future-focused

EPA and Army Corps Issue New Guidance for Implementing WOTUS Definition under Supreme Court’s Sackett Decision

3 minute read

On March 12, 2025, EPA and the Army Corps of Engineers issued a joint memorandum providing guidance to field staff on implementing the definition of “waters of the United States” (WOTUS) as it pertains to “adjacent wetlands.”1 The memorandum represents a new iteration of the decades-old debate on the extent of Clean Water Act (CWA) authority over wetlands adjacent to jurisdictional navigable WOTUS. The previous iteration took place under the Biden Administration after the Supreme Court announced a two-part test in Sackett v. EPA. There, the Supreme Court held that CWA authority over WOTUS extends only to wetlands when: (1) the adjacent body of water is a “relatively permanent body of water connected to traditional interstate navigable waters” and (2) the wetland has “a continuous surface connection with that water, making it difficult to determine where the water ends and the wetland begins.” The new guidance narrows the scope of WOTUS by clarifying the current administration’s interpretation of when a wetland has a “continuous surface connection.”

The new guidance states that CWA authority will not extend to wetlands that are connected to jurisdictional waters by discrete features like non-jurisdictional ditches, swales, pipes, or culverts. It also explicitly rescinds any components of guidance or training materials that assumed a non-jurisdictional discrete feature established a continuous surface connection, citing materials compiled under the Biden Administration. The new guidance from the Trump Administration takes issue with such prior implementation, finding the “discrete features” language in tension with the “continuous surface connection” standard that Sackett set forth. EPA and the Army Corps now state that WOTUS includes “only those adjacent wetlands that have a continuous surface connection because they directly abut the [requisite jurisdictional water] (e.g., they are not separated by uplands, a berm, dike, or similar feature).”

In addition to the new guidance, EPA and the Army Corps issued a notice in the Federal Register regarding their intent to engage with stakeholders and gather recommendations on the meaning of key terms from Sackett, such as “relatively permanent” and “continuous surface connection,” to inform any potential future administrative actions to clarify the WOTUS definition and to ensure transparent, efficient, and predictable implementation.2 Stakeholders have challenged Biden-era implementation of CWA authority over adjacent wetlands in ongoing litigation, and the listening sessions are aimed at ensuring any potential, future action “will reflect consideration of the experiences of, and input received from, landowners, industry groups, the agricultural community, States, Tribes, local governments, community organizations, environmental groups, and the general public.”

The agencies will hold at least six listening sessions, with two open to all stakeholders, one open to States, one open to Tribes, one open to industry and agricultural stakeholders, and one open to environmental and conservational stakeholders. The listening sessions will be held as web and in-person conferences in late March-April 2025. Registration instructions and dates will be forthcoming at the following website here.

The listening sessions may lead to a more robust form of administrative action, such as a rulemaking to amend the existing regulations defining WOTUS, which would be more difficult for a future administration to reverse.

Liskow will be monitoring and covering further actions regarding the WOTUS definition under the new administration on Liskow’s The Louisiana Industrial Insights Hub. For more information on industry impacts and opportunities arising under the new administration, please contact Liskow attorneys Greg Johnson, Clare Bienvenu, and Colin North.

1Memorandum to the Field Between the Army Corps of Engineers and the EPA Concerning Proper Implementation of “Continuous Surface Connection” Under the Definition of “WOTUS” Under the CWA.

2 WOTUS Notice: The Final Response to SCOTUS.

EPA and Army Corps Issue New Guidance for Implementing WOTUS Definition under Supreme Court’s Sackett Decision

3 minute read

On March 12, 2025, EPA and the Army Corps of Engineers issued a joint memorandum providing guidance to field staff on implementing the definition of “waters of the United States” (WOTUS) as it pertains to “adjacent wetlands.”1 The memorandum represents a new iteration of the decades-old debate on the extent of Clean Water Act (CWA) authority over wetlands adjacent to jurisdictional navigable WOTUS. The previous iteration took place under the Biden Administration after the Supreme Court announced a two-part test in Sackett v. EPA. There, the Supreme Court held that CWA authority over WOTUS extends only to wetlands when: (1) the adjacent body of water is a “relatively permanent body of water connected to traditional interstate navigable waters” and (2) the wetland has “a continuous surface connection with that water, making it difficult to determine where the water ends and the wetland begins.” The new guidance narrows the scope of WOTUS by clarifying the current administration’s interpretation of when a wetland has a “continuous surface connection.”

