18-2974(L)
`In re: M/V MSC Flaminia
`
`
`
`In the
`United States Court of Appeals
`For the Second Circuit
`______________
`
`August Term, 2019
`
`(Argued: May 15, 2020 Decided: June 30, 2023)
`
`Docket Nos. 18-2974-cv(L), 18-3083-cv(CON)
`______________
`
`IN RE: M/V MSC FLAMINIA
`_______________
`
`
`
`
`
`Stolt Tank Containers B.V., Stolt-Nielsen USA, Inc., Deltech Corporation,
`
`
`Plaintiffs-Claimants-Appellants,
`
`ArcelorMittal, SNF Holdings, Flomin, Inc., SNF Saint Avold, SNF SAS, Roam
`Global Logistics LLC, Tetra Technologies Norge, Milliken & Company, Ahlers EDC,
`Steinweg Handelsveem, CISC Liggett-Ducat, British American Tobacco PLC, LLC,
`Petroresurs, United Transport Tankcontainers BV, General Mills UK, Ayecue
`Internacional S.L.U., C.H. Robinson International Inc., C.H. Robinson Poland S.P ZO.O,
`Line X Acquisition LLC, Clariant Corporation, Panalpina, Inc., Potter Group, Ltd.,
`Clariant Production, UK Ltd., Panalpina World Transport Ltd., Ecolab Inc., Nalco
`Company, Eastman Chemical Company, Rauan Nalco LLC, Mexpack International
`Movers S.A. deC., NSB Niederelbe Schiffahrtsgesellschaft MBH & Co KG, as operator,
`of the vessel MSC FLAMINIA, Mueller Water Products, Inc., Rim Logistics, Ltd., VCK
`Rotterdam BV, Protim Solignum Ltd., GP Cellulose GMBH, GP Harmon Recycling LLC,
`Eagle Paper International, Inc., Trouw Nutrition USA, LLC, Cheng Loong Corporation,
`Indemnity Insurance Company of North America, Ace European Group Ltd., Ace
`Seguros S.A., Alcan Automotive LLC, RLI Insurance Company, Senator International
`Ocean LLC, Plastic Omnium Automotive Exterior, Borbet, IAC Spartanburg, Behr
`Industries, Mubeca Inc., Carcoustics USA Inc., Lear Corporation, Magna Exteriors and
`Interiors, Proper Polymers, Excell USA Inc., TI Automotive, Draexlmaier Automotive
`America, BMW Group Plan 2.7, BMW AG Werk 2.7, Gulbrandsen Chemicals Inc.,
`
`

