Trying to triangulate exactly how much Maryland may have agreed to with Grace Ocean Private and Synergy Marine Group, the companies that own and manage the Dali, which collapsed the Francis Scott Key Bridge in 2024, is a bit like trying to hit a bullseye with your eyes closed.
The state and the companies announced Thursday they came to an “agreement in principle” on the settlement, meaning the ink isn’t dry on the deal, but it’s a solid start on avoiding trial.
The amount that Maryland settled for probably won’t be disclosed for quite some time, considering there are still more than 50 entities suing the companies and the civil trial isn’t set until June.
However, we can get an extremely wide range on what the possibilities are.
The damages
The first thing to note is the cost. Maryland is suing for damages and the economic impacts of the Key Bridge incident.
The bridge could cost as much as $5.2 billion to rebuild and won’t be finished until 2030, according to the Maryland Transportation Authority (MDTA).
The state got a $350 million payout from its insurance company ACE American, which settled with the companies last week.
The federal government has also agreed to foot the bill for the full cost of the bridge, significantly limited costs for Maryland.
However, the state still says it’s missing out of tolls and there’s a huge economic impact now that one of the main ways to get to and from Baltimore is blocked off. In fact, some trucks have had to completely circumvent the city due to regulations about hazardous materials going through the Fort McHenry Tunnel.
A wide range of possibilities
Ship companies have a large amount of money at their disposal for accidents. Most vessels pay into the Protection and Indemnity Club for incidents like these, according to H. Allen Black, a maritime lawyer at Mills Black.
Black says the club’s kitty is about $3.1 billion.
Of course, that pool is intended for all maritime accidents and putting it all toward the Key Bridge would be a huge shake for the maritime industry.
Still, the money is available.
On the other end of the spectrum, Grace Ocean and Synergy could only been on the hook for $44 million at most.
That’s because the companies filed for limited liability after the accident.
The Limitation of Liability Act of 1851 allows ship owners to reduce their exposure under certain circumstances.
Sean Pribyl, a partner at Holland and Knight, said the state must show the vessel was unseaworthy or that neglect was taking place in order to show that liability limitation should not be granted.
That may be a risky gamble after the National Transportation Safety Board’s report last year found that a loose wire was the culprit for the two blackouts that cut steering to the ship.
Investigators concluded the reason the wire came loose is that a label was affixed to the wire too close to where it was plugged into the breaker.
The label prevented the wire from fully inserting into the breaker because the casing pushed against the label.
Furthermore, the NTSB found that the MDTA failed to assess the Francis Scott Key Bridge for threats for decades, leaving the bridge 30 times more vulnerable than thresholds set by industry standards.
“The MDTA would have been able to proactively identify strategies to reduce the risk of a collapse and loss of lives associated with a vessel collision with the bridge,” said NTSB Chair Jennifer Homendy. “What's frustrating is, not only did MDTA fail to conduct the vulnerability assessment on the Key Bridge, they did not provide, nor were they able to provide, the NTSB with the data needed to conduct the assessment, including the characteristics of vessel traffic passing under the bridge, vessel transit speeds, vessel loading characteristics.”
Finding middle ground
The extremes seem to be pretty high risk for both sides — $44 million or $3.1 billion — which is why Martin Davies, a maritime law professor at Tulane University, says a settlement was in the best interest of both parties.
“I am not particularly surprised that the case settled as Grace Ocean and Synergy would have been unlikely to succeed in limiting their liability under the statute if the case had gone to trial,” he said. “The only real issue would have been the amount to be paid, which has not yet been disclosed.”
Black agreed.
“If the claimants could not find some actual fault on the part of the owners, then they would presumably be granted limitation,” Black said. “On the other hand, if they are denied limitation, then they would face the full amount of liability found by the court. A compromise settlement would appear to be a very prudent alternative to a “roll the dice approach” for both parties.”
The civil trial for the other claimants, including the city of Baltimore, suing the companies is set for June.
