CMA CGM Sues Houston Supplier for $5M in Damages Due to Fuel Contamination

French shipping giant CMA CGM Group is citing more than $5 million in damages in a suit filed in a Houston court. The suit alleges that 13 vessels either owned or chartered by the company were damaged due to faulty fuel supplied while they were in Houston, Texas.

The complaint filed in the U.S. District Court for the Southern District of Texas reports between March and June 2023, CMA CGM took delivery of 33,628 metric tons of very low sulfur fuel oil for its vessels while they were docked in the Port of Houston. The company had a supply contract with GCC Supply & Trading for the manufacture, sale, supply, and delivery of maritime fuel.

“Shortly after the fuel was supplied, the vessels encountered significant operational issues, including but not limited to fuel pump seizures, ICU leakages, loss of engine power and propulsion in some cases leading to blackouts. CMA CGM put GCC on notice of these issues as soon as they became known,” the complaint alleges. It goes on to state, “The vessels suffered physical damage to their fuel tanks, fuel purifiers, fuel systems, and their engines and engine components, causing CMA CGM damages.”

They are alleging that GCC should have known that it was delivering “contaminated, defective, off-specification, unfit for consumption,” fuel that would cause physical harm to the vessels. They contend the supplier failed to “employ reasonable practices and policies for testing and screening its product for harmful contaminants or components.”

CMA CGM says it incurred disrupted and delayed operations, which caused operational cost increases, lost opportunities, demurrage, and further damages. They are suing for breach of contract, breach of warranties, negligence, and product liability.

The shipping company is demanding a jury trial. It asks the court to determine the final amount of damages and relief it will be granted.

Bunker fuel testing and advisory company VPS issued a public report on the problem in July 2023 saying that it detected the presence of Dicyclopentadiene (DCPD) and associated isomers at significantly high levels in VLSFO bunker fuel deliveries in Houston. At the time, it said at least 11 vessels had been impacted but it caused widespread concern. Weeks earlier in March 2023 over 200 vessels reported issues after fueling in Singapore. Regulators later traded the problem back to the origin well and imposed significant penalties on the supplier.