`

`Novozymes, Newport Tank Containers Inc., Huntsman Petrochemical LLC, Graftech
`Switzerland S.A., Network America Lines, Graftech Mexico, Brokmak OU, Graftech
`France SNC, Huntsman Holland B.V., Deltech Corporation, Deltech Europe Ltd., Nuco
`Logistics, Inc., ARR-MAZ Custom Chemicals Inc., Triple F. Logistics B.V., Cray Valley
`USA Inc., CJ Hendricks B.V., The Lubrizoil Corporation, Lubrizoil France SA, Bercen
`Inc., Selluken AB, Hellas S.A., Bulkhaul (USA) Inc., ADPO NV, Bulkhaul Limited,
`National Union Fire Insurance Company of Pittsburgh, PA., Chartis Seguros Mexico,
`S.A. de C.V., AMI Trading (USA), Inc., Jewometaal Stainless Processing, Arubis AG,
`Shandong Jinsheng NonFerrous Group Co., Ltd., Armstrong World Industries Inc.,
`Expeditors MCO, Expeditors International (UK) Ltd., Atlas Van Lines International,
`Oceanic Container Line, Inc., Oceanic Shipping & Transport GMBH, Lager, Cooper Tire
`& Rubber Company, Cooper Tire & Rubber Company Europe Ltd., Coty Geneva S.A.,
`Coty US LLC, Cray Valley USA LLC, Kintetsu World Express (USA) Inc.,
`Environmental Express Inc., Metlab Supplies Ltd., DHL Global Forwarding, Firestone
`Building Products Co., Wiehag GMBH, Bridgewell Resources LLC, Nippon Denko
`Company Ltd., Quiborax S.A., Special Metals Welding Products Company, Precision
`Castparts, Equipos Nucleares SA, Magnelec S.A. De C.V., Veitsch Radex GMBH & Co.
`OG, Viscofan USA Inc., OOO Procasing, Taminco, Inc., United Transport Tank
`Containers, 3M Belgium N.V., Interbulk (Tank Containers) Ltd., Nufarm UK Ltd.,
`Butachimie, SKF De Mexico, S.A. De C.V., SKF GMBH, UAB Neo Group, Productora De
`Tereftalatos De Altamira S.A. De C.V., EPU Service Center, NEK, Schlumberger
`Technology Corporation, Terza S.A. De C.V., Galleon International Freight Service,
`Groupement Ivoirien D'Industrie ET, Total Petrochemicals & Refining USA, Inc., AGCS
`Marine Insurance Company, Rockwood Holdings, Inc., Rockwood Lithium, Inc.,
`Bulkhaul UK Ltd., Chemtall GMBH, Volkswagen Group of America, Inc., Zenda
`Dienstleistungen GMBH, Rudolph Logistik Gruppe, GMBH, Volswagenwerk AG,
`Baillie Lumber Sales Co, Baillie Lumber Co., Trinseo Materials Operating S.C.A., Styron,
`LLC, Styron Europe GMBH, Industrias John Deere SA De C.V., Wayand GMBH, John
`Deere International GMBH, DOSECC Exploration Services, LLC, Global Logistics
`Shipping Inc., Hydrobiological Institute-Ohrid, Rayonier, Inc., SE Tylose GMBH & Co.
`KG, Vopak Agencies Rotterdam B.V., Dow Chemical Company, DOW Europe Gmbh,
`BDP International NV, Angus Chemie GMBH, Amerchol Corporation, Estee Lauder,
`Inoac Polytec De Mexico, Suttons International, Centre Point JB Nagar, Unicharm
`Corporation, Procter & Gamble Company, Westerlund, Societe Industrielle De
`Papeterie, Farmeko, Liberty International Underwriters, Huntsman Corporation,
`Johann Haltermann Ltd., Monument Chemical BVBA, Copperweld Bimetallics LLC,
`Red Electrica De Espana, Continental Insurance Company, Toyo Cotton Co., Fiber
`Source International Corp., Asya Kagit Matbaa Gida Ve, Tekstil Santic AS, Stemaco
`USA Inc., SB Enterprises, JA Lacour Company, Giorgio Gori USA Inc., Danzer UK Ltd.,
`
`
`
`
`
`2
`
`

`

`CNA Metals Limited, Thai Nguyen Iron and Steel Joint Stock Corporation, Oceanic
`Logistics Inc., Exxonmobil Chemical Company, Advanced Elastomer Systems Ltd.,
`Exxonmobil Specialty Elastomers, Exxonmobil Petroleum & Chemical Holdings Inc.,
`Mobil Chemical Products International, Esso Societe Anonyme Francaise, Exxonmobil
`Chemical Films, Exxonmobil Chemical Films Europe, Emeraude International SAS, XL
`Specialty Insurance Company, Cabot Corporation, Kansai Nerolac Ltd. Bilakhia House,
`Tokio Marine & Nichido Fire Insurance Co. Ltd., Shintech, Inc., Klockner Pentaplast,
`Mitsubishi Corporation, Agrinorte S.A., Itochu Plastics PTE Ltd., Unitcargo Container
`Line, Holzextroplast OOO, Aspen American Insurance Company, Inter-Trans
`Insurance, Raif Coskun Caglar, Rainier Overseas Movers Inc., Vinmar International
`Limited, Tricon Dry Chemicals LLC, MTS Logistics Inc., MTS Lojistik Ve tasimacilik
`Hizmetleri Tic A.S., Elite House LLP, Taloox Group LLC, Ocean World Lines Inc.,
`Trinity Industries Inc., Allseas Global Logistics, Hill & Smith Ltd., Formosa Plastics
`Corporation, TCR Plastics, Apiexport S.A. De CV, Lamex Foods UK, Multienlaces De
`Transportes Internacionales SA De CV, Banks And Lloyd (Shipping) Ltd., Great
`American Insurance Company, Al Ahlia Insurance, Nipponkoa Insurance (Europe),
`Prosight Specialty Insurance, Classic American Hardwoods, Carolina Ocean Lines,
`Timber Connection, Palmer Timber, Naddi Motors, Link Lines Logistics, Inc., Golink
`Ltd., Hanna Motors, Society A-N Auto Import Export, JF Hillebrand Mexico SA,
`Bahrain Maritime & Mercantile International, Wisco Espanola SA, Ivan Luna Segura,
`Carolinas Cotton Growers Corp., Starr Indemnity & Liability Company, American
`Hardwood Industries, LLC. Tradelanes, Inc., Caterpillar Inc., Caterpillar SARL, Eneria
`S.A.S., Zeppelin Power System GMBH, Zeppelin Baumaschinen GMBH, Pon Power AS,
`Finning (UK) Ltd., Cargo Partner AG, Vinmar International Ltd., Caterpillar Marine
`Power (UK) Ltd., Esco Corporation, Kamin LLC, OMYA AB, Schuite & Schuite
`Druckfarben GMBH, OMYA GMBH, Kansai Altan Boya Sanayi Ve Ticaret AS, Prochem
`AG, OOO OMYA URAL, Blagden Specialty Chemicals Ltd., Stanley Black & Decker,
`Inc., Stanley Logistics Centre, Black & Decker Limited SARL, Expeditors International,
`DSV Air & Sea Inc., DSV Air & Sea Ltd., Weatherford International Inc., Sabic
`Innovative US, Sabic Innovative Plastics BV, Sabic Innovative Plastics India PVT Ltd.,
`Sabic Innovative Plastics Mexico, Cummins Inc., Ceva Freight Management (Mexico),
`CWL Mexico S De RL, Ceva Freight (UK) LTD., Crane Worldwide (UK) Ltd., Whitman
`Laboratories Ltd., Unitrans P.R.A. Company, Inc., Grand Medical Group, Dart
`Containers FCA Bahamas, Polymers International Limited, Surrey Europe SARL, Red
`Square Corporation, Unitrans P.R.A. Company, Inc., FTT Consulting, Grand Medical
`Group, Dart Containers FCA Bahamas, Polymers International Limited, Nomad Brands,
`Inc. LLC TLC, NCR Nederland, NCR SDC, NCR Global Solutions, Gaylord Chemical
`Co. LLC, IMCD Benelux N.V., ICC Chemical Corporation, Fleur De Lis Worldwide,
`LLC, MTS Logistics, Inc., OOO Pioneer Trade, Pioneer Polyleathers PVT Ltd., Parmar
`
`
`
`
`
`3
`
`

