Nederland Shipping Corp v. United States

PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

_____________

No. 20-2269

_____________

NEDERLAND SHIPPING CORPORATION;

CHARTWORLD SHIPPING CORPORATION,

v.

UNITED STATES OF AMERICA

Nederland Shipping Corporation,

Appellant

_______________

On Appeal from the United States District Court

for the District of Delaware

(D.C. No. 1-19-cv-01302)

District Judge: Hon. Richard G. Andrews

_______________

Argued

April 14, 2021

Before: CHAGARES, JORDAN, and SCIRICA, Circuit

Judges.

(Filed: November 16, 2021)

_______________

George M. Chalos [ARGUED]

Chalos & Co.

55 Hamilton Avenue

Oyster Bay, NY 11771

Counsel for Appellant

Anne Murphy [ARGUED]

United States Department of Justice

Appellate Section

Room 7644

950 Pennsylvania Avenue, NW

Washington, DC 20004

Charles W. Scarborough

United States Department of Justice

Appellate Section

Room 7244

950 Pennsylvania Avenue, NW

Washington, DC 20004

Counsel for Appellee

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OPINION OF THE COURT

_______________

JORDAN, Circuit Judge.

Delay is a serious problem in the transportation

business, especially for shippers of perishable goods. So, when

a ship called the M/V Nederland Reefer (the “Reefer” or the

“Vessel”), carrying a cargo of fruit, arrived in the Port of

2

Wilmington, Delaware in February of 2019, its crew thought

the layover would be brief. Things did not turn out that way.

After a Coast Guard inspection of the ship revealed evidence

of an illegal discharge of bilge water,1 the Reefer was held in

port pending an investigation. The Reefer’s owner, Nederland

Shipping Corporation (“Nederland”), wanted to get the ship

back to sea as rapidly as possible and so entered into a contract

with the United States government to allow for the release of

the Reefer in exchange for, among other consideration, a surety

bond to cover potential fines.

Although Nederland delivered the bond and met its

other requirements under the contract, the Vessel was detained

in Wilmington for at least two additional weeks. Nederland

sued in the United States District Court for the District of

Delaware, but the government moved to dismiss the suit,

arguing among other things that the District Court lacked

subject matter jurisdiction. The District Court accepted that

argument and dismissed the complaint, holding that

Nederland’s claims had to be brought in the United States

Court of Federal Claims. More specifically, the District Court

1

“Bilge,” as a shorthand expression for bilge water, is

sometimes used as a synonym for “nonsense,” denoting

disbelief and derision, Bilge, Cambridge Dictionary (2021),

https://dictionary.cambridge.org/us/dictionary/english/bilge,

but it has a literal maritime meaning too. Bilge water is the

often noxious mixture of liquids that collects in the lowest

compartment of a ship. Bilge Water, Cambridge Dictionary

(2021),

https://dictionary.cambridge.org/us/dictionary/english/bilge-

water. Improperly disposing of it can lead to criminal liability,

as further discussed herein.

3

held that the breach of contract claim did not invoke the

Court’s admiralty jurisdiction and that the statutory cause of

action under the Act to Prevent Pollution from Ships (the

“APPS”) failed because the APPS did not waive the

government’s sovereign immunity. We disagree on both

counts and will accordingly reverse and remand for further

consideration.

I. BACKGROUND

The Reefer arrived at the Port of Wilmington, Delaware

on February 20, 2019 for what Nederland expected to be a short

stay. Upon shipboard inspection, however, the Coast Guard

noticed evidence suggesting that the Vessel had violated the

APPS.2 Specifically, the Coast Guard suspected that the

Vessel had discharged dirty bilge water directly overboard and

misrepresented in its record book that the ship’s oil water

separator had been used to clean the bilge water prior to

discharge. The Coast Guard accordingly detained the Reefer

2

The Act to Prevent Pollution from Ships authorizes the

Department of Homeland Security to enforce the 1973

International Convention for the Prevention of Pollution from

Ships (“MARPOL”) and to “prescribe any necessary or desired

regulations to carry out” that treaty. 33 U.S.C. § 1903(c)(1);

see United States v. Abrogar, 459 F.3d 430, 431-32 (3d Cir.

2006). It is a crime to “knowingly violate[ ]” those regulations

or the APPS. 33 U.S.C. § 1908(a). “A ship operated in

violation of” those laws “is liable in rem for any fine

imposed[.]” Id. § 1908(d).

4

by withholding a departure clearance, under 33 U.S.C.

§ 1908(e) of the APPS.3

The Coast Guard’s Captain of the Port issued a letter to

the Vessel’s representative on February 22, 2019, explaining

the Coast Guard’s authority to withhold the departure

clearance and that clearance could be granted if the Vessel

entered into a surety agreement that included providing a

financial bond. To negotiate that agreement, Nederland sought

3

The Coast Guard may “refuse or revoke” a vessel’s

departure clearance “if reasonable cause exists to believe” that

the vessel may be subject to a fine under the APPS. 33 U.S.C.

