Coast Guard Faces Suit Over Damages to Ship

(CN) - The 9th Circuit on Thursday revived a lawsuit brought by the crew of an Ecuadorian fishing boat, which the U.S. Coast Guard boarded and seized near the Galapagos Islands for suspected drug smuggling.

The Coast Guard towed the boat to Ecuador for an intensive search but found no drugs and filed no charges. Investigators damaged the boat and its cargo in the process, and its 26 crew members sued the United States in California District Court, seeking more than $5 million in damages.

The incident occurred in 2005.

U.S. District Judge William Hayes of San Diego dismissed the crew's complaint, finding that the United States had not waived its sovereign immunity from suit.

The three-judge federal appeals panel in Pasadena vacated that ruling with a broad reading of the Public Vessels Act (PVA), which waives sovereign immunity in lawsuits for "damages caused by a public vessel of the United States," according to the ruling.

The panel found that the crew's allegations had met two of the criteria for a waiver of immunity under the PVA - that the incident disrupted maritime activity and involved a public vessel. Whether the complaint meets the third criterion for bringing suit - reciprocity - remains in question, and it is a question that the District Court must answer, according to the panel.

To establish the reciprocity requirement in this case, the crew had to show that a similar action could be filed in Ecuador by a U.S. national.

The District Court ruled that the plaintiffs had failed to do so in their filings.

There is some question, however, as to whether the plaintiffs must explain the laws of Ecuador to the District Court, which is allowed a certain amount of discretion to study Ecuadorian law itself, according to the panel.

"Whether reciprocity exists under Ecuadorian law remains undetermined," Judge Susan Graber wrote for the panel. "Notably, the attorney for the United States asserted at oral argument that he did not know whether such reciprocity exists. In these circumstances, we find it appropriate to give the parties and the court an additional opportunity to determine this threshold question. On remand, the court may instruct the parties to provide additional evidence, through testimony or other means; the court may conduct its own research; and the court may undertake any other inquiry ... to determine whether reciprocity exists under Ecuadorian law."

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