`

`International PVT, Ltd., International Commodities, Arubis Belgium NVSA, Tyco
`International Ltd., Ocean World Lines Inc., OWL Belgium, Honeywell International
`Inc., E Rigas SA, Anheuser-Busch International Inc., Arkema Inc., Pfauth Logistiek
`Diensyverl, Arkema Vlissingen BV, PJ Lumber Company, Lathams Limited, Ramsay
`Timber, Junkers Industrier A/S, Danzer IK Ltd., Hardwood Dimensions Ltd., Timber
`Connections Ltd., Tzeng Long USA, Inc., Rocktenn CP, LLC, Helvetia Insurance S.A.,
`Chevron Oronite Company LLC, Chevron Oronite SAS, Turk Ekonomi Bakasi, UAB
`"Jurvista", Stolt Tank Containers Germany GMBH,
`Stolt Tank Containers France SAS,
`Plaintiffs,
`
`–v.–
`
`NSB Niederelbe Schiffahrtsgesellschaft MBH & Co. KG, as operator, of the vessel MSC
`FLAMINIA, Conti 11 Container Schiffahrts-GmbH & Co. KG MS MSC Flaminia, MSC
`Mediterranean Shipping Company S.A., BDP International, Inc.,
`
`
`Rubicon LLC,
`
`Defendants-Appellees,
`
`Third-Party-Defendant–
`Appellee,
`
`Chemtura Europe GmbH, Chemtura Corporation, Chemtura Italy S.R.L.,
`
`
`Defendants–Counter-
`Claimants–Appellees.∗
`
`
`
`
`
`
`
`
`
`B e f o r e :
`
`
`
`
`______________
`
`CHIN, CARNEY, and MENASHI, Circuit Judges.
`______________
`
`
`Deltech Corp. (“Deltech”), a chemical manufacturer, joins here with Stolt-Nielsen
`USA, Inc., and Stolt Tank Containers B.V. (together, “Stolt”), a shipping concern, to
`challenge the district court’s determination that they alone bear liability for damages
`
`
`∗ The Clerk of the Court is directed to amend the caption to conform to the above.
`
`
`
`
`4
`
`

