Litigation Defenders

With a growing number of boats, ships and cargo containers catching fire due to onboard lithium battery storage and charging, as is evidenced by the following cases, industry insurance providers who have knowledge of maritime safety regulations and fire investigation training can stay a step ahead of frivolous or protracted litigation.

At 3 a.m. on Sept. 2, 2019, a fire began on a dive boat off the coast of California, claiming the lives of 33 passengers and one crew member, all of whom were asleep at the time of the incident. This fire is believed to have started on a deck directly above a lower berthing area where numerous lithium-ion battery-powered devices were being charged.

On Aug. 19, 2021, a shipping container was en route to the Port of Virginia where it was to be loaded onto a foreign-flagged container ship bound for China. Contained within the shipping container were illegally loaded and discarded lithium batteries. Before reaching the port, on the highway, the batteries caught fire. The local fire department determined the heat from the fire was sufficient to burn a hole through the metal container structure. For reference, shipping containers are made of Cor-Ten steel, sometimes referred to as weathering steel. Cor-Ten steel is used in hot environments due to its temperature-resistant properties.

On Oct. 29, 2020, the United State Coast Guard issued a policy letter regarding the carriage of lithium-ion batteries on small passenger vessels. The letter outlines how marine inspection officers in charge and marine inspectors are to determine how portable Lithium-ion batteries are used on board small passenger vessels. The recommendations include the following:

• Batteries and devices should be securely stored in dry and cool locations away from combustible materials.
• Charging should only occur in regularly occupied spaces or spaces with continuous fire monitoring.
• Charging should occur on a single outlet, without linking or “daisy chaining” of power strips.
• Batteries should be removed from the charger once fully charged.
• Batteries should be purchased from the device manufacturer or their authorized reseller.

Not to be left out, the Maritime & Coastguard Agency (MCA) for the United Kingdom issued its safety guidance on June 2, 2023, for fire safety and storage of electric crafts on yachts. Citing 16 total losses due to fire between August 2021 and August 2022, the MCA’s new guidelines address the growth of electric tenders, lithium-ion powered jet skis, eFoils, and other watercraft on maritime vessels. These guidelines include the following:

• Storage only in a dedicated cabinet or locker.
• Batteries should be sourced from reputable manufacturers/retailers and have appropriate certification.
• Charging should not take place forward of collision bulkheads, machinery spaces, or adjacent to or in spaces containing the main source of electrical power.
• Charging and storage only within spaces that are temperature controlled and monitored.
• Spaces, where charging occurs, must be equipped with ducted mechanical ventilation.
• Vessels must have means for mechanically securing the batteries on a charge to prevent movement or cable disconnection at sea.
• Automatic stop of all charging processes in case of detection of fire or high temperatures.

These recent publications by two of the world's largest maritime authorities should remind insurers about the increasing risks of insuring commercial and private vessels associated with the prevalence of Lithium-ion powered devices. These risks however aren’t confined to the insurers of maritime vessels.

Insurers of shipping companies, container storage and transportation, diving, fishing, or excursion companies, marinas, dry docks, ports, boat slips, storage facilities, and harbors should also be aware of the increasing risks associated with Lithium-ion batteries.

For these reasons, the prelitigation retention of counsel with a knowledge of maritime safety regulations and fire investigation training can mitigate exposure and potentially prevent frivolous or protracted litigation. While the high seas might be high fun this summer, don’t forget the high-risk Lithium-ion batteries pose.