§ 1908(e). The departure clearance may nonetheless be

granted “upon the filing of a bond or other surety satisfactory

to the Secretary” of Homeland Security. Id. Entitled “Ship

clearance or permits; refusal or revocation; bond or other

surety[,]” 33 U.S.C. § 1908(e) provides:

If any ship subject to the MARPOL Protocol,

Annex IV to the Antarctic Protocol, or this

chapter, its owner, operator, or person in charge

is liable for a fine or civil penalty under this

section, or if reasonable cause exists to believe

that the ship, its owner, operator, or person in

charge may be subject to a fine or civil penalty

under this section, the Secretary of the Treasury,

upon the request of the Secretary [of Homeland

Security], shall refuse or revoke the clearance

required by section 60105 of Title 46 [to proceed

from a port]. Clearance may be granted upon the

filing of a bond or other surety satisfactory to the

Secretary.

5

out Commander Robert Pirone of the Coast Guard. On

March 7, Commander Pirone repeated that departure clearance

could be obtained upon the issuance of a bond as part of a

security agreement. He also told Nederland that the alleged

discharge of bilge water had been referred to the Department

of Justice for criminal prosecution under the APPS.

Seeking to get the Reefer underway again, Nederland

signed an “Agreement on Security” (the “Agreement”) with

the United States on March 8, 2019. Nederland agreed to post

a surety bond of $1 million, which would act as security for

any adjudicated fines or penalties for violations of the APPS.4

It also agreed to other provisions “[a]s consideration for surety

satisfactory to the Secretary [of Homeland Security] for the

release of the Vessel.” (App. at 37.) Those provisions included

consent to the jurisdiction of the United States over the

criminal case and assurance that the thirteen crewmembers of

the Reefer would remain in the United States to participate in

the criminal trial, at the expense of Nederland. The Agreement

also provided that “[a]ny dispute between the United States and

Owner or Operator[, i.e., Nederland,] regarding payment under

this paragraph shall be submitted to the United States District

Court for the District of Delaware. ... [T]he party asserting that

there has been a breach of the Agreement shall bear the burden

of proof.” (App. at 39.) In addition, the parties agreed that

“the criminal and civil penalty claims of the United States

against the Vessel in rem shall attach to the Vessel release’s

security as provided pursuant to the Federal Rules of Civil

4

Nederland ended up entering a guilty plea in the

criminal case. It paid a $900,000 fine.

6

Procedure, Admiralty, Maritime Claims, Supplemental Rule

E(5).” (App. at 46.)

On that same day, March 8, Coast Guard agents served

the Reefer’s crewmembers with subpoenas to testify before a

grand jury in April. Three days later, on March 11,

Nederland’s attorney informed Commander Pirone that all

replacement crewmembers were on board the Reefer and had

completed the handover from the thirteen crewmembers who

were required to stay in Delaware. But the Vessel did not

receive a departure clearance. After sending several emails

asking for updates on the processing of paperwork for the

detained crewmembers, Nederland’s attorney told the

government that the continuing delay of the Vessel had become

unreasonable. He also highlighted Nederland’s right to pursue

damages under 33 U.S.C. § 1904(h).5 In particular, he

emphasized the economic losses that the Vessel would

experience if the delay continued, including the costs

associated with making alternative arrangements for its

perishable cargoes and missing its next commercial

commitment. Nederland continued to ask for updates from the

government, with little to no response, until March 28, 2019,

when the Vessel was finally permitted to leave port.

Approximately three months later, Nederland filed for

declaratory relief in the District Court under 33 U.S.C.

§ 1904(h), seeking a declaratory judgment that the Agreement

5

Section 1904(h) provides: “Compensation for loss or

damage [-] A ship unreasonably detained or delayed by

the Secretary acting under the authority of this chapter is

entitled to compensation for any loss or damage suffered

thereby.” 33 U.S.C. § 1904(h).

7

was null and void ab initio and asking for damages for breach

of contract and compensation for unreasonable delay in

allowing the Vessel’s departure. The government moved to

dismiss for failure to state a claim and for lack of subject matter

jurisdiction.

The District Court was persuaded by the government’s

attack on subject matter jurisdiction. As to Nederland’s breach

of contract claim, the Court held that it did not have jurisdiction

in admiralty because the Agreement is not a maritime contract,

as the “principal objective of the Agreement is to permit the

ship’s departure clearance while preserving the Government’s

ability to investigate.” (App. at 9.) Without the waiver of

sovereign immunity attendant to admiralty jurisdiction, the

claim could not proceed, the Court said, because the

Agreement itself did not amount to a waiver of that immunity.

As to the APPS cause of action under 33 U.S.C. § 1904(h), the

Court held that § 1904(h) does not expressly waive sovereign

immunity. According to the Court, the waiver of sovereign

immunity found in the Tucker Act, 28 U.S.C. § 1491, could

instead provide an avenue for relief for Nederland, but any

such claim would have to be brought in the Court of Federal

Claims.

Nederland now appeals.

II. DISCUSSION6

Nederland argues that the District Court erred in

holding that it lacked subject matter jurisdiction in this case.

6

We have appellate jurisdiction under 28 U.S.C.