The new guidance states that CWA authority will not extend to wetlands that are connected to jurisdictional waters by discrete features like non-jurisdictional ditches, swales, pipes, or culverts. It also explicitly rescinds any components of guidance or training materials that assumed a non-jurisdictional discrete feature established a continuous surface connection, citing materials compiled under the Biden Administration. The new guidance from the Trump Administration takes issue with such prior implementation, finding the “discrete features” language in tension with the “continuous surface connection” standard that Sackett set forth. EPA and the Army Corps now state that WOTUS includes “only those adjacent wetlands that have a continuous surface connection because they directly abut the [requisite jurisdictional water] (e.g., they are not separated by uplands, a berm, dike, or similar feature).”

In addition to the new guidance, EPA and the Army Corps issued a notice in the Federal Register regarding their intent to engage with stakeholders and gather recommendations on the meaning of key terms from Sackett, such as “relatively permanent” and “continuous surface connection,” to inform any potential future administrative actions to clarify the WOTUS definition and to ensure transparent, efficient, and predictable implementation.2 Stakeholders have challenged Biden-era implementation of CWA authority over adjacent wetlands in ongoing litigation, and the listening sessions are aimed at ensuring any potential, future action “will reflect consideration of the experiences of, and input received from, landowners, industry groups, the agricultural community, States, Tribes, local governments, community organizations, environmental groups, and the general public.”

The agencies will hold at least six listening sessions, with two open to all stakeholders, one open to States, one open to Tribes, one open to industry and agricultural stakeholders, and one open to environmental and conservational stakeholders. The listening sessions will be held as web and in-person conferences in late March-April 2025. Registration instructions and dates will be forthcoming at the following website here.

The listening sessions may lead to a more robust form of administrative action, such as a rulemaking to amend the existing regulations defining WOTUS, which would be more difficult for a future administration to reverse.

Liskow will be monitoring and covering further actions regarding the WOTUS definition under the new administration on Liskow’s The Louisiana Industrial Insights Hub. For more information on industry impacts and opportunities arising under the new administration, please contact Liskow attorneys Greg Johnson, Clare Bienvenu, and Colin North.

1Memorandum to the Field Between the Army Corps of Engineers and the EPA Concerning Proper Implementation of “Continuous Surface Connection” Under the Definition of “WOTUS” Under the CWA.

2 WOTUS Notice: The Final Response to SCOTUS.

FinCEN Announces Pause on Fines and Other Penalties Related to BOI Reporting Deadlines

less than a minute

The Financial Crimes Enforcement Network (“FinCEN”) announced on February 27, 2025 that it will not issue any fines or penalties or take any other enforcement actions against any companies based on any failure to file or update beneficial ownership information (“BOI”) reports. The pause in enforcement will last “until a forthcoming interim final rule becomes effective and the new relevant due dates in the interim final rule have passed.” The interim final rule should be published before the new March 21, 2025 deadline. FinCEN reiterated its commitment to reducing regulatory burden on businesses and prioritizing BOI reporting for entities that pose the most significant law enforcement and national security risks. We will provide further updates about the status of the BOI reporting deadline as they become available. For further questions regarding the update, contact Liskow attorneys Leon Rittenberg III, Julie Chauvin, Marilyn Maloney, Caroline Lafourcade or Kevin Naccari, Jr. and visit our Tax Practice page.

FinCEN Announces Pause on Fines and Other Penalties Related to BOI Reporting Deadlines

less than a minute

The Financial Crimes Enforcement Network (“FinCEN”) announced on February 27, 2025 that it will not issue any fines or penalties or take any other enforcement actions against any companies based on any failure to file or update beneficial ownership information (“BOI”) reports. The pause in enforcement will last “until a forthcoming interim final rule becomes effective and the new relevant due dates in the interim final rule have passed.” The interim final rule should be published before the new March 21, 2025 deadline. FinCEN reiterated its commitment to reducing regulatory burden on businesses and prioritizing BOI reporting for entities that pose the most significant law enforcement and national security risks. We will provide further updates about the status of the BOI reporting deadline as they become available. For further questions regarding the update, contact Liskow attorneys Leon Rittenberg III, Julie Chauvin, Marilyn Maloney, Caroline Lafourcade or Kevin Naccari, Jr. and visit our Tax Practice page.

