Fernando Lucina, Gina Pagaduan and others v. Carnival PLC and Fleet Maritime Services International, Ltd.

At a glance

Parties

Fernando Lucina, Gina Pagaduan, Argie Anova, Vidalito Galas, Joue Gauzon, Jun Nazarro and Cristita Onting (on their own behalf and for similarly situated seafarers) v. Carnival PLC and Fleet Maritime Services International, Ltd.

Case no.

No. 17-CV-6849 (CBA) (LB)

Court

U.S. District Court, Eastern District of New York (Judge Carol Bagley Amon)

Forum and rules

Motion to compel arbitration under the New York Convention and Chapter Two of the Federal Arbitration Act (9 U.S.C. § 206)

Treaty

New York Convention, Articles II(3) and V(2)

Sector

Maritime employment; cruise ship crew wages

Outcome

Motion to compel arbitration in the Philippines granted (Memorandum & Order dated March 2019, filed 22 March 2019). The Court kept limited jurisdiction to enforce any award.

The dispute

The plaintiffs were Filipino stewards and stewardesses who had worked aboard the ocean liner Queen Mary 2 since at least 2009. They were employed by Carnival PLC and its subsidiary Fleet Maritime Services International, Ltd. under a series of fixed-term employment contracts. On 22 November 2017 they sued for unpaid wages under the Seamen's Wage Act (46 U.S.C. § 10313) and the New York Labor Law. The defendants moved to compel arbitration in the Philippines. They relied on the dispute resolution clause (Section 29) of the Philippine Overseas Employment Administration (POEA) Memorandum Circular No. 10 of 26 October 2010, which they said the plaintiffs' POEA Contracts and Seafarer's Employment Agreements (SEA Contracts) incorporated by reference. The plaintiffs argued that no written arbitration agreement existed: they said their signatures on the POEA Contracts were not genuine, the contracts were not properly authenticated, and Carnival had not signed them. They also argued that the clause was null and void because it worked as a prospective waiver of their U.S. statutory remedies and had been obtained under duress.

Key holdings

1. The POEA Contracts are authentic and binding. A bare assertion of forgery does not create an issue of fact. The signatures resemble the admitted signatures on the SEA Contracts, the contracts carry POEA approval stamps, and the affidavit of Rene Riel of Singa Ship Management authenticates them under Federal Rule of Evidence 901. pp. 8–10
2. Carnival can enforce the POEA Contracts even though it did not sign them. Following Pagaduan v. Carnival Corp. (2d Cir. 2017), agency principles apply: Singa Ship Management is the agent of Fleet Maritime, which is a Carnival subsidiary. Under Pagaduan, the POEA Contracts therefore incorporate the arbitration clause of Memorandum Circular No. 10. p. 10
3. Separately, the SEA Contracts incorporate the clause by reference. Part A incorporates Part B. Part B refers to the "POEA dated October 2010", which identifies Memorandum Circular No. 10 in clear and unambiguous terms. The plaintiffs did not need to sign Part B. pp. 10–13
4. The public policy defense in Article V(2) of the Convention applies at the award-enforcement stage, so the prospective-waiver objection was premature. In any case, the plaintiffs had not shown that a POEA arbitrator would refuse to apply U.S. law, or that applying Philippine law would be fundamentally unfair. pp. 13–15
5. No duress under Article II. The plaintiffs identified no improper threat. They also did not show that they had no reasonable alternative to signing. The clause is therefore not null and void and can be enforced. pp. 15–16
6. The motion to compel arbitration was granted. The Court kept limited jurisdiction to enforce any award and directed the parties to report the result of the arbitration. p. 16

Procedural history

1. 22 November 2017The plaintiffs filed the action in the Eastern District of New York.
2. 22 June 2018The defendants filed a Motion to Compel Arbitration.
3. 14 December 2018Oral argument. The Court directed the defendants to produce the Memorandum Circular No. 10 terms signed by the plaintiffs.
4. 21 March 2019Memorandum & Order granting the motion to compel arbitration in the Philippines (filed 22 March 2019).

Tribunal, counsel and experts

Decided by

• Carol Bagley Amon Judge, U.S. District Court, Eastern District of New York

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Keywords

• motion to compel arbitration
• New York Convention Article II(3)
• null and void
• incorporation by reference
• POEA Memorandum Circular No. 10
• Filipino seafarers
• Seamen's Wage Act
• Queen Mary 2
• prospective waiver
• public policy Article V(2)
• duress
• non-signatory
• agency
• authentication of signatures
• Pagaduan v. Carnival
• cruise ship crew

Summary generated with AI from the published documents — refer to the award for the authoritative text.