Owners Of Ship That Spilled Oil In San Francisco Bay Post $79.5 Million Bail

Saturday, December 15th 2007, 7:54 am

By: News On 6

SAN FRANCISCO (AP) _ The owner of a ship that spilled oil in San Francisco Bay has paid the federal government nearly $80 million as bail of sorts while U.S. officials seek a civil judgment, the Justice Department said Friday.

The government asked for and received $79.5 million _ the full value of the ship _ as the maritime equivalent of a release bond, said Andrew Ames, a department spokesman.

The container ship Cosco Busan struck a support on the San Francisco-Oakland Bay Bridge as it headed for South Korea on Nov. 7, spilling 58,000 gallons of oil into the fragile bay. The spill killed thousands of birds and closed more than a dozen beaches.

The deposit eliminates the government's threat to seize the vessel, which could have cost taxpayers significant money, Ames said. The threat was part of a lawsuit filed last month by the federal government against the ship's owner, Regal Stone Ltd.; Capt. John Cota, the pilot; and Regal Stone's insurance company.

Darrell Wilson, a spokesman for Hong Kong-based Regal Stone, confirmed that the ship owner posted the money but suggested that the company might try to knock the amount down.

Obtaining the security bond means that if the government wins a judgment against the ship itself, it can collect as much as $79.5 million directly against the security.

But the agreement does not limit how much the government can seek in damages as part of its November lawsuit, nor what other plaintiffs may seek, Ames said.

The lawsuit seeks unspecified damages to compensate taxpayers for the federal response to the spill.

The ship will next head for South Korea, Wilson said, though the departure date was unclear.

Meanwhile, in a separate case, a Greek shipping company was fined $4.9 million Friday in federal court in New Haven, Conn., for repeatedly dumping waste oil into international waters and lying about it.

Ionia Management was convicted in September of violating the Act to Prevent Pollution from Ships, falsifying records, obstruction of justice and conspiracy. Prosecutors say Ionia dumped waste oil several times between January 2006 and March 2007. The crew of its ship Kriton routinely dumped sludge and bilge water into the sea without recording the discharges, prosecutors said.

The company was accused of presenting false discharge records to the Coast Guard in ports in Connecticut, Florida, New York and the Virgin Islands. Ionia leaders have said senior company officials were not aware of the intentional oil discharges and would not have condoned them.