 

FinCEN Confirms BOI Report Filing Extension to March 21 After Nationwide Injunction Lifted

less than a minute

For most businesses, Beneficial Ownership Information (“BOI”) reports will now be due by March 21, 2025 according to a FinCEN Notice updating deadlines for filing BOI reports. Any businesses which had previously received an extended deadline beyond March 21, 2025, such as for disaster relief, will retain the later filing deadline. The Notice also indicates that FinCEN will use the thirty-day pause to assess its options for further delayed deadlines and to revise the BOI reporting rule to reduce the burden for lower-risk entities. Congress is also considering legislation to extend the deadline until next year. We will provide further updates about the status of the BOI reporting deadline as they become available. For further questions regarding the update, contact Liskow attorneys Leon Rittenberg III, Julie Chauvin, Marilyn Maloney, Caroline Lafourcade or Kevin Naccari, Jr. and visit our Tax Practice page.

FinCEN Confirms BOI Report Filing Extension to March 21 After Nationwide Injunction Lifted

less than a minute

For most businesses, Beneficial Ownership Information (“BOI”) reports will now be due by March 21, 2025 according to a FinCEN Notice updating deadlines for filing BOI reports. Any businesses which had previously received an extended deadline beyond March 21, 2025, such as for disaster relief, will retain the later filing deadline. The Notice also indicates that FinCEN will use the thirty-day pause to assess its options for further delayed deadlines and to revise the BOI reporting rule to reduce the burden for lower-risk entities. Congress is also considering legislation to extend the deadline until next year. We will provide further updates about the status of the BOI reporting deadline as they become available. For further questions regarding the update, contact Liskow attorneys Leon Rittenberg III, Julie Chauvin, Marilyn Maloney, Caroline Lafourcade or Kevin Naccari, Jr. and visit our Tax Practice page.

FinCEN Confirms BOI Report Filing Extension to March 21 After Nationwide Injunction Lifted

less than a minute

Featured Image

For most businesses, Beneficial Ownership Information (“BOI”) reports will now be due by March 21, 2025 according to a FinCEN Notice updating deadlines for filing BOI reports. Any businesses which had previously received an extended deadline beyond March 21, 2025, such as for disaster relief, will retain the later filing deadline. The Notice also indicates that FinCEN will use the thirty-day pause to assess its options for further delayed deadlines and to revise the BOI reporting rule to reduce the burden for lower-risk entities. Congress is also considering legislation to extend the deadline until next year. We will provide further updates about the status of the BOI reporting deadline as they become available. For further questions regarding the update, contact Liskow attorneys Leon Rittenberg III, Julie Chauvin, Marilyn Maloney, Caroline Lafourcade or Kevin Naccari, Jr. and visit our Tax Practice page.

The FMC’s Latest Ruling on Detention Charges: What it Means for Ocean Carriers

6 minute read

On February 13, 2025, the Federal Maritime Commission (“FMC”) issued its latest ruling in a saga concerning whether an ocean carrier’s assessment of detention and demurrage (“D+D”) charges during periods when equipment cannot be returned due to terminal closures constitutes an “unjust and unreasonable” practice in violation of the Shipping Act.  See TCW, Inc. v. Evergreen Shipping Agency (Am.) Corp., Docket No. 1966(I) (FMC Feb 13, 2025). 

Brief Legal Background:  Under the Shipping Act of 1984, an ocean carrier must “establish, observe, and enforce just and reasonable regulations and practices relating to or connected with receiving, handling, storing, or delivering property,” including with respect to the assessment of D+D charges.  46 U.S.C. § 41102(c).  In 2020, the FMC issued an interpretive rule to clarify what constitutes “unjust and unreasonable” practices with respect to the assessment of D+D charges, in which it developed the “incentive principle,” which provides the “reasonableness” of D+D charges is judged by the “extent to which…[such charges] are serving their intended primary purposes as financial incentives to promote freight fluidity.”  46 CFR § 545.5(c)(1) (hereinafter, the “Interpretive Rule”).  The Interpretive Rule further specifies that “[a]bsent extenuating circumstances, practices and regulations that provide for imposition of detention when it does not serve its incentivizing purposes, such as when empty containers cannot be returned, are likely to be found unreasonable.”  § 545.5(c)(2)(ii).  However, when issuing the Interpretive Rule, the FMC acknowledged that the rule did not create any new “requirements, or mandates or dictates,” and specifically rejected calls by some industry groups to adopt a “bright line” rule (i.e., a rule providing that any D+D charges which do not incentivize freight fluidity are per se unreasonable).  85 Fed. Reg. at 29642, 29654.

