U.S. loses Jones Act case

A federal court in Virginia has handed the Shipbuilders Council of America its second victory this year in cases it brought against the US Coast Guard for allowing major work on Jones Act ships to be done at foreign shipyards.

Matthew Paxton, SCA president, said that District Judge T.S. Ellis of the U.S. District Court for the Eastern District of Virginia had issued an order in favour of the organization, which had sued over the conversion of a Matson container ship to a combination container-car carrier vessel at a yard in China.

The SCA argued that the USCG had failed to enforce its regulations governing the rebuilding of Jones Act ships at foreign facilities. The agency also had incorrectly calculated the steel weight involved in the conversion, and had allowed Matson to have a small portion of the work completed in the U.S. as a pretext for compliance with the law.

Paxton said the judge’s opinion is expected next week. In April, a different judge in the same district ruled that the USCG had incorrectly allowed a U.S. tanker to be double-hulled at a foreign yard.