Archives For Legal Disputes

SS John Barry

August 28, 2014 — Leave a comment

John Barry

On the night of August 28, 1944, the American Liberty ship SS John Barry silently glided through the waves on its way to Saudi Arabia loaded with a secret cargo of silver. Unfortunately for the Barry and her crew, the Nazi U-boat U-859 detected the ship and successfully torpedoed her, sending her to the bottom of the Arabian Sea along with millions of silver riyal coins (shown above). Rumors quickly arose that the ship had not only been loaded with 3,000,000 silver riyals for ARAMCO, but also with tons of silver bullion destined for the USSR via India.

Due to the ship’s depth (8,500 feet) the wreck was left undisturbed until a consortium of Americans assembled a hodgepodge of recovery components primarily scavenged from the oil and gas industry. After winning a bid to recover the wreck from the US government, the consortium, dubbed “The John Barry Group” successfully located the Barry in 1994 and used a grap to bring up 1,300,000 (17 tons) of silver riyals before they ceased operations. Although no sign of the Soviet silver shipment was found, some experts still believe there is a high likelihood the Soviet silver is aboard the vessel and was not located due to the primitive technology employed by The John Barry Group. Stalin’s Silver, by John Beasant, presents a well-written account of both the recovery and the rationale for why more silver may be located aboard the Barry. Sadly, due to bureaucratic intransigence, the US government has not re-opened the vessel to a recovery bid process and, until then, neither will the mystery be solved nor the American taxpayer enriched by the recovery fees paid to the US government by a successful salvor.

Jack Cheevers

The events surrounding the capture of the USS Pueblo, a US Navy spy ship, rank among the most ignominious in the storied history of the United States Navy. Jack Cheevers’ book Act of War brings to life the capture of the Pueblo, the torture and humiliation of her crew at the hands of the North Korean government and the efforts to secure their return to the United States. Relying on period documents, interviews with crew members and government records, Cheevers reconstructs for readers not just the “exciting” parts of the capture and torture, but also the bureaucratic decision making that led to the capture of the Pueblo.

Cheevers devotes special attention to the captain of the Pueblo Commander Lloyd Bucher, his background, the agonizing decisions he had to make while under fire and his subsequent pariah status within the US Navy. One of the strongest aspects of the book is how the reader is presented with the facts of the capture of the Pueblo and allowed to decide on his or her own where the blame should lie for the capture of the Pueblo and whether more should have been done to prevent her capture. While not a light beach read, Act of War is an enlightening tome worthy of one’s time, especially given the continued saber rattling by an increasingly unhinged North Korean regime.

Taiwan missile corvette

Tuo Jiang

Late last week the Republic of China launched the first of a new class of stealth missile corvettes. Christened Tuo Jiang, the vessel is designed to operate with a low radar signature and is aimed at countering the threat of the People’s Republic of China’s growing aircraft carrier capability. The Tuo Jiang’s armament has not been fully publicized, however, Taiwanese news sources are reporting that it will be outfitted with a battery of Siung Feng III (HF-3) ramjet-powered supersonic anti-ship missiles. Combined with the stealth of the Tuo Jiang, the missiles give Taiwan’s navy a formidable indigenous option to discouraging and/or defeating an attack by the People’s Republic.

Despite the United States’ “Asia Pivot,” the new US policy of “leading from behind” has justifiably worried Taiwan and other Pacific nations. As such, Japan, Taiwan, South Korea and the Philippines are prescient to increase their indigenous options to defending their sovereignty in the face of an increasingly belligerent People’s Republic of China. With reports of hesitation in the Chinese economy, saber rattling in the Diaoyus/Spratlys/Senkakus/South China Sea will most likely increase much like Argentina and the Falklands in the ’80s and more recently under Christina Kirchner. If the People’s Republic’s saber rattling ever becomes more than mere noise, then the stealth missile corvettes of the Tuo Jiang class will allow Taiwan’s navy to punch above its weight class much like Israel’s missile boats did in the Yom Kippur War.

The Spratlys

March 14, 2014 — Leave a comment

Boomerang Island in the Spratlys
CC Image Courtesy of Storm Crypt on Flickr

As relations continue to deteriorate between China and Japan over the Senkaku/Diaoyu Islands, it is easy to forget that China has had previous conflicts over other island chains that exist in close proximity to its borders. One such conflict occurred on March 14, 1988 between Vietnamese forces and elements of the People’s Liberation Army Navy (PLAN).

Taiwan, the PRC, Vietnam, the Philippines, Malaysia and Brunei have all laid claim to the Spratly Islands, an uninhabited collection of 750 islands, reefs and atolls in the South China Sea. Apart from rich fishing grounds and possible oil and gas deposits, the islands have no economic value; their primary value being geopolitical in nature. In early 1988, Vietnamese forces began landing forces and construction supplies at one of the reefs in order to further their claim to the area. A short skirmish erupted when the Vietnamese forces encountered a PLAN squadron.

Despite this confrontation, the two countries continued to operate in the area until March 14 when PLAN and Vietnamese forces again collided. This time the firefight was more intense and by the time it was over two Vietnamese transports had been sunk and another heavily damaged. While the Chinese suffered no casualties, the Vietnamese lost more than 70 sailors in the short and sharp encounter.

