January 17, 2025 • 23 mins
Topic of the Week (1/17/25):
Let's talk about a few things I'm watching for 2025
⚓ The Maritime Professor® presents By Land and By Sea Podcast 🎙️ - an attorney breaking down the week in supply chain
with Lauren Beagen (Founder of The Maritime Professor® and Squall Strategies®)
Let's dive in...
1 - Federal Maritime Commission - Petition Updates (Motion to Dismiss to be addressed)
2 - United States Trade Representative releases Sec 301 report findings - "USTR Finds That China’s Targeting the Maritime, Logistics, and Shipbuilding Sectors for Dominance Is Actionable Under Section 301"
https://ustr.gov/about-us/policy-offices/press-office/press-releases/2025/january/ustr-finds-chinas-targeting-maritime-logistics-and-shipbuilding-sectors-dominance-actionable-under
https://ustr.gov/sites/default/files/enforcement/301Investigations/USTRReportChinaTargetingMaritime.pdf
https://ustr.gov/sites/default/files/enforcement/301Investigations/FRNActionabilityChinaTargetingMaritime.pdf
3 - Sean Duffy's Confirmation Hearings this week - what we know about his credentials for Secretary of Transportation
-------------------------------
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Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:26):
no-transcript Catwalk to the beat when you see me
coming Nixon Room.
Everywhere I go, I'm in thespotlight.
This is a good life I'm living.
Bold.
This is what it looks like Onthe tips of the world.
(00:49):
The port strike is over, thankgoodness, so now we can
officially start 2025.
Is that right?
So today let's go through a fewof the things that I'm watching
in 2025.
Hi, welcome, by land and by sea,an attorney breaking down the
(01:10):
weekend supply chain presentedby Maritime Professor Me.
I'm Lauren Began, founder ofMaritime Professor and Squall
Strategies, and I'm yourfavorite maritime attorney.
Join me every week to walkthrough both ocean transport and
surface transport topics in thewild world of supply chain.
As always, the guidance here isgeneral and for educational
purposes only.
It should not be consideredlegal advice and there is no
(01:32):
attorney client privilegecreated by this video or this
podcast.
If you need an attorney,contact an attorney.
So before we go into thediscussion of the day, let's go
through my top three stories ofthe week.
All right, story number onethere are no new updates to any
of the rules that have come outof the FMC.
(01:53):
We are watching to see whathappens with the petition.
We're going to talk about thatin just a minute.
But no new updates in therulemaking area.
No new updates.
No new rules have been putforward.
There are a few updates on thepetitions, so let's kind of go
over where we are, which twopetitions that we're looking at
Right.
So we have the the FMC releasedtheir rule on billing practices
(02:15):
of detention to merge, so thatpetition came out right about a
month, a month and a half rightbefore that rule became final at
the end of May, about a month,a month and a half right before
that rule became final at theend of May.
So this started April 18th.
There's been, as we've beentalking about, a lot of kind of
procedural things going back andforth.
The real crux of what thisultimately will likely
(02:36):
potentially go over is kind ofthat direct contractual
relationship for motor carriersand the removal of them from the
ability of the billing party,as it's indicated in the rule,
to bill a motor carrier becausethey would not be a directly
contractual, a directcontractual relationship, as the
(02:57):
FMC has indicated.
The argument from the WorldShipping Council is that there
is a direct contractualrelationship, sometimes with
motor carriers, with truckers,and in those instances the FMC
is still saying that doesn'tcount under their direct
contractual relationship rule,where they really are kind of
moving more toward directcontractual relationship as it
(03:19):
relates to either shippers orconsignees and they say not both
, either one or the other.
So we've talked about thedetention to merge rule quite a
bit here.
Go back and take a look at oneof those past episodes.
I think we actually did a fewepisodes breaking it down.
But we had an interestingdevelopment in December where a
few trucking associations gotinvolved, wrote an amicus curia
(03:42):
brief and basically said we havesome thoughts on this as well,
but we do have some updates.
This week the World ShippingCouncil filed their reply brief,
so a longer form argument cameback from the World Shipping
Council this week and I'm notgoing to go too far into detail
here.
I'm still kind of digesting thewhole thing.
It only came out a few days ago.
(04:03):
But I just want to quote partof their opening which I think
is kind of it's a well-writtensummary of their position and
what they they are presenting astheir argument in this petition
.
So again, the World ShippingCouncil brought this petition in
the US Court of Appeals for theDC Circuit against the Federal
Maritime Commission against thisfinal rule, this detention to
(04:26):
merge billing practices rule.
They've been going back andforth but there's a motion to
dismiss.
Well, excuse me, I'm confusingit with the next one.
There is a back and forth,procedural back and forth here
where they're trying to decideif this is, if the if FMC has
standing, if the World ShippingCouncil is standing.
(04:47):
It kind of goes back to thelegalese of it all.
They haven't quite gotten intothe crux of the matter, but I
thought this was a well-writtensummary in the intro of the
reply brief.
So the World Shipping Councilsays the commission's responses
fail to persuade and arerevealing of one of the final
rule's key flaws, pointing tothe detention and demurrage
final rule.
They say the commission'sstated purpose does not match
(05:08):
the policy that the commissionultimately chose to adopt.
