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An HMM-operated container vessel. (Photo: HMM) |
[Alpha Biz= Paul Lee] HMM, South Korea’s largest container shipping company, is facing a series of lawsuits filed by U.S. cargo owners over alleged failures to honor shipping service contracts during the COVID-19 pandemic.
According to the shipping industry on January 15, U.S. importer DK Butterfly earlier this month filed a complaint with the Federal Maritime Commission (FMC) seeking damages from HMM. The company claims that amid the global logistics crisis triggered by COVID-19, HMM failed to provide contractually guaranteed vessel space and effectively forced shippers to pay additional charges not stipulated in their contracts as global ocean freight rates surged.
DK Butterfly argues that HMM did not faithfully fulfill its service obligations, citing vessel space shortages as the reason for disrupted shipments.
HMM has countered that the issues stemmed from force majeure circumstances caused by prolonged global port congestion and delays in container loading and unloading. During the pandemic, container vessels were frequently forced to remain anchored for extended periods due to quarantine measures at ports worldwide, significantly reducing available shipping capacity. As a result, many carriers were unable to fully perform existing contracts, HMM said.
The company has already been embroiled in multiple similar lawsuits, driving up its legal costs. Samsung Electronics’ U.S. subsidiary and Euromarket Designs have also filed claims against HMM, alleging inadequate shipping services and disputing additional charges.
Despite the growing number of legal challenges, industry observers believe HMM has a strong chance of prevailing. In a comparable case brought by U.S. food importer MSRF, HMM ultimately secured a favorable ruling.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
