July 15, 2024 — Virginia-based Ocean Fleet Services and Ocean Harvesters filed a “motion to dismiss” a $2 billion lawsuit against seafood giant Cooke Inc. of New Brunswick, Canada, that claimed the firm violated U.S. foreign ownership laws with the acquisition in 2017 of Omega Protein in Reedville, Va.
The lawsuit, filed on July of 2021 by plaintiffs W. Benson Chiles and Chris Manthey and unsealed in April 2024, alleges Cooke Inc., Omega Protein, Alpha Vessel Co. Holdings Inc., Ocean Fleet Services, Ocean Havesters, have been violating the American Fisheries Act (AFA) of 1998 and the 1920 Jones Act that allow only U.S. citizens to fish in U.S. waters.
The suit stems from an approximately $500 million purchase of Omega Protein of Reedville in 2017 by Cooke Inc. The lawsuit alleges that part of the deal was an illegal arrangement that gave Cooke improper control of the company and the fishing vessels.
The fishing companies’ motion to dismiss, filed July 9 in U.S. District Court in New York, alleges that the suit “lacks factual basis, are speculative, and are quite simply inaccurate.”
“From the moment we became aware of this case, we have been eager to show that the allegations are inaccurate,” says an Ocean Harvesters spokesman. “Our legal filing underscores several key misstatements from the complaint and offers concrete evidence that they are false.”
The lawsuit alleges Cooke Inc. was involved in a “figurehead fraud scheme” creating a Delaware shell corporation to avoid violation of the AFA citizenship requirement and that “instead of simply acquiring Omega and owning its vessels (Cooke) restructured the entire acquisition to create an illusion of compliance with the AFA citizenship requirement.”