The FMC repeatedly emphasizesthat it intended to limit
demurrage and detention invoicesto only the parties that
negotiated the relevantcontracts.
As these parties quote wouldlikely have greater knowledge,
quoting as the FMC on part ofthe justification, and then the
(05:28):
World Shipping Council continuesand would be better able to
evaluate and dispute any charges.
But the final rule prohibitsbilling motor carriers even when
those motor carriers havecontractual relationships with
the Ocean Common Carrier and arethus the best position party to
receive the invoice under theFMC's own reasoning.
This fundamental mismatchbetween reasoning and result
(05:49):
renders the commission's actionboth outside of its statutory
authority and arbitrary andcapricious.
The final rule should bevacated.
So that's, I mean, a prettygood summary.
They certainly go into moredepth and kind of more
development of their arguments,but kind of a nice distillation
in this intro of what the WorldShipping Council is trying to
prove here.
They're trying to say look, therule is a little bit
(06:11):
inconsistent or mismatched tothe application.
And further they're saying thatthe FMC went too far and is
reaching outside of itsstatutory authority and because
of that this is like this israndom, arbitrary and capricious
.
This is just random that theFMC is doing this in a way that
isn't well supported by theCongress telling them to do it.
(06:33):
That's kind of the distillationof the argument here in this
intro.
You know the stated purpose notmatching the policy that the
commission chose to adopt.
I think that this argument, asthe FMC, has stepped into the
spotlight.
I think this critique has risen.
I've seen more and more people.
I've seen a lot of peoplesupporting the FMC and where
(06:55):
it's going with its delivery orits enjoyment of its statutory
authority.
But it's clear to see that theFMC has gotten a lot more active
in the past few years as well,right?
So I think, as it's gainedattention and as it's stepped
into the spotlight that it founditself in after those 2021,
(07:17):
2022 congestion years, I thinkthat we've also seen a critique
of are they being too active Ingeneral?
Right, an active commissionwill often find itself.
The critique of are they beingtoo active In general?
Right, an active commissionwill often find itself.
The critique of mission creep isusually what it is, mission
creep being it's you're kind ofcreeping outside of the mission
that you've been given.
And, as we remember, right,congress gives these agencies
(07:39):
their authority.
The FMC has the authoritythrough the Shipping Act and a
few others, but the Shipping Actis kind of the main authority
and main jurisdiction for theFMC to enjoy its regulatory
authority here.
And, you know, I think aresponsible commission also does
a little bit of checks andbalances within itself against
its statutory purposes andauthorities, and I think that we
(08:02):
might see that in the change ofadministration and a following
change of chairmanship.
I think that Chairman Dan Maffeidid a fantastic job of really
trying to provide availablevenue for a large portion of the
shipping community and not justshippers, but a large portion
(08:23):
of the shipping community thatwasn't quite sure what to do
when they all of a sudden hadall of these giant charges.
They weren't exactly sure whatto do.
And I think that the FMCstepped into that spotlight well
, in that they provided a lot ofopportunities for piecemeal and
bite-sized opportunities fordispute resolution instead of
(08:44):
just going to the big bang of abig lawsuit.
So I think that that was great.
But in that right it became amore active commission because
there were more filings with thecommission and therefore the
commission had to make moredecisions and kind of all of
that snowballed together.
And so now I think we're at thismoment of the FMC is going to
have to start looking okay, well, what are we getting right?
(09:07):
What aren't we getting right?
Are we staying within ourmission?
Are we not?
And I think that this petitionis going to force that
conversation.
And again, remember, this is apetition against the detention
and demurrage billing practices,but it sounds like it's kind of
being looped into a largerconversation of this active
agency, statutory authority and,like I said, as we move into
(09:30):
the next administration.
We know from Trumpadministration one they prefer
limited government.
I've mentioned this a few timesthat for every one rule that
was brought out of any agency towere required to be repealed.
So, all that to say, I thinkwe'll see that, if not more,
with Trump administration numbertwo, maybe pulling back or
(09:57):
being a little bit moreconservative in their
interpretation, although youknow the FMC, I feel like the
FMC does a good job of stayingwithin its jurisdiction, but
there are some gray areas thatjust need to be determined and I
don't think that they're onlygoing to be determined by the
FMC.
I think this petition is goingto be a good opportunity for
that conversation of where thoselimits are.
I think we're also going to seethat conversation on, perhaps,
(10:19):
chassis and intermodal rail andthrough bills of lading and all
of those different areas of well, who's in charge of some of the
rail storage, demurrage perdiem, those types of things.
I think that we're going to seethat over the next few years
and with a limited lens of alimited government.
I think that's going to be aninteresting conversation to have
(10:40):
and probably an appropriatetime to be having those
conversations, and this happensall the time, right Every few
years, every five to 10, thisprobably is just part of any
agency's process, right, thatthey get challenged on their
mission creep or they getchallenged on where they're
going and their interpretationof their statutory authority,
(11:01):
which I think those are normal,healthy kind of housekeeping
type things to do.
So I'll keep watching it.
I'll let you know what I see.
But interesting, right?
The other petition that we'rewatching is the unreasonable
refusal to negotiate withrespect to health and face
accommodations.
This is where I got a littleahead of myself.
There is a motion to dismiss onthis one.
