right to their day in court.

Second, in Shute the Court mentioned, by way of example, that the fundamental fairness standard may be violated if assent to the clause was obtained by fraud or overreaching. If assent to the contract was obtained in such a manner, than assent to the clause necessarily was so obtained. There is nothing to suggest that the Court was limiting its caveat of fraud and overreaching to the choice of forum clause itself.(84) It is difficult to conceive of a situation when a consumer would specifically bargain about the choice of forum provision so as to be misled, particularly when most passengers do not even receive their tickets which contain the clause until after the transaction is completed.(85) Moreover, to use the choice of forum clause as the basis for a breach of contract claim against a consumer, who wishes to test its fundamental fairness in a specific factual context, is indeed fundamentally unfair and manifestly unjust. Such predatory action is designed to foreclose litigation, not to predetermine its forum.

Third, the Supreme Court justified its decision in Shute in part by recognizing the special interest a cruise line has in limiting the forums in which it could be subject to suit.(86) The Court immediately followed that observation with the example of a “mishap on a cruisers”(87) such as the one at issue in the actual case. While that analysis might be applicable to personal injuries caused by negligent omissions, it is not instructive for affirmative misrepresentations. In such cases the cruise lines themselves can limit the forums to which they are exposed by not affirmatively misrepresenting the nature and quality of their product and services.

Fourth, the Shute Court acknowledged that The Bremen was controlling, and that case specifically declared that a choice of forum clause should be held unenforceable “if enforcement would contravene a strong public policy of the forum in which the suit is brought, whether by statute or by judicial decision.”(88) While the public policy of most states is to enforce forum selection clauses absent unconscionability arguments,(89) three states, Montana,(90) Idaho(91) and North Carolina,(92) have statutorily declared forum selection clauses to be void and unenforceable. By judicial decision, Alabama and Georgia have declared such clauses unenforceable.(93) Perhaps, then, some plaintiffs will be spared the effect of forum selection clauses if the laws of these states is applicable to their controversy.(94) Nevertheless, in a federal diversity case, Stewart Organization v. Ricoh Corporation,(95) the Supreme Court held that in considering a motion for a change of venue under federal law for the convenience of the parties(96) to the forum designated in the contract, the validity and effect of the forum selection clause was to be governed by federal law, even though Alabama state law, which was applicable to the substantive issues in the case, declared such clauses to be unenforceable.(97)

Finally, an interesting due process issue arises if by contract plaintiffs are forced to waive personal jurisdiction and to litigate in a state with which they have no affiliating circumstances, nor from which they have derived any benefit.(98) The Supreme Court has recognized that plaintiffs as well as defendants have due process rights.(99) Because personal jurisdiction is a constitutional right afforded to both plaintiffs and defendants, it is difficult to see how a right of constitutional import can be waived by a forum selection provision contained in a standard, pre-printed form contract.(100) particularly if it was induced by misrepresentations, when the waiver would have occurred after the deception was completed, but prior to its discovery.

If any or all of these arguments counsel against the enforceability of forum selection clauses in cruise contracts allegedly induced by misrepresentations, there is still another hurdle plaintiffs must overcome before being able to litigate at home. The defendant cruise line must be amenable to personal jurisdiction in the plaintiff’s chosen forum. Before a court can exercise jurisdiction over a non-resident defendant pursuant to its long-arm statute, the defendant must have certain minimum contacts with the state so as not to offend due process.(101)

Because cruise lines blanket all states with their marketing brochures and solicit potential passengers throughout the United States, it would seem that personal jurisdiction would not be a problem. Nevertheless, in some cases neither the distribution of advertisements, the generation of substantial revenues through the sale of tickets, nor the conduct of business with independent travel agents who do not have the authority to issue binding reservations nor to write tickets, have been held to be sufficient contacts to confer personal jurisdiction.(102) In other jurisdictions, similar facts have been found to be “the kind of continuous and systemic general business contacts which justify the assertion of in personam jurisdiction.”(103) Unfortunately for consumers, even if the forum selection clause falls, personal jurisdiction could likely be a point of contention for pre-trial motions and interlocutory appeals because each cruise line’s contacts with each state may vary from previously established precedents on the question of sufficient minimum contacts.

Maritime Law and Contractual Time Limitations

In addition to forum selection clauses, most cruise passenger contracts provide that notice of an intent to file suit must be given and claims must be filed within a specified time period. In the absence of contractual provisions to the contrary, admiralty law has a three-year statute of limitation period for personal injury claims.(104) A one-year limitation period with a six-month notice requirement to the carrier is permissible under admiralty law if such a limitation is contained in the contract of passage.(105) Such limitation provisions for personal injury claims are routinely included in passenger contracts and upheld by courts, provided they are reasonably communicated.(106) Courts have also upheld limitation periods of six months for claims of property loss or damage, or for breach of contract.(107)

Most likely, however, complaints of misrepresentation would not be based upon breach of contract, perhaps in part to evade the applicability of federal maritime law.(108) Surprisingly, then, a common limitation period of three months for any additional claims may be applicable to consumer complaints of misrepresentation, which arguably would be enforceable under maritime law.(109) While such a short window in and of itself may not be problematic under admiralty law, it still must be reasonably communicated. In Deck v. American Hawaii Cruises, Inc.(110) plaintiffs sued for, inter alia, false advertising and unfair and deceptive trade practices.(111) The district court held that even though maritime law would govern,(112) the language used in the ticket did not reasonably notify the reader of the limitation in this contract of a fifteen-day notice provision and a six-month filing limitation.(113) The court noted that the language used in the “Other Claims” section of the ticket employed the term “other loss of any nature.”(114) The court concluded that such language might not reasonably alert a passenger of the time limitation applied to federal and state statutory rights, as might the use of a more inclusive term, such as “any” instead of “other.”(115) Thus, the court held the limitation to be unenforceable,(116) particularly because “[c]ruise passenger tickets are contracts of adhesion and as such, ambiguities in them must be construed against the carrier.”(117)

If there is no ambiguity in the terms used and the provision is reasonably communicated to the passenger in large, bold, and contrasting print, there is nothing to suggest that short notice to sue and requirement to file periods would not be enforceable, even if the contractual period substantially shortened the amount of time permitted under the applicable statute of limitations. While an enforceable forum selection clause may, as a practical matter, foreclose a lawsuit because of costs, an enforceable and surprisingly short notice and limitation provision extinguishes the action outright. Nevertheless, even if admiralty law applies to consumer complaints of misrepresentations and the forum selection clause contained in the contract of carriage is enforceable, a plaintiff might be undeterred from filing suit against a cruise line, provided the limitations period had not expired, if state consumer protection laws applied to the substance of the complaint.