`

`caused by an explosion and fire that took place in June 2012 aboard the ocean-going
`vessel M/V MSC Flaminia. Two weeks into the Flaminia’s trip from New Orleans
`Terminal across the Atlantic, three tanks of 80% grade divinylbenzene (DVB-80)
`manufactured by Deltech and shipped by Stolt exploded, and a fire then ignited, killing
`several members of the ship’s crew, injuring others, and damaging the ship and its
`cargo.
`
`In the first phase of a three-part proceeding in the United States District Court for
`the Southern District of New York (Forrest, J.), the district court addressed the causes of
`the explosion. It determined that the decision to ship DVB-80 from New Orleans
`Terminal rather than a northeastern port, the early filling of the DVB-80 containers and
`their early transport to New Orleans Terminal, the conditions in which the tanks of
`DVB-80 were kept at New Orleans Terminal, and their placement and stowage onboard
`the Flaminia were the primary causes of the explosion. These conditions resulted in the
`chemical undergoing runaway auto-polymerization, emitting a cloud of vapor that was
`ultimately ignited when the crew’s firefighting efforts generated a spark. See In re M/V
`MSC FLAMINIA, No. 12-cv-8892 (KBF), 2018 WL 526549, at *30-31 (S.D.N.Y. Jan. 23,
`2018) (“Phase I”). In the second phase, the district court addressed liability for cargo loss
`and damage. (Separately, claims for death and bodily injury had largely been settled.) It
`found Deltech and Stolt together wholly responsible for those losses: Deltech, at a 55%
`level, and Stolt, at 45%. See In re M/V MSC FLAMINIA, 339 F. Supp. 3d 185, 229–30
`(S.D.N.Y. 2018) (“Phase II”). It exculpated other parties to the shipping transaction from
`legal liability. It is this decision that Deltech and Stolt challenge now in an interlocutory
`appeal. (In further proceedings, the court will make and apportion a damages award
`among those parties still pursuing claims. Id. at 191.)
`On review, we affirm in part and reverse in part. We REVERSE the district
`court’s determination that Deltech and Stolt are strictly liable under Section 4(6) of the
`Carriage of Goods at Sea Act (“COGSA”), 46 U.S.C. § 30701 (note), but we AFFIRM its
`ruling that Deltech and Stolt are liable under a failure-to-warn theory pursuant to
`Section 4(3) of COGSA. As to the other defendants, we AFFIRM the district court’s
`conclusion that the carrier and related shipowner interests—MSC Mediterranean
`Shipping Company S.A. (“MSC”), Conti 11 Container Schiffahrts-GMBH & Co. KG
`MSC “FLAMINIA” (“Conti”), and NSB Niederelbe Schiffahrtsgesellschaft MBH & Co.
`KG (“NSB”)—were not negligent in their treatment of the shipment, and that New
`Orleans Terminal too was not negligent. We also AFFIRM the district court’s
`determination that Stolt has not stated a claim against its subcontractor, the
`documentation provider BDP International, Inc. ("BDP"), because we agree that Stolt
`failed to show that BDP’s breach in processing the shipment’s waybill was a
`contributing cause of the damages. Finally, we AFFIRM the district court’s
`
`
`
`
`
`5
`
`

`

`determination that MSC, Conti, and NSB are entitled to indemnification for their losses
`by Stolt and Deltech.
`
`Judge Menashi concurs in part and dissents in part in a separate opinion.
`
`
`
`AFFIRMED IN PART, REVERSED IN PART, AND REMANDED.
`
`
`______________
`
`
`NICHOLAS D. STELLAKIS (Lawrence K. DeMeo, Brian J.
`Bosworth, on the brief), Hunton Andrews Kurth LLP,
`Boston, MA; Timothy J. McDonnell, Joseph J. Perrone
`(on the brief), Giuliano McDonnell & Perrone LLP,
`New York, NY, for Claimant-Appellant Deltech
`Corporation.
`
`
`JOHN A.V. NICOLETTI (James F. Sweeney, Robert A. Novak,
`Richard W. Stone II, on the brief), Nicoletti Horning &
`Sweeney, New York, NY; Stephen V. Rible (on the
`brief), Mendes & Mount LLP, New York, NY, for
`Claimants-Appellants Stolt-Nielsen USA, Inc. and Stolt
`Tank Containers B.V.
`
`
`JAMES W. JOHNSON, Ricci Tyrrell Johnson & Grey,
`Philadelphia, PA, for Defendant-Appellee BDP
`International, Inc.
`
`
`PETER R. KNIGHT (Joseph L. Clasen, Trevor L. Bradley, on the
`brief), Robinson & Cole LLP, New York, NY, for
`Defendants-Appellees Chemtura Europe GmbH, Chemtura
`Corporation, Chemtura Italy S.R.L., and Rubicon LLC.
`
`
`EUGENE J. O’CONNOR (Timothy Semenoro, on the brief),
`Montgomery McCracken Walker & Rhoads LLP, New
`York, NY, for Defendants-Appellees Conti 11 Container
`Schiffahrts-GmbH & Co. KG MS MSC “Flaminia” and
`NSB Niederelbe Schiffahrtsgesellschaft mbH & Co. KG.
`
`
`
`
`
`
`
`6
`
`