So what we saw this week Ithink it was just yesterday or
(11:23):
the day before from the court wesaw a procurium order that the
motion to dismiss should beaddressed and not necessarily by
incorporation by reference ofthe party saying look, we
already talked about this, thisis why it shouldn't be a motion,
this is why it should bedismissed, or vice versa, this
is why it shouldn't.
The court's saying look, youneed to address this directly
with its own briefing schedule,meaning like their own arguments
(11:49):
turned in.
So what that means is that thisargument made by the FMC the
FMC is the one who presentedthis motion to dismiss of the
World Shipping Council nothaving standing.
The FMC's argument is basicallylike the carrier should have
been bringing this collectivelyand not the World Shipping
Council on behalf of thecarriers Because, again, this is
unreasonable refusal to deal ornegotiate with respect to
vessel space accommodations.
This is defining unreasonablerefusal to deal or negotiate.
(12:09):
That's the question.
Motion to dismiss Should ithave been the World Shipping
Council or should it have beensome of these carriers
individually?
We're going to see that play out.
I think this is going to be aninteresting motion to dismiss to
see because this argument isalso being raised in the
detention to merge petition.
So I think this might haveknock-on effects to other
(12:30):
petitions that are out there andso we're going to see that play
out in various arguments to seeif this case gets thrown out
before it even gets started andthat's kind of what we're
talking about here.
A motion to dismiss meansdismiss the whole thing or
dismiss parts of it before youeven get to really into like the
meat of what's going on here.
Hopefully, I mean on all ofthese, I hope that we get to the
(12:51):
content, the subject matter ofkind of the argument at issue
and that's not to dismiss.
A motion to dismiss sayingshouldn't be properly heard.
But I'm interested to see thisone particularly unreasonable
refusal to negotiate.
I'm interested to have itchallenged in thought because
I'd like to just make surethere's a few parts that I have
(13:12):
questions on that.
I just want to make sure thatthey're on the right track.
So I think that this will be areally interesting one to watch.
Story number two we're movingright along.
It's 13 minutes in and we'reonly in story number one.
So story number two the USTR,the United States Trade Rep,
released a post this week orjust yesterday, actually about
24 hours ago, where they saidpress release saying USTR finds
(13:34):
that China's targeting themaritime logistics and
shipbuilding sectors fordominance is actionable under
Section 301.
So this is a petition broughtby United Steel, paper, forestry
, rubber Manufacturing, energy,allied Industrial and Service
Workers, International Union,the International Association of
Machinists and AerospaceWorkers, international
(13:55):
Brotherhood of Boilermakers,iron Shipbuilders, blacksmiths,
foragers, helpers, theInternational Brotherhood of
Boilermakers, iron Shipbuilders,blacksmiths, foragers, helpers,
the International Brotherhoodof Electrical Workers and the
Maritime Trades Department ofthe AFL-CIO.
So this one was interesting.
We've talked about this before.
There were two Section 301s thathave kind of come into the
spotlight.
One was the China Trade Tariffs.
That's not this.
(14:15):
And then there was this one.
This one was talking about thePeople's Republic of China
targeting maritime logistics andshipbuilding sectors for
dominance.
Concluding that the PRC this iswhat the announcement said
concluding that PRC Chinatargeted dominance in these
sectors is unreasonable andburdens or restricts US commerce
and is therefore actionableunder Section 301.
(14:38):
I think you should go take alook at this.
There is a very comprehensivereport it's over 100 pages, it's
almost 200 pages, I think wherethey talk about everything that
they've looked at since thispetition began in April, just
April of this year.
So this was all started under aBiden administration.
But I mean, I can't imaginethat this.
It doesn't come out with theremedies, so I think that this
(15:02):
just provides a study and ajustification for, yes, we found
that it was unfair.
We found that China's tacticsessentially China's tactics are
unfair and burdensome and areviolative, basically, of Section
301 of the Trade Act of 1974.
(15:25):
So what this means is that wemight see a Trump administration
walk through this door, becausewhat's happened is the door has
been unlocked for a Section 301with justification, saying that
anything related to themaritime shipbuilding or any of
the things that they list, yeah,china's in the wrong here.
(15:56):
How can I say this Proceedingdetermination that needs to be
taken to try to correct ornegate or make even the playing
field anything in thisunreasonable or discriminatory
or burdening or restricting ofthe US commerce, and that might
be tariffs again.
This might be anotherjustification for tariffs.
We'll see, we'll see.
(16:17):
This one will be interesting.
This just came out yesterday.
I'm still sorting through thedocument but I think this one's
going to be interesting to watch.
All right.
Story number three Sean Duffy.
Have you heard of him?
He has been nominated for theDepartment of Transportation
Secretary of the Department ofTransportation, secdot.
He doesn't have a lot oftransportation experience, but I
(16:37):
did read somewhere and Ihaven't been able to confirm
this but I did read somewherethat he does have his commercial
driver's license, his CDL, sohe must have some potential
trucker experience because youdon't just necessarily get a CDL
for no reason.
Look, he was on the Real WorldBoston and so he's gotten a
little bit of feedback on thatthat he was a reality TV star of
(17:04):
sorts.