ADMIRALTY’S PREEMPTION OF STATE DECEPTIVE TRADE PRACTICES ACTS

All states have enacted some type of unfair or deceptive trade practices act (DTPA) which generally prohibits deceptive acts and unfair methods of competition in the conduct of trade or commerce.(118) Although many of the state acts mimic the Federal Trade Commission Act (FTCA),(119) unlike the federal legislation,(120) nearly all state acts create a private cause of action for aggrieved consumers.(121) Violations of these state laws are typically easier to establish than common law fraud or misrepresentation,(122) but even more attractive are their statutory remedies, which can include treble damages, attorneys’ fees, and costs.(123) Passengers may not be dissuaded from litigating their complaints for misrepresentation and deceptive practices in a distant forum if the recovery of treble damages, attorneys’ fees, and costs are available, even though the amount of actual damages sought may not be substantial. However, even if the passenger sues in state court under the “saving to suitors clause,” federal maritime law may apply to the exclusion of the DTPA.(124)

In maritime actions tried in state court, state procedural law applies

In Hetzel v. Bethlehem Steel Corporation(129) the Fifth Circuit held that the federal Longshore and Harbor Workers’ Compensation Act (LHWCA) preempted the Texas DTPA. While under Texas law an employee who receives workers’ compensation can also sue his employer under the DTPA, the appeals court held that the LHWCA was intended by Congress to be the exclusive remedy.(130) Because the DTPA directly conflicted with federal law and would frustrate the Congressional purpose, which was aimed at inducing employers to participate in the federal compensation scheme by eliminating non-participating employers’ state tort immunity, preemption was required.(131) Hetzel, however, involved the preemption of state law by a federal statute in an admiralty context,(132) not the application of state law in admiralty cases involving judge-made maritime law. To that end the interpretation of Congressional intent is of considerable importance.(133) While the intent, purpose, and language of state DTPAs are virtually identical to the FTCA,(134) that statute is unrelated to admiralty, but rather is aimed at consumer protection in general.

The more pertinent inquiry then, is whether judge-made maritime law would supplant state consumer protection legislation. The Supreme Court has said that maritime law, a species of judge-made federal common law(135) with its own precedents,(136) preempts conflicting state law to the same extent as would admiralty law that had been codified by an act of Congress.(137) It is hard to imagine how enforcing state consumer protection legislation against cruise lines would disrupt either a fundamental feature of maritime law or the harmony and uniformity of non-statutory admiralty jurisdiction, especially because passengers are not engaged in a seafaring trade nor do their consumer complaints typically involve issues of seaworthiness. While arguably it is difficult to predict when state law should yield to federal admiralty law,(138) learned commentators suggest that the trend is toward the accommodation of state law,(139) and the Supreme Court has not held a state law displaced by non-statutory maritime law since 1961. Nonetheless, diverse remedies afforded under state DTPAs, which may allow costs, attorneys’ fees, double, treble, and/or punitive damages depending on the statute and the facts of the case,(140) could be problematic for such an accommodation.(141)

There is only a paucity of cases which discuss the DTPA preemption issue in admiralty.(142) In Delta Marine v. Whaley(143) the federal district court held that the standard for awarding punitive damages under the North Carolina DTPA conflicted with the requirements for awarding punitive damages under admiralty law.(144) In admiralty, punitive damages are only appropriate where the defendant’s actions are “intentional, deliberate, or so wanton and reckless as to demonstrate a conscious disregard for the rights of others.”(145) In contrast, the DTPA permitted a recovery of treble damages, what the court considered akin to punitive damages, upon a lesser showing of a trade practice as having a capacity or tendency to deceive.(146) Given the perceived conflict, the court dismissed the plaintiff’s DTPA claim.(147) Whaley, however, involved an attempt to apply the DTPA to a commercial maritime contract, not one involving a consumer, or passenger, and may be distinguishable on those grounds.

Whether or not attorneys’ fees were recoverable in admiralty was at issue in Southworth Machinery Co. v. F/V Corey Pride.(148) The First Circuit held that the provision of the Massachusetts DTPA which allowed for the recovery of attorney’s fees impermissibly conflicted with the general admiralty rule that such fees were not allowable as damages nor taxable as costs absent a showing of bad faith or oppressive litigation tactics,(149) although one commentator has questioned the court’s conclusion as to the precedential value of this admiralty rule.(150) In this case too, the plaintiff sought to apply the attorneys’ fees provision of the state’s DTPA to a commercial transaction, which, although it would be covered by the Act in other circumstances, still did not involve a quintessential consumer transaction.(151)

In the insurance context, the application of DTPAs has fared better

Because state DTPAs, like insurance, are principally a state concern, their application in the limited context of misrepresentations made to passengers of cruise lines would not disrupt the uniformity of admiralty law. Moreover, federal regulatory law in general embraces the fairness of protecting consumers from false and misleading advertisements and deceptive trade practices, and leaves the primary authority for policing deceptive trade practices and providing individual protection to consumers in civil court to state law. States would have forceful arguments for extending such protection to consumers of the cruise segment of the leisure travel industry, just as the protection is equally afforded to consumers of the services of hotels, restaurants, recreational facilities, theaters, and casinos operating on land, particularly in light of recent trends toward the accommodation of state law in the area of non-statutory federal maritime law.

CONCLUSION

If applicable, there are many features of admiralty law which make the litigation of consumer complaints against cruise lines difficult

(1) Gene Sloan, Trips, Crowds and Prices: On the Up and Up, USA TODAY, Oct. 22, 1999, at 1D. The Cruise Lines International Association estimates that 6.5 million Americans will cruise in 2000, a 51% increase from 1995. Id.

