BARCLIFF, LLC, d.b.a. Radcliff/Economy Marine Services, Plaintiff - Appellant,
M/V DEEP BLUE, IMO NO. 9215359, her engines, apparel, furniture, equipment, appurtenances, tackle, etc., in rem, Defendant-Appellee, ING BANK N.V., P. O. Box 1800 ALP B.02.050 Amsterdam 1000 BV Netherland, Intervenor - Appellee.
from the United States District Court for the Southern
District of Alabama D.C. Docket No. 1:14-cv-00590-C
ED CARNES, Chief Judge and BLACK, Circuit Judges, and MAY,
Deep Blue is a pipe-laying vessel deployed in the Gulf of
Mexico. In late 2014, the Deep Blue required a routine
refueling. Its owner contacted a global marine fuel supplier.
The supplier agreed to sell the fuel and deliver it to the
Deep Blue at the Port of Mobile, Alabama. Rather than fulfill
the order out of its own stocks, the supplier purchased the
fuel from an affiliate. The affiliate, in turn, subcontracted
with Plaintiff-Appellant Barcliff, LLC, d/b/a
Radcliff/Economy Marine Services (Radcliff), a Mobile-based
maritime fuel provider, to supply and deliver the fuel.
Radcliff rendered performance and fueled the Deep Blue in
otherwise ordinary transaction ultimately became a problem
for Radcliff because, before any money changed hands, the
global marine fuel conglomerate collapsed into bankruptcy.
Radcliff found itself in the position of having supplied
several hundred metric tons of fuel on the credit of a
now-insolvent counterparty. Radcliff asserted a maritime lien
on the Deep Blue in a bid to recover directly from the ship,
giving rise to this litigation.
bench trial, the district court determined Radcliff did not
have a lien on the Deep Blue. Instead, a lien had arisen in
favor of the global fuel supplier, and was duly assigned to
ING Bank N.V. (ING), an intervenor in the suit. Radcliff
appeals, and we affirm.
significance of the contractual structure of the sale
outlined above will become clear in the course of our
analysis. Accordingly, we begin by introducing the parties to
the transaction in relation to their contractual
counterparties. A. The Sequence of Contracts
Technip purchases bunkers from O.W. UK
UK Limited (Technip) is a U.K.-based company and the owner of
the Deep Blue. Since 2001, Technip has used the Deep Blue to
lay pipe for oil rigs in the Gulf. The Deep Blue requires
periodic refueling. Each time, Technip's Scotland-based
procurement team solicits bids from a handful of
international fuel suppliers. The suppliers respond with
price quotes, and Technip selects the most appropriate
Bunkers (UK) Limited (O.W. UK), also a U.K. entity, is a
member of the O.W. Bunker Group, a global fuel supply
conglomerate. On October 22, 2014, Technip sent out a request
for quotations to O.W. UK and two other suppliers, seeking
bunker fuel for the Deep Blue in the Port of Mobile,
Alabama. After reviewing the bids, Technip awarded the supply
contract to O.W. UK, whose offer, at $824 per metric ton, was
the least expensive. Payment was to be due within thirty days
O.W. UK purchases bunkers from O.W. USA
obligated to supply the Deep Blue in the Gulf of Mexico, O.W.
UK entered into a second purchase and sale contract in order
to procure the 850 metric tons of bunkers it had agreed to
sell to Technip. This time, O.W. UK was the buyer of the fuel
and O.W. Bunker USA, Inc. (O.W. USA) was the seller. O.W.
USA, a Houston-based sibling company of O.W. UK, agreed to
sell 850 metric tons of bunker fuel to O.W. UK for $823.30
per ton, with delivery to be made to the Deep Blue in Mobile.
O.W. USA purchases bunkers from Radcliff
USA had agreed to sell O.W. UK 850 tons of fuel, but the fuel
would not come from its own stocks. Rather, O.W. USA added a
final link to the chain of contracts by retaining Radcliff to
supply the bunkers. Radcliff agreed to sell the fuel to O.W.
USA and deliver it to the Deep Blue at a price of $823 per
ton, payment due within thirty days.
the contractual arrangements were worked out, O.W. USA
emailed Radcliff and put Radcliff in touch with the Chief
Engineer of the Deep Blue, Ian Ladyka, to coordinate
delivery. Radcliff communicated with Ladyka, rather than O.W.