§ 1291. Nederland asserted jurisdiction in the District Court

8

According to Nederland, the Agreement it entered with the

government is maritime in nature and thus vested the Court

with admiralty jurisdiction.7 Nederland also contends that its

statutory cause of action for monetary damages under 33

U.S.C. § 1904(h) provides subject matter jurisdiction because

it is an independent cause of action that waives the

government’s sovereign immunity. The government counters

that the Tucker Act waives sovereign immunity for non-tort

monetary claims against the United States “founded …

upon … any Act of Congress[,] … or upon any express or

implied contract with the United States,” and also provides

exclusive jurisdiction for such claims in the Court of Federal

Claims, 28 U.S.C. § 1491(a)(1), so that Nederland’s suit must

instead be brought in that court.

To prevail in this jurisdictional dispute, Nederland must

clear two hurdles: it has to demonstrate that Congress provided

for subject matter jurisdiction in the district courts over the

claims at issue and that Congress waived sovereign immunity.

See United States v. Bormes, 568 U.S. 6, 9-10 (2012)

(explaining plaintiffs may only sue the United States for

under 28 U.S.C. §§ 1331 and 2201. We address the District

Court’s jurisdiction herein. We exercise plenary review to

determine whether the District Court enjoyed subject matter

jurisdiction. In re Allen, 768 F.3d 274, 279 (3d Cir. 2014).

7

Nederland also argues that the parties contracted for

subject matter jurisdiction in the District Court. That argument

plainly fails because parties cannot create subject matter

jurisdiction. See Samuel-Bassett v. KIA Motors Am., Inc., 357

F.3d 392, 396 (3d Cir. 2004) (“[P]arties may not confer subject

matter jurisdiction by consent.”).

9

monetary damages where sovereign immunity has been waived

and subject matter jurisdiction exists). The parties do not

dispute that if there is admiralty jurisdiction in this case, both

conditions are satisfied for the contract claim, since federal

courts have power to hear “all Cases of admiralty and maritime

Jurisdiction[,]” U.S. Const. art. III, § 2, cl. 1; 28 U.S.C. § 1333,

and Congress has waived sovereign immunity for claims

brought in admiralty, Henderson v. United States, 517 U.S.

654, 665 (1996); 46 U.S.C. § 30903. The fight over the

contract claim is thus whether it is a maritime claim and so

properly subject to admiralty jurisdiction. As to the APPS

statutory claim, the fight is whether 33 U.S.C. § 1904(h)

waives sovereign immunity.

A. The Agreement is a maritime contract.

Nederland argues that the Agreement is maritime in

nature and thus invokes the District Court’s admiralty

jurisdiction. The government responds that the Agreement

primarily sought to facilitate a criminal investigation pursuant

to the APPS and so is not a maritime contract. Nederland has

the better of the argument.

The Supreme Court emphasized in Norfolk Southern

Railway Co. v. Kirby that the primary interest of maritime

jurisdiction is “the protection of maritime commerce.” 543

U.S. 14, 25 (2004) (emphasis in original) (quoting Exxon Corp.

v. Cent. Gulf Lines, Inc., 500 U.S. 603, 608 (1991)).

Consequently, we are looking to “the nature and character of

the contract” at issue to determine whether it has “reference to

maritime service or maritime transactions.” Id. at 24 (quoting

N. Pac. S.S. Co. v. Hall Bros. Marine Ry. & Shipbuilding Co.,

249 U.S. 119, 125 (1919)). A ship does not need to be directly

10

involved in the dispute for admiralty jurisdiction to attach, as

“the admiralty and maritime jurisdiction ... extends to and

includes cases of injury or damage ... caused by a vessel on

navigable waters even though the injury or damage is done or

consummated on land.” Id. at 23-24 (quoting the Admiralty

Jurisdiction Extension Act, 46 U.S.C. § 30101).

Following the two-step inquiry established more than a

half-century ago in Kossick v. United Fruit Co., 365 U.S. 731,

735 (1961), the Kirby Court asked first whether the contracts

under review were maritime, and, second, whether they dealt

with an inherently local dispute such that federal law should

not control. Kirby, 543 U.S. at 22-23. It held that bills of

lading for the transport of goods from Australia to Alabama

were maritime contracts even though the final leg of the

journey was via rail. Id. at 23-24. Because the bills of ladings’

“primary objective” under the first step of Kossick was to

“accomplish the transportation of goods by sea from Australia

to the eastern coast of the United States[,]” the Court held that

it was beside the point that part of the journey was by rail. Id.

at 24. The Court also indicated, at the second step of Kossick,

that no local interests had been suggested that would call

federal jurisdiction into question. Id. at 27.

Following the same analytical path here, but in reverse

order, we can quickly dispose of the “inherently local” issue.

The dispute before us clearly implicates federal law – the APPS

– and international concern with sea-going commerce and

ocean pollution. It is thus obviously not inherently local. The

issue, then, is the first question posed in Kossick and Kirby:

what is the primary objective of the contract at issue. Not

surprisingly, each party characterizes the Agreement’s

“primary objective” differently. Id. The government says the

11

primary objective of the Agreement was to allow “the criminal

proceedings to continue to conclusion, including the payment

of a potential criminal penalty.” (Answering Br. at 23.)