(2) Cynthia Corzo, Cruise Industry Hopes to Top Record 1998, MIAMI HERALD, Mar. 11, 1999, at C1.

(3) Id.

(4) Jim Barlow, Clear Sailing for Cruise Lines, HOUSTON CHRON., Feb. 22, 1998, at 1B.

(5) Brook Hill Snow, New Ship Preview: Multi-Billion-Dollar Shipbuilding Boom Stretches into the 21st Century, CRUISE TRAVEL, Feb. 1999, at 17, 21. As the 20th century came to an end, only 3 of the 36 largest ships in service had been built before 1990, with 25 having entered service after 1995. Bridge Talk, VACATIONS AT SEA CRUISE NEWS, Nov. 1999 (on file with author).

(6) How Big Is Big? The Cruise Boom, CRUISENET, Sept/Oct. 1998, at 8. In comparison, the Titanic was only 43,239 gross registered tons. Id. In 1996 Carnival’s Destiny was the first passenger ship to break the 100,000 ton barrier. Bill Marsano, Carnival’s Triumph, CURRENTS, Summer 1999, at 21 (on file with author).

(7) Snow, supra note 5, at 16-17. Other recreational facilities on board the ship include an outdoor sports deck with golf course, regulation size basketball and volleyball courts, a 20-foot high rock-climbing wall, and an in-line skating track. See New Ships Join CLIA in “1999,” CRUISE NEWS, Spring 1999, at 6

(8) See Randy & Karen Mink, Princess Cruises Grand Princess: A Grand New Wave of Cruising Where Choices Abound, CRUISE TRAVEL, Dec. 1999, at 34-39

(9) Theodore W. Scull, Cruising ’98: The Year in Review, CRUISE TRAVEL, Feb. 1999, at 7. Before the launch of Royal Caribbean’s Voyager of the Seas, Cunard announced plans to build the world’s largest ship by 2003, even though the line had not yet finalized an agreement with the shipyard to build the project. Gene Sloan, Cunard Torpedoes Voyager’s Glory, USA TODAY, Nov. 12, 1999, at ID. Additionally, Carnival Corporation also announced plans to add 11 additional vessels to the fleets of its subsidiaries, Carnival Cruise Lines, Holland America, and Costa Cruises, which are to be delivered before 2003. Carnival Exercises Option for Third 84,000-Ton Cruise Ship, (visited Jan. 10, 2000) <http://www.mytravelco.com.news.cruiseNews.asp>.

(10) A Titanic Response to Cruises, INCENTIVE, June 1998, at 49-54.

(11) Disney Lines recently launched its second ship, the Disney Magic. Brook Hill Snow, Disney Magic: Disney Cruise Line Debuts an Innovative Vessel with Something for Everyone, CRUISE TRAVEL, Mar./Apr. 1999, at 18.

(12) Renaissance Cruises, which operates ships on itineraries in the South Pacific and Mediterranean, recently initiated an adults only policy on board all its ships, prohibiting passengers under the age of eighteen. Renaissance Lowers the Boom on Kids, USA TODAY, Apr. 2, 1999, at 1D.

(13) For example, the Holland America Line sponsors University at Sea, a program operated by Continuing Education, Inc. which provides seminars in medicine, law, finance, education, and architecture. The tax incentives for such programs are obvious.

(14) Paul Lasley & Elizabeth Harryman, A Taste of Paradise, CURRENTS, Winter 1999, at 20.

(15) Carnival Takes Web Bookings, USA TODAY, Mar. 3, 1999, at D1.

(16) There are books to help consumers discover the vast array of options that are available on the 20 or so major cruise lines, from the itinerary to the type of cruise experience, that is, formal versus informal. See, e.g., FODOR’S 99 OF THE BEST CRUISES: A COMPLETE GUIDE TO THE TOP CRUISE LINES AND THEIR MOST POPULAR PORTS OF CALL (1998)

(17) Discounts are offered at anywhere from 20% to 65% off the brochure rate. See Veronica Gould Stoddart, Sea of Options, USA TODAY, Jan. 22, 1999, at D1. There are also travel agencies, such as Cruises Only, a subsidiary of The Travel Company, which specialize in cruises. See ED PERKINS & WALT LEONARD, CONSUMER REPORTS BEST TRAVEL DEALS 29-30 (1997 ed.)

(18) Perkins & Leonard, supra note17, at 27-28. Alternatively, for the traveler who is flexible about sailing dates and destinations, travel agents advertise last minute cruise bargains over the Internet, which can be even more economical. Elizabeth Armstrong, Clicking on Cruise Bargains, VACATIONS, Fall 1999, at 6.

(19) Another explanation for the cruise lines’ record profits lies in their rather minimal tax burden. The companies are registered as foreign corporations which sail foreign-flagged ships

(20) Paul Brinkley-Rogers, Cruise Ships Might Be Headed for Titanic Trouble, TIMES-PICAYUNE, Aug. 2, 1998, at A31.

(21) Cruise Ship Losses Insured, BUS. INS., Dec. 21,1998, at 2. Three years previously the Star Princess had run aground in Alaska. James V. Grimaldi, Improve Safety, Cruise Lines Told, SEATTLE TIMES, June 11, 1997, at B3. The infamous collision which occurred at the mouth of the Mississippi between the M/V Noordam of the Norwegian Cruise Lines and the freighter M/S Mount Ymitos gave rise to an interesting case for damages that provides much insight into pricing in the cruise industry. See Hal Antillen N.V. v. The M/S Mount Ymitos, No. 93-3714, 1998 U.S. Dist. LEXIS 2327 (E.D. La. Feb. 26, 1998).