Relevant Facts and Procedural History:  Yamaha Motor Company, a shipper based in Japan, contracted with Evergreen, an ocean carrier, for the transport of its containerized motorcycles from Japan to Georgia, via the Port of Savannah.  Yamaha appointed TCW, a motor carrier, to retrieve the container from the Savannah terminal and deliver its contents to destination.  Per the governing contract, once TCW retrieved the container, it had 21 days of free time to return the (empty) container before Evergreen began assessing detention charges of $150 per day.  (Detention charges for use of a chassis were also assessed at $20 per day following 4 days of free time.)  Ultimately, because TCW returned the container and chassis 7 and 22 days after the respective free time periods expired, Evergreen assessed $1,490 in detention charges.  TCW objected to the charges assessed during a three-day period when the terminal was closed (amounting to $510) and filed a complaint against Evergreen with the FMC’s small claims program.  The small claims officer issued an initial decision in TCW’s favor, which the full FMC affirmed in an opinion dated December 29, 2022.  In its opinion, the FMC focused on how assessing D+D when the terminal was closed did not serve the incentive principle, remarking in part that “during the rulemaking the Commission was clear that no amount of detention can incentivize the return of a container when the terminal cannot accept the container.”  TCW, Inc. v. Evergreen Shipping Agency (Am.) Corp., Docket No. 1966(I) (FMC Dec. 29, 2022)

Evergreen’s Appeal to the D.C. Circuit:  In its appeal to the D.C. Circuit, Evergreen asserted the FMC’s ruling was arbitrary and capricious since it failed to consider several critical facts and extenuating circumstances in determining the reasonableness of the D+D charges, including (1) Evergreen’s allotment of 21 days of free time for the container and 4 days for the chassis, which TCW did not claim was unreasonable; (2) TWC’s contractual obligation to pay detention charges after the expiration of free time; (3) the terminal had announced (before TCW took the container) the days it would be closed); and (4) free time on both the container and chassis had expired before the subject three-day closure.

In a blistering opinion, the D.C. Circuit admonished the FMC for giving short shrift to the points raised by Evergreen and for its outsized reliance on the incentive principle to the exclusion of other considerations.  Evergreen Shipping Agency (Am.) Corp. v. FMC, 106 F.4th 1113 (D.C. Cir. 2024).  The court made clear that the incentive principle did not replace the Shipping Act’s “reasonableness” standard and did not create a “bright line” rule, remarking: “In effect, the Commission treated the incentive principle as just the sort of ‘bright line’ rule it had denied creating when adopting the rule.  Yet, . . . an interpretive rule does not create any legal obligations; terms such as ‘incentive principle’ do not replace ‘reasonableness’ which is the underpinning of the Shipping Act.”  Id. at 1117 (cleaned up).  The court also characterized the FMC’s reasoning as “implausible,” explaining “the [FMC] errs insofar as it maintains a detention charge necessarily lacks any incentivizing effect because it is levied for a day on which a container cannot be returned to a marine terminal.  On the contrary, being charged for detention during a port closing announced before the carrier picks up the equipment heightens the incentive to return equipment on time.”   

In vacating the FMC’s ruling, the D.C. Circuit threw down the gauntlet:  “Under the [Administrative Procedure Act], the [FMC] cannot rest upon a bare assertion that a detention charge assessed for a day when a port is closed has no incentivizing effect.  It must, at a minimum, provide a logical explanation for its view.  Perhaps it can do so on remand, but so far it has done the very opposite.”

