United States v. Approximately 64,695 Pounds of Shark Fins (520 F.3d 976) is a 2008 decision of the United States Court of Appeals for the Ninth Circuit concerning civil forfeiture in admiralty law. Judge Stephen Reinhardt wrote for a three-judge panel that ordered that the shark fins be returned to their owners, reversing a decision by the Southern District of California. The government did not appeal the case further.
The case began in 2002 when a Coast Guard crew working from a Navy ship stopped and searched the King Diamond II, a U.S.-flagged, Hong Kong–based vessel in international waters off the coast of Guatemala. On board the ship they found shark fins, equivalent to tons ( tonnes) but without any corresponding shark carcasses. The Coast Guard, upon further investigation, found documentary evidence that the KD II had arranged to meet fishing vessels at predetermined locations and buy various quantities of fins. These activities were believed to violate the Shark Finning Prohibition Act of 2000 (SFPA). The fins were thus seized and the ship escorted to San Diego, the nearest American port.
Federal agencies filed charges against the KD IIs owner, operator and captain. They further sought forfeiture of the fins under in rem jurisdiction, resulting in the unusual case title. Judge Barry Ted Moskowitz granted the order in 2005. The boat's owners appealed to the Ninth Circuit, which reversed Moskowitz's decision three years later. It held that the seizure was illegal: the KD IIs activities did not meet the definition of a fishing vessel under the Magnuson–Stevens Fishery Conservation and Management Act. Since it did not, under the SFPA, the fins could not have been lawfully seized on the high seas. In 2011, President Barack Obama signed the Shark Conservation Act into law, which closed these loopholes.
Background
China's late-20th-century economic reforms produced a middle class that increased demand for traditional luxury items like shark fins. Chinese traditional medicine ascribes various restorative and healing effects to the fins, and the soup is considered a delicacy, costing as much as US$100 per bowl. The Chinese demand for fins led fishing crews to both take them from sharks in their bycatch and start fishing for sharks directly.Clarke, Shelley; ; April 16, 2008; United States House Committee on Natural Resources, p. 3; retrieved March 25, 2012.
Shark populations began declining. Since they are predators near the top of the marine food chain, an umbrella species, playing an important role in maintaining ocean ecosystems, this could have serious adverse environmental consequences for marine fisheries. Campaigns began in many nations to prohibit or greatly curtail finning in both territorial and international waters and work toward international agreements on the practice. In the U.S., President Bill Clinton signed the Shark Finning Prohibition Act (SFPA) into law in 2000 shortly before leaving office. It amended the Magnuson–Stevens Fishery Conservation and Management Act, the primary statute regulating fisheries in the U.S.'s Exclusive Economic Zone up to 200 nautical miles offshore, to prohibit finning in U.S. territorial waters by any vessels, and the possession of fins by a U.S.-flagged vessel in international waters or the landing of any fins at a U.S. port without corresponding carcasses amounting to at least 20 times the weight of the fins. The National Marine Fisheries Service (NMFS) was charged with promulgating and implementing regulations to enforce the act.
During Congressional debate on the SFPA, Eni Faleomavaega, non-voting Delegate to the House of Representatives from American Samoa, had expressed concerns about the lack of language barring vessels from engaging in transshipment of fins, such as purchasing those taken by other vessels on the high seas. To stop this, he introduced an amendment to the bill banning the possession of the fins without the carcasses by fishing vessels, as defined in the Magnuson–Stevens Act, and the landing of same by any vessel. Congress assumed that this language would be sufficient to accomplish its intended purpose.Rahall, Nick; ; United States House Committee on Natural Resources, p. 3; July 8, 2008; retrieved March 25, 2012.
Underlying dispute
On August 13, 2002, the U.S. Navy destroyer USS Fife was in international waters southeast of Acapulco, Mexico, when it observed the King Diamond II, an U.S.-flagged vessel owned by Tran and Yu, Inc, a shipping company in Hong Kong, its home port.United States v. Approximately 64,695 Pounds of Shark Fins (hereafter Shark Fins I), 353 F.Supp.2d 1095, 1096 (S.D. Cal., 2005). The Fife's crew asked more questions over the radio. It learned that the KD II, having sailed out of Honolulu some time ago, was on its way from Honolulu to Guatemala.
A Coast Guard detachment aboard the Fife confirmed that it was properly flying the U.S. flag. The Coast Guard was suspicious since the ship was low in the water, suggesting it was carrying heavy cargo, yet there were no cranes or other equipment that a legitimate fishing vessel would be expected to have. Instead there were several large shipping containers. Via radio, they asked the Joint Interagency Task Force West, a consortium of various federal law enforcement agencies, for permission to investigate further, since smugglers and drug traffickers were known to use that route.