`

`EDWARD P. FLOOD (Jon Werner, Martin R. West II, on the
`brief), Lyons & Flood, LLP, New York, NY, for
`Defendant-Appellee MSC Mediterranean Shipping
`Company S.A.
`______________
`
`CARNEY, Circuit Judge:
`
`Deltech Corp. (“Deltech”), a chemical manufacturer, joins here with Stolt-Nielsen
`
`USA, Inc., and Stolt Tank Containers B.V. (together, “Stolt”), a shipping concern, to
`
`challenge the district court’s determination that they alone bear liability for damages
`
`caused by an explosion and fire that took place in June 2012 aboard the ocean-going
`
`vessel M/V MSC Flaminia. Two weeks into the Flaminia’s trip from New Orleans
`
`Terminal across the Atlantic, toward Belgium, three tanks of 80% grade of the chemical
`
`divinylbenzene (DVB-80)—manufactured by Deltech and shipped by Stolt—exploded.
`
`The explosion and ensuing fire killed several members of the ship’s crew, injured
`
`others, and damaged the ship and its cargo.
`
`In the first phase of a three-part proceeding in the United States District Court for
`
`the Southern District of New York (Forrest, J.), the district court addressed the causes of
`
`the explosion. It determined that the conditions in which the tanks of DVB-80 were kept
`
`at New Orleans Terminal and then stowed onboard were two of the primary causes of
`
`the explosion. Together, these conditions resulted in the chemical undergoing a process
`
`known as auto-polymerization; this in turn caused the tanks to emit a cloud of vapor
`
`that ultimately ignited and exploded when the crew’s firefighting efforts generated a
`
`fateful spark. See In re M/V MSC FLAMINIA, No. 12-cv-8892, 2018 WL 526549 (KBF), at
`
`*30-31 (S.D.N.Y. Jan. 23, 2018) (“Phase I”).
`
`In the second phase, the district court addressed the parties’ respective liability
`
`for cargo loss and damage. (Separately, claims for death and bodily injury had largely
`
`been settled.) The district court found Deltech and Stolt, together, wholly responsible
`
`
`
`
`
`7
`
`

`

`for the cargo losses: Deltech, at a 55% level, and Stolt, at 45%. In re M/V MSC
`
`FLAMINIA, 339 F. Supp. 3d 185, 229–30 (S.D.N.Y. 2018) (“Phase II”). As detailed below,
`
`it exonerated other parties to the shipping transaction. It is the latter rulings that
`
`Deltech and Stolt challenge in this interlocutory appeal.1 In a third phase and final
`
`phase, the court will award damages. Id. at 191.
`
`On review, we affirm in part and reverse in part. We AFFIRM the district court’s
`
`ruling that Deltech and Stolt are liable for the explosion’s resulting damages under a
`
`failure-to-warn theory pursuant to Section 4(3) of the Carriage of Goods by Sea Act
`
`(“COGSA”), 46 U.S.C. § 30701 (note); we REVERSE, however, the district court’s
`
`determination that Deltech and Stolt are strictly liable for the damages under Section
`
`4(6) of COGSA. We also AFFIRM the district court’s conclusion that the carrier and
`
`related shipowner interests—MSC Mediterranean Shipping Company S.A. (“MSC”),
`
`Container Schiffahrts-GMBH & Co., KG MSC “FLAMINIA” (“Conti”), and NSB
`
`Niederelbe Schiffahrtsgesellschaft MBH & Co. KG (“NSB”)—were not negligent in
`
`relation to the shipment, and that New Orleans Terminal too was not negligent. We also
`
`AFFIRM the district court’s determination that Stolt has not stated a claim against its
`
`subcontractor, the documentation provider BDP International, Inc. ("BDP"): we agree
`
`that Stolt failed to show that BDP’s breach in processing the shipment’s waybill was a
`
`contributing cause of the damages. Finally, we AFFIRM the district court’s
`
`determination that MSC, Conti, and NSB are entitled to indemnification for their losses
`
`by Stolt and Deltech.
`
`
`
`1 The courts of appeals generally have jurisdiction over appeals from “[i]nterlocutory decrees of
`such district courts or the judges thereof determining the rights and liabilities of the parties to
`admiralty cases in which appeals from final decrees are allowed.” 28 U.S.C. § 1292(a)(3).
`
`
`
`
`8
`
`