The Chinese victory, now known as the Johnson South Reef Skirmish, allowed the PLA to occupy several more reefs in the area and expand their area of influence at the expense of Vietnam. A resolution to the issue between the multitude of sparring countries has yet to occur and provides simply one more smoldering match to the growing powder keg that is the South and East China Seas.

war of 1812

In Ships of Oak, Guns of Iron, Dr. Ronald D. Utt has produced a magnificent 500 page tome that provides readers with a well-researched and highly readable account of the War of 1812 at sea. As Utt masterfully argues, the United States Navy truly came into its own during the War of 1812, a conflict that is undergoing a renaissance in the pop history circle as the bicentennial of the war began in 2012.

Although the US Navy fought several notable battles during the American Revolution, including John Paul Jones’ famous duel with HMS Serapis, these were primarily performed with foreign crews and former merchant vessels adapted for naval service. The War of 1812 was the first time that the fledgling US Navy faced a first world power in a declared war and its spectacular results allowed the Navy to create epic lore and traditions in only three years.

Utt skillfully guides the reader from the opening salvos of the war through the US Navy’s early single-ship victories over the vaunted Royal Navy to the two squadron level clashes on the Great Lakes, privateer derring-do against the British merchant marine, and the later and lesser known naval actions of the war. Readers will be unable to put down the book at certain points, especially when reading the chapters concerning privateering and some of the lesser known single-ship voyages against British merchant and warships. The heroic and honorable actions of officers and sailors from both sides will keep readers captivated with tales of a breed of gentlemen warriors whose time has long since passed.

Among the many strengths of Utt’s work is his organization of the book into chapters that take the reader from events at sea to land and then back to sea. In most cases, Utt keeps his narration of the land war to only a few pages in order to give readers an idea of how the sea war affected the land war and vice versa. At times the land war descriptions can grow a bit tedious as Utt jumps between the numerous Indian tribes, Americans, Brits, and Canadians who intermingled in the land conflict. For readers concerned more with the war at sea, the land warfare chapters are sometimes roadbumps in the greater storyline. This minor weakness, though, does not overshadow the overall excellence of Utt’s book.

Another strength is Utt’s strong documentation and endnotes – he has clearly worked to craft a book that is both historically accurate and accessible to the everyday reader. Overall, in Ships of Oak, Guns of Iron, Utt has created a fantastic piece that opens the naval battles of the War of 1812 to a wider audience.

SMS Adler

SMS Adler

During the last three decades of the 19th century, various Western nations carved up not just Africa, and the Near and Far East, but also various Pacific islands. In many cases, the smaller European powers sought to do empire on the cheap by not governing the islands but encouraging the installation of puppet governments. Thus, the nation could merely secure resources and coaling stations for its naval fleet. In the case of the Samoan Islands in the late 1880s, the German Empire encouraged a civil war between several tribes in order to weaken the tribes’ hold on the island and secure German concessions. Recognizing the strategic importance of the islands, the British and Americans shipped military assistance to opponents of the tribes aligned with Germany.

us gunboat samoa

USS Vandalia

As the conflict escalated, each Western nation dispatched naval vessels to Samoa and the three nations confronted one another in Apia Harbor during 1889. Britain sought to remain a peaceful arbitrator while America and Germany faced each other with the threat of belligerent action. The need for negotiations or military action between the American and German vessels, though, was swept away by the March 15/16th Apia Cyclone. Unbeknownst to either side, a cyclone had been bearing down on Samoa as each side scowled at one another across the harbor. Samoans awoke on the morning of the 16th to discover both the American and the German squadrons beached, sunk or wrecked in the harbor. The loss of the naval squadrons effectively defused the situation and the dispute was resolved by the Tripartite Convention of 1889 by which Samoa was divided between America and Germany.

wrecked german ships

SMS Eber’s Bow

argentina navy

ARA Libertad
CC Image Courtesy of maduroman on Flickr

Earlier this October, a court in Ghana ordered the Argentinian naval training vessel ARA Libertad to be held until the Argentinian government posts a $20 million bond to release the ship. The action ultimately stems from Argentina defaulting on its debt in the early 2000s. Argentina’s default wiped its balance sheet clean of billions in bond liabilities while leaving bondholders with bonds worth 30% of their face value. Because Argentinian courts will not force repayment of the bonds, some bondholders who are holding out for the full value of the bonds have turned to more novel methods of collecting on Argentina’s sovereign debts.

One of the most time tested techniques for securing a judgment and payment on a debt is arresting the debtor’s assets when they are in a jurisdiction favorable to the bondholder. Thus, when Libertad arrived in Ghana, Elliott Capital Management sued for the vessel to be held until the Argentinian government pays the bond. While some would characterize the technique as nothing more than holding the ship hostage in exchange for a ransom, the bondholders merely seek to recoup the money the Argentinian government received from the sale of the bonds and promised to repay.