The FMC’s Order on Remand:  In its Order on Remand, the FMC doubled down on its original holding—that the assessment of D+D charges during the three-day period when the terminal was closed was unjust and unreasonable, in violation of § 41102(c)—but bolstered its ruling with new reasoning.  While the FMC expressly acknowledged TCW was incentivized “to return equipment before scheduled port closures to avoid accruing detention charges,” it rejected the idea that such financial incentive promotes freight fluidity.  In the FMC’s view, incentivizing equipment to be returned “just before scheduled closures” does not necessarily promote freight fluidity because there are no terminal workers to “turn around equipment returned late on the Friday before a weekend closure,” and “multi-day scheduled closures could lead to congestion and logjams at ports when truckers rush to return equipment to avoid harsher penalties, which also hinders freight fluidity.”  The FMC also cautioned that allowing detention charges over scheduled closures may also disincentivize ocean carriers and marine terminal operators to perform efficiently, such as by “maintaining open terminals to allow for the timely return of equipment.” 

Nor was the FMC persuaded by the various factors and extenuating circumstances offered by Evergreen to justify the D+D charges as reasonable.  For example, it found that although TCW had advance notice of the port’s closure (which the FMC acknowledged was a relevant factor in determining the reasonableness of detention charges), TCW was unable to return the equipment sooner due to a Covid-related closure of Yamaha’s plant.  (Notably, the FMC appears to take the view here that the ocean carrier should bear the risk of delays caused by the cargo interest.)

Ultimately, whether the FMC’s new reasoning will withstand further judicial scrutiny (or whether it will likewise be deemed “implausible” by a reviewing court) remains to be seen.  In addition, in the wake of the Supreme Court’s ruling in Loper, there could be an opportunity for ocean carriers and marine terminal operators to more broadly assert that attempts to narrow the focus of D+D charges within the framework of the incentive principle should not displace the general reasonableness standard imposed by the Shipping Act.  See Loper Bright Enters. v. Raimondo, 603 U.S. 369 (2024) (overturning Chevron deference).

For further questions regarding this ruling, contact Liskow maritime attorneys William Yost and Nicolette Kraska and visit our Maritime Litigation & Casualty Response practice page.

Disclaimer: This Blog/Web Site is made available by the law firm of Liskow & Lewis, APLC (“Liskow & Lewis”) and the individual Liskow & Lewis lawyers posting to this site for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice as to an identified problem or issue. By using this blog site you understand and acknowledge that there is no attorney-client relationship formed between you and Liskow & Lewis and/or the individual Liskow & Lewis lawyers posting to this site by virtue of your using this site. The Blog/Web Site should not be used as a substitute for legal advice from a licensed professional attorney in your state regarding a particular matter.

Privacy Policy: By subscribing to Liskow & Lewis’ E-Communications, you will receive articles and blogs with insight and analysis of legal issues that may impact your industry. Communications include firm news, insights, and events. To receive information from Liskow & Lewis, your information will be kept in a secured contact database. If at any time you would like to unsubscribe, please use the SafeUnsubscribe® link located at the bottom of every email that you receive.

The FMC’s Latest Ruling on Detention Charges: What it Means for Ocean Carriers

6 minute read

On February 13, 2025, the Federal Maritime Commission (“FMC”) issued its latest ruling in a saga concerning whether an ocean carrier’s assessment of detention and demurrage (“D+D”) charges during periods when equipment cannot be returned due to terminal closures constitutes an “unjust and unreasonable” practice in violation of the Shipping Act.  See TCW, Inc. v. Evergreen Shipping Agency (Am.) Corp., Docket No. 1966(I) (FMC Feb 13, 2025). 

Brief Legal Background:  Under the Shipping Act of 1984, an ocean carrier must “establish, observe, and enforce just and reasonable regulations and practices relating to or connected with receiving, handling, storing, or delivering property,” including with respect to the assessment of D+D charges.  46 U.S.C. § 41102(c).  In 2020, the FMC issued an interpretive rule to clarify what constitutes “unjust and unreasonable” practices with respect to the assessment of D+D charges, in which it developed the “incentive principle,” which provides the “reasonableness” of D+D charges is judged by the “extent to which…[such charges] are serving their intended primary purposes as financial incentives to promote freight fluidity.”  46 CFR § 545.5(c)(1) (hereinafter, the “Interpretive Rule”).  The Interpretive Rule further specifies that “[a]bsent extenuating circumstances, practices and regulations that provide for imposition of detention when it does not serve its incentivizing purposes, such as when empty containers cannot be returned, are likely to be found unreasonable.”  § 545.5(c)(2)(ii).  However, when issuing the Interpretive Rule, the FMC acknowledged that the rule did not create any new “requirements, or mandates or dictates,” and specifically rejected calls by some industry groups to adopt a “bright line” rule (i.e., a rule providing that any D+D charges which do not incentivize freight fluidity are per se unreasonable).  85 Fed. Reg. at 29642, 29654.

