Alaska Oil Company Fined with Largest Jones Act Penalty in History of the Act

In 2011, Furie Operating Alaska, an Alaskan oil and gas company, transported the Spartan 151 jack-up drill rig from the Gulf of Mexico to Alaska using a foreign-flagged vessel. The company agreed to pay a record $10,000,000 fine for failing to get pre-approval from the U.S. government to use a foreign-flagged vessel for the transport.

Passed in 1920, the Jones Act prohibits a foreign vessel from transporting merchandise between points in the United States. Any party violating the Jones Act may receive a civil penalty equal to the value of the merchandise. Some circumstances may allow for a waiver obtainable from the Secretary of the Department of Homeland Security; the applicant must show that such waiver is in the interest of national defense and that no U.S. vessel is available to carry the merchandise between the designated points.

As a result of the penalty, Furie filed a civil lawsuit in 2012 to challenge the assessment of the civil penalty. However, the parties finally resolved the lawsuit with a record breaking $10,000,000 settlement.

The Department of Justice reported that while the settlement is not designed to hinder Furie’s ability to bring natural gas to the Alaskan market, it provides important precedent and illustrates how seriously the Jones Act will be enforced.

There are many other Jones Act violations that vessel owners or operators are held responsible for. If you have been seriously injured or your loved one has been killed in a maritime accident, it is important to find an attorney with experience handling complex maritime injury cases. Abraham, Watkins, Nichols, Agosto, Aziz & Stogner is the oldest personal injury firm in Texas, and our attorneys have successfully handled numerous maritime injury claims. Contact us today by calling (713) 222-7211 or toll free at 713-222-7211 for your free consultation.