He was also a Wisconsincongressman and district
attorney, but he's also recently, through these confirmation
hearings, it's come out thathe's supportive big section of
the maritime industry that'svery much watching to see what
any DOT transportation secretaryis looking at.
(17:25):
As it relates to the Jones Act,which kind of has a
protectionistic or a I don'twant to say protectionist
necessarily, but it provides anopportunity for US flag and US
mariners to have a fighting shot.
Basically, we'll go into theJones Act another time.
There are two sides to it,obviously, and it can become.
(17:50):
It's not necessarily evensomething that falls on
political lines, but it doeshave kind of two different sides
to it.
So notable that he's come outsaying that he's supportive of
the Jones Act.
So, like I said, he was acongressman for Wisconsin.
He was a member of the HouseFinancial Services Committee
during his tenure Not that thathas anything to do with
transportation, but you know,that's that's good that he's.
(18:12):
He was with the numberscommittees, financial services
that's good that he was with thenumbers committees, financial
services.
He was a contributor on FoxNews since 2020.
He was on Fox Business.
So I mean, I think that thiskind of circling around, he's a
numbers guy who does businessthings, so perhaps there's
something there.
He has received some industrysupport from OIDA, the Owner
(18:34):
Operator Independent DriversAssociation, saying that he
understands small businesstruckers.
He's also endorsed by theGovernor's Highway Safety
Association, allegedly sayingthat they're emphasizing the
need for strong leadership intransportation safety.
So we'll see where this goes.
The nominations and theconfirmations are kind of still
(18:55):
ongoing.
We'll see.
Right, certainly, havingtransportation experience is not
a job requirement.
Even Secretary Pete Buttigieg,the outgoing Transportation
Secretary, didn't have more thanreally just light rail and a
light bus experience from histime as mayor in South Bend.
Elaine Chao, the secretarybefore that, had a lot of
transportation experience, right, specifically maritime,
(19:16):
obviously.
I love to see that, but we'llsee where this goes.
If Secretary Duffy if confirmedwhere he would go with this
term and what his priorities are.
I think that it's sometimes agood thing to bring fresh eyes
to transportation sector, butthen also it's a very, as we all
know, right, there's a lot ofdifferent modes within and it
can be drinking from a fire hosefor a long time just to get up
(19:39):
to speed.
So let's see where he goes withthis.
But let's get into the mainstages of the day.
I just kind of want to quicklyrun through some of the 2025
things that I'm looking at.
We've seen the ILA, we've seenthat there was a deal struck,
(20:06):
and all I really have to sayhere is that it looks like
mid-February is when we're goingto see this deal finalized.
I've been hearing about apotential meeting happening in
mid-Febru.
Out was actually when the ILAleadership went to Mar-a-Lago to
meet with Trump mid-December,december 15th.
He actually called US MaritimeAlliance at that time, and so
there might have been like alittle mini negotiation
(20:27):
discussion at that time, whichwe didn't know.
We just knew that the ILA hadmet with President Trump.
So that's interesting what weknow about the agreement.
It's still under wraps, butwe've been hearing a few here
and there.
Six-year contract, it lookslike.
So 2030,.
Meet you back here, we'll talkabout it.
A potential 62% wage increase,it looks like, is where we came
(20:50):
out.
The ILA has been saying thatit's stronger healthcare and
retirement package.
Job preservation and expansionis a key tenant and a tech
advancement is allowed if newjobs are also created.
So I think that's going to begood for just making sure that
our ports and our services areable to advance with tech
advances.
(21:11):
Fmc things that I'm watching in2025, as we know, commissioner
Carl Bensel departed FMC inmid-December.
He went over to work for theNational Association of
Waterfront Employers, nowi,which leaves an open
commissioner spot.
We've been hearing a few namesfloating about.
I still don't want to say themain name that I keep hearing
because it hasn't been put outthere publicly but I'm starting
to hear a little bit more aboutone person in particular that is
(21:33):
being eyed, but until they'refully and officially nominated,
it's just a rumor, so we'll seewhere that goes.
And then also we've talkedabout this Chairman Maffei moves
to a commissioner role.
A new chairman of the FMC hasnot been appointed or named, so
we'll keep watching that In 2025, I anticipate that we're going
to see charge complaints moveinto a formal rulemaking process
(21:53):
Again.
Remember the charge complaintswere created by Congress in
their OSHA Superinform Act of2022, but it was always an
interim process.
So we will see a full formalrulemaking happen in 2025.
We're also going to be watchingfor alliance reshuffling.
We'll dive into this in alittle bit more depth in a
future episode.
But we have 2M has disbandedand moved around.
(22:16):
We have the alliance will benow moving over to the premier
alliance.
We have Ocean Alliance.
That is mostly staying the same.
So the Gemini cooperation isessentially the new 2M, if you
will.
It's Maersk and Hapag-Lloyd.
The premier alliance losesHapag-Lloyd.
As we know, it went over toGemini, so it'll be O-N-E, yang
(22:38):
Ming and Hyundai Merchant Marineand then Ocean Alliance, like I
said, stays the same, so I'mgoing to be watching all of that
.
As always, the guidance here isgeneral and for educational
purposes.
It should not be considered tobe legal advice directly related
to your matter.
If you need an attorney,contact an attorney, but if you
have specific legal questions,feel free to reach out to me at
my legal company, smallStrategies.
