U.S. Coast Guard Has Statutory Authority to Ban a Vessel Contingent Upon Successful Implementation of an Environmental Compliance Plan

Types : Alerts

In May 2010, the U.S. Coast Guard revoked the Wilmina’s certificate of compliance and banned the Wilmina from reentering any U.S. waters for three years, or until it developed an environmental compliance plan (“ECP”) and successfully completed a year of audits.  This revocation was based on a finding that the Wilmina bypassed its oily water separator (“OWS”) and dumped oily bilge water directly overboard, in violation of the International Convention to Prevent Pollution from Ships (“MARPOL”) and the Act to Prevent Pollution from Ships (“APPS”).After the Coast Guard issued its order, Wilmina Shipping brought an action before the United States District Court for the District of Columbia to challenge the Coast Guard’s statutory authority to issue the ban or to require an ECP with audits.  In their claim, Wilmina Shipping alleged violations of the Administrative Procedure Act (“APA”), the Ports and Waterways Safety Act (“PWSA”), and the U.S. Constitution.  The District Court issued two decisions in the matter.

In its first decision in Wilmina Shipping AS v. U.S. Dep’t of Homeland Sec., dated March 27, 2013, the District of Columbia held that the U.S. Coast Guard does not have the statutory authority to ban a vessel for a period of time without providing a method of reinstatement, but the Coast Guard does have the statutory authority to ban a vessel until it implements an ECP and successfully complies with the ECP for a reasonable time period.

Subsequently, in a cross-motion for summary judgment on the merits, Wilmina Shipping argued that the District Court should have invalidated the entire Coast Guard order because it was not severable, the agency violated its own policies, and the evidence did not support the order.

In its second decision, dated December 2, 2014, the District Court further held that the APA allows courts to sever agency orders and uphold one portion while striking another so long as the upheld portion is able to operate independently and maintain the order’s designed purpose. The District Court also held that banning a vessel until it successfully implements an ECP without first obtaining a criminal conviction is permissible under the PWSA because under the PWSA the Coast Guard is authorized to require a ship to satisfy certain requirements before entrance is permitted into U.S. waters and that authority is beyond the criminal penalties of PWSA.  Additionally, the District Court found that the ban does not violate the policies and procedures of the agency because Coast Guard’s policies give it broad discretion to implement “a variety” of control actions to regulate the safety of U.S. waters. Finally, the District Court found that lack of precedence does not render the order invalid because agencies are able to change policies so long as there are good reasons for the change.