Nederland says instead that the primary objective of the

Agreement was to provide sufficient security to obtain the

Vessel’s departure clearance so it could continue its trade.

Both objectives are, it is true, contemplated in the Agreement,

but the government’s characterization ignores every interest

but its own and, even at that, fails to acknowledge that the

crime under investigation was itself particularly maritime in

character. The government chooses to define its objective as

simply pursuing a criminal prosecution, but that does not

change the fact that the charge it was pursuing was a crime on

the seas, outlawed by a maritime treaty. Nor does it change

that both the Agreement (App. at 46) and the statute under

which the government detained the vessel, 33 U.S.C.

§ 1908(d), speak in terms of liability in rem, which is language

classically associated with admiralty jurisdiction. See, e.g.,

Leon v. Galceran, 78 U.S. 185, 190 (1870) (“[A] party may

proceed in rem in the admiralty, and if he elects to pursue his

remedy in that mode he cannot proceed in any other form, as

the jurisdiction of the admiralty courts is exclusive in respect

to that mode of proceeding[.]”). That is not determinative here,

but it is telling.

What is determinative is that, contrary to the

government’s position, it did not need the Agreement to permit

the criminal proceeding to continue to conclusion. The result

of there having been no agreement and no surety bond would

not have been the Reefer sailing away scot-free. It would have

been the Coast Guard withholding the Vessel’s departure

clearance until the criminal proceedings ended. Watervale

Marine Co. v. U.S. Dep’t of Homeland Sec., 807 F.3d 325, 330

12

(D.C. Cir. 2015) (Section 1908(e) “clearly provides authority

in the Coast Guard to simply hold the ship in port until legal

proceedings are completed.”); see also Angelex Ltd. v. United

States (Angelex I), 723 F.3d 500, 507 (4th Cir. 2013) (Section

1908(e) “grants the Coast Guard broad discretion to deny bond

altogether[.]”). So the essential character and purpose of the

Agreement was not to secure the Vessel and crew in port; that

was already done. The primary objective of the Agreement

was rather to set the Reefer free to pursue maritime commerce.8

8

The parties also discuss the purposes of the APPS and

MARPOL, both pointing to various aims of the treaty and its

enacting legislation to support their characterizations of their

Agreement’s primary objective. The government argues that

the APPS was “passed to implement various environmental

obligations that the United States assumed when it entered

into” MARPOL. (Answering Br. at 16 (quoting Watervale

Marine Co. v. U.S. Dep’t of Homeland Sec., 807 F.3d 325, 327

(D.C. Cir. 2015)).) And Nederland contends that MARPOL

not only sought to preserve the marine environment, but to

balance those environmental concerns with “the desire not to

impose laws which make shipping prohibitively expensive.”

(Reply Br. at 4-5 (quoting United States v. Apex Oil Co. Inc.,

132 F.3d 1287, 1291 (9th Cir. 1997)).) Such a concern was

codified in § 1904(h), which provides a means by which ships

unreasonably detained can seek compensation. 33 U.S.C.

§ 1904(h). Ultimately, however, “the nature and character of

the contract” itself must guide our admiralty jurisdiction

analysis – not a broader review of the treaty or the enabling

legislation behind the particular contract. Norfolk S. Ry. Co. v.

Kirby, 543 U.S. 14, 24 (2004) (citation omitted).

13

The conclusion that the Agreement here has, as the

saying goes, a “genuinely salty flavor,” Kirby, 543 U.S. at 22

(citation omitted), is confirmed by other cases considering

contracts that provide security in exchange for a vessel’s

freedom to continue on its journey. For example, in Deval

Denizcilik Ve Tigaret A.S. v. Agenzia Tripcovich S.R.L., the

district court held that it had admiralty jurisdiction over a

bank’s guaranty to pay as a substitute for releasing cargo from

arrest because it “ultimately hastened the delivery of the cargo

by sea.” 513 F. Supp. 2d 6, 9 (S.D.N.Y. 2007). Just as the

ship’s “cargo would not have been released had [the bank] not

issued the guarantee[,]” Nederland’s Vessel would not have

been allowed to continue its maritime trade but for the

Agreement. Id. Similarly, in Great Eastern Shipping Co. v.

Binani Cement Ltd., the district court held that a letter of

indemnity promising to pay a bond to secure the release of a

ship in exchange for the delivery of cargo was a maritime

contract. 655 F. Supp. 2d 395, 399 (S.D.N.Y. 2009); see also

Compagnie Francaise De Navigation a Vapeur v. Bonnasse,

19 F.2d 777, 778-79 (2d Cir. 1927) (holding admiralty

jurisdiction existed over a contract to assume the performance

of a bond “to release the res, or to prevent its arrest”).

