Maersk Line is settling a $13.9 million lawsuit by British retailer Argos claiming the Danish ocean carrier breached its contract with the shipper for Asia-Europe transport.
Terms of the settlement were not disclosed, but Maersk said in a statement released Monday that Argos will remain a customer of the container line under “a significantly firmer contractual basis.”
The settlement ends the only legal battle that went to court in the aftermath of the volatile shipping environment of early 2010, when deeply discounted rates started skyrocketing and a sudden surge in demand overwhelmed tight capacity across the industry.
Several shippers claimed carriers breached contracts during the period and Argos claimed in the London High Court that Maersk reneged on its commitment to ship 10,000 40-foot equivalent units from Asia to the UK through 2010 and 2011 at a base rate of $930 per container.
“Argos and Maersk are no longer in dispute and their commercial relationship has now been established in a way which both companies believe provides a significantly firmer contractual basis going forward,” Maersk said. “Argos is and continues to be an important customer for Maersk.”
“The terms of the relationship are confidential, and accordingly it is not appropriate to comment further,” Maersk said.
Argos claimed Maersk unilaterally raised the rate to $2,730 per FEU in January 2010, forcing the retailer to find an alternative carrier to ship its containers, resulting in increased costs of almost $13.9 million.
Several carriers have denied broad shipper charges that they breached contracts as demand scaled up in early 2010, with some saying rates were raised to spot market levels only after minimum volume commitments in contracts were met.
Terms of the settlement were not disclosed, but Maersk said in a statement released Monday that Argos will remain a customer of the container line under “a significantly firmer contractual basis.”
The settlement ends the only legal battle that went to court in the aftermath of the volatile shipping environment of early 2010, when deeply discounted rates started skyrocketing and a sudden surge in demand overwhelmed tight capacity across the industry.
Several shippers claimed carriers breached contracts during the period and Argos claimed in the London High Court that Maersk reneged on its commitment to ship 10,000 40-foot equivalent units from Asia to the UK through 2010 and 2011 at a base rate of $930 per container.
“Argos and Maersk are no longer in dispute and their commercial relationship has now been established in a way which both companies believe provides a significantly firmer contractual basis going forward,” Maersk said. “Argos is and continues to be an important customer for Maersk.”
“The terms of the relationship are confidential, and accordingly it is not appropriate to comment further,” Maersk said.
Argos claimed Maersk unilaterally raised the rate to $2,730 per FEU in January 2010, forcing the retailer to find an alternative carrier to ship its containers, resulting in increased costs of almost $13.9 million.
Several carriers have denied broad shipper charges that they breached contracts as demand scaled up in early 2010, with some saying rates were raised to spot market levels only after minimum volume commitments in contracts were met.