FOURTH CIRCUIT RULES AGAINST TITANIC SALVORS

On Tuesday, January 31, the Fourth Circuit hands down an order in an appeal involving salvage rights to the RMS Titanic.  The ruling largely affirms a district court’s decision denying the salvor a change in status that would have enabled the salvor to claim title to certain artifacts.  The case is RMS Titanic Inc. v. Wrecked and Abandoned Vessel.

The salvor of the Titanic‘s artifacts, a company named RMS Titanic, Incorporated, has conducted salvage operations on the sunken vessel for many years.  Since no claimants had come forward to assert actual ownership interests over the artifacts brought up from the sea floor, the salvor petitioned the US District Court for the Eastern District of Virginia to convert its status to that of a finder.

The district court rejected the salvor’s request, noting that it had received the benefit of exclusive salvage rights for years under maritime law (which treats the salvor favorably, because it is performing a service for the owner or the public).  The salvor sought to have the artifacts, indeed the entire sunken vessel, treated under the law of finds, which the appellate court today likens to the ancient and venerated legal doctrine doctrine of “finders, keepers.”  If it had prevailed, it would have obtained ownership and control over the artifacts, including those still at the bottom of the sea, and the district court would no longer have any supervisory role.

The opinion handed down today contains some strong and memorable language, starting with the observation that, as noted by the district court, the salvor was trying to have its cake and eat it too.  More forcefully, the court opines that “a free finders-keepers policy is but a short step from active piracy and pillaging.”  The law of salvage is favored, as it is designed to reward those who perform selfless tasks in aid of distressed maritime travellers and their property.  The law of finds, in contrast, is disfavored, and applied in only rare circumstances.  The court determines that this situation — as singular as the Titanic herself may be — is not one of those exceptions to the general rule favoring the law of salvage.

Today’s specific holdings restrict the salvor’s rights to those originally asserted in its 1993 petition filed in Norfolk, attended by the almost ceremonial presentation of certain artifacts to the court in order to obtain constructive in rem jurisdiction over the lost vessel.  This is by no means a complete loss for the salvor, as it still has the right to seek an award of a salvage “fee” from the district court.  Indeed, this was an interlocutory appeal that interrupted the district court proceedings just as a hearing on that request was about to be scheduled.  The case is now remanded to Norfolk for a determination of the amount of the salvage award.

One aspect of the ruling, however, is decidedly in favor of the salvor.  The district court had declined to afford comity to (that is, declined to recognize) a French administrative decision in 1987 that awarded the salvor title to the first set of salvaged artifacts.  The district court found that the administrative decision failed in several respects to meet the legal requirements for comity.  But the Fourth Circuit reverses this holding, determining that the district court never acquired any jurisdiction over those artifacts.  By the time the later artifacts were recovered and brought to Norfolk for the symbolic seizure, the early set had already been taken to France.  The appellate court notes that while the ship now rests in international waters, and is thus subject to maritime law, the 1987 artifacts are in a foreign country, and that’s a very different matter.

Today’s opinion is authored by Judge Niemeyer, joined by Chief Judge Wilkins and Judge King.