Vafias-linked Psara Energy has failed in its attempt to keep its contentious lawsuit against Advantage Tankers alive.
The New Orleans-based Fifth Circuit Court of Appeals denied Psara's petition to reverse a circuit court decision forcing the parties into arbitration over the now-scrapped 104,500-dwt CV Stealth (built 2005) on Thursday last week.
"The decision of the Fifth Circuit Court of Appeals was very technical on arbitration issues, not substance," said Psara's attorney George Gaitas of Gaitas & Chalos. "It was on the procedure and process of arbitration."
Psara sued Space Shipping, Advantage, Geden Lines and several other individuals and companies both in the Eastern District of Texas federal court and in New Orleans federal court in 2018.
Psara said Space, the Mehmet Emin Karamehmet-led charterer, failed to maintain the CV Stealth when it was detained in Venezuela for three years under suspicion it was part of a scheme to ship oil diverted from state oil company PDVSA.
Arrest secured
The Texas lawsuit sought $19.8m and the company secured the arrest of the 115,804-dwt Advantage Arrow (built 2009) and the 156,639-dwt Advantage Start (built 2011) as security.
Psara has also made arguments accusing the Karamehmet side of perjury, arguing that Advantage is 85% controlled by Karamehmet's daughter, Gulsun Nazli Karamehmet-Williams, and was a way for Geden to reshuffle assets and avoid having to pay for the CV Stealth lawsuits.
Advantage, which has maintained that it is independent, argued in court that the charter had an enforceable arbitration clause and that the matter would have to be settled in London.
Gaitas said his side would not appeal the decision further. He declined to elaborate on details of the London arbitration, beyond that it is going well for his side.
"[We are] happy with the way arbitration is going, there is no point in appealing anywhere," he said.
Insurance litigation
Psara filed a claim in the London High Court against a syndicate of 35 marine insurers in May, seeking a payout for the CV Stealth's total loss under its war risk policies, according to court documents.
The company seeks the tanker's insured value of $77m, plus interest and costs.
In their defence, the insurers argue that Psara has no claim over the payout because it was not a co-assured under the policies, which covered only the Geden corporate group.
The insurers also deny that the vessel's detention in Venezuela was caused by an insured peril under the policies.
Psara argues that the "intervention" of Venezuelan authorities is similar to "capture at sea" or "confiscation", which are insured perils.
The insurers also claim the vessel's value at the time of its interception was around $23m and that its $77m insured value was "substantially overstated".