(22) See David Adams, Cruise Ship Crime on the High Seas: Allegations of Rape Have Raised Concerns about Safety on Board Superliners, OTTAWA CITIZEN, Feb. 6, 1999, at A7

(23) While the Coast Guard and National Transportation Safety Board (NTSB) have limited regulatory jurisdiction in territorial waters, the United Nations’ International Maritime Organization (IMO) is the primary regulatory body which leaves enforcement of its safety standards to member countries. Gregg Fields, Cruise Ships Sail Away from U.S. Regulation, MIAMI HERALD, July 26, 1998. Reports in 1989 and 1993 by the NTSB indicated that major improvements were needed in the safety preparedness of passenger ships. Trish Power, Guard Gave Cruise Ship OK before Fire

(24) Carnival Cruise lines purports to guarantee consumer satisfaction by offering consumers a full refund if they are not satisfied with their cruise. The passenger, however, must notify the ship’s management before the first port, which is usually within 24 hours. Larry Fox & Barbara Radin Fox, When No Fun Means Refund, WASH. POST, May 26, 1996, at E4. While Carnival will fly the unsatisfied passenger back to the port of embarkation, there is no reimbursement for airfare, hotel expenses, or the transportation costs associated with arriving at the initial port. Id. So in effect, their “guarantee” is hollow unless the passenger happens to live in the port of embarkation.

(25) See Arline Bleecker, When a Dream Cruise Turns Nightmare–Resolving Disputes Is No Simple Matter under Maritime Law, SEATTLE TIMES, Oct. 11, 1998, at K6.

(26) See Richard Danielson, Toilets Spoil Fun on `Topicale’, ST. PETERSBURG TIMES, Oct. 22, 1999, at 1B

(27) In addition to giving consumers a right to sue individually, most deceptive trade practices acts vest enforcement authority in the state attorney general. In one case the Florida Attorney General filed suit against several cruise lines under the state deceptive and unfair trade practices act with respect to hidden port charges not reasonably communicated to passengers prior to sailing. The largest lines sailing from Florida (Carnival, Royal Caribbean, Norwegian,, Celebrity, Dolphin, and Majesty) collectively settled for $295,000, a sum reflective of the costs of the investigation. Mark Albright, Cruise Ads to Reflect True Port Charges, ST. PETERSBURG TIMES, Feb. 6, 1997, at 1E. In such regulatory cases the consumer receives no relief individually.

(28) Even in a multi-million dollar class action suit involving the alleged deceptive practice of assessing port fees, which in addition to government taxes impermissibly included non-tax operating expenses, the settlement came in the form of vouchers, or discount certificates for future travel on the cruise line. Christopher Reynolds, Coupon Settlements Offer Little Help to Consumers, L.A. TIMES, Mar. 12, 2000, at L2. While the class action strategy is available to consumers in litigation against cruise lines, it is only applicable if the complaints arise out of the same set of circumstances, but not if the deceptive practice affects only an individual, not a group. Of course, whether or not a suit is brought as a class action or individually, the issue of admiralty’s preemption will still need to be addressed. See infra notes 118-156 and accompanying text.

(29) While similar problems might be faced by personal injury claimants as well, this paper will focus on consumer complaints.

(30) U.S. CONST. art. III, [sections] 2. Because “admiralty” and “maritime” are almost synonymous, they will be used interchangeably in this article. The difference between them is that “admiralty” derives from the English law of the seas whereas “maritime” has a general connotation not limited to the law. GRANT GILMORE & CHARLES L. BLACK, JR., THE LAW OF ADMIRALTY [sections] 1-1, at 1 (2d ed. 1975). “Admiralty” has been defined as the “corpus of rules, concepts, and legal practices governing certain centrally important concerns of the business of carrying goods and passengers by water.” Id.

(31) 2 AM. JUR. 2D Admiralty [subsections] 120-21 (1994). For a historical perspective on the concurrent jurisdiction of state courts see DAVID W. ROBERTSON, ADMIRALTY AND FEDERALISM 18-28 (1970).

(32) 28 U.S.C. [sections] 1333 (1999). This section provides that “[t]he district courts shall have original jurisdiction, exclusive of the courts of the States, of … Ia]ny civil case of admiralty or maritime jurisdiction, saving to suitors in all cases all other remedies to which they are otherwise entitled.” Id. [sections] 1333(1). Thus, the “savings to suitors” clause preserves the plaintiffs right to a common law remedy.

(33) Melnik v. Cunard Line Ltd., 875 F. Supp. 103, 106 (N.D.N.Y. 1994) (citing Kermarec v. Compagnie Generale Transatlantique. 358 U.S. 625 (1959)). If an action is brought in state court under the saving to suitors clause, it is not removable to federal court unless independent grounds for federal court jurisdiction are present. David W. Robertson, Displacement of State Law by Federal Maritime Law, 26 J. MAR. L. & COM. 325, 334 n.48 (1995) (citing C. WRIGHT, LAW OF FEDERAL COURTS 228 (5th ed. 1994)).

(34) See The Moses Taylor, 71 U.S. (4 Wall) 411, 427 (1886)

(35) Milanovich v. Costa Crociere, S.P.A., 954 F.2d 763 (D.C. Cir. 1992)

(36) See Deck v. American Hawaii Cruises, Inc., No. 98-00002, 1999 U.S. Dist. LEXIS 5332 (D. Haw. Jan. 15, 1999)

(37) Ames v. Celebrity Cruises, Inc., No. 97-0065(LAP), 1998 U.S. Dist. LEXIS 11559 (S.D.N.Y. July 29, 1998).

(38) For example, Premier Cruises’ Big Red Boat had been associated for almost a decade with Warner Brothers’ Looney Tunes characters. That association ended at the end of October 1999, although the brochure advertised Looney Tunes characters as being on board cruises through April of 2000. Representatives of the cruise line asserted that some attempts were made to contact passengers who had scheduled their children for breakfasts or night time tuck-ins with the characters. Conversation with Bradley Gallant, Hotel Manager, Premier Cruises’ Big Red Boat, at sea (Mar. 3, 2000). However, other passengers were not notified of the disassociation prior to boarding, and, to their disappointment, were expecting to find the children’s entertainment on board.