Elliott Capital Management, a New York based hedge fund, manages money for large institutional investors which often includes the likes of pension funds for firemen in Peoria, teachers in Chicago or trash collectors in Milwaukee. The Argentinian government has protested Ghana’s actions with their usual populist rhetoric and decried Elliott Capital Management’s actions as “trickery” instead of accepting it as simply the rule of law. Elliott Capital Management and other bondholders have received more than 100 court judgments against the Argentinian government, none of which the Argentinians have honored.

Yesterday the International Tribunal for the Law of the Sea ordered Ghana to release the Libertad. Because both Argentina and Ghana are signatories to the Law of the Sea Treaty, the International Tribunal’s decision is binding and Ghana must release the ship. The United States has thus far not signed the treaty and this incident is yet another example of why signing the treaty would be a serious mistake for the US and would impede US sovereignty.

chinese porcelain

Blue & White Yuan Dynasty Porcelain

Vietnamese authorities are attempting to protect a 14th century shipwreck discovered earlier this year in the province of Quang Ngai. Local fishermen originally found the wreck and salvaged some of its Yuan dynasty porcelain cargo. Authorities quickly swooped in and confiscated the recovered porcelain. Now, locals are determined to profit from the wreck by salvaging it themselves.

Last Saturday, Vietnamese police guarding the wreck were attacked by a throng of 60 fishermen. Two policemen were injured after the fishermen pelted the guards with rocks and swarmed their boats and vehicles. The mob freed a fisherman the authorities were attempting to arrest and hundreds of police eventually had to be called in to quell the violence. The police presence will most likely continue for the 3 months it is predicted to take to salvage the wreck.

Shi Lang

Former Soviet Carrier Varyag
Photo: Information Dissemination

China’s first aircraft carrier is finally getting an official name.  Blogger Andrew S. Erickson, an expert in Chinese naval affairs, is reporting that an official state media outlet has stated that the ship’s name will be Liaoning, in honor of the province where the ship was recently re-built. The ship’s name has been the source of much speculation with it often being referred to as Shi Lang in Western news reports. While many might scoff at the hubbub surrounding the naming of the carrier, its name will carry some significance regarding Chinese attitudes towards other countries in the region. Shi Lang was a Qing general who subdued Taiwan through a seaborne invasion and the naming of the ship after him would have had sinister overtones for Chinese-Taiwanese relations. Another name choice reportedly debated within government circles was Diaoyu Dao which is an island group controlled by Japan, but disputed by both China and Taiwan. Either of those names would have indicated a bellicose attitude towards Japan and/or Taiwan.

Liaoning was originally launched as the Varyag in 1988 by the Soviet Union and remained unfinished at the time of the collapse of the Soviet Union. China purchased the Varyag from the Ukraine in 1998 and the ship sat derelict for several years until the decision was made to rebuild the carrier to fulfill its original role. Re-building of the ship was completed earlier last year and she has undergone multiple sea trials since. Naval experts have differed as to whether China intends to use the carrier for belligerent purposes or merely as a training vessel. It takes years to hone the skills necessary to effectively conduct the air-sea ballet that is carrier operations and it is most likely that the Liaoning will serve merely to train the crew and officers of the follow-on carriers China intends to build. The Chinese have even built a mock-up of the ship on dry land to get a head-start on training its newest generation of naval aviators.

Photo: Nick Messinger

A century old mystery may soon be solved in the frigid depths off Alaska’s coast. The SS Islander, a 240 foot liner operated by the Canadian Pacific Navigation Company, sank on August 15, 1901 while en route from Skagway, Alaska to Vancouver, British Columbia. Approximately 40 people perished in the sinking including the highest government official of the Yukon Territory. The steamer was purportedly carrying 6 tons of gold which led to a series of salvage efforts beginning only weeks after the ship’s sinking. Not until 1934, though, were any successful attempts made due to hazardous working conditions and primitive salvage equipment. The 1934 expedition used a process similar to that employed on the Swedish Vasa shipwreck to raise a 175 foot section of the ship and beach it on shore. The tremendous efforts expended to float the ship are documented in Sunken Klondike Gold written by the expedition’s official photographer, Leonard Delano. Unfortunately for the salvors, only $75,000 in gold dust and nuggets was found – not even enough to cover the expedition’s costs. Either the 6 tons of gold was never aboard or it had been stored in the Mail and Storage Room in the bow of the ship which wasn’t recovered.

Eight decades later another group, Ocean Mar, Inc., has returned to (hopefully) complete the salvage of the ship. Ocean Mar began its efforts in the early 1990s, but were stymied by legal wranglings with another salvage company – Yukon Recovery LLC. A federal court finally resolved the dispute in June of 2012 and the state of Alaska issued Ocean Mar, Inc. a work permit for the site this week, nearly 111 years to the day since the ship’s sinking. The permit extends through December 31 and the Alaska State Museum will serve as a repository for salvaged artifacts. If recovered, the melt value of the gold alone would be worth more than $300,000,000.00 in 2012 dollars. Ocean Mar has a salvage agreement in place with Salvage Association of London whereby Ocean Mar would pay Salvage Association 25% of any recovery in order to pay off any insurers’ claims.