Otherwise, for the non-legalquestions, the e-learning and
(22:59):
general industry information andinsights, come find me at the
Maritime Professor.
If you like these videos, letme know, comment, like and share
.
If you want to listen to theseepisodes on demand, or if you
missed any previous episodes,check out the podcast by Landon
Bicey and if you prefer to seethe video, they live on my
YouTube page by Landon by Sea.
While you're at it, check outthe website, the
maritimeprofessorcom.
Until next week.
This is Lauren Began, theMaritime Professor, and you've
(23:19):
just listened to by Land and bySea.
See you next time.
no-transcript Catwalk to the beat when you see me
coming Nixon Room.
Everywhere I go, I'm in thespotlight.
This is a good life I'm living.
Bold.
This is what it looks like Onthe tips of the world.
(00:49):
The port strike is over, thankgoodness, so now we can
officially start 2025.
Is that right?
So today let's go through a fewof the things that I'm watching
in 2025.
Hi, welcome, by land and by sea,an attorney breaking down the
(01:10):
weekend supply chain presentedby Maritime Professor Me.
I'm Lauren Began, founder ofMaritime Professor and Squall
Strategies, and I'm yourfavorite maritime attorney.
Join me every week to walkthrough both ocean transport and
surface transport topics in thewild world of supply chain.
As always, the guidance here isgeneral and for educational
purposes only.
It should not be consideredlegal advice and there is no
(01:32):
attorney client privilegecreated by this video or this
podcast.
If you need an attorney,contact an attorney.
So before we go into thediscussion of the day, let's go
through my top three stories ofthe week.
All right, story number onethere are no new updates to any
of the rules that have come outof the FMC.
(01:53):
We are watching to see whathappens with the petition.
We're going to talk about thatin just a minute.
But no new updates in therulemaking area.
No new updates.
No new rules have been putforward.
There are a few updates on thepetitions, so let's kind of go
over where we are, which twopetitions that we're looking at
Right.
So we have the the FMC releasedtheir rule on billing practices
(02:15):
of detention to merge, so thatpetition came out right about a
month, a month and a half rightbefore that rule became final at
the end of May, about a month,a month and a half right before
that rule became final at theend of May.
So this started April 18th.
There's been, as we've beentalking about, a lot of kind of
procedural things going back andforth.
The real crux of what thisultimately will likely
(02:36):
potentially go over is kind ofthat direct contractual
relationship for motor carriersand the removal of them from the
ability of the billing party,as it's indicated in the rule,
to bill a motor carrier becausethey would not be a directly
contractual, a directcontractual relationship, as the
(02:57):
FMC has indicated.
The argument from the WorldShipping Council is that there
is a direct contractualrelationship, sometimes with
motor carriers, with truckers,and in those instances the FMC
is still saying that doesn'tcount under their direct
contractual relationship rule,where they really are kind of
moving more toward directcontractual relationship as it
(03:19):
relates to either shippers orconsignees and they say not both
, either one or the other.
So we've talked about thedetention to merge rule quite a
bit here.
Go back and take a look at oneof those past episodes.
I think we actually did a fewepisodes breaking it down.
But we had an interestingdevelopment in December where a
few trucking associations gotinvolved, wrote an amicus curia
(03:42):
brief and basically said we havesome thoughts on this as well,
but we do have some updates.
This week the World ShippingCouncil filed their reply brief,
so a longer form argument cameback from the World Shipping
Council this week and I'm notgoing to go too far into detail
here.
I'm still kind of digesting thewhole thing.
It only came out a few days ago.
(04:03):
But I just want to quote partof their opening which I think
is kind of it's a well-writtensummary of their position and
what they they are presenting astheir argument in this petition
.
So again, the World ShippingCouncil brought this petition in
the US Court of Appeals for theDC Circuit against the Federal
Maritime Commission against thisfinal rule, this detention to
(04:26):
merge billing practices rule.
They've been going back andforth but there's a motion to
dismiss.
Well, excuse me, I'm confusingit with the next one.
There is a back and forth,procedural back and forth here
where they're trying to decideif this is, if the if FMC has
standing, if the World ShippingCouncil is standing.
(04:47):
It kind of goes back to thelegalese of it all.
They haven't quite gotten intothe crux of the matter, but I
thought this was a well-writtensummary in the intro of the
reply brief.
So the World Shipping Councilsays the commission's responses
fail to persuade and arerevealing of one of the final
rule's key flaws, pointing tothe detention and demurrage
final rule.
They say the commission'sstated purpose does not match
(05:08):
the policy that the commissionultimately chose to adopt.
The FMC repeatedly emphasizesthat it intended to limit
demurrage and detention invoicesto only the parties that
negotiated the relevantcontracts.
As these parties quote wouldlikely have greater knowledge,
quoting as the FMC on part ofthe justification, and then the
(05:28):
World Shipping Council continuesand would be better able to
evaluate and dispute any charges.
But the final rule prohibitsbilling motor carriers even when
those motor carriers havecontractual relationships with
the Ocean Common Carrier and arethus the best position party to
receive the invoice under theFMC's own reasoning.
This fundamental mismatchbetween reasoning and result
(05:49):
renders the commission's actionboth outside of its statutory
authority and arbitrary andcapricious.