The government attempts to distinguish those cases by

arguing that the security agreements at issue in them were for

inherently maritime obligations, while securing a potential

criminal penalty is not a maritime obligation. In drawing that

contrast, the government again views its Agreement with

Nederland solely from its own perspective, not recognizing the

obvious commercial benefit to Nederland of freeing the Reefer

to go to sea. On top of that, the distinction the government

draws is unfounded. The Deval court did not premise its

decision on the underlying charter contract, but instead

14

emphasized that the guaranty permitted maritime commerce to

continue. 513 F. Supp. 2d at 9. That is a precise analog of deal

in the Agreement here. So too in Great Eastern Shipping, the

court stated that “Great Eastern’s consideration was the prompt

discharge of the cargo, a quintessentially maritime service, in

forbearance of its right to demand the bills of lading on

discharge, a quintessentially maritime right.” 655 F. Supp. 2d

at 399. It thus relied on its finding that the “overall purpose of

the transaction ... was maritime” to conclude that the letter of

indemnity was maritime in nature. Id. While the government

rightly points out that both cases involved underlying

commercial contracts, it was the discharge of the cargo to allow

for uninterrupted maritime trade that rendered the contracts

maritime in nature.

The government would prefer that we rely upon a case

from the District of New Hampshire that was decided before

Kirby. In Chi Shun Hua Steel Co. v. Crest Tankers, Inc., the

district court held that an agreement releasing the attachment

of a vessel in exchange for posting security or bringing the

vessel the following day to be reattached was a non-maritime

contract. 708 F. Supp. 18, 22 (D.N.H. 1989). But, lacking the

later guidance that the Supreme Court provided in the Kirby

opinion, the Crest Tankers court determined whether the

contract was maritime in nature by asking whether the contract

“concerns transportation by sea, relates to navigation and

concerns maritime employment.” Id. Applying that outdated

rule, the court held that the involvement of a ship did not bring

the matter within its admiralty jurisdiction because “the

settlement agreement itself was of a non-maritime nature.” Id.

Even if that reasoning were persuasive, it does not survive after

Kirby. The Kirby Court specifically noted that “reference to

maritime service or maritime transactions” can make a contract

15

maritime in nature. 543 U.S. at 24 (quoting Hall Bros., 249

U.S. at 125). Reference to a vessel which has been detained,

and which a surety agreement would free to continue its

maritime trade, falls within the Supreme Court’s definitional

guidance.

For much the same reason, we are not persuaded by the

cases that the District Court cited to support its jurisdictional

conclusion. In saying it lacked jurisdiction, the Court first

pointed to Angelex I, 723 F.3d at 509, which is inapposite

because, although it concerned the withholding of a departure

clearance for a vessel accused of violating the APPS, there was

no underlying contractual agreement in that dispute. There, the

Fourth Circuit held that the withholding of a vessel’s departure

clearance for an indeterminate amount of time – where the

vessel owner could not afford to post bond – was

not “tantamount to an arrest of the ship” and thus did not

invoke in rem admiralty jurisdiction. Id. Because in rem

admiralty actions involve a vessel being “treated as the

offender and made the defendant by name or description in

order to enforce a lien[,]” and “discretionary action on the part

of the Coast Guard under APPS” cannot be considered “an

offense to the ship itself,” the Fourth Circuit concluded that

subject matter jurisdiction was lacking. Id. at 509-10. That

case would surely be on point and we would have to address

its analysis if Nederland and the government had failed to

negotiate a security agreement. But the parties here did

negotiate a contract, and our jurisdictional inquiry must focus

on whether the Agreement they entered into, pursuant to

§ 1908(e), constitutes a maritime contract – a question not

raised in Angelex I.

16

The District Court also relied on Retif Oil & Fuel, LLC

v. Offshore Specialty Fabricators, LLC, which held that a

guaranty agreement to pay the debt owed on a contract for ship

fuel and lube was a maritime contract. No. 17-7831, 2018 WL

4680125, at *5 (E.D. La. Sept. 28, 2018). The District Court

in the instant case quoted Retif Oil for the proposition that “a

‘surety agreement is held not to be an admiralty contract, since

the obligation of the surety is only to pay damages in the event

of liability on the underlying contract[.]’” (App. at 9 (quoting

Retif Oil, 2018 WL 4680125, at *5).) The Retif Oil court

concluded that the guaranty agreement before it, in contrast,

was a promise to step into the shoes of the obligor and fully

perform the underlying obligation by paying for the provisions

if the other party did not. 2018 WL 4680125, at *6. So, the

guaranty agreement at issue was more than a bare promise to

pay damages and, thus, was a maritime contract. Id. But the

hypothetical surety contract discussed in Retif Oil differs from

the Agreement before us in a key aspect. Nederland did not

merely promise to pay money in the event of liability; it

promised to pay money and perform other undertakings in

order to obtain a departure clearance so the Reefer could leave

port and continue its maritime trade. In sum, both cases relied

on by the District Court – Angelex I and Retif Oil – are

distinguishable because they did not determine whether

contracts providing security to allow a vessel to continue

seagoing commerce are maritime in nature.

Finally, we note that the Agreement, which was drafted

by the government, is premised on the explicit understanding

that subject matter jurisdiction is proper in the District Court.

