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Trek Bicycle and Bell Sports sue over cargo lost or damaged at sea

Published November 7, 2022

NEW YORK (BRAIN) — COVID-19, massive consumer demand, and the war in Ukraine have upset the industry's supply chain in recent years. Rough seas also played a part.

Bell Sports and Trek Bicycle are among the firms suing shipping companies over containers lost or damaged due to storms in the North Pacific in early 2021.

The Maersk Essen 051, a 366-meter ship, lost more than 700 containers when it encountered heavy seas off Mexico on Jan. 16, 2021. The vessel was en route from Xiamen, China, to Los Angeles. Trek is among more than 30 companies suing Maersk, the ship's operator, and other related parties for lost or damaged cargo on the Essen.

Trek was part of an initial suit with fellow plaintiff Formlabs Inc. filed in January 2022 against freight carrier Flexport. That complaint demanded to recover $337,000 in damages. Trek's share of the total is not specified in court filings. The case is being consolidated with other related suits naming Maersk, Flexport and other companies related to the voyage. Other plaintiffs include Sunbeam Products, Bob's Discount Furniture, and Skechers.

Among the lost or damaged containers were four that contained a total of 8,200 cartons of Bell Sports helmets and accessories.

A month and a day after the Essen incident, the Maersk Eindhoven — also a 366-meter vessel that was en route from Xiamen to Los Angeles – lost about 260 containers in a storm near Japan. Other containers were damaged.

According to suit filed by Bell, among damaged containers from the Eindhoven were four that contained a total of 8,200 cartons of Bell Sports helmets and accessories. Bell and its insurer, AGCS Marine Insurance Company, are among at least 17 companies suing Maersk and others over the loss. Bell's complaint, filed in February 2022, said it lost products worth $256,000.

Other plaintiffs in that suit include Homegoods, Hallmark Cards, Wolverine World Wide, and Ashley Furniture.

A Vista Outdoor spokesman declined to comment to BRAIN about the suit. A company communication earlier this year mentioned the incident. The announcement said Vista Outdoor's procurement department quickly used an insurance payout after the loss to charter an airplane and fly replacement products to the U.S. "'It's a classic example of having to be creative and ensuring that we get the product where it needs to be and on time,'" the communication said, quoting David Stokoe, Vista Outdoor's vice president of strategic procurement.

BRAIN could not reach Maersk regarding the suits. Maersk's press office told in February that such lawsuits are "a very common tool in the maritime sector" to invoke claims for compensation.

The years 2020-2021 were especially eventful for Maersk and the trans-Pacific shipping industry, with 3,113 containers lost at sea according to the World Shipping Council. In the prior two-year period, just 779 containers were lost. The council said that the containers lost in 2020-2021 represented less than one-thousandth of 1% (0.001%) of all containers shipped.

More lost en route

In another more recent suit over goods lost or damaged in transit, Trek and its insurance underwriters at Lloyds filed suit in October against Union Pacific Railroad Company and others over damage to a shipment of bikes from Vietnam to Butler, Iowa, via the port of Long Beach, California.

It's not clear from court filings whether the shipment was damaged at sea or after it left Long Beach, but the suit says damages totaled $96,000; Trek is looking to recover the $25,000 deductible on its insurance policy with Lloyds, and Lloyds wants to recover the balance.
The suit was filed Oct. 11 in the U.S. District Court for Southern California. Union Pacific and its codefendants have not responded to the suit in court filings. They have until Nov. 17 to do so. A Trek spokesman did not reply to BRAIN inquiries for this article.


Getty stock image.
Topics associated with this article: Lawsuits/legal, Supply chain, Broken Chain

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