FMC Won’t Intervene in Split Routing Case

Commissioners of the Federal Maritime Commission won’t intervene in an informal review of a split routing case involving a non-vessel-operating common carrier.

On June 15, the FMC denied all proposals by venture capitalist Olympus Growth Fund, former owners of Global Link Logistics of Tucker, Ga.

Olympus sought input in a case which Global Link’s current owners took to the commission’s Bureau of Enforcement last year. The current owners disclosed that under the old management Global Link violated the Shipping Act by “split-routing” inland shipments. Olympus argued that the practice was common in the NVO industry.

According to legal documents in the case, Global Link would book a container to an inland destination using door-to-door rates in its service contract with an ocean carrier. However, under a second agreement with a different trucker, the container would move to a different destination that might have a higher door rate. (The Journal of Commerce, June 11.)

The determination by the FMC was important because an arbitration panel said that Global Link’s current owner was due back part of its purchase price because Olympus had falsely said that Global Link at the time of the sale was in full compliance with the law.

The FMC’s denial still leaves open a separate case by Mitsui O.S.K. Lines to recover some $4.5 million in underpayments from Global Link. There is other litigation involving Global Link’s previous and former owners in state courts.

Contact R.G. Edmonson at bedmonson@joc.com.