For example, the Agreement provides that “the criminal and

civil penalty claims of the United States against the Vessel in

rem shall attach to the Vessel release’s security as provided

17

pursuant to the Federal Rules of Civil Procedure, Admiralty,

Maritime Claims, Supplemental Rule E(5).” (App. at 46.) We

cannot conceive of a circumstance in which the government

would contract to the applicability of Admiralty Supplemental

Rule E(5) if it viewed potential breaches of the contract as not

falling under admiralty jurisdiction.9 In addition, the

government agreed that “any” dispute “regarding payment

under this paragraph shall be submitted to the United States

District Court for the District of Delaware.” (App. at 39.) At

oral argument, counsel for the government said that this

provision only refers to the United States’ ability to sue

Nederland for the payment of the bond. (See audio recording

of oral argument held on April 14, 2021 at 30:00-31:57

(https://www2.ca3.uscourts.gov/oralargument/audio/20-

2269_NederlandShippingv.USA.mp3).) But that assertion is

belied by the very next sentence in the Agreement: “In any

such dispute wherein one party claims a breach of the terms

and conditions herein, the party asserting that there has been a

breach of the Agreement shall bear the burden of proof.” (App.

at 39.) The use of the generic term “party[,]” rather than

specifying that only the United States may sue in the District

Court, plainly means that either party could commence

litigation in the District Court. While the parties to a contract

cannot confer subject matter jurisdiction on federal courts, and

while the government’s past or present positions on

jurisdiction do not determine our conclusion, it is nevertheless

revealing that the government’s pre-litigation view of the law,

9

The Supplemental Admiralty and Maritime Claims

Rule E contemplates jurisdiction over “actions in personam

with process of maritime attachment and garnishment, actions

in rem, and petitory, possessory, and partition actions[.]” Fed.

R. Civ. P. Adm. Rule E(1) (emphasis added).

18

as embodied in the form of contract it drafted, was that

admiralty jurisdiction in a case like this existed in the District

Court.

Given all of the foregoing, our view is that the District

Court has admiralty jurisdiction over the breach of contract

claim, as the primary objective of the Agreement was to secure

the Vessel’s departure clearance, so that it could continue its

maritime trade.10

10

Nederland fleetingly argues in the alternative that the

contract is a “mixed” contract, meaning it contains both

maritime and non-maritime elements. Mixed contracts do not

fall within admiralty jurisdiction unless they are severable and

may be separately adjudicated, Berkshire Fashions, Inc. v.

M.V. Hakusan II, 954 F.2d 874, 880 (3d Cir. 1992), and

Nederland suggests only in a conclusory manner that the

Agreement is severable. Because the contract’s primary

objective is maritime in nature and thus falls within admiralty

jurisdiction, we need not address that alternative argument.

We do, however, briefly note the government’s

subsidiary arguments. It says that the Agreement contains no

maritime clauses or terms “that might require the district court

to draw upon its maritime expertise[.]” (Answering Br. at 25.)

It fails, however, to cite any precedent to support its suggestion

that a contract can only be maritime in nature if it requires a

court to analyze the meaning of a maritime term. Lastly, it

relies on Kirby to contend that “the core purpose of admiralty

jurisdiction, uniformity in the law,” is best served if APPS

security agreements are always adjudicated in the Court of

Federal Claims. (Answering Br. at 25-26.) But any uniformity

concern cited by Kirby involved whether the contract at issue

was inherently local or federal, not where in the federal system

19

B. The District Court erred in holding that it

lacked subject matter jurisdiction over the

APPS cause of action.

Nederland also contends that the District Court has

federal question jurisdiction pursuant to 28 U.S.C. § 1331 over

its statutory cause of action because Congress explicitly

waived the government’s sovereign immunity for damages

claimed under the APPS in 33 U.S.C. § 1904(h).11 The

government argues that Nederland’s § 1904(h) claim is not

cognizable as an independent cause of action and thus must be

transferred to the Court of Federal Claims under the waiver of

sovereign immunity provided by the Tucker Act.12 We agree

with Nederland because the APPS explicitly waives the

government’s sovereign immunity, making the Tucker Act

immaterial to this dispute.

The Tucker Act waives the government’s sovereign

immunity for non-tort monetary claims against the United

States founded upon “any Act of Congress,” the Constitution,

the contract claim should be adjudicated. Kirby, 543 U.S. at

27-28.

11

Nederland does not contend that the District Court

enjoyed admiralty jurisdiction under 28 U.S.C. § 1333 over the

statutory cause of action, and it is not necessary to consider that

point.

12

The government also says that Nederland forfeited its

sovereign immunity waiver argument on appeal. Not so:

Nederland argued that the APPS permits claims against the

government through waiver of sovereign immunity.

20

or contracts, but it vests jurisdiction only in the Court of

Federal Claims. 28 U.S.C. § 1491(a)(1).13 With that waiver,

the Tucker Act “supplied the missing ingredient for an action

against the United States for the breach of monetary

obligations not otherwise judicially enforceable.” Bormes, 568

U.S. at 12. It does not provide a substantive right to damages

but instead opens the door to government liability for claims

falling under its purview. Chabal v. Reagan, 822 F.2d 349,

355 (3d Cir. 1987). For a claim to have the advantage granted

by the Tucker Act, it need only “fairly be interpreted as

mandating compensation by the Federal Government for the

damage sustained.” United States v. White Mountain Apache

Tribe, 537 U.S. 465, 472 (2003) (citation omitted). That “‘fair

interpretation’ rule demands a showing demonstrably lower

than the standard for the initial waiver of sovereign

immunity[,]” and thus “an explicit provision for money

damages” is not necessary. Id. at 472, 477.