(39) The issue of hidden costs represents an example of a potential consumer complaint concerning material omissions which looms on the horizon. As cruise lines are adding more amenities, some of them, which were once gratis, are not covered in the cost of the cruise. For example, while the new Voyager of the Seas boasts an ice skating rink, rock climbing facility, and golf course, participation in these activities costs extra money. Jayne Clark, Cruise Lines Tacking on More Fees-Even for Food, USA TODAY, Nov. 5, 1999, at 1D. Some cruise lines are also charging additional fees for alternative dining, or for gourmet treats such as Seattle’s Best Coffee or Haagen Dazs ice cream. Id. Passengers accustomed to the all-inclusive nature of cruising who are not notified of the additional costs for the advertised amenities are likely to feel deceived by marketing efforts.

(40) See Exxon Corp. v. Central Gulf Lines, Inc., 500 U.S. 603, 612 (1991) (holding that in determining whether an agency contract is within the realm of admiralty law courts should examine whether the services performed under the contract are maritime in nature)

(41) See infra notes 145-150 and accompanying text.

(42) Because most passenger tickets contain a merger clause, representations contained in brochures and advertising supplements would likely be excluded under the Parole Evidence Rule anyway. See Warren v. Ajax Navigation Corp., No. 91-0230, 1995 U.S. Dist. LEXIS 19535 (S.D. Fla. Feb. 3, 1995) (holding that no provisions contained in marketing brochure may be incorporated into the passenger contract).

(43) 2 AM. JUR. 2D Admiralty [subsections] 87-88 (1994).

(44) See, e.g., Pope & Talbot, Inc. v. Hawn, 346 U.S. 406, 409-10 (1963)

(45) See Executive Jet Aviation v. City of Cleveland, 409 U.S. 249 (1972)

(46) See Chan v. Adventurer Cruises, Inc., 123 F.3d 1287, 1292 (9th Cir. 1997) (applying maritime law when injuries were sustained during Zodiac transport from ship to shore and travel brochure characterized expedition stops as part of cruise)

(47) See Carnival Cruise Lines v. Goodin, 535 So.2d 98 (Ala. 1988).

(48) For example, the potential recovery for damages for emotional distress, mental suffering, or psychological injury recently was reduced by a federal law which permits cruise lines to insert a provision in a passenger’s contract disclaiming liability for such damages. 46 U.S.C. app. [section] 183c(b) (1999)

(49) The complaint in Wiedeman v. Cunard Line Ltd., 380 N.E.2d 932 (1978), concerned misrepresentations allegedly made in informational material sent by the cruise line regarding the safety and suitability for swimming of the beaches which would be visited during the cruise. The court, however, never reached the issue of whether the tortious act complained of occurred in Illinois because it determined that the misrepresentations, if made, were made only by the persons in St. Lucia who were not agents of Cunard. The tortious act, as a result, occurred in St. Lucia.

(50) The claim of an actionable misrepresentation is strengthened by the fact that consumers typically cannot independently verify the accuracy of the representations contained in the brochures until they have actually boarded the vessel. See Thomas J. Holdych, Standards for Establishing Deceptive Conduct under State Deceptive Trade Practices Statutes that Impose Punitive Remedies, 73 OR. L. REV. 235, 307-08 (1994).

(51) Most cruise lines have some sort of forfeiture schedule for canceled cruises. For example, the contract may provide that there is no penalty (or a minimal one) for cancellations made 60 days prior to departure

(52) For a discussion of state consumer remedies and their possible preemption by federal maritime law see infra notes 118-156 and accompanying text.

(53) In certain situations a passenger who booked the cruise through a travel agent may be able to proceed against the travel agent who owes a fiduciary duty to exercise reasonable care in arranging travel. See Grigsby v. O.K Travel, 693 N.E.2d 1142 (Ohio Ct. App. 1997) (holding that fiduciary duty was breached by travel agent who failed to make reasonable inquiries into the financial stability of tour promoter)

(54) 407 U.S. 1 (1972).

(55) Id. at 15.

(56) Id. at 19.

(57) 499 U.S. 585 (1991), rev’g 897 F.2d 377 (9th Cir. 1990).

(58) See, e.g., Patrick J. Borchers, Forum Selection Agreements in the Federal Courts after Carnival Cruise: A Proposal for Congressional Reform, 67 WASH. L. REV. 55 (1992) (stating that Court’s pronouncement holds the promise of turning forum selection agreements from instruments of freedom to instruments of economic oppression)

(59) Shute, 499 U.S. at 585.

(60) Id. at 594.

(61) Id. For an overview of the case see Paul S. Edelman, The Supreme Court and a Forum Selection Clause, N.Y. L.J., June 7, 1991, at 3.

(62) Shute, 499 U.S. at 586.

(63) Id. at 595-97 (interpreting 46 U.S.C. app. [sections] 183c). While the Act is designed to protect shipowners, Section 183c cuts the other way to a limited extent by invalidating contractual stipulations which attempt to limit liability for negligence resulting in loss of life or bodily injury, and which attempt to limit the claimant’s right to a trial by a court of competent jurisdiction. The same year Shute was decided, Congress amended the part of the statute which made it unlawful for a shipowner to lessen, weaken, or avoid the right of a claimant “to a trial by a court of competent jurisdiction” to read instead “any court of competent jurisdiction,” presumably in response to the Court’s opinion in Shute. Brian Mattis, Forum Selection Clauses in Florida, 6 ST. THOMAS L. REV. 247, 276 (1994). The next year, Congress restored the Act to its 1992 version, re-establishing the vitality of the Court’s interpretation in Shute. See Kalman v. Cunard Line, Ltd., 904 F. Supp. 1150, 1151 (D. Haw. 1995)

(64) Shute, 499 U.S. at 597-605 (Stevens, J., and Marshall, J., dissenting). To reveal the fine print contained in the contract, Justice Stevens attached it to his opinion.

(65) All 16 members of the International Committee of Passenger Lines which operate 81 vessels include forum selection clauses in their tickets. Jeffrey A. Liesemer, Note, Carnival’s Got the Fun … and the Forum: A New Look at Choice-of-Forum Clauses and the Unconscionability Doctrine after Carnival Cruise Lines, Inc. v. Shute, 53 U. PITT. L. REV. 1025, 1042 (1992) (citing Committee’s brief in Shute)

(66) Northwestern Nat’l Ins. Co. v. Donovan, 916 F.2d 372, 376 (7th Cir. 1990) (referencing the Ninth Circuit’s pro-plaintiff decision in Shute).