The final rule should bevacated.
So that's, I mean, a prettygood summary.
They certainly go into moredepth and kind of more
development of their arguments,but kind of a nice distillation
in this intro of what the WorldShipping Council is trying to
prove here.
They're trying to say look, therule is a little bit
(06:11):
inconsistent or mismatched tothe application.
And further they're saying thatthe FMC went too far and is
reaching outside of itsstatutory authority and because
of that this is like this israndom, arbitrary and capricious
.
This is just random that theFMC is doing this in a way that
isn't well supported by theCongress telling them to do it.
(06:33):
That's kind of the distillationof the argument here in this
intro.
You know the stated purpose notmatching the policy that the
commission chose to adopt.
I think that this argument, asthe FMC, has stepped into the
spotlight.
I think this critique has risen.
I've seen more and more people.
I've seen a lot of peoplesupporting the FMC and where
(06:55):
it's going with its delivery orits enjoyment of its statutory
authority.
But it's clear to see that theFMC has gotten a lot more active
in the past few years as well,right?
So I think, as it's gainedattention and as it's stepped
into the spotlight that it founditself in after those 2021,
(07:17):
2022 congestion years, I thinkthat we've also seen a critique
of are they being too active Ingeneral?
Right, an active commissionwill often find itself.
The critique of are they beingtoo active In general?
Right, an active commissionwill often find itself.
The critique of mission creep isusually what it is, mission
creep being it's you're kind ofcreeping outside of the mission
that you've been given.
And, as we remember, right,congress gives these agencies
(07:39):
their authority.
The FMC has the authoritythrough the Shipping Act and a
few others, but the Shipping Actis kind of the main authority
and main jurisdiction for theFMC to enjoy its regulatory
authority here.
And, you know, I think aresponsible commission also does
a little bit of checks andbalances within itself against
its statutory purposes andauthorities, and I think that we
(08:02):
might see that in the change ofadministration and a following
change of chairmanship.
I think that Chairman Dan Maffeidid a fantastic job of really
trying to provide availablevenue for a large portion of the
shipping community and not justshippers, but a large portion
(08:23):
of the shipping community thatwasn't quite sure what to do
when they all of a sudden hadall of these giant charges.
They weren't exactly sure whatto do.
And I think that the FMCstepped into that spotlight well
, in that they provided a lot ofopportunities for piecemeal and
bite-sized opportunities fordispute resolution instead of
(08:44):
just going to the big bang of abig lawsuit.
So I think that that was great.
But in that right it became amore active commission because
there were more filings with thecommission and therefore the
commission had to make moredecisions and kind of all of
that snowballed together.
And so now I think we're at thismoment of the FMC is going to
have to start looking okay, well, what are we getting right?
(09:07):
What aren't we getting right?
Are we staying within ourmission?
Are we not?
And I think that this petitionis going to force that
conversation.
And again, remember, this is apetition against the detention
and demurrage billing practices,but it sounds like it's kind of
being looped into a largerconversation of this active
agency, statutory authority and,like I said, as we move into
(09:30):
the next administration.
We know from Trumpadministration one they prefer
limited government.
I've mentioned this a few timesthat for every one rule that
was brought out of any agency towere required to be repealed.
So, all that to say, I thinkwe'll see that, if not more,
with Trump administration numbertwo, maybe pulling back or
(09:57):
being a little bit moreconservative in their
interpretation, although youknow the FMC, I feel like the
FMC does a good job of stayingwithin its jurisdiction, but
there are some gray areas thatjust need to be determined and I
don't think that they're onlygoing to be determined by the
FMC.
I think this petition is goingto be a good opportunity for
that conversation of where thoselimits are.
I think we're also going to seethat conversation on, perhaps,
(10:19):
chassis and intermodal rail andthrough bills of lading and all
of those different areas of well, who's in charge of some of the
rail storage, demurrage perdiem, those types of things.
I think that we're going to seethat over the next few years
and with a limited lens of alimited government.
I think that's going to be aninteresting conversation to have
(10:40):
and probably an appropriatetime to be having those
conversations, and this happensall the time, right Every few
years, every five to 10, thisprobably is just part of any
agency's process, right, thatthey get challenged on their
mission creep or they getchallenged on where they're
going and their interpretationof their statutory authority,
(11:01):
which I think those are normal,healthy kind of housekeeping
type things to do.
So I'll keep watching it.
I'll let you know what I see.
But interesting, right?
The other petition that we'rewatching is the unreasonable
refusal to negotiate withrespect to health and face
accommodations.
This is where I got a littleahead of myself.
There is a motion to dismiss onthis one.
So what we saw this week Ithink it was just yesterday or
(11:23):
the day before from the court wesaw a procurium order that the
motion to dismiss should beaddressed and not necessarily by
incorporation by reference ofthe party saying look, we
already talked about this, thisis why it shouldn't be a motion,
this is why it should bedismissed, or vice versa, this
is why it shouldn't.
The court's saying look, youneed to address this directly
with its own briefing schedule,meaning like their own arguments
(11:49):
turned in.
So what that means is that thisargument made by the FMC the
FMC is the one who presentedthis motion to dismiss of the
World Shipping Council nothaving standing.