After receiving permission to do so, the Coast Guard boarded the KD II. The stench of decaying flesh quickly led them to a large quantity of shark fins. They were in bundles on the deck, the shipping container and filling most of the 40-ton (36-tonne) hold, where the ammonia odor was so strong that the Coast Guardsman who found them had to breathe through his mouth since it burned his nose. Since no corresponding carcasses could be found, the task force told the boarding party that this indicated a likely violation of the SFPA, and to consider the ship a crime scene as the fins were contraband.
Two days later, the Coast Guard cutter Chase took over, escorting the KD II to San Diego. Along the way the investigation continued. The Coast Guard reported that the four-man crew was cooperative with the investigation, largely sitting back and watching television in the lounge. Since they claimed not to have finned the sharks themselves, they believed they had not done anything wrong. Ship's records revealed that the KD II had met fishing vessels, primarily Korean longline fishing boats, at prearranged locations on the high seas near Fiji and the Solomon Islands and bought fins from them for a total of $250,000. On an earlier voyage that summer, the ship had made $6 million from shark fins obtained the same way. Korean-language records from a broker on board indicated an ongoing operation, giving the names of other ships involved. The refrigeration unit on board had broken before the ship had left Honolulu, and the fins were out on deck in an attempt to dry them out and reduce the odor.
In San Diego, the fins were unloaded and weighed. It took a crew of eight seven hours to unload all the fins, most of which had been tied into bundles weighing roughly 100 pounds (40 kg) each. They were put on trucks to be secured in a cold-storage facility as evidence pending the outcome of any legal proceedings. At 32.3 tons (29.3 tonnes), the total was more than twice the anticipated amount, making it the largest seizure of shark fins ever. It was estimated that the fins represented a total of 30,000 sharks taken.
Litigation
In early 2003 the National Oceanic and Atmospheric Administration (NOAA) Fisheries Office of Law Enforcement finished its investigation and charged Tran and Yu; Tai Loong Hong Marine Products Ltd., of Hong Kong, for whom the fins had been bought; and Chien Tan Nguyen, captain of the KD II, with 26 counts of violating the SFPA. They were assessed fines of $620,000, the highest civil penalty ever levied for a violation of the act.
Tai Loong believed that the government had exceeded its statutory authority by confiscating the fins. It argued that before Judge Barry Ted Moskowitz, a federal district judge for the Southern District of California, who granted an injunction against NOAA prohibiting it from selling the fins itself. The company and the agency then agreed that, in return for the former putting up a $775,000 bond, that it would take possession of the shark fins, although they remained in cold storage pending the outcome of the case. Tai Loong presold the fins for an amount almost equal to the fine against it. NOAA then initiated a civil forfeiture action with the bond substituting for the fins.Shark Fins I, at 1098.
District court In 2004 the government went before Moskowitz seeking summary judgement. The case turned on whether the KD II was a fishing vessel under the SFPA. Early in 2005 he issued his ruling, holding that while it was not directly engaged in fishing it was nevertheless engaging in activities supporting fishing and thus also subject to the SFPA. He did not grant the forfeiture as NOAA had not moved for it yet.
The SFPA deferred to the Magnuson–Stevens Act for its definition of a fishing vessel. According to that statute, a fishing vessel was one that either engaged in fishing, or "aiding or assisting one or more vessels at sea in the performance of any activity relating to fishing, including, but not limited to, preparation, supply, storage, refrigeration, transportation, or processing."16 U.S.C. § 1802(17)(A) and (B). Moskowitz rejected NOAA's argument that the KD II was engaged in fishing and therefore a fishing vessel because, under its previous ownership, it had been equipped with longline equipment and held a federal permit. That had lapsed shortly after Tran and Yu bought the ship and was no longer valid, so neither was the argument based on paper. "Whether the KD II is in fact a fishing vessel under [the first definition] depends on its configuration and how it was outfitted at the time of the seizure", he wrote. Since there was nothing in the record about that, he declined to decide the question on that grounds.Shark Fins I, at 1100–1101.
There was more to consider when Moskowitz turned to the support aspect. "Simply put, the issue in this case narrows down to whether the KD II is a vessel which was used for, equipped to be used for, or of a type which is normally used for aiding or assisting one or more vessels at sea in the performance of any activity relating to fishing." On this question Moskowitz agreed with NOAA. By going from ship to ship to buy, store and transport the fins, the KD II and its crew "directly aided and assisted the foreign vessels in an expressly enumerated fishing activity under the statute."
Moskowitz qualified his interpretation by disagreeing with the government's assertion that the mere purchase of the fins constituted an activity in support of fishing, pointing out that that would make into a fishing vessel any ship where someone aboard purchased a single fin for personal use. But in this case the KD II and its crew had acted as a middleman, "effectively br[inging] the shark fin market to the foreign fishing vessels at sea. This act, in and of itself, aided and assisted the foreign fishing vessels which no longer had to store, transport, and land their shark fins in order to sell them in the market." By doing so, they had saved time and money for the other fishing vessels they had taken fins from. He cited a document in the records, a communication between Tran and the Korean broker explicitly saying that a rendezvous "will save our time and cost" as proof.Shark Fins I, at 1102.