(67) Letter from John F. Billera, Senior Litigation Counsel Loss Prevention, Carnival Cruise Lines, Inc. 2 (Sept. 21, 1998) (on file with author).

(68) Damages for breach of the passenger contract would presumably include attorneys’ fees and costs for transferring the action to the appropriate forum. Id.

(69) See Walker v. Carnival Cruise Lines, 63 F. Supp. 2d 1083, 1087-88 (N.D. Cal. 1999)

(70) See Smith v. Doe, 991 F. Supp. 781, 783-84 (E.D. La. 1998), Gomez v. Royal Caribbean Cruise Lines, 964 F. Supp. 47, 50-51 (D.P.R. 1997), and cases cited therein. See also Kalman v. Cunard Line Ltd., 904 F. Supp. 1150, 1152 (D. Haw. 1995) (stating a factual dispute as to whether or not constructive notice received).

(71) Melnik v. Cunard Line Ltd., 875 F. Supp. 103, 107 (N.D.N.Y. 1994)

(72) 794 F. Supp. 1005 (D. Haw. 1992).

(73) Id. at 1011-12. The court held that it would be unreasonable to apply the forum selection clause because the passengers could not reject it without forfeiting the purchase price plus additional penalties. See id. at 1022

(74) See Hicks v. Carnival Cruise Lines, Inc., No. 93-5427, 1994 U.S. Dist. LEXIS 10194 (E.D. Pa. July 26, 1994) (asserting that standby passengers accept certain risks when they choose to travel in that manner and doubting that the Third Circuit would find enforcement of the forum selection clause to be unreasonable)

(75) See, e.g., Gomez v. Royal Caribbean Cruise Lines, 964 F. Supp. 47, 51-52 (D.P.R. 1997) (holding that travel from Puerto Rico to Miami to litigate is not overly burdensome because plaintiffs are frequent travelers)

(76) See Effron v. Sun Line Cruises, Inc., 67 F.3d 7, 10 (2d Cir. 1995) (enforcing clause which required litigation in Greece). Bat see White v. Sun Line Cruises, Inc., 999 F. Supp. 924 (S.D. Tex. 1998) (holding that to enforce clause which required litigation in Greece, coupled with the additional facts that the plaintiff received the ticket only three or four days prior to departure and would have forfeited the entire price if she canceled the contract, would be fundamentally unfair). Prior to Shute, the circuit courts in the Achille Lauro highjacking litigation split on whether or not forum selection clauses were enforceable when a foreign country was specified in the contract. Compare Hodes v. Achille Lauro, 858 F.2d 905, 916 (3d Cir. 1988), cert. dismissed, 490 U.S. 1001 (1989) (requiring plaintiffs to litigate in Italy) with Chasser v. Achille Lauro Lines, 844 F.2d 50 (2d Cir. 1988) (dismissing an appeal from an order denying application of the clause on the basis of inadequate notice).

(77) Rather than dismiss the case for lack of jurisdiction based upon the forum selection clause, federal courts enjoy transfer powers and may instead transfer the case to the jurisdiction specified in the contract. 28 U.S.C. [sections] 1406(a)(1999). State courts, on the other hand, may not enjoy transfer powers, in which case they would be forced to dismiss for lack of jurisdiction. Joseph E. Smith, ]Note, Civil Procedure-Forum Selection-N. C. Gen. Stat. 22B-3, N.C.L. REV. 1608, 1608 n.4 (1994).

(78) 28 U.S.C. [sections] 1404(a) (1999) provides that “for the convenience of the parties and witnesses, in the interest of justice, a district court may transfer any civil action to another district or division where it might have been brought.”

(79) See Walter W. Heiser, Forum Selection Clauses in Federal Courts: Limitations on Enforcement after Stewart and Carnival Cruise, 45 FLA. L. REV. 554, 573-74 (1993) (stating that plaintiffs could seek transfer back to initially chosen forum “in the interest of justice” by a 1404 transfer motion)

(80) Shute, 499 U.S. at 595.

(81) Id.

(82) See, e.g., Effron v. Sun Line Cruises, Inc., 67 F.3d 7, 10 (2d Cir. 1995)

(83) Shute, 499 U.S. at 595. The Court in The Bremen had also provided for the invalidation of forum selection clauses on such grounds. The Bremen, 407 U.S. at 15.

(84) But see Borchers, supra note 58, at 89-90 (arguing that in the context of arbitration agreements the Supreme Court requires fraud to be shown with respect to the forum agreement itself).

(85) Liesemer, supra note 66, at 1045 (comparing the facts of Yoder v. Heinhold Commodities, Inc., 630 F. Supp. 756 (E.D. Va. 1986), to those of Shute).

(86) Shute, 499 U.S. at 593.

(87) Id.

(88) The Bremen, 407 U.S. at 15.

(89) See Walter W. Heiser, Forum Selection Clauses in State Courts: Limitations on Enforcement after Stewart and Carnival Cruise, 45 FLA. L. REV. 361, 371-72 (1993)

(90) See MONT. CODE ANN. [subsections] 28-2-708 & 18-1-403 (1998) (providing that stipulations in contracts which restrict parties from enforcing contractual rights in the ordinary tribunals in which such an action may have been brought are void)

(91) See IDAHO CODE [sections] 29-110 (1998) (providing that “every stipulation or condition in a contract, by which any party thereto is restricted from enforcing his rights under the contract by the usual proceedings in the ordinary tribunals, or which limits the time within which he may thus enforce his rights, is void”).

(92) Section 22B of the North Carolina General Statutes declares that “any provision in a contract entered into in North Carolina that requires the prosecution of any action or the arbitration of any dispute that arises from the contract to be instituted or heard in another state is against public policy and is void and unenforceable.” N.C. GEN. STAT. [sections] 22B-3 (1999). The Act is not to apply to non-consumer loan transactions when an out-of-state forum is selected after the dispute arises. Id. An issue might arise in cruise contracts as to whether the contract was entered into in North Carolina, depending on the circumstances surrounding the purchase. For a discussion of the statute see Smith, supra note 77.