The FMC's argument is basicallylike the carrier should have
been bringing this collectivelyand not the World Shipping
Council on behalf of thecarriers Because, again, this is
unreasonable refusal to deal ornegotiate with respect to
vessel space accommodations.
This is defining unreasonablerefusal to deal or negotiate.
(12:09):
That's the question.
Motion to dismiss Should ithave been the World Shipping
Council or should it have beensome of these carriers
individually?
We're going to see that play out.
I think this is going to be aninteresting motion to dismiss to
see because this argument isalso being raised in the
detention to merge petition.
So I think this might haveknock-on effects to other
(12:30):
petitions that are out there andso we're going to see that play
out in various arguments to seeif this case gets thrown out
before it even gets started andthat's kind of what we're
talking about here.
A motion to dismiss meansdismiss the whole thing or
dismiss parts of it before youeven get to really into like the
meat of what's going on here.
Hopefully, I mean on all ofthese, I hope that we get to the
(12:51):
content, the subject matter ofkind of the argument at issue
and that's not to dismiss.
A motion to dismiss sayingshouldn't be properly heard.
But I'm interested to see thisone particularly unreasonable
refusal to negotiate.
I'm interested to have itchallenged in thought because
I'd like to just make surethere's a few parts that I have
(13:12):
questions on that.
I just want to make sure thatthey're on the right track.
So I think that this will be areally interesting one to watch.
Story number two we're movingright along.
It's 13 minutes in and we'reonly in story number one.
So story number two the USTR,the United States Trade Rep,
released a post this week orjust yesterday, actually about
24 hours ago, where they saidpress release saying USTR finds
(13:34):
that China's targeting themaritime logistics and
shipbuilding sectors fordominance is actionable under
Section 301.
So this is a petition broughtby United Steel, paper, forestry
, rubber Manufacturing, energy,allied Industrial and Service
Workers, International Union,the International Association of
Machinists and AerospaceWorkers, international
(13:55):
Brotherhood of Boilermakers,iron Shipbuilders, blacksmiths,
foragers, helpers, theInternational Brotherhood of
Boilermakers, iron Shipbuilders,blacksmiths, foragers, helpers,
the International Brotherhoodof Electrical Workers and the
Maritime Trades Department ofthe AFL-CIO.
So this one was interesting.
We've talked about this before.
There were two Section 301s thathave kind of come into the
spotlight.
One was the China Trade Tariffs.
That's not this.
(14:15):
And then there was this one.
This one was talking about thePeople's Republic of China
targeting maritime logistics andshipbuilding sectors for
dominance.
Concluding that the PRC this iswhat the announcement said
concluding that PRC Chinatargeted dominance in these
sectors is unreasonable andburdens or restricts US commerce
and is therefore actionableunder Section 301.
(14:38):
I think you should go take alook at this.
There is a very comprehensivereport it's over 100 pages, it's
almost 200 pages, I think wherethey talk about everything that
they've looked at since thispetition began in April, just
April of this year.
So this was all started under aBiden administration.
But I mean, I can't imaginethat this.
It doesn't come out with theremedies, so I think that this
(15:02):
just provides a study and ajustification for, yes, we found
that it was unfair.
We found that China's tacticsessentially China's tactics are
unfair and burdensome and areviolative, basically, of Section
301 of the Trade Act of 1974.
(15:25):
So what this means is that wemight see a Trump administration
walk through this door, becausewhat's happened is the door has
been unlocked for a Section 301with justification, saying that
anything related to themaritime shipbuilding or any of
the things that they list, yeah,china's in the wrong here.
(15:56):
How can I say this Proceedingdetermination that needs to be
taken to try to correct ornegate or make even the playing
field anything in thisunreasonable or discriminatory
or burdening or restricting ofthe US commerce, and that might
be tariffs again.
This might be anotherjustification for tariffs.
We'll see, we'll see.
(16:17):
This one will be interesting.
This just came out yesterday.
I'm still sorting through thedocument but I think this one's
going to be interesting to watch.
All right.
Story number three Sean Duffy.
Have you heard of him?
He has been nominated for theDepartment of Transportation
Secretary of the Department ofTransportation, secdot.
He doesn't have a lot oftransportation experience, but I
(16:37):
did read somewhere and Ihaven't been able to confirm
this but I did read somewherethat he does have his commercial
driver's license, his CDL, sohe must have some potential
trucker experience because youdon't just necessarily get a CDL
for no reason.
Look, he was on the Real WorldBoston and so he's gotten a
little bit of feedback on thatthat he was a reality TV star of
(17:04):
sorts.
He was also a Wisconsincongressman and district
attorney, but he's also recently, through these confirmation
hearings, it's come out thathe's supportive big section of
the maritime industry that'svery much watching to see what
any DOT transportation secretaryis looking at.
(17:25):
As it relates to the Jones Act,which kind of has a
protectionistic or a I don'twant to say protectionist
necessarily, but it provides anopportunity for US flag and US
mariners to have a fighting shot.
Basically, we'll go into theJones Act another time.
There are two sides to it,obviously, and it can become.
(17:50):
It's not necessarily evensomething that falls on
political lines, but it doeshave kind of two different sides
to it.
So notable that he's come outsaying that he's supportive of
the Jones Act.
