Rocking the boat
Ship captains sue to compete directly with Galveston-Texas City Pilots.
Attorney Justin Renshaw stood before a judge and called the Galveston-Texas City Pilots a cartel, seeking to make as much money as possible and exclude other mariners from the esteemed and lucrative task of guiding vessels into the local ports.
“You don’t get to be a GalTex pilot,” he said Wednesday in a courtroom in Austin, “unless a GalTex pilot wants you to be a GalTex Pilot.”
His clients, a group of five ship captains, are seeking to compete directly with the Galveston-Texas City Pilots, whose members earn an estimated $400,000 or so a year. Unable to get state licenses, they decided to sue Gov. Greg Abbott and the stateappointed commissioners who oversee the pilots group.
It was the first major hearing in what’s poised to be a contentious battle, with the judge already chiding attorneys for incivility toward one another. A major theme hinges on the illegality of monopolies in Texas vs. the state’s right to regulate a critical service for the public good.
“Even if a monopoly did exist, it’s authorized by the state’s interest in safety and the state’s interest that there not be any accidents between vessels,” said Assistant Attorney General John Langley, who represents Abbott and the Pilot Commissioners.
It’s common for one state pilot group to control a waterway, and this isn’t the first time disgruntled mariners have taken the system to court. Cases from Galveston more than 100 years ago failed to gain traction,
though Renshaw argues those challenged different issues than the ones he is fighting pro bono.
U.S. waterways with two state pilot groups are typically bordered by multiple states, and these associations have agreements for dividing up the traffic.
“There’s no place where two or more groups of state pilots operate in the same area and compete for assignments,” said Paul Kirchner, executive director and general counsel for the American Pilots’ Association. The mariners
Going to court was not the first option for Capts. Jay Heichelheim and Graylin Gant, plaintiffs who live in Galveston and Beaumont, respectively. Both have long maritime careers.
Heichelheim, 62, first captained a small crew boat at age 16, gradually earning qualifications to steer larger vessels. He’s worked at a shipyard, learning to get failing, hard-to-steer vessels onto the dry dock, and is currently a tugboat captain.
Gant, 55, started on deep-sea fishing boats and later captained supply vessels for offshore oil rigs.
Both men are graduates of “Hawsepipe University,” a grit-and-sweat term referencing the pipe that holds the chain of a ship’s anchor.
“Hawsepipe University means we swam over to the anchor chain, crawled up the anchor chain and through the hawsepipe,” Heichelheim said. “And that’s how we got on deck.”
They’ve both applied multiple times to join the Galveston-Texas City Pilots; Heichelheim was 24 when he first did so.
In those days, Heichelheim said, pilot groups across the country were very nepotistic — a person made pilot because his father and grandfather were pilots. Much of that has been addressed with anti-nepotism policies, though Heichelheim said pilots still trade votes. If a pilot in Corpus Christi gets a Galveston pilot’s son into the Corpus Christi group, he alleges, then that Galveston pilot will get his counterpart’s son into Galveston.
“I’m not saying that this happens all the time, but it’s another possibility,” he said.
In February 2015, two years before the lawsuit was filed, Renshaw asked the chair of the Pilot Commissioners how mariners could submit applications to become state-licensed pilots other than joining the Galveston-Texas City Pilots.
He was eventually told that mariners must be trained by an existing pilot with that group to get a state license for Galveston County. They could not get that license any other way. Furthermore, there weren’t published rules in the Texas Register to guide mariners on applying for a state license in the county. ‘Closed system’
The lawsuit alleges that the process is “completely deferential” to the Galveston-Texas City Pilots. It alleges “a closed system excluding ‘outsiders’ ” and a monopoly that is prohibited by the Texas constitution.
Ultimately, the mariners are seeking to change the application process and specific sections of the Texas Transportation Code governing state pilot licenses.
“Just give us the process by which we could do an application outside of the monopoly,” Renshaw told the judge.
Yet Jim Brown, a Houston attorney who represents other Texas pilot associations, does not consider the application process to be dictated by the Galveston-Texas City Pilots. These pilots can accept trainees only from a pool of applicants the pilot commissioners have approved and deemed qualified. That provides checks and balances, he said.
“The Galveston procedures, I would say they’re pretty common,” Brown said.
Furthermore, Langley argues in court documents that previous court decisions have recognized exceptions to the state’s prohibition on monopolies. They’re justified when created by government regulations that protect public health and welfare, such as requiring occupational licenses to practice medicine or law.
