Gloucester Daily Times
July 17, 1984
By Kevin Sullivan
In October 1981, a 20-pound steel block fell 20-feet from the rigging of the eastern-rigged dragger Racketeer and broke skipper DiMercurio’s arm. DiMercurio’s insurance carrier, New Hampshire Insurance Company, of Manchester, N.H., offered a $20,000 settlement for the accident, which left DiMercurio with a steel plate and five screws in hi arm.
DiMercurio, 32, hired lawyer Joseph Orlando and sued the DiMercurio Fishing Corporation – his own corporation, in which he owned 51 percent of the stock – for a more lucrative settlement from its insurance company -his insurance company.
In Februrary, a U.S. district court awarded DiMercurio about $525,000. Orlando described 1983 as DiMercurio’s best year fishing, despite his broken arm.
New Hampshire Insurance Co. no longer insures commercial fishing vessels. Other major companies also have pulled out of insuring fishing vessels, saying they pay more in claims from commercial fishing boats than they collect in premiums.
They point to Gloucester’s 35 sinkings in the 1980s – compared to 14 in New Bedford and none in Point Judith, R.I. – as one of the nation’s worst records.
So do the companies that still insure fishing boats. But those companies have simply responded by raising rates, in some cases more than 100 percent over the past year.
“The sinkings, yes, were difficult. But it was the liability claims more than anything that raised our consternation,” said a New Hampshire Insurance Co. official, who asked not to be identified.
“The obligations of an insurance company to a crewman are astronomical,” he said ” Fishermen have become more claims- conscious: And the captians are paying big dollars on their claims insurance ”
In addition to hull insurance, the equivalent of auto collision coverage, boat owners must pay a protection and indemnity – ” P and I ” – premium for each crew member, which covers injuries suffered while fishing.
“P and I ” costs are generally $ 1,500 to $2,000 a year per crewman. Scallopers generally pay $ 2,000 or more per man, because shucking scallops on deck often results in more cuts and other injuries than sorting fish.
Some insurance officials, like Howard Clarke of the American International Marine Agency in Boston, which also has stopped insuring commercial fishing boats, blame many of their problems on Orlando.
“Joe Orlando … has been getting the fishermen to pursue all their injuries to great extent,” Clarke said, ” He’s been promoting all of this.”
Orlando, a 31 – year-old Gloucester native, responded: “I’m proud, I’m complimented and I’m amused.
“The simple fact is that in the last five years, we have, in fact, had the highest verdicts and the highest settlements, and we’ve never lost a jury trial, and we’ve never lost an appeal,” Orlando said.
He reeled off several recent settlements: a lumper who won a $200,000 settlement from a boat after injuring his back in a fall in the fish hold; a crewman who won $140,000 from a boat after receiving minor injuries when he fell from a mast: another crewman, son of the skipper, who won $350,000 from the corporation’s insurance company after injuring his back in a fall.
“For the first time, the fisherman in the community have had effective representation. And have been able to get what … has been denied them in the past 30 years.”
“We’ve changed the stakes,” said Orlando, son of Michael Orlando, vice president and port agent of the local branch of the Seafarers International Union. “We don’t play ball with them (insurance companies), we represent the guys who get hurt.”
Sebastian “Busty” Moceri, owner and skipper of the Andromeda, said crewmen no longer took for a compromise settlement with skipper or insurance company. Rather than seeking reimbursement for “trips” they missed, injured crew members are suing for as much as they can get, he said.
“Nobody’s looking for trips now,” Moceri said, “They’re looking for hundreds and hundreds (of thousands of dollars).
“Nobody can compromise anymore,” he said. “Crew members now, as soon as the come in from fishing, they go right to the lawyer. They can do anything they want with us.”
“Nobody wants to go fishing; everybody’s on disability,” Moceri said. “I’ve got to go into the barrooms and get a bunch of bums to go fishing.” Angela Sanfilippo, president of the Fisherman’s Wives Association, said insurance companies often cause big settlements because they refuse to pay the legitimate claims.
She said her nephew was injured on a fishing boat and asked for one “trip” for $3,000 from the insurance company. The company refused to pay; her nephew hired a lawyer and eventually won a $15,000 settlement. The lawyer’s fee was $5,000, one-third of that settlement, Mrs. Sanfilippo said.
“They (the insurance company) look at every claim as a phony,” said former fisherman Gus Foote, now Ward 2 city councilor, who described a similar case on the south shore.
Gaetano “Tom” Brancaleone, Fisheries Commission member and owner and skipper of the Paul and Dominic, said “if a guy gets away with it on a claim,” maybe more will be tempted to file for larger settlements.
“The fisherman on deck, he could care less,” Brancaleone said. “If he gets it (a large settlement), he doesn’t have to work anymore.
“Ninety percent of the thing is that the insurance companies and the claimers are at fault for this increase.
“The lawyers themselves … in the past two or three years, they’ve become millionaires,” he said.
Orlando said, “If you’re getting money for fishermen, the insurance rates are going to go up.”
But he said he has a legal and moral obligation to protect clients who are injured on the job. He cited the example of a fisherman who suffers an injury that leaves him with chronic stiffness that prevents him from working in the cold weather.
“My function is to protect them and their families for the rest of their lives,” he said.
The ludicrousness of settlements affects how the National Marine Fisheries Service (NMFS) handles its government-backed low-interest loan program, said Michael Grable, chief of the NMFS Financial Services Division in Washington, D.C.
Grable said NMFS prefers that only top notch insurance companies cover boats that have NMFS mortgage loans.
“But what we have run into is good underwriters pulling out of the market, so that we’ve had to drop our standards,” he said.
Grable said dealing with some less-reputable underwriters has led to delays on payment of some claims after sinkings.
“We find ourselves threatening suit quite frequently,” Grable said.
And Grable said the Jones Act, federal legislation protecting seamen, puts an “outmoded burden of liability” on boat owners.
The New Hampshire Insurance Company official pointed to a lawsuit that shows the Jones Act is too broad in scope.
In 1975, fishing skipper Robert Fahey was killed in a Blackburn Circle accident, while driving a pickup truck owned by the corporation he worked for, Western Ocean Resources. Earlier that day, he had attended a company meeting.
In 1980, Fahey’s family sued the corporation, arguing that the Jones Act covered Fahey’s accident because he was driving a corporation-owned truck. Last year, Western Ocean Resources insurance company paid Fahey’s family $100,000 to settle the suit.
Congress is now considering a bill that would make the Jones Act less sweeping. U.S. Rep. Walter Jones, D-North Carolina, chairman of the House Merchant Marine and Fisheries Committee, is drafting the bill, which he plans to introduce later this year, according to a spokesman in his Washington office.
In the meantime, Orlando said he would encourage fisherman to pursue legal action and large settlements.
“They’ve been forced into it because the insurance companies have never dealt fairly with them,” Orlando said. “They all read newspapers, they know what’s happening. These guys learn.
“If they (insurance companies) put on a better face with these guys and dealt with them more honestly, perhaps this wouldn’t happen.”
