## Facts

- The United States shipped large quantities of famine-relief food cargo to several ports in Africa.
- The United States hired Ocean Bulk Ships, Inc. as the ocean carrier for the shipments.
- The cargo was loaded using standard packaging, and Ocean Bulk issued clean bills of lading stating the cargo was received in apparent good order and condition.
- When the cargo was discharged at the destination ports, significant portions were missing and/or damaged.
- Port surveyors who observed discharge offered differing, largely speculative explanations for the losses, including the possibility of insufficient packaging by the United States.
- The United States calculated total cargo loss and damage at $203,319.87 and sued Ocean Bulk in federal district court under the Carriage of Goods by Sea Act (COGSA).
- The district court limited the United States’ recovery to $7,300.08 based on COGSA-related limitations.
- The United States appealed, and Ocean Bulk cross-appealed, disputing both liability and the sufficiency of the damages proof.

## Issues

1. Did the United States establish a prima facie case under COGSA by showing the cargo was delivered to the carrier in good order and outturned short or damaged at destination?
2. Did Ocean Bulk rebut the prima facie case by proving a COGSA defense or exception, including alleged insufficiency of packing?
3. Did the United States present competent proof of the amount of damages it claimed?
4. Did the district court err by limiting recovery to $7,300.08 rather than awarding the proven loss?

## Decision

- The Fifth Circuit vacated the district court’s judgment limiting recovery to $7,300.08.
- The court rendered judgment for the United States for $203,319.87 plus prejudgment interest.
- The court held the United States made a prima facie COGSA showing through clean bills of lading (evidence of good condition on receipt) and proof that the cargo was missing or damaged upon discharge.
- The court held Ocean Bulk did not carry its burden to avoid liability because the surveyors’ theories— including packing-related explanations—were conjectural and did not prove an actual causal exception under COGSA.
- The court rejected Ocean Bulk’s challenge to damages, concluding the government’s documented calculation provided a sufficient basis to award the full amount claimed.

## Legal Principles

- Under COGSA, a cargo claimant establishes a prima facie case by proving (1) delivery to the carrier in good order and condition and (2) outturn in damaged or short condition.
- A clean bill of lading is strong evidence that the carrier received the cargo in apparent good order, shifting the burden to the carrier once outturn loss or damage is shown.
- After a prima facie showing, the carrier must prove a statutory exception or other non-fault basis for the loss; speculation about possible causes (including possible packing problems) does not satisfy that burden.
- Damages need not be proven with absolute precision, but the claimant must provide reliable evidence from which the trier of fact can determine the amount of loss with reasonable certainty.
- When the record permits a final determination of liability and damages, an appellate court may render judgment rather than remand, and prejudgment interest is commonly awarded in admiralty to fully compensate the injured party.

## Conclusion

In *United States v. Ocean Bulk Ships*, the Fifth Circuit held that the United States proved a prima facie COGSA cargo-loss case with clean bills of lading and evidence of missing or damaged famine-relief cargo at discharge, and that Ocean Bulk failed to rebut liability with anything more than speculative theories such as insufficient packing; the court therefore vacated the nominal award and rendered judgment for the full $203,319.87 plus prejudgment interest.


United States v. Ocean Bulk Ships, 248 F.3d 331 (2001)