Not all claims against the government, however, are

reliant on the Tucker Act. Claims premised upon statutes that

provide for independent causes of action and that waive the

13

The Tucker Act provides:

The United States Court of Federal Claims shall

have jurisdiction to render judgment upon any

claim against the United States founded either

upon the Constitution, or any Act of Congress or

any regulations of an executive department, or

upon any express or implied contract with the

United States, or for liquidated or unliquidated

damages in cases not sounding in tort.

28 U.S.C. § 1491(a)(1).

21

government’s sovereign immunity need not be channeled

through the Tucker Act. See Bowen v. Massachusetts, 487

U.S. 879, 910 n.48 (1988) (“Rather, [the Court of Federal

Claims’] jurisdiction is ‘exclusive’ only to the extent that

Congress has not granted any other court authority to hear the

claims that may be decided by the Claims Court.”); Franklin-

Mason v. Mabus, 742 F.3d 1051, 1055 (D.C. Cir. 2014) (“If a

separate waiver of sovereign immunity and grant of

jurisdiction exist, district courts may hear cases over which,

under the Tucker Act alone, the Court of Federal Claims would

have exclusive jurisdiction.” (citation omitted)); Tritz v. U.S.

Postal Serv., 721 F.3d 1133, 1137 (9th Cir. 2013) (While

the Tucker Act “create[s] a presumption of exclusive

jurisdiction in the Court of Federal Claims, ... that presumption

can be overcome by an independent statutory grant of

jurisdiction to another court.”). Nederland argues that the

APPS is one such statute, as it waives sovereign immunity and

provides jurisdiction in the district courts, so resort to the

Tucker Act, and transfer to the Court of Federal Claims, is

unnecessary. The government, on the other hand, contends

that the APPS should be interpreted as providing a cause of

action under the Tucker Act but not as an independent waiver

of sovereign immunity.

The government does not dispute that if the APPS

waives sovereign immunity, jurisdiction would be proper in the

District Court.14 The question before us, then, is whether the

14

The government cites Chabal v. Reagan, where, in

denying jurisdiction over a former U.S. Marshal’s suit for

reinstatement, back pay, and damages for an allegedly

improper removal, we explained: “Jurisdiction over non-tort

monetary claims against the United States is exclusively

22

APPS indeed waives the government’s sovereign immunity.

The United States is immune from suit unless it expressly and

unequivocally waives its immunity. United States v. Mitchell,

445 U.S. 535, 538 (1980). Statutory text purporting

to waive governmental immunity is strictly construed “in favor

of the sovereign.” United States v. Nordic Vill., Inc., 503 U.S.

30, 34 (1992) (internal quotation marks and citation omitted).

Thus, “[a]ny ambiguities in the statutory language are to be

construed in favor of immunity,” and “[a]mbiguity exists if

there is a plausible interpretation of the statute that would not

authorize money damages against the [g]overnment.” F.A.A.

v. Cooper, 566 U.S. 284, 290-91 (2012). There is no particular

set of words that must be invoked to waive sovereign

immunity, but the waiver must be discernable and explicit

through traditional tools of statutory interpretation. Id. at 291.

Furthermore, “[a] statutory waiver of sovereign immunity …

defines the scope of a court’s jurisdiction to entertain the suit.”

Gentile v. Sec. & Exch. Comm’n, 974 F.3d 311, 316 (3d Cir.

2020) (internal quotation marks and citations omitted).

Consequently, “[t]o sustain a claim that the Government is

liable for awards of monetary damages, the waiver of

sovereign immunity must extend unambiguously to such

monetary claims.” Lane v. Pena, 518 U.S. 187, 192 (1996).

defined by the Tucker Act, as codified at 28 U.S.C. §§ 1346,

1491, because it is only under the terms of the Tucker Act that

the United States waives its sovereign immunity to non-tort

claims seeking monetary relief.” 822 F.2d 349, 353 (3d Cir.

1987). But, as later explained by the Supreme Court, that is

merely an “assumption[,]” and Congress has the ability to

waive sovereign immunity for other claims. Bowen, 487 U.S.

at 910 n.48.

23

With all of that in mind, we conclude that there is a

waiver of sovereign immunity for monetary damages in the

plain text of the APPS. Section 1904(h), under which

Nederland brings its statutory cause of action, provides:

“Compensation for loss or damage [–] A ship unreasonably

detained or delayed by the Secretary acting under the authority

of this chapter is entitled to compensation for any loss or

damage suffered thereby.” 33 U.S.C. § 1904(h). The Fourth

Circuit has dubbed that provision an “after-the-fact damages

remedy against the United States for unreasonable detention or

delay.” Angelex I, 723 F.3d at 509.