`

`BACKGROUND2
`
`On July 1, 2012, the Flaminia departed New Orleans Terminal, loaded with cargo
`
`and bound for Antwerp, Belgium. Fourteen days into its journey across the Atlantic, a
`
`major explosion occurred in one of its holds, causing the tragic deaths of several crew
`
`members, serious bodily injury to others, and substantial damage to both the ship and
`
`the cargo of numerous shippers.
`
`Phase I of the court proceedings regarding the resulting losses examined the
`
`conditions in which Deltech’s DVB-80 was manufactured and shipped and considered
`
`the physical cause or causes of the explosion. After an extensive bench trial, the district
`
`court, by a preponderance of the evidence, concluded that a spark that ignited a cloud
`
`of vapor rising from three tanks of DVB-80 stored in one of the Flaminia’s holds—Hold
`
`4—caused the explosion. The spark was generated by the crew in their efforts to fight
`
`what they perceived to be a fire in that hold. The cloud of vapor, in turn, was the result
`
`of DVB-80 undergoing a chemical process called auto-polymerization and reaching
`
`thermal runaway. When DVB-80 auto-polymerizes, it can be dangerous because the
`
`reaction generates heat and is self-perpetuating.
`
`In Phase II, the district court considered liability for the explosion, fire, and
`
`physical damage. The district court explained that the DVB-80 onboard the Flaminia
`
`was manufactured by Deltech in its Baton Rouge, Louisiana, plant. Stolt—Deltech’s
`
`regular non-vessel operating common carrier (“NVOCC”)3—made shipping
`
`
`
`2 Unless otherwise noted, the facts set forth in this background section are drawn from the
`district court’s two thorough opinions. We note any relevant disagreements among the parties.
`
`3 As the district court explained, “Stolt played two roles with regard to the DVB cargo at issue
`here. First, it acted as an NVOCC, and in that capacity was Deltech’s shipping agent and
`arranged for transport aboard the Flaminia. Stolt also arranged for truck transport . . . from
`Deltech to [New Orleans Terminal].” Phase II, 339 F. Supp. 3d at 205. NVOCCs “typically assist
`
`
`
`
`9
`
`

`

`arrangements for the DVB-80 on behalf of Deltech. To enable the shipment, it provided
`
`three large shipping tanks (also known as “ISO containers”),4 which were filled with the
`
`DVB-80 at the Baton Rouge plant. Stolt also procured space for the shipment aboard an
`
`ocean-going vessel; arranged for a trucker to transport the tanks to a suitable shipping
`
`terminal; and was responsible for certain aspects of documenting the shipment.
`
`Applying a preponderance of the evidence standard, the district court found Deltech
`
`and Stolt together exclusively liable for the damages that resulted when the shipped
`
`DVB-80 exploded both under a strict-liability theory (in the COGSA regime) and under
`
`a failure-to-warn theory (also in the COGSA regime), with damages for the lost and
`
`damaged cargo to be apportioned in the projected Phase III. See Phase II, 339 F. Supp. 3d
`
`at 194–95.
`
`In contrast, the district court found appellees not liable for the losses. Appellees
`
`are primarily other parties who had a role in delivering the DVB-80 shipment to Deltech
`
`customers in Antwerp. Key among them are:
`
`• MSC Mediterranean Shipping Company S.A. (“MSC”): the charterer of
`the Flaminia;
`• Conti 11 Container Schiffahrts-GMBH & Co., KG MSC “FLAMINIA”
`(“Conti”): the owner of the Flaminia;
`• NSB Niederelbe Schiffahrtsgesellschaft MBH & Co. KG (“NSB”): the
`operator of the Flaminia;
`
`
`a cargo shipper with making necessary arrangements for the booking of any pre-carriage (such
`as transport by truck to an ocean terminal), as well as the booking for ocean carriage. Ocean
`carriage is provided by a ‘vessel operating common carrier’ who either owns a vessel outright
`or charters space on vessels for the transportation of cargo. NVOCCs are middlemen acting
`between the shipper and the ocean carrier.” Id. at 205 n.31.
`
`4 “ISO containers” are large shipping containers meeting standards set by the International
`Organization for Standardization (“ISO”). See https://www.iso.org/home.html (last visited June
`29, 2023).
`
`
`
`
`
`10
`
`

