The Legal Strategy of the Cruise Line Industry

Abstract

The three dominant North American cruise line companies have developed an effective legal strategy that provides a strategic, competitive advantage involving any dispute or litigation with a guest. All cruise guests are required to sign a contract containing similar terms and conditions that limit the loss for personal property, death, personal injury, emotional stress, and mental anguish; require written notice of claims; require filing of lawsuits within a specified shortened period of time; provide mandatory arbitration for certain claims; and waive class actions. The terms and conditions also take advantage of and conform to legislation affecting the maritime industry. At the heart of the strategy is the identical forum selection clause requiring all guests to initiate all suits in the U.S. District Court for Southern Florida. Because most litigation takes place in the same court, corporate counsel will have the benefit of being able to modify and update their terms and conditions to reflect the court’s most recent decisions, even when they were not parties to the case. The ability of litigating in a location close to their home offices is also a huge convenience factor. Equally important, the forum may be one that is very inconvenient for the guest, a factor that may cause some cases to be settled early. The strategy of an industry-wide, comprehensive, and similar set of terms and conditions, anchored by a forum selection clause, is an effective litigation strategy that might be used as model by lodging companies as part of their online contracts.