Bloomberg News

Carnival Sued for $100 Million Over Costa Concordia Disaster

February 07, 2012

(Updates with damages demand in first paragraph.)

Jan. 27 (Bloomberg) -- Carnival Corp., the world’s largest cruise-line owner, was sued for at least $100 million over the wreck of the Costa Concordia near Italy’s coast, which killed at least 16 people and left the vessel half submerged on its side.

The complaint, alleging negligence and breach of contract, was filed yesterday in federal court in Chicago by Gary Lobaton, a member of the Costa Concordia crew who seeks class-action status to represent all victims of the Jan. 13 disaster off Giglio Island. Captain Francesco Schettino has been accused of causing the accident by steering too close to shore and then abandoning ship as it sank.

“The defendants failed to properly and timely notify all plaintiffs on board of the deadly and dangerous condition of the cruise ship as to avoid injury and death,” Lobaton said in the complaint. The passengers and crew “were abandoned by the captain.”

The Costa Concordia, carrying about 3,200 passengers and 1,000 crew for a Mediterranean cruise, ran aground after it struck submerged rocks near the island in the Tyrrhenian Sea. Survivors, some of whom had to swim to shore, spoke of panic as the six-year-old ship began listing. There are still 16 people missing, according to the complaint.

The lawsuit, which also names Miami-based Carnival’s Costa Crociere unit in Italy, seeks damages for alleged violation of the Athens Convention for safely carrying passengers at sea, breach of contract, negligence and unjust enrichment.

Punitive Damages

Extra punitive damages being sought in the case “will dramatically increase the recovery on behalf of our clients,” Lobaton’s lawyer, Monica Kelly, said in an e-mail. Such damages usually triple the amount awarded in court, she said. She said she will seek at least $100 million in damages.

A message left with Carnival’s press office wasn’t immediately returned before office hours. A Costa spokesman declined to immediately comment.

Costa said today that it reached agreements with consumer groups in several countries to pay damages to passengers. One group preparing a class action advised its clients not to accept the offer of about 11,000 euros ($14,452) each, while another group said most passengers would agree to it.

The amounts being offered are “a joke,” said Kelly, of Ribbeck Law Chartered in Chicago. “If you are running for your life and you see people left behind in the ship, how do you think you would feel? They have been damaged for life.”

Hours after the vessel left a port near Rome, Schettino deviated from the planned route and steered close to the island, according to Italian investigators. Carnival has suspended advertising the cruise line.

‘Present a Spectacle’

Schettino claims the company pressured him to sail close to the island “to present a spectacle” to passengers and generate good publicity “in the increasingly competitive cruise ship business,” according to the complaint.

Costa suspended Schettino, who was placed under house arrest on Jan. 17 for allegedly causing the shipwreck.

Schettino “breached his duty as the master of his vessel and abandoned his ship in the first available opportunity he had,” Lobaton said in the complaint. Based on a recording of a phone conversation between the captain and the port authority, Schettino was ordered by the coast guard to return to the stricken ship after claiming the evacuation was almost complete, “when it had scarcely begun,” Lobaton said.

The cruise company failed to carry out safety drills to prepare passengers for an accident and didn’t notify them of the danger to the ship after water began flooding the engine room, according to the complaint.

The defendants “were on notice of the existent danger and failed to evacuate plaintiffs upon impact,” the crewman said. The ship’s staff “had a duty to provide true and accurate information to the plaintiffs to prevent undue risks.”

The case is Lobaton v. Carnival Corp., 12-cv-598, United States District Court, Northern District of Illinois (Chicago).

--With assistance from Marco Bertacche in Milan. Editors: Anthony Aarons, Stephen Farr

To contact the reporters on this story: Erik Larson in London at elarson4@bloomberg.net; Sophia Pearson in Philadelphia at spearson3@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net


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