(93) Heiser, supra note 89, at 371

(94) Choice of law and state conflict of laws provisions will affect the applicability of such statutes or judicial decisions. See Smith, supra note 77, at 1613-14

(95) 487 U.S. 22 (1988).

(96) See supra note 78 for the text of the federal transfer statute.

(97) For a discussion of the case and its impact see Borchers, supra note 58, at 68-69

(98) See Purcell, supra note 58, at 485-69 (arguing that facts in Shute would be insufficient to give Florida personal jurisdiction over the plaintiffs).

(99) Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 811 (1985). Further, the Supreme Court has endorsed the traditional right of the plaintiff to choose the forum. See Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1947)

(100) See Borchers, supra note 58, at 78 (asserting that assuming a waiver of jurisdiction in Shute is inconsistent with the constitutional status of the right)

(101) See, e.g., Kulko v. California Superior Court, 436 U.S. 84, 85 (1978)

(102) See, e.g., Mulhern v. Holland-America Cruises, 393 F. Supp. 1298, 1302 (D.N.H. 1975) (holding that relationship with local travel agents who are independent contractors not sufficient for the exercise of in personam jurisdiction)

(103) See Wilkinson v. Carnival Cruise Lines, Inc., 654 F. Supp. 318, 321 (S.D. Tex. 1985)

(104) 46 U.S.C. app. [sections] 763a (1999).

(105) 46 U.S.C. app. [sections] 183b (1999).

(106) See, e.g., Jiminez v. Peninsular & Oriental Steam Navigation Co., 974 F.2d 221 (1st Cir. 1992)

(107) See Ames v. Celebrity Cruises, Inc., No. 97-0065, 1998 U.S. Dist. LEXIS 11559 (S.D.N.Y. July 29, 1998) (citing Shankles v. Costa Armatori, S.P.A., 722 F.2d 861, 863-67 (1st Cir. 1983)).

(108) See supra notes 36-42 and accompanying text.

(109) Ames v. Celebrity Cruises, Inc., No. 97-0065, 1998 U.S. Dist. LEXIS 11559 (S.D.N.Y. July 29, 1998), in part involved allegations of fraud and misrepresentation. The court granted the defendant’s motion for summary judgment because none of the claims were timely filed, and noted in dicta with respect to the three-month period for all other claims that “plaintiffs fail[ed] to produce any case law suggesting that a three-month limitation on non-personal-injury suits is void as a matter of law.” Id. at *22.

(110) No. 98-00002, 1999 U.S. Dist. LEXIS 3532 (D. Haw. Jan. 15, 1999).

(111) The complaint also alleged that the Americans with Disabilities Act (ADA) was applicable to the ship and was violated. The court ruled that some provisions of the ADA were indeed applicable to this particular ship. Id. at *9. The cruise ship, the S.S. Independence, is currently the only American-flagged cruise ship. Frantz, supra note 19, at A1. American-flagged ships are subject to U.S. laws, including a requirement that the ship’s hull be built domestically, which in effect acts as a deterrent to U.S. registration. Fields, supra note 23. Even though shipbuilding costs in the United States are twice those in Europe, and compliance with U.S. regulatory laws is expensive, plans were recently announced for the building and subsequent U.S. registration of two sister ships, the first in 40 years to be built in the states. Mississippi Shipyard to Build First Cruise Ship in Forty Years, CRUISE NEWS, May 1999, at 1 (on file with author).

(112) Deck, 1999 U.S. Dist. LEXIS 3532, at *14.

(113) Id. at *17.

(114) Id.

(115) Id. at *18.

(116) Id. at *21.

(117) Id. at *18 (citing Chan v. Society Expeditions, 123 F.3d 1287, 1292 (9th Cir. 1997). In Chan, the Ninth Circuit refused to enforce the limitations period because the plaintiffs would have been unable to file the verified complaint required under admiralty law for in rem jurisdiction within the contractually stipulated time period because the ship would not be physically within the court’s jurisdiction. Chan, 123 F.3d at 1294.

(118) For a general discussion of such legislation, see Marshall A. Leaffer & Michael H. Lipson, Consumer Actions against Unfair or Deceptive Acts or Practices: The Private Uses of FTC Jurisprudence, 48 GEO. WASH. L. REV. 521 (1980)

(119) 15 U.S.C. [sections] 45(a)(1) (1999). The federal act prohibits “unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce.” Id.

(120) The federal act is regulatory with enforcement powers vested exclusively in the Federal Trade Commission. Fulton v. Hecht, 580 F.2d 1243, 1258 (5th Cir. 1978), cert. denied, 440 U.S. 981 (1979)

(121) Debra D. Burke, The Learned Profession Exemption of the North Carolina Deceptive Trade Practices Act: The Wrong Bright Line?, 15 CAMPBELL L. REV. 223, 225 & nn.5, 6 (1993) (citing state statutes).

(122) Proof of deception or unfairness requires neither a finding of fraud nor scienter, but rather a finding of a practice which is likely to mislead the reasonable consumer. Moldavan, supra note 118, at 553-62. Fraud, on the other hand, typically requires proof of the misrepresentation of a material fact, some element of scienter or fault, and justifiable reliance. See Warren v. Ajax Navigation Corp., 1995 U.S. Dist. LEXIS 19535, at *19-21 (S.D. Fla. Feb. 3, 1995).

(123) Debra D. Burke & Max Bishop, A Survey of the Potential Liability of Accountants under State Deceptive Trade Practices Acts, 23 MEMPHIS ST. L. REV. 805, 807-12 (1993) (citing specific statutory provisions for remedies under state legislation).

(124) See generally 2 AM. JUR. 2D Admiralty [subsections] 142-45 (1994)

(125) See American Dredging Co. v. Miller, 510 U.S. 443 (1994) (asserting that federal forum non conveniens law does not preempt state law in state court because it is procedural not substantive). The distinction between procedural and substantive law is not always easily determined. See Robertson, supra note 33

(126) Yamaha Motor Corp. v. Calhoun, 516 U.S. 199, 206 (1996) (citing Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., 513 U.S. 527, 545 (1995)).

