Royal Caribbean Cruise Lines 2011 Annual Report Download - page 39

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PART I
ROYAL CARIBBEAN CRUISES LTD. 35
We believe that our facilities are adequate for our
current needs and that we are capable of obtaining
additional facilities as necessary.
We also operate two private destinations which we
utilize as a port of call on certain of our itineraries:
(i) an island we own in the Bahamas which we call
CocoCay; and (ii) Labadee, a secluded peninsula which
we lease and is located on the north coast of Haiti.
ITEM 3. LEGAL PROCEEDINGS
Between August 1, 2011 and September 8, 2011, three
similar purported class action lawsuits were filed
against us and certain of our officers in the U.S.
District Court of the Southern District of Florida. The
cases have since been consolidated and a consoli-
dated amended complaint was filed on February 17,
2012. The consolidated amended complaint was filed
on behalf of a purported class of purchasers of our
common stock during the period from October 26,
2010 through July 27, 2011 and names the Company,
our Chairman and CEO, our CFO and the Presidents
and CEOs of our Royal Caribbean International and
Celebrity Cruises brands as defendants. The consoli-
dated amended complaint alleges violations of Section
10(b) of the Securities Exchange Act of 1934 and
SEC Rule 10b-5 as well as, in the case of the individual
defendants, the control person provisions of the
Securities Exchange Act. The complaint principally
alleges that the defendants knowingly made incorrect
statements concerning the Company’s outlook for 2011
by not taking into proper account lagging European
and Mediterranean bookings. The consolidated
amended complaint seeks unspecified damages,
interest, and attorneys’ fees. We believe the claims
are without merit and we intend to vigorously defend
ourselves against them.
A class action complaint was filed in June 2011 against
Royal Caribbean Cruises Ltd. in the United States
District Court for the Southern District of Florida on
behalf of a purported class of stateroom attendants
employed onboard Royal Caribbean International
cruise vessels alleging that they were required to
pay other crew members to help with their duties in
violation of the U.S. Seaman’s Wage Act. The lawsuit
also alleges that certain stateroom attendants were
required to work back-of-house assignments without
the ability to earn gratuities in violation of the U.S.
Seaman’s Wage Act. Plaintiffs seek judgment for
damages, wage penalties and interest in an indetermi-
nate amount. We have filed a Motion to Dismiss the
Complaint on the basis that the applicable collective
bargaining agreement requires any such claims to be
arbitrated. We believe we have meritorious defenses
to the lawsuit which we intend to vigorously pursue.
We commenced an action in June 2010 in the United
States District Court for Puerto Rico seeking a declar-
atory judgment that Puerto Rico’s distributorship laws
do not apply to our relationship with an international
representative located in Puerto Rico. In September
2010, that international representative filed a number
of counterclaims against Royal Caribbean Cruises Ltd.
and Celebrity Cruises, Inc. alleging violations of Puerto
Rico’s distributorship laws, bad faith breach of con-
tract, tortious interference with contract, violations of
various federal and state antitrust and unfair competi-
tion laws. The international representative is seeking
in excess of $40.0 million on each of these counter-
claims together with treble damages in the amount of
$120.0 million on several of the counterclaims as well
as injunctive relief and declaratory judgment. We
believe that the claims made against us are without
merit and we intend to vigorously defend ourselves
against them.
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 and
cash flows.
ITEM 4. MINE SAFETY DISCLOSURES
None.