`

`• Chemtura Corp. (“Chemtura”): the owner and shipper of the chemical,
`diphenylamine (“DPA”), which was stored at high temperatures on the
`Flaminia in tanks next to the DVB-80 containers;5
`• BDP International, Inc. (“BDP”): a Stolt subcontractor that prepared
`shipping documents for the three DVB-80 tanks and was the subject of a
`contract claim by Stolt;
`• New Orleans Terminal (“the Terminal” or “NOT”): where a trucker
`retained by Stolt delivered Deltech’s DVB-80 to await loading onto the
`Flaminia.
`
`In the Phase I and II proceedings, the parties asserted many claims and
`
`counterclaims, as the district court ably described, discussed, and resolved in its
`
`comprehensive prior opinions. Only the following five are before us now:
`
`(1) Strict liability: Was the district court correct in concluding that
`
`both Deltech and Stolt are strictly liable to Conti and NSB under COGSA?
`
`(2) Failure-to-warn negligence: Did the district court err in
`
`concluding that both Deltech and Stolt are liable to Conti and NSB under a
`
`failure-to-warn negligence theory pursuant to COGSA?
`
`(3) Non-negligence of carrier interests: Did the district court err in
`
`finding that MSC, Conti, and NSB (these three together, the “carrier”
`
`interests) did not act negligently and therefore do not bear partial
`
`responsibility for the losses?
`
`
`
`5 In a Nondispositive Stipulation dated April 27, 2020, Stolt and Deltech withdrew their
`respective appeals insofar as they renewed claims against defendants-counter-claimants-
`appellees Chemtura Corporation, Chemtura Italy S.R.L., and Chemtura Europe GmbH, and
`third-party defendant-appellee Rubicon, LLC (collectively, the “Chemtura Appellees”). See
`Order, Dkt. 376, In re M/V MSC Flaminia, No. 18-2974 (2d Cir. Apr. 28, 2020).
`
`
`
`
`11
`
`

