fuel from O.W. Bunker & Trading (O.W. Bunker) or its subsidiaries, O.W. Bunker
rarely supplied the bunkers directly to the ships. Instead, O.W. Bunker acted only as
an intermediary by sub-contracting with third-party suppliers (actual suppliers) to
deliver the bunkers to the ships.
2 In addition, certain O.W. entities assigned their
rights, pursuant to an Omnibus Security Agreement, in the bunker supply contracts
as security to ING Bank N.V. (ING). When O.W. Bunker suddenly collapsed and
filed for bankruptcy in Denmark on November 7, 2014, amidst internal fraud and
risk management losses, many of its subsidiaries and affiliates sought bankruptcy
protection by filing petitions all over the world.
3 Given the bankruptcy filing, some
actual suppliers feared that any payment collected by the upstream O.W. entities
would become part of a bankruptcy estate from which actual suppliers might never
recover.
4 Thus, actual suppliers sought an alternative way to recover payment for the
bunkers they supplied, namely, through enforcement of their maritime liens against
the ships, regardless of whether shipowners had already paid the amounts owed to
O.W. Bunker.
5 Also, ING alleged that it had an interest in the payment as assignee
against shipowners, who were then faced with potential multiple claims for payment
from O.W. Bunker, actual suppliers, and ING.
6
To address these competing claims and the risk of ship arrests, a solution was
found by shipowners in the form of an interpleader action. Such an action is a device
that can protect a disinterested party or entity who is facing competing claims by
providing for their adjudication in a single proceeding. At least twenty-five interpleader actions have been filed in, or transferred to, the Southern District of
New York. In these cases, the court is asked the overarching question: whether the
court has subject matter jurisdiction over the interpleader actions. The United States
District Court for the Southern District of New York held that it did so and granted
interpleader injunction.
7 One of the actual suppliers (“USOT”) filed an interlocutory
appeal. The United States Court of Appeals for the Second Circuit affirmed the
decision of the Southern District of New York and held that the in personam claims
against the shipowners and the in rem claims against the ships were merely alternative procedural devices to obtain the same relief and therefore the court has subject
matter jurisdiction over the interpleader actions.
8
2 Id.
3 Id.
4 Id. at 2073.
5 Id. at 2072.
6 Id. at 2073.
7 Id. at 2087.
8 Hapag-Lloyd Aktiengesellschaft v. U.S. Oil Trading LLC, 814 F.3d 146, 156 (2d Cir. 2016).
678
J. Xu
rarely supplied the bunkers directly to the ships. Instead, O.W. Bunker acted only as
an intermediary by sub-contracting with third-party suppliers (actual suppliers) to
deliver the bunkers to the ships.
2 In addition, certain O.W. entities assigned their
rights, pursuant to an Omnibus Security Agreement, in the bunker supply contracts
as security to ING Bank N.V. (ING). When O.W. Bunker suddenly collapsed and
filed for bankruptcy in Denmark on November 7, 2014, amidst internal fraud and
risk management losses, many of its subsidiaries and affiliates sought bankruptcy
protection by filing petitions all over the world.
3 Given the bankruptcy filing, some
actual suppliers feared that any payment collected by the upstream O.W. entities
would become part of a bankruptcy estate from which actual suppliers might never
recover.
4 Thus, actual suppliers sought an alternative way to recover payment for the
bunkers they supplied, namely, through enforcement of their maritime liens against
the ships, regardless of whether shipowners had already paid the amounts owed to
O.W. Bunker.
5 Also, ING alleged that it had an interest in the payment as assignee
against shipowners, who were then faced with potential multiple claims for payment
from O.W. Bunker, actual suppliers, and ING.
6
To address these competing claims and the risk of ship arrests, a solution was
found by shipowners in the form of an interpleader action. Such an action is a device
that can protect a disinterested party or entity who is facing competing claims by
providing for their adjudication in a single proceeding. At least twenty-five interpleader actions have been filed in, or transferred to, the Southern District of
New York. In these cases, the court is asked the overarching question: whether the
court has subject matter jurisdiction over the interpleader actions. The United States
District Court for the Southern District of New York held that it did so and granted
interpleader injunction.
7 One of the actual suppliers (“USOT”) filed an interlocutory
appeal. The United States Court of Appeals for the Second Circuit affirmed the
decision of the Southern District of New York and held that the in personam claims
against the shipowners and the in rem claims against the ships were merely alternative procedural devices to obtain the same relief and therefore the court has subject
matter jurisdiction over the interpleader actions.
8
2 Id.
3 Id.
4 Id. at 2073.
5 Id. at 2072.
6 Id. at 2073.
7 Id. at 2087.
8 Hapag-Lloyd Aktiengesellschaft v. U.S. Oil Trading LLC, 814 F.3d 146, 156 (2d Cir. 2016).
678
J. Xu