Relevant Facts and Procedural History:  Yamaha Motor Company, a shipper based in Japan, contracted with Evergreen, an ocean carrier, for the transport of its containerized motorcycles from Japan to Georgia, via the Port of Savannah.  Yamaha appointed TCW, a motor carrier, to retrieve the container from the Savannah terminal and deliver its contents to destination.  Per the governing contract, once TCW retrieved the container, it had 21 days of free time to return the (empty) container before Evergreen began assessing detention charges of $150 per day.  (Detention charges for use of a chassis were also assessed at $20 per day following 4 days of free time.)  Ultimately, because TCW returned the container and chassis 7 and 22 days after the respective free time periods expired, Evergreen assessed $1,490 in detention charges.  TCW objected to the charges assessed during a three-day period when the terminal was closed (amounting to $510) and filed a complaint against Evergreen with the FMC’s small claims program.  The small claims officer issued an initial decision in TCW’s favor, which the full FMC affirmed in an opinion dated December 29, 2022.  In its opinion, the FMC focused on how assessing D+D when the terminal was closed did not serve the incentive principle, remarking in part that “during the rulemaking the Commission was clear that no amount of detention can incentivize the return of a container when the terminal cannot accept the container.”  TCW, Inc. v. Evergreen Shipping Agency (Am.) Corp., Docket No. 1966(I) (FMC Dec. 29, 2022)

Evergreen’s Appeal to the D.C. Circuit:  In its appeal to the D.C. Circuit, Evergreen asserted the FMC’s ruling was arbitrary and capricious since it failed to consider several critical facts and extenuating circumstances in determining the reasonableness of the D+D charges, including (1) Evergreen’s allotment of 21 days of free time for the container and 4 days for the chassis, which TCW did not claim was unreasonable; (2) TWC’s contractual obligation to pay detention charges after the expiration of free time; (3) the terminal had announced (before TCW took the container) the days it would be closed); and (4) free time on both the container and chassis had expired before the subject three-day closure.

In a blistering opinion, the D.C. Circuit admonished the FMC for giving short shrift to the points raised by Evergreen and for its outsized reliance on the incentive principle to the exclusion of other considerations.  Evergreen Shipping Agency (Am.) Corp. v. FMC, 106 F.4th 1113 (D.C. Cir. 2024).  The court made clear that the incentive principle did not replace the Shipping Act’s “reasonableness” standard and did not create a “bright line” rule, remarking: “In effect, the Commission treated the incentive principle as just the sort of ‘bright line’ rule it had denied creating when adopting the rule.  Yet, . . . an interpretive rule does not create any legal obligations; terms such as ‘incentive principle’ do not replace ‘reasonableness’ which is the underpinning of the Shipping Act.”  Id. at 1117 (cleaned up).  The court also characterized the FMC’s reasoning as “implausible,” explaining “the [FMC] errs insofar as it maintains a detention charge necessarily lacks any incentivizing effect because it is levied for a day on which a container cannot be returned to a marine terminal.  On the contrary, being charged for detention during a port closing announced before the carrier picks up the equipment heightens the incentive to return equipment on time.”   

In vacating the FMC’s ruling, the D.C. Circuit threw down the gauntlet:  “Under the [Administrative Procedure Act], the [FMC] cannot rest upon a bare assertion that a detention charge assessed for a day when a port is closed has no incentivizing effect.  It must, at a minimum, provide a logical explanation for its view.  Perhaps it can do so on remand, but so far it has done the very opposite.”

The FMC’s Order on Remand:  In its Order on Remand, the FMC doubled down on its original holding—that the assessment of D+D charges during the three-day period when the terminal was closed was unjust and unreasonable, in violation of § 41102(c)—but bolstered its ruling with new reasoning.  While the FMC expressly acknowledged TCW was incentivized “to return equipment before scheduled port closures to avoid accruing detention charges,” it rejected the idea that such financial incentive promotes freight fluidity.  In the FMC’s view, incentivizing equipment to be returned “just before scheduled closures” does not necessarily promote freight fluidity because there are no terminal workers to “turn around equipment returned late on the Friday before a weekend closure,” and “multi-day scheduled closures could lead to congestion and logjams at ports when truckers rush to return equipment to avoid harsher penalties, which also hinders freight fluidity.”  The FMC also cautioned that allowing detention charges over scheduled closures may also disincentivize ocean carriers and marine terminal operators to perform efficiently, such as by “maintaining open terminals to allow for the timely return of equipment.” 

