Hapag-Lloyd is under fire again for its alleged conduct at US ports.
On Monday, Florida-based fruit importer One Banana North America filed a complaint with the Federal Maritime Commission (FMC) accusing the German container ship giant of detention and demurrage conduct so outrageous that more than a dozen trucking companies refused to pick up boxes carrying its cargo.
The company alleged that the various systems Hapag-Lloyd employed to take its containers back amid worldwide supply chain congestion were unreasonable and drove trucking companies to charge thousands.
“Hapag Lloyd unfairly profited from the delays caused by its own refusal to accept empty containers because it then charged demurrage for the containers that arrived and could not be retrieved,” One Banana said in its complaint.
“Likewise, Hapag Lloyd unfairly charged detention fees.”
One Banana said Hapag-Lloyd would only allow container deliveries if one would be picked up, a so-called “double transaction”.
In one instance, a trucking company asked One Banana for $12,000 up from to cover detention fees it believed Hapag-Lloyd would charge. In another, the company had to pay $7,000 per container to move its cargo from the port to a local warehouse.
One Banana — a subsidiary of Guatemala-based AgroAmerica — seeks more than $700,000 in damages, $365,947 of which comes from losses related to the cargoes.
It had a contract with Hapag-Lloyd from January 2021 for the carriage of bananas from Guatemala and Ecuador to the ports of Los Angeles, Long Beach and Seattle.
One Banana’s is the second complaint filed against Hapag-Lloyd, with the first coming from trucker Orange Avenue Express in December.
In that complaint, Orange Avenue alleges Hapag-Lloyd effectively turned its facilities into a storage facility with Orange Avenue holding roughly 70 Hapag-Lloyd containers that the liner operator refused to take back.
At one point, Orange Avenue had to begin stacking the containers. It had so many that the California-based company almost had to shut down operators as all its chassis were taken up by empty Hapag-Lloyd containers.
Both Orange Avenue and One Banana alleged the double transaction system was the first the company employed, as skyrocketing consumer demand packed containers, ships and ports full of cargo.
The liner operator eventually set up an email system that would automatically reply with locations that were accepting containers, but it eventually stopped replying, both complaintants alleged. Hapag-Lloyd would then reply at its own discretion and would eventually require appointments to return containers.
Orange Avenue further alleged that Hapag-Lloyd would only waive detention fees for days when there were no drop off locations available.
The company seeks unspecified damages related to the cost of storage, chassis use fees, cost to take containers off chassis, detention charges and re-delivery charges.
The two complaints follow the FMC launching an investigation into Hapag-Lloyd's conduct around detention and demurrage charges in November.
In its order opening the investigation issued in November, the FMC made largely the same allegations as One Banana and Orange Avenue.
A joint status report on the investigation has an oral hearing set for April.
Hapag-Lloyd declined to comment. In filings in the Orange Avenue dispute, it denies that it deactivated the email and denies the dual transaction requirement.
The FMC began taking a harder look at liner operators in July following an executive order from President Joe Biden on competitiveness in the US economy.
The order prompted the commission — tasked with regulating ocean carriers and settling disputes over violations of the Shipping Act — to sign an agreement with the Department of Justice's antitrust division and seek greater investigative and enforcement powers.
It has launched investigations into container ship operators Wan Hai Lines and Ocean Network Express and sought greater powers to investigate and enforce its rules.
The commission alleges Wan Hai Lines charged fees for containers without giving a place to return them and that ONE had an excessively broad definition of "merchant" in its terms and conditions.
ONE has argued it is being singled out and stemmed from a unique circumstance regarding a freight forwarder's conduct.
Pennsylvania furniture manufacturer MCS Industries has also filed a complaint against Mediterranean Shipping Co alleging it failed to provide the cargo space reserved in a contract.