So, like I said, he was acongressman for Wisconsin.
He was a member of the HouseFinancial Services Committee
during his tenure Not that thathas anything to do with
transportation, but you know,that's that's good that he's.
(18:12):
He was with the numberscommittees, financial services
that's good that he was with thenumbers committees, financial
services.
He was a contributor on FoxNews since 2020.
He was on Fox Business.
So I mean, I think that thiskind of circling around, he's a
numbers guy who does businessthings, so perhaps there's
something there.
He has received some industrysupport from OIDA, the Owner
(18:34):
Operator Independent DriversAssociation, saying that he
understands small businesstruckers.
He's also endorsed by theGovernor's Highway Safety
Association, allegedly sayingthat they're emphasizing the
need for strong leadership intransportation safety.
So we'll see where this goes.
The nominations and theconfirmations are kind of still
(18:55):
ongoing.
We'll see.
Right, certainly, havingtransportation experience is not
a job requirement.
Even Secretary Pete Buttigieg,the outgoing Transportation
Secretary, didn't have more thanreally just light rail and a
light bus experience from histime as mayor in South Bend.
Elaine Chao, the secretarybefore that, had a lot of
transportation experience, right, specifically maritime,
(19:16):
obviously.
I love to see that, but we'llsee where this goes.
If Secretary Duffy if confirmedwhere he would go with this
term and what his priorities are.
I think that it's sometimes agood thing to bring fresh eyes
to transportation sector, butthen also it's a very, as we all
know, right, there's a lot ofdifferent modes within and it
can be drinking from a fire hosefor a long time just to get up
(19:39):
to speed.
So let's see where he goes withthis.
But let's get into the mainstages of the day.
I just kind of want to quicklyrun through some of the 2025
things that I'm looking at.
We've seen the ILA, we've seenthat there was a deal struck,
(20:06):
and all I really have to sayhere is that it looks like
mid-February is when we're goingto see this deal finalized.
I've been hearing about apotential meeting happening in
mid-Febru.
Out was actually when the ILAleadership went to Mar-a-Lago to
meet with Trump mid-December,december 15th.
He actually called US MaritimeAlliance at that time, and so
there might have been like alittle mini negotiation
(20:27):
discussion at that time, whichwe didn't know.
We just knew that the ILA hadmet with President Trump.
So that's interesting what weknow about the agreement.
It's still under wraps, butwe've been hearing a few here
and there.
Six-year contract, it lookslike.
So 2030,.
Meet you back here, we'll talkabout it.
A potential 62% wage increase,it looks like, is where we came
(20:50):
out.
The ILA has been saying thatit's stronger healthcare and
retirement package.
Job preservation and expansionis a key tenant and a tech
advancement is allowed if newjobs are also created.
So I think that's going to begood for just making sure that
our ports and our services areable to advance with tech
advances.
(21:11):
Fmc things that I'm watching in2025, as we know, commissioner
Carl Bensel departed FMC inmid-December.
He went over to work for theNational Association of
Waterfront Employers, nowi,which leaves an open
commissioner spot.
We've been hearing a few namesfloating about.
I still don't want to say themain name that I keep hearing
because it hasn't been put outthere publicly but I'm starting
to hear a little bit more aboutone person in particular that is
(21:33):
being eyed, but until they'refully and officially nominated,
it's just a rumor, so we'll seewhere that goes.
And then also we've talkedabout this Chairman Maffei moves
to a commissioner role.
A new chairman of the FMC hasnot been appointed or named, so
we'll keep watching that In 2025, I anticipate that we're going
to see charge complaints moveinto a formal rulemaking process
(21:53):
Again.
Remember the charge complaintswere created by Congress in
their OSHA Superinform Act of2022, but it was always an
interim process.
So we will see a full formalrulemaking happen in 2025.
We're also going to be watchingfor alliance reshuffling.
We'll dive into this in alittle bit more depth in a
future episode.
But we have 2M has disbandedand moved around.
(22:16):
We have the alliance will benow moving over to the premier
alliance.
We have Ocean Alliance.
That is mostly staying the same.
So the Gemini cooperation isessentially the new 2M, if you
will.
It's Maersk and Hapag-Lloyd.
The premier alliance losesHapag-Lloyd.
As we know, it went over toGemini, so it'll be O-N-E, yang
(22:38):
Ming and Hyundai Merchant Marineand then Ocean Alliance, like I
said, stays the same, so I'mgoing to be watching all of that
.
As always, the guidance here isgeneral and for educational
purposes.
It should not be considered tobe legal advice directly related
to your matter.
If you need an attorney,contact an attorney, but if you
have specific legal questions,feel free to reach out to me at
my legal company, smallStrategies.
Otherwise, for the non-legalquestions, the e-learning and
(22:59):
general industry information andinsights, come find me at the
Maritime Professor.
If you like these videos, letme know, comment, like and share
.
If you want to listen to theseepisodes on demand, or if you
missed any previous episodes,check out the podcast by Landon
Bicey and if you prefer to seethe video, they live on my
YouTube page by Landon by Sea.
While you're at it, check outthe website, the
maritimeprofessorcom.
Until next week.
This is Lauren Began, theMaritime Professor, and you've
(23:19):
just listened to by Land and bySea.
See you next time.
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