Nor was the FMC persuaded by the various factors and extenuating circumstances offered by Evergreen to justify the D+D charges as reasonable.  For example, it found that although TCW had advance notice of the port’s closure (which the FMC acknowledged was a relevant factor in determining the reasonableness of detention charges), TCW was unable to return the equipment sooner due to a Covid-related closure of Yamaha’s plant.  (Notably, the FMC appears to take the view here that the ocean carrier should bear the risk of delays caused by the cargo interest.)

Ultimately, whether the FMC’s new reasoning will withstand further judicial scrutiny (or whether it will likewise be deemed “implausible” by a reviewing court) remains to be seen.  In addition, in the wake of the Supreme Court’s ruling in Loper, there could be an opportunity for ocean carriers and marine terminal operators to more broadly assert that attempts to narrow the focus of D+D charges within the framework of the incentive principle should not displace the general reasonableness standard imposed by the Shipping Act.  See Loper Bright Enters. v. Raimondo, 603 U.S. 369 (2024) (overturning Chevron deference).

For further questions regarding this ruling, contact Liskow maritime attorneys William Yost and Nicolette Kraska and visit our Maritime Litigation & Casualty Response practice page.

Disclaimer: This Blog/Web Site is made available by the law firm of Liskow & Lewis, APLC (“Liskow & Lewis”) and the individual Liskow & Lewis lawyers posting to this site for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice as to an identified problem or issue. By using this blog site you understand and acknowledge that there is no attorney-client relationship formed between you and Liskow & Lewis and/or the individual Liskow & Lewis lawyers posting to this site by virtue of your using this site. The Blog/Web Site should not be used as a substitute for legal advice from a licensed professional attorney in your state regarding a particular matter.

Privacy Policy: By subscribing to Liskow & Lewis’ E-Communications, you will receive articles and blogs with insight and analysis of legal issues that may impact your industry. Communications include firm news, insights, and events. To receive information from Liskow & Lewis, your information will be kept in a secured contact database. If at any time you would like to unsubscribe, please use the link located at the bottom of every email that you receive.

Eastern District of Texas Stays Injunction Against Enforcement of BOI Reporting Requirements

2 minute read

The last nationwide injunction against enforcement of the Corporate Transparency Act’s Beneficial Ownership Information (“BOI”) reporting requirements has been stayed by Judge Kernodle of the Eastern District of Texas. In the order, Judge Kernodle indicated that the Supreme Court of the United States’ ruling in McHenry v. Texas Top Cop Shop, Inc. necessitated that the nationwide injunction he had previously granted be lifted. Although the government has not commented since today’s ruling was announced, FinCEN previously published an Alert indicating that a thirty-day extension would be granted in the event the nationwide injunction were lifted. We will provide further updates about the status of the BOI reporting deadline as they become available. For further questions regarding the update, contact Liskow attorneys Leon Rittenberg III, Julie Chauvin, Marilyn Maloney, Caroline Lafourcade or Kevin Naccari, Jr. and visit our Tax Practice page.

Disclaimer: This Blog/Web Site is made available by the law firm of Liskow & Lewis, APLC (“Liskow & Lewis”) and the individual Liskow & Lewis lawyers posting to this site for educational purposes and to give you general information and a general understanding of the law only, not to provide specific legal advice as to an identified problem or issue. By using this blog site you understand and acknowledge that there is no attorney-client relationship formed between you and Liskow & Lewis and/or the individual Liskow & Lewis lawyers posting to this site by virtue of your using this site. The Blog/Web Site should not be used as a substitute for legal advice from a licensed professional attorney in your state regarding a particular matter.

Privacy Policy: By subscribing to Liskow & Lewisʼ E-Communications, you will receive articles and blogs with insight and analysis of legal issues that may impact your industry. Communications include firm news, insights, and events. To receive information from Liskow & Lewis, your information will be kept in a secured contact database. If at any time you would like to unsubscribe, please use the SafeUnsubscribe® link located at the bottom of every email that you receive.