By “entitl[ing] [a ship] to compensation for any loss or

damage suffered” due to its detention or delay by the Secretary

of Homeland Security, § 1904(h) clearly goes beyond

providing a cause of action that is cognizable only under the

Tucker Act. Cf. White Mountain Apache Tribe, 537 U.S. at

477 (comparing “the less demanding requirement” for finding

a cause of action under the Tucker Act with the more

demanding requirement for finding an independent waiver of

sovereign immunity). We thus do not agree with the

government that § 1904(h) provides a cause of action only in

tandem with the Tucker Act’s waiver of sovereign immunity.

Rather, Congress provided “an explicit provision for money

damages” by allowing for “compensation for any loss” caused

by the Secretary’s unreasonable detention of a ship. Id.; 33

U.S.C. § 1904(h). The provision need not explicitly state that

“the United States” will pay compensation for any loss

because, reading the provision in context as we must, see King

v. Burwell, 576 U.S. 473, 486 (2015) (“Our duty ... is to

construe statutes, not isolated provisions” (internal quotation

marks and citation omitted)), no other actor could logically be

held liable. The federal government causes the unreasonable

24

detention, and the federal government thus provides

compensation for the resulting loss or damage. Cf. Cooper,

566 U.S. at 291 (“We have never required that Congress use

magic words” to waive sovereign immunity.). Congress

intended to make the United States liable when a vessel is

unreasonably detained by the Secretary of Homeland Security,

and § 1904(h) is express and unequivocal in stating that waiver

of sovereign immunity.15 Mitchell, 445 U.S. at 538.

That conclusion comports with the opinion of the only

other court of appeals to have considered a claim under

§ 1904(h). See Angelex, Ltd. v. United States (Angelex II), 907

F.3d 612, 623 (D.C. Cir. 2018) (affirming a grant of summary

judgment for the government where a ship owner sought

compensation under § 1904(h) for expenses after an allegedly

unreasonable delay of its ship). In Angelex II, the D.C. Circuit

15

Nederland also argues that Congress waived

sovereign immunity for claims brought under the APPS

through § 1910. That provision, entitled “Legal Actions[,]”

provides that “any person having an interest which is, or can

be, adversely affected, may bring an action” upon certain stated

grounds “in the United States district court for any judicial

district wherein the ship or its owner or operator may be

found.” 33 U.S.C. § 1910(a), (c)(3). Because we read

§ 1904(h) to expressly waive sovereign immunity, we need not

resort to other sections of the APPS to reach our conclusion.

As a reminder, the government does not dispute

jurisdiction in the District Court if the APPS waives sovereign

immunity. As contemplated by 33 U.S.C. § 1908(d), “[a] ship

operated in violation of the MARPOL Protocol … may be

proceeded against in the United States district court of any

district in which the ship may be found.”

25

addressed a § 1904(h) claim on its merits without questioning

or discussing subject matter jurisdiction. Id. at 618. The

district court in that case had noted at the motion to dismiss

stage that the government did not contest jurisdiction. Angelex,

Ltd. v. United States, 123 F. Supp. 3d 66, 74 n.4 (D.D.C. 2015).

While the government is correct to point out that “drive-by

jurisdictional ruling[s]” carry little precedential weight, Del.

Riverkeeper Network v. Sec’y Pa. Dep’t of Env’t Prot., 903

F.3d 65, 71 (3d Cir. 2018), it is notable that neither the district

court nor the D.C. Circuit viewed subject matter jurisdiction

over the § 1904(h) claim as worthy of discussion.

The government would have us reason that Congress

may only displace the provisions of the Tucker Act through a

statute with a “specific remedial scheme[,]” which the APPS

does not have. (Answering Br. at 29 (quoting Bormes, 568

U.S. at 12).) Relying on United States v. Bormes, the

government notes that the Supreme Court held a plaintiff could

not avail himself of the Tucker Act’s waiver of sovereign

immunity because the Fair Credit Reporting Act contained its

own self-executing remedial scheme, indicating that Congress

intended to displace the Tucker Act. 568 U.S. at 10-11. When

a litigant brings a claim under a statute with a self-executing

remedial scheme that imposes monetary liability on the

government, that law “supersedes the gap-filling role of the

Tucker Act” because “precisely drawn, detailed statute[s] pre-

empt[ ] more general remedies[.]” Id. at 12-13. So the

government is quite right that Bormes described how “[t]he

Tucker Act yields when the obligation-creating statute

provides its own detailed remedies[.]” Maine Cmty. Health

Options v. United States, 140 S. Ct. 1308, 1328 (2020) (citing

Bormes, 568 U.S. at 13). But that case does not mandate

deferral to the Tucker Act unless the other statute at issue has

26

a detailed remedial scheme. The issue is not the level of detail

surrounding an alternative remedy; the issue is whether there

is a clear waiver, and in the APPS there is.

Because there is no “plausible interpretation of the

statute that would not authorize money damages against the

[g]overnment[,]” we conclude that § 1904(h) waives the

federal government’s sovereign immunity. Cooper, 566 U.S.

284 at 290-91. Thus, under 28 U.S.C. § 1331, the District

Court enjoyed jurisdiction over the independent statutory cause

of action provided in 33 U.S.C. § 1904(h).

III. CONCLUSION

For the foregoing reasons, we will reverse the order of

the District Court and remand for consideration of Nederland’s

claims.

27