Royal Caribbean Cruise Lines 2009 Annual Report Download - page 38

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In July 2009, three purported class actions were filed in United States District Court for the Eastern District of Michigan against
Park West Galleries, Inc., doing business as Park West Gallery, PWG Florida, Inc., Fine Art Sales, Inc., Vista Fine Art LLC, doing
business as Park West At Sea (together, “Park West”), and other named and unnamed parties, including Royal Caribbean Cruises Ltd.
and Celebrity Cruises Inc. and other unaffiliated cruise line companies. The actions are being brought on behalf of purchasers of
artwork at shipboard art auctions conducted by Park West on the named cruise lines. All three actions were subsequently transferred
to the United States District Court for the Western District of Washington and are no longer being brought on a class action basis.
Also pending in the Western District of Washington as a result of transfer are two other actions against Park West and other
unaffiliated cruise line companies that, after being transferred, were amended to add Royal Caribbean Cruises Ltd. and Celebrity
Cruises Inc. as defendants. One of these actions is being brought on a class action basis. The substance of the claims in all five actions
is virtually the same. The suits allege that the artwork Park West sells is not what it represents to its customers and that Royal
Caribbean Cruises Ltd., Celebrity Cruises Inc. and other named cruise lines are complicit in the activities of Park West, including
engaging in a conspiracy with Park West in violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), and are
being enriched unjustly from the sale of the artwork. The actions seek from the named defendants refund and restitution of all monies
acquired from the sale of artwork at shipboard auctions, recovery for the amount of payments for the purchased artwork, damages on
the RICO claims in an indeterminate amount, permitted statutory damages and unspecified equitable or injunctive relief. The suits
also seek from certain non-Royal Caribbean parties additional statutory, breach of contract and breach of warranty damages in
unspecified amounts. The suits are at their very early stages of litigation; however, we believe we have meritorious defenses to the
claims against us and we intend to vigorously pursue them.
In September 2009, demands for arbitration were made under our collective bargaining agreement covering Celebrity Cruises’
crewmembers on behalf of twenty current and/or former Celebrity Cruises’ cabin stewards and others similarly situated (the
“September 2009 Demands”). These demands contend that between 2001 and 2005 Celebrity Cruises improperly required the named
cabin stewards to share guest gratuities with assistant cabin stewards. The demands seek payment of damages, including penalty
wages, under the U.S. Seaman’s Wage Act of approximately $0.6 million for the named crewmembers and estimates damages in
excess of $200.0 million, for the entire class of other similarly situated crewmembers. In October 2009, and again in December 2009,
additional demands for arbitration were made under our collective bargaining agreement covering Celebrity Cruises’ crewmembers
by the same counsel on behalf of a total of three current and/or former Celebrity Cruises’ cabin stewards and others similarly situated,
making the same contentions and seeking the same damages as in the September 2009 Demands. A similar action brought by this
same counsel in October 2009 on behalf of ten crew members and others similarly situated in the Southern District Court, Southern
District of Florida making the same contentions and seeking the same damages as the arbitration demands was dismissed with
prejudice. We believe we have meritorious defenses to the pending arbitration demands which we intend to vigorously pursue.
We are routinely involved in other claims typical within the cruise vacation industry. The majority of these claims are covered
by insurance. We believe the outcome of such claims, net of expected insurance recoveries, will not have a material adverse impact
on our financial condition or results of operations.
None.
28
Item 4. Submission of Matters to a Vote of Securit
y
Holders