(127) See Nadeau v. Carnival Cruise Lines, Inc., 634 So.2d 649, 652-53 (Fla. Ct. App. 1994) (noting that because admiralty courts are split on the issue of whether independent negligence by the shipowner is required to impose liability for an intentional assault by a crew member, the court is free to apply state law).

(128) Southern Pac. Co. v. Jensen, 244 U.S. 205, 216 (1917) (applying admiralty law, not state workers’ compensation statutes, to case involving non-seaman who was killed while acting as a stevedore on a gangplank between the ship and shore, because accident occurred over navigable waters)

(129) 50 F.3d 360 (5th Cir. 1995).

(130) Id. at 366.

(131) Id. at 366-67. For a discussion of the case see Harold K. Watson, Survey: Admiralty Law, 27 TEX. TECH L. REV. 485, 489 (1996).

(132) See Askew v. American Waterways Operators, Inc. 411 U.S. 325 (1973), rev’g 335 F. Supp. 1241 (M.D. Fla. 1971) (holding that state oil spill prevention and pollution control act is not preempted by federal Water Quality Improvement Act or the nonexclusive Admiralty Extension Act). The issue of whether federal statutory law preempts state DTPAs has arisen in a variety of non-admiralty contexts as well. See, e.g., American Airlines, Inc. v. Wolens, 513 U.S. 219 (1995) (holding that Airline Deregulation Act of 1978 preempts Illinois DTPA with respect to changes in frequent flyer program)

(133) See, e.g., Sun Ship, Inc. v. Pennsylvania, 447 U.S. 715 (1980) (stating that neither legislative history nor language of 1972 amendments to the LHWCA suggests Congress intended to preempt totally state workers’ compensation remedies for land-based injuries that fall within coverage of the federal law)

(134) See supra note 110 and accompanying text.

(135) The application of federal common law in admiralty cases is often referred to as the “reverse-Erie” doctrine. See ROBERTSON, supra note 31, at 188-95

(136) See, e.g., Dillon v. Admiral Cruises, Inc., 960 F.2d 743 (8th Cir. 1992) (holding that plaintiffs estoppel argument is governed by general maritime common law)

(137) Wilburn Boat Co. v. Fireman’s Ins. Co., 348 U.S. 310, 314 (1954) (“States can no more override such judicial rules validly fashioned than they can override Acts of Congress.”). This conclusion is now questionable. In the past three decades, Supreme Court maritime federalism decisions have validated state law. See Rebertson, supra note 125, at 89-97 (table of decisions).

(138) For a discussion of the application of state law in particular contexts see generally 2 AM. JUR. 2D Admiralty [sections] 141 (1994)

(139) See Robertson, supra note 125, at 99

(140) See Burke & Bishop, supra note 123, at 811-12 (discussing range of remedies available under state DTPAs).

(141) See Ed Bluestein, Jr., Products Liability in Admiralty: Damages in Maritime Products Liability Cases, 62 TUL. L. REV. 511, 547 (1988) (stating that objective of uniformity will not be served if state-by-state statutory penalties attach in admiralty cases).

(142) While cases may be brought alleging DTPA violations, they can fall prey to short contractual limitation periods before ever being decided on their merits. See O’Connell v. Paquet Cruises, Inc., No. 88-1481-MC, 1989 U.S. Dist. LEXIS 8374 (D. Mass. July 7, 1989) (precluding decision on whether cruise line violated state DTPA for misrepresentations allegedly made because contractual time limitations period expired). Another impediment to successful consumer litigation is the cost involved in litigating in a distant forum when damages are not likely to be substantial. Notwithstanding this consideration, the plaintiffs in Vallery v. Bermuda Star Line, 532 N.Y.S.2d 965 (Civ. Ct. 1988), traveled from Ohio to New York to litigate successfully pro se against the cruise line whose brochures had deceptively represented the qualities and characteristics of its staterooms and child care facilities under New York’s Deceptive Trade Practices Act. The issue, however, of whether or not admiralty law conflicted with or preempted the state’s DTPA was neither raised nor addressed.

(143) 813 F. Supp. 414 (E.D.N.C. 1993)

(144) Id. at 417.

(145) Id. (citing Muratore v. M/S Scotia Prince, 845 F.2d 347, 354 (1st Cir. 1988)).

(146) Id.

(147) Id.

(148) 994 F.2d 37 (1st Cir. 1993).

(149) Id. at 41.

(150) David W. Robertson, Court-Awarded Attorneys’ Fees in Maritime Cases: The “American Rule” in Admiralty, 27 J. MAR. L. & COM. 507, 567 (1996).

(151) In another commercial application of the DTPA to a ship repair contract, the Fifth Circuit held that to apply the state act to void a red letter clause would impermissibly conflict with maritime law. Coastal Iron Works, Inc. v. Petty Ray Geophysical, 783 F.2d 577 (5th Cir. 1986).

(152) See Wilburn Boat Co. v. Fireman’s Fund Ins. Co., 348 U.S. 310 (1955). Wilburn involved a question concerning the warranties in a maritime insurance policy. The Court held that the policy was a maritime contract governed by admiralty law. However, the Court recognized that no judicially created rules existed in maritime law which would apply to the dispute. Congressional statutes did not regulate marine insurance contracts, and the exercise of regulatory power by the states in the area of insurance was broad. Given these considerations, the Court declined to establish a federal admiralty rule governing warranties and allowed state law to govern, even though the case involved a maritime contract. Id. at 316-21. The reasoning of Wilburn Boat seems to permit the application of state DTPAs in maritime law.

(153) 794 F.2d 941 (5th Cir. 1986).

(154) Id. at 948-50.

(155) 664 F. Supp. 256 (S.D. Tex. 1987).

(156) Id. at 258. In the case, however, an award of attorneys’ fees under the DTPA was not available because there was no judgment for actual damages as required by the Act.

(157) See supra notes 46-52 and accompanying text.

(158) See supra notes 83-100 and accompanying text.

(159) See supra notes 135-156 and accompanying text.

DEBRA D. BURKE, Professor of Business Administration & Law, Western Carolina University. The author wishes to thank Professor David W. Robertson of the University of Texas School of Law for his valuable input and insightful comments in the preparation of this article for publication.