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Carnival ships will need court approval 60 days before restarting cruises, judge says

By Taylor Dolven, Miami Herald on

Published in Business News

MIAMI - A federal judge said she plans to require Carnival Corp. to certify that each of its cruise ships is compliant with its probation obligations 60 days before those ships reenter U.S. waters to restart cruises.

The forthcoming order from U.S. District Judge for the Southern District of Florida Patricia Seitz could inhibit the company's plans to resume cruise operations in the United States on Dec. 1. Seitz made the announcement at a status conference Friday in the company's ongoing criminal case for environmental crimes.

Seitz said the order will require ships to notify her 60 days in advance of reentering U.S. waters, and each ship will need a certification from CEO Arnold Donald regarding its environmental compliance status.

"I will determine whether the level of compliance ... whether it is appropriate that that ship enter and operate in U.S. waters," she said.

Carnival has been on probation since April 2017 after pleading guilty to environmental crimes - dumping oily waste into the ocean for a period of eight years from its Princes Cruises ships - and paying a $40 million fine. In June 2019, the company pleaded guilty again to violating probation, paid a $20 million fine and agreed to more strict oversight during its remaining years on probation. Throughout its probation, the company has continued to violate environmental laws.

Cruise companies shut down operations in mid-March amid COVID-19 outbreaks on several ships. Late last month, the U.S. Centers for Disease Control and Prevention extended its "no-sail" order through Oct. 31.

 

At the start of Friday's hearing, Seitz said she would sign her order requiring the 60-day notice that evening. Carnival lawyers David Kelly and David Markus begged her to reconsider. Kelly claimed her announcement had already hurt the company financially during the hearing. Markus said the order was "not justified."

"The market has already reacted to this," Kelly said. "This could have a huge negative impact on the company."

Carnival Corp. shares closed up 0.43% Friday at $14.08 and remained relatively flat in immediate after-hours trading.

Carnival pulled all of its ships out of U.S. waters in June right before the CDC began to publish COVID-19 infection levels on cruise ships. Carnival has not been required to report illnesses or submit its ships to inspection by the U.S. Coast Guard since then.

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