“Courts recognize that allowing pilots to train their own candidates on the waters they will be called upon to pilot ships enhances skill and safe practices important to protecting the public interest,” the court document reads. “The state’s oversight of this system is not the fostering of an ‘illegal monopoly’; rather it is proper regulation of a critical service and the valid exercise of the state’s police power in protecting the public and the Texas coast.”
Renshaw countered that the pilot situation is not like getting a license to practice law because lawyers have the liberty of choosing among myriad firms. It would be comparable to the pilot situation only if there was just one law firm in town through which a lawyer could be licensed and employed.
He emphasized that the mariners are not trying to get rid of licensing. They are equally committed to safety, he said. They just want everyone to have the same opportunity for receiving that license.
“We’re not asking to force the courts to give these guys licenses,” Renshaw said. “We’re just asking that they be given a chance on the same footing. Non-discriminatory, non-monopolistic means to apply to get the same license.” Federal vs. state
Gant and Heichelheim already have federal pilot licenses for the waterway on which the GalvestonTexas City Pilots operate. It’s a license that the state pilots must also earn from the U.S. Coast Guard. The federal license can be obtained after making a certain number of round trips on the waterway and memorizing the ship channel, among other requirements.
These licenses determine which ships a pilot can board. State-licensed pilots can guide ships sailing under U.S. and foreign flags. Federally licensed pilots, however, can guide only U.S.-flag ships.
“You could have the exact same ship, just flying a different flag,” Renshaw said.
Separately, and after not being accepted into the Galveston-Texas City Pilots, Gant and Heichelheim started pilot businesses to get U.S.-flag ships into port. Some ship owners expressed an interest in working with the federally licensed pilots, but they wanted them to hire more people to assure their ships wouldn’t have to wait while the pilots moved other vessels.
But the small number of U.S.-flag ships calling on Galveston and Texas City doesn’t justify hiring more people.
“Without being able to do foreign-flag vessels,” Heichelheim said, “there’s not quite enough business to justify building a larger business and hiring people and training people.”
State pilots argue that a federal license does not prepare mariners to the same level as a state license. Federal pilots often get the qualification as crew members on a U.S.flag ship. They know the intricacies and quirks of that particular ship, but state pilots must be able to jump on vessels varying in size and quirks.
“We’re talking about very, very precise movements that are required every step of the way,” said Paxton Crew, the attorney for the Galveston-Texas City Pilots. Crew and his clients joined the litigation despite not being sued directly.
Capt. Christos Sotirelis, presiding officer of the Galveston-Texas City Pilots, said state pilots in Texas complete a two- or three-year apprenticeship. They can expect to work 340 days in their first year, and they will have handled nearly 1,000 vessels by the end of their second year. That’s above and beyond the requirements for a federal license.
“There are a great many skilled mariners, but what sets a local pilot apart — in any port, not just ours — is an extensive and thorough knowledge of the distinct, sometimes unexpected characteristics of their waterways,” he said in an email. “The only way to truly understand the way traffic should flow into and out of any port is through extensive training under the guidance of someone who already understands it.” Competition’s effects
The proposition of two competing pilot organizations worries Kirchner with the American Pilots’ Association. He said it could make waterways unsafe and pilot services unreliable.
If pilots are chasing only lucrative ship movements — some jobs pay better than others — then some ships may be at risk of not getting moved. With only one association, all ships are guaranteed a trained, competent and rested pilot.
Competition was among the many topics discussed before Travis County state District Judge Dustin Howell. He was also presented with a plea to the jurisdiction, in which Abbott claims immunity, and several motions for summary judgment. Howell did not release a ruling from the bench but will instead issue a written decision later.
Joseph Keefe, editor of Maritime Logistics Professional and MarineNews magazines, said the lawsuit could change the way pilot duties are carried out at all Texas ports if it’s successful.
“Is the dispute being watched closely by other ports?” Keefe said in an email. “I would think so.”
Representatives for the Houston Pilots and Texas State Pilots associations were at the hearing Wednesday.
Heichelheim said he doesn’t want to discredit the Galveston-Texas City Pilots. He just wants a chance to do what he loves and to pass along his knowledge to the next generation.
“We don’t want to frown down on the Galveston pilots,” Heichelheim said. “I think they do a fine job. But I think we could do a fine job, too. We could do the same fine job.”