`

`(4) Breach of contract claim: Did the district court err in ruling that
`
`Stolt’s breach of contract claim against BDP is not actionable?
`
`(5) Indemnification: Did the district court err in concluding that
`
`Stolt and Deltech breached the Sea Waybills and must indemnify MSC,
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`Conti, and NSB for their losses?
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`In answering these questions, we adopt the district court’s uncontested
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`description of the setting for the applicable legal regimes:
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`This action concerns claims based on contracts for the carriage of goods
`by sea and torts that occurred at sea. As such, the contracts at issue are
`maritime contracts and the torts are maritime torts within the admiralty
`jurisdiction of the Court pursuant to 28 U.S.C. § 1333(1). And with
`admiralty jurisdiction comes the application of substantive admiralty
`law. Absent a relevant statute, the general maritime law, as developed
`by the judiciary, applies.
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`Phase II, 339 F. Supp. 3d at 229 n.91 (alterations, citations, and internal quotation marks
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`omitted). Various additional statutory and international regulatory regimes also bear on
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`the parties’ claims. We discuss those below as they become relevant.
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`To enable us to address the liability arguments, we turn first to a more in-
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`depth review of the accident’s causation as determined by the district court.
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`I.
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`The Properties of DVB-80
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`DVB-80 is a chemical compound that is used in water purification. When
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`exposed to heat, DVB-80 molecules can become unstable, causing them to react, link
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`together, and form a polymer chain. This bonding of two or more simple molecules to
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`form larger molecules with repeating structural units is called polymerization. When
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`DVB-80 polymerizes, it releases heat. The polymerization process can thus become self-
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`sustaining and can even accelerate without the addition of any more heat. That
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`phenomenon is called auto-polymerization.
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`When the heat generated by DVB-80’s polymerization exceeds the heat that the
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`reaction loses to the environment, the rate of polymerization increases exponentially,
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`and the reaction is said to have reached “thermal runaway.” Phase I, 2018 WL 526549 at
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`*8. At that stage, the temperature increases rapidly, building pressure in any tank in
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`which it is stored. Eventually, any pressure-release valve found on the tank starts to
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`vent a white vapor resembling the smoke that is generated by an ordinary fire. Unlike
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`ordinary smoke, however, the cloud resulting from DVB-80 in thermal runaway can
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`explode in certain conditions if exposed to an ignition source and a specific amount of
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`oxygen.
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`When it stores DVB-80, Deltech uses an additive called p-tert-butylcatechol
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`(commonly known as “TBC”) to inhibit polymerization. See Phase II, 339 F. Supp. 3d at
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`196. TBC, combined with the oxygen that is dissolved in the liquid DVB-80 and that is
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`inside empty storage tanks, impedes polymerization, making DVB-80 relatively safe for
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`transport in tanks, at least under ordinary conditions. Even TBC-treated DVB-80 is heat-
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`sensitive, however. A storage tank’s exposure to heat causes its contents to consume
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`oxygen more quickly and reduces TBC’s effectiveness. Like untreated DVB-80, then,
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`TBC-treated DVB-80 requires careful “handling and storage” at each step of transport
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`and delivery. Id. at 200. Deltech developed its shipment protocols accordingly, and then
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`in 2006, not long after it had begun shipping its DVB-80 overseas, it refined its protocols
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`after a few of its shipments underwent auto-polymerization. Id. at 197.6
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`
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`6 Deltech experienced two auto-polymerization incidents involving overseas shipments of DVB-
`80 in 2006. Phase II, 339 F. Supp. 3d at 197. It also had five other shipments with “polymerization
`issues” that year, but the district court found that those incidents were not analogous to the
`incident aboard the Flaminia. See Phase I, 2018 WL 526549, at *16 (finding only the “Chauncy”
`and “Grangemouth” incidents “useful” and “support[ing] the view that the Flaminia DVB80
`cargo would have completed the voyage safely under normal conditions”).
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`In 2012, when it engaged Stolt to handle the Antwerp-bound shipment, Deltech
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`protocols included: (1) generally shipping from the Port of New York (Newark) during
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`the summer months, when temperatures at New Orleans Terminal, which is nearest to
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`the Deltech plant, are especially high; and (2) avoiding exposure of tanks filled with
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`DVB-80 to more than 15 to 20 days of average external temperatures between 75 to 85
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`degrees Fahrenheit. One Deltech employee explained that shipping from Newark in the
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`summer months offered three important safety advantages: “(1) a cooler port of
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`departure, (2) therefore cooler temperatures preceding vessel loading (e.g., at the
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`terminal), and (3) a shorter ocean voyage.” Id. at 201. Confirming that statement, data
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`cited by the district court showed that “the maximum number of days in transit from
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`[New Orleans Terminal] to Antwerp is 31 days, with a median of 16; from Newark, the
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`maximum days in transit is 13 days with a median of 9.5.” Id. at 197.
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`II.
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`The DVB-80 Shipment Loaded onto the Flaminia
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`In March or April 2012, Deltech made what the district court called the “fateful
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`decision” to make at least one shipment of its DVB-80 to customers in Europe from New
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`Orleans Terminal, contrary to its protocols. Id. at 201–02. Either intentionally, or (as
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`alleged by Deltech) because of an internal “miscommunication,” Deltech slated the
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`Antwerp shipment at issue here to be sent from New Orleans Terminal in June. Id. at
`210.
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`On June 8, 2012, Deltech requested that Stolt make the arrangements for the
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`shipment, and Stolt duly began to do so. On June 11, Stolt sent Deltech its booking
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`confirmation and contacted MSC to reserve space aboard a suitable vessel.
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`On June 21, Stolt supplied Deltech with three ISO tanks for the shipment, and
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`Deltech personnel filled the tanks with Deltech’s TBC-treated DVB-80 later that day.
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`Under Stolt’s direction, the tanks were then trucked to New Orleans Terminal that same
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`day.7 And there, for about ten days, they sat on the dock, in direct sunlight and in
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`average ambient temperatures of 85 degrees Fahrenheit and a high of 96–98 degrees.
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`Finally, on July 1, they were loaded onto the Flaminia along with the ship’s other
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`cargo. The Deltech tanks were stored below deck in Hold 4, which was flanked by the
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`ship’s wing tanks holding heated fuel oil. The tanks also sat alongside three heat-
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`producing containers of the chemical DPA, manufactured and shipped by Chemtura.
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`The Flaminia departed New Orleans at 10:00 a.m. on July 1. Two weeks later, on
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`July 14, while the vessel was at sea, the three DVB-80 tanks exploded and a firestorm
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`erupted. By then, Deltech’s DVB-80 shipment had been in transit from the Baton Rouge
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`factory for a total 23 days, many of them—if not all—in hot conditions.
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`III. Warnings About Handling DVB-80
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`In preparation for the shipment, Deltech, Stolt, and BDP created several different
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`documents that served as contracts among the parties to the shipment, guidance for the
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`treatment of the shipment, or sometimes both. The documents were also used to
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`arrange and track the tanks’ transport and manage their safety. Each contained some
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`kind of warning and instructions related to the safe handling of DVB-80.
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`June 8 Booking Request: Deltech’s June 8 booking request to Stolt included the
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`following brief specifications: (1) “Please secure a booking with temperature monitoring
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`to load DVB 80%”; (2) “Container to be stowed ‘in stack’ or below deck to avoid
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`exposure to direct sunlight. Do not stow near heat sources[]”; and (3) “If container is
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`7 The record suggests that the tanks were filled and left Baton Rouge for New Orleans Terminal
`earlier than expected because of some unforeseen circumstances, including an emergency
`medical need of a Deltech employee. See Phase II, 339 F. Supp. 3d at 215–16.
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`greater than 27 C, the Iso-Container cannot be shipped.” Phase II, 339 F. Supp. 3d at 202
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`n.17.
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`Straight Bill of Lading & Material Safety Data Sheet: Deltech developed and used
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`a Straight Bill of Lading, which it gave to Boasso, the trucking concern Stolt engaged to
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`transpo