The US FMC ordered Mediterranean Shipping Company (MSC) to pay furniture maker MCS Industries almost $1 million in reparations.
The FMC awarded default judgment to MCS in its breach-of-contract complaint against MSC, citing MSC’s “willful and deliberate failure to provide discovery” as the reason for the judgment.
The news comes after MCS filed a complaint with the FMC in July 2021, claiming that MSC and COSCO Shipping Lines did not supply shipping slots for exports to Asia, as per their contractual obligations.
MCS resolved its dispute with COSCO two months later, but the case against MSC remained. According to MCS, As container freight rates soared, they found themselves paying exorbitant prices as the two carriers allegedly failed to provide the necessary slots outlined in their contracts.
In response, MCS requested reparations of $944,655 from MSC. Later, MSC responded to the accusations declaring that legal bases for a default judgment did not stand.
More specifically, the carrier argued that a default judgment could not be issued as alternative channels to avoid an irreconcilable conflict with Swiss law are available and have not been fully exhausted.
However, FMC Judge Erin Wirth cited MSC’s failure to comply with multiple discovery orders, including not providing information about force majeure, as reasons for the ruling.
She specifically stated that MSC had only provided information about cancelled sailings but had not produced any documentation or communication that would explain why those sailings were cancelled.
MSC expressed disappointment with the recent decision, and will make an appeal.
