Court hands down sentences in San Nikunau case

JANUARY 14, 2013 — A New Zealand fishing company that owned and operated the tuna fishing vessel San Nikunau, and a former chief engineer on the ship, were sentenced in federal court Friday for environmental crimes and obstruction of justice, announced Assistant Attorney General Ignacia S. Moreno of the Justice Department’s Environment and Natural Resources Division and U.S. Attorney for the District of Columbia Ronald C. Machen Jr.

Sanford Ltd. was ordered to pay a criminal fine of $1.9 million and pay $500,000 in community service to the National Marine Sanctuaries Foundation for the benefit of the Fagatele Bay National Marine Sanctuary in American Samoa. The vessel’s former Chief Engineer James Pogue was sentenced to 30 days in jail to be followed by two years of supervised release and ordered to pay a criminal fine of $6,000.

“Companies, like Sanford, who benefit from fishing in the oceans and selling their catch in the U.S. must comply with the laws that protect the oceans,” said Assistant Attorney General Moreno. “Today’s sentence makes clear that companies, like Sanford, who deliberately break the law by discharging oil waste into the ocean over a period of years and lie to the U.S. Coast Guard (USCG) about their activities, will be held fully accountable under U.S. laws.”

“Deliberately polluting our oceans is not only harmful to our environment– it is criminal,” said U.S. Attorney Machen. “Today’s sentence sends a clear message to owners and operators of commercial vessels who illegally dump oily waste and try to cover it up. We are committed to protecting our precious natural resources and will punish companies and individuals who ignore their obligations to our planet and future generations.”

“Some of the world’s most pristine marine ecosystems are located in the South Pacific and it is important that the rule of law is regarded and respected even in the most remote areas,” said Captain Joanna Nunan, USCG Commander, Coast Guard Sector Honolulu and Captain of the Port in American Samoa. “The U.S. Coast Guard is committed to working with the maritime community to help ensure compliance with these environmental standards.”

According to the government’s evidence, in July 2011, the U.S. Coast Guard conducted a Port State Control examination when the vessel returned to Pago Pago, American Samoa. The investigation revealed that the vessel had been routinely discharging oily waste water, without first using equipment to clean the waste water, and making false entries or no entries in an oil record book that vessels are required to maintain accurately, all in violation of international and U.S. laws.

According to evidence presented at trial, Sanford Ltd. operates the fishing vessel San Nikunau, a vessel that routinely delivers tuna to a cannery in Pago Pago. Over the past five years, Sanford was paid over $24 million for tuna deliveries. Sanford Ltd. was convicted of numerous charges including conspiracy and causing the vessel to enter into the port of Pago Pago with a knowingly falsified oil record book. Sanford Ltd. was also convicted of failing to maintain an accurate oil record book and failing to disclose that required pollution prevention equipment had not been used on the vessel. Sanford Ltd. was also convicted of discharging machinery space bilge waste into the port of Pago Pago without using required pollution prevention equipment, including the oil water separator.

Mr. Pogue, of Idaho, served as the chief engineer on the vessel between 2001 and 2010. He was convicted of failing to maintain an oil record book for the vessel and failing to account for transfers of machinery space bilge waste to other areas of the vessel. In addition, he was convicted of intending to influence a Coast Guard investigation by falsely stating in the oil record book that required pollution prevention equipment had been used when it had not.

Sanford Limited issued the following press release

U.S. Court Penalty Issued In San Nikunau Case

Following a trial in August 2012, the U.S. District Court in Washington, D.C. has today fined Sanford Limited $US1.9 million in the case relating to noncompliance with MARPOL requirements aboard its Tuna fishing vessel, the San Nikunau while it operated in international waters around American Samoa.

The Court ordered that a further Community Service Payment of $US500,000 be paid to the US National Fisheries Foundation. A probationary period of three years has been set during which time Sanford vessels cannot enter US Ports until approved audits of the Company’s Environmental Compliance Plan have been completed. The first audit is scheduled in February.

At the hearing, which got underway at 9:30am in Washington, Sanford’s lawyers argued that the US Justice Department’s call for the maximum US$3 million fine and a five year probation period, including a ban on Sanford boats entering US waters, was ‘excessive’.

They told Judge Beryl Howell that Sanford has a proven record of sound environmental management and compliance and has moved ‘aggressively to broaden and strengthen its Environmental Management System for its Pacific tuna vessels and across all of its vessel operations.’

Counsel for Sanford said that the company’s fleet was no longer calling at U.S. ports or transiting its waters.

Sanford Managing Director, Eric Barratt was in Washington for today’s sentencing. He said the company respected and understood the Court’s sentencing.

“This case has raised serious issues for Sanford, which have required the company to make significant changes to ensure they will not be repeated. These new environmental management systems are now in place across our fleet. We are pleased the court issue is now behind us and we can concentrate our efforts on improving our overall environmental compliance.”

Mr .Barratt went on to say: “Historically, Sanford vessels rarely transited through US waters, but now avoid doing so. The fleet is not presently calling at any U.S. ports. Our vessels no longer use Pago Pago as an unloading port with all catch now being sold and transferred to fish carriers at sea or landed in New Zealand.”

In 2012, Sanford also invested in a significant capital upgrade of the San Nikunau and its equipment.

Sanford’s tuna vessels are also set to be accredited to ISO 14001 by February 2013. ISO 14001 focuses on three key aspects: continual improvement; the prevention of pollution; and, the commitment to comply with all legal requirements. “All three of which support our commitment of operating in a sustainable manner,” said Eric Barratt.

“All waste-management and recording systems on our tuna purse seine fleet have been upgraded to ISO 14001 certification standard and all crew fully trained on requirements to comply with MARPOL, the international treaty that guards against marine pollution, and other international safety standard systems.”

“Choosing to gain accreditation for our Pacific tuna operations was voluntary, and includes a rigorous and intense accreditation process. Once accredited, ISO 14001 requires renewal every three years, with annual surveillance audits undertaken in the in-between years.”

The San Nikunau’s former Chief Engineer, James Pogue was found guilty in respect of two Oil Record Book related charges. He was today sentenced to one month custodial sentence, five months home detention and 18 months probation. The San Nikunau is one of three tuna purse seiners that Sanford operates throughout the Pacific and, on occasions, in New Zealand. The vessel targets skipjack tuna, which was unloaded and sold into one of the two canneries based in Pago Pago, American Samoa.

Following a routine investigation in Pago Pago in July 2011, the San Nikunau was detained for five months, which led to criminal charges being filed in January 2012 in the United States of America alleging that Sanford was vicariously liable for the crew’s failure to properly maintain the vessel’s Oil Record Book, which deals with the management of oily wastes aboard the vessel, including the use of the oily water separator.

Copies of the full sentencing submissions to the Court by Sanford’s legal team are available at www.sanfordfacts.com

Full background on the case including the jury verdicts and court documents are available at www.sanfordfacts.com