USA, from that point on with respect to the logistics of the
fueled the Deep Blue outside the Port of Mobile on November
1, 2014. When the fueling was complete, Ladyka signed a
bunker delivery certificate acknowledging that the 850 tons
of fuel had been conveyed. Each seller sent an invoice to its
respective buyer at their agreed prices: Radcliff to O.W. USA
for the fuel sold to it and delivered to the Deep Blue; O.W.
USA to O.W. UK; and O.W. UK to Technip.
ING Bank and the Collapse of the O.W. Bunker Group
ship now fueled and having recommenced its operations, all
that remained was settlement. Had everything gone according
to plan, Technip would have paid O.W. UK $700, 400 for 850
tons of fuel at $824 per ton; O.W. UK would have paid O.W.
USA $699, 805; and O.W. USA would have paid Radcliff $699,
550. But none of these sums was remitted because the O.W.
Bunker Group, the global marine fuel conglomerate of which
O.W. UK and O.W. USA were members, imploded. The Group's
parent company filed for bankruptcy in its native Denmark on
November 7, 2014, one week after the Deep Blue was fueled,
and concurrent bankruptcy cases were opened for its
subsidiaries, including O.W. UK and O.W. USA, in
jurisdictions around the world. Relevant here, O.W. USA's
proceeding commenced on November 13, 2014, in the District of
Connecticut. See Chapter 11 Voluntary Petition,
In re O.W. Bunker USA Inc., No. 14-51722 (Bankr. D.
Conn. Nov. 13, 2014). Thus, Radcliff remained unpaid.
overview of the O.W. Bunker Group explains the involvement of
ING in this case. The O.W. Bunker Group was founded in
Denmark in 1980 and grew to be one of the world's largest
maritime fuel providers. The Group's operations consisted
of a physical supply division, which provided bunkers
directly from the Group's onshore stocks using its own
fleet of ships, and a trading and reselling division, which
bought fuel from third parties and sold it at a markup.
December 2013, eleven months before the transaction at issue
in this case, members of the O.W. Bunker Group, including
O.W. UK and O.W. USA, entered into a $700 million revolving
credit agreement with ING and a syndicate of other lenders to
supply working capital. The credit was secured by O.W. Bunker
Group's receivables due from customers around the world
pursuant to a security agreement governed by English law (the
the course of 2014, the Group drew down nearly the entire
facility, which empowered ING to take its security, namely,
payments that third parties owed to members of the Group. ING
began to do so pursuant to a cooperation agreement between
ING and the bankruptcy estate of O.W. UK, by which ING became
entitled to collect on O.W. UK's outstanding receivables,
with all recoveries to be paid into ING accounts. Among them
was Technip's unpaid invoice for the fuel supplied to the
received no payment, and with its contractual counterparty,
O.W. USA, in bankruptcy, Radcliff filed this suit in the
Southern District of Alabama on December 19, 2014, seeking a
lien on the Deep Blue so that it could collect from the ship.
Notwithstanding the fact that its contractual obligation to
supply the ship had been owed to O.W. USA, not to Technip,
Radcliff contended that it had supplied the vessel and not
been paid, so it was entitled to a lien. Technip made a
restricted appearance for the purpose of defending the claim
against the vessel. Technip was willing to pay for the fuel
supplied to its ship, but wanted to be sure it only paid
once, since its contractual debt was to O.W. UK, not to
Radcliff, with whom it had no contractual relationship at
all. Consequently, Technip deposited $705, 529.50 into the
registry of the court, equal to the value of the invoice from
O.W. UK for the fuel plus interest, to be distributed
according to the court's ultimate determination.
April 2015, ING intervened in the suit. ING alleged that O.W.
UK supplied the fuel to the ship, albeit using
subcontractors, and Technip had not yet paid O.W. UK, so O.W.
UK, not Radcliff, had a lien on the Deep Blue. In addition,
ING had taken title to O.W. UK's accounts receivable as a
result of the credit arrangements. Thus, ING asserted that
it, not Radcliff, was entitled to the money Technip paid into
parties consented to try the case before a magistrate
judge. Following a two-day bench trial, the court
entered an order concluding that Radcliff did not possess a
lien on the ship. O.W. UK, on the other hand, did have a
lien, and had duly assigned it to ING. The court entered
judgment against Radcliff and in favor of ING and ...