OOE’s Sea of Troubles

The voyage is apparently over for One Ocean Expeditions (OOE).

The Polar cruise specialist founded by Westmount native Andrew Prossin, which had been canceling this season’s voyages one by one, has sent a letter to passengers stating it “will enter a formal process of business re-structure in accordance with Canadian corporate law.” Kevin Mora, a California attorney whose own cruise was canceled and who launched a Facebook group for all those in the same situation, shared the email the company sent him regarding its next steps:

Mora received the email because he chose Option B — “a potential refund of a portion of monies paid to OOE” — from three options offered by OOE. He was also sent a form to fill out with his contact details and those of his travel agent.

OOE has not (yet) declared bankruptcy, but does seem to be insolvent, a stage, according to insolvency trustee Rumanek & Company:

…where the debts of the corporation are no longer being paid in the terms agreed upon with the suppliers of the goods or services.

According to The Squamish Chief, OOE is facing multiple lawsuits over its failure to pay for good and services and is the subject of numerous complaints to the BC Ministry of Labour (the company is headquartered in Squamish) over unpaid wages.

If OOE follows the “proposal provisions” of the federal Banking and Insolvency Act (BIA), it hires a licensed insolvency trustee (LIT) to “conduct a review” of its finances to see if there is an option other than bankruptcy. This can include making a proposal to creditors which they can either accept or reject. According to Harris & Partners Inc (LITs based in Markham, Ontario):

If there is no other option but bankruptcy, your trustee will administer the process, complete the necessary forms, and handle all communications with creditors. Company assets will be liquidated to pay creditors as much as possible.

If OOE applies to the court for protection under the Companies’ Creditors Arrangement Act (which applies to insolvent corporations that owe creditors in excess of $5 million) it will, according to the consultancy Farber:

…receive an initial 30 days of protection from creditors with extension often granted beyond the initial 30 days to provide time to formulate a potential plan of arrangement (CCAA plan) with the stakeholders.

During this time, the court will appoint an independent third party, referred to as a monitor, to assist with such matters as monitoring of the company’s ongoing operations and cash flow, communicating with key stakeholders and ultimately potentially filing a CCAA plan with the creditors.

The Office of the Superintendent of Bankruptcy in Canada says of the CCAA:

Canadian courts have held that the main purpose of the CCAA is to avoid, where possible, the social and economic consequences of bankruptcy, and to allow a company to carry on business. CCAA proceedings are carried out under supervision of the Court and the statute offers more flexibility and greater judicial discretion to deal with complex issues that may arise during the restructuring process than the more rule-based Bankruptcy and Insolvency Act (BIA).

If creditors reject a CCAA plan the company’s creditor protection is “usually lifted” but “the debtor company does not automatically become bankrupt.” (The Superintendent doesn’t say what happens next. I would guess bankruptcy proceedings would either be entered into voluntarily by the company or triggered by a creditor’s petition, but don’t quote me on that.)

 

A & C

As for the other options offered disappointed travelers, A was an alternative sailing with a “partner.” The “partner” language had earlier caused a bit of a flap after OOE told travelers it had:

…entered into a marketing partnership with a highly regarded company with more than 120 years of cruise and expedition experience.

The “120 years of cruise and expedition experience” seemed to point to Hurtigruten, but the Norwegian cruise line issued a statement denying any “partnership” arrangement:

We fully understand the stress the One Ocean Expeditions cancellations causes both agents and travelers. As a courtesy given the difficult situation, Hurtigruten has decided to offer guests who have been impacted by OOE cancellations the opportunity to book a Hurtigruten expedition cruise under “compassionate rates” on selected itineraries.

“We are truly sorry for the confusion the misleading communication depicting a partnership has caused to guests in an already difficult situation. But it is important for us to underline that the compassionate rate offer is made independently of OOE, and any booking or financial disputes remain with OOE and the traveler – and does not in any way involve Hurtigruten.

 

Option C is to pursue your insurance company for payment — SWOOP, a British travel agency, after reporting the latest OOE development on its website noted that:

This latest news has brought clarity for booked customers in terms of now knowing the options. Swoop are working with our customers to help find the best outcome for each one.

None of these options is particularly good, of course. “A” requires you to spend additional money and change your travel dates; “B” hinges on what, exactly, OOE has in terms of “assets;” and “C” only works if you had travel insurance that covers the insolvency of a carrier.

 

‘This John Geiger Guy’

I have nothing to add to the OOE story, but by a strange coincidence, Jesse Brown’s media criticism podcast Canadaland dedicated this week’s episode to a subject related to OOE, which makes for a fascinating sidebar to the insolvency story.

Brown  interviewed former Toronto Star reporter Paul Watson who quit the paper in 2015 after he was barred from reporting a story about someone Brown refers to as “this John Geiger guy.”

Geiger, as those of you who’ve been following the OOE saga will know, is the CEO of the Royal Canadian Geographic Society (RCGS), OOE’s “partner” in Arctic exploration, the organization that put its initials on the RCGS Resolute (which is still, apparently, under arrest in Argentina).

Watson’s story — later published by Buzzfeed — focuses on Geiger’s participation in the 2014 expedition in search of Sir John Franklin’s lost vessels. Watson argues that Geiger exaggerated his role in the discovery of the HMS Erebus.

Watson recounts how Geiger, the former chair of the editorial board at the Globe & Mail (and Conservative party donor), became “a prominent spokesperson” for the expedition, which he and the RCGS had joined “just a few months” before the Erebus discovery. Geiger, who was not on the vessel that made the discovery, provided a “technical briefing” for reporters following the announcement during which:

None of the experts directly involved in discovering the shipwreck, or the artefacts that led to the find, were made available to media…

It’s a great read, and I’m not going to spoil it for you, but I have to discuss one aspect, which is Geiger’s role in advancing what Watson calls “a central Harper government theme,” the “the importance of government cooperating with the private sector to make big things happen.” Writes Watson:

The tightly scripted media rollout would see Geiger give interview after interview about the find, talking freely about the moment of discovery and about the prime minister’s deep passion for the north. It would culminate months later with Geiger and Harper being awarded medals in separate ceremonies to mark their important roles in finding HMS Erebus, the ship that Sir John himself had sailed on.

Geiger was actually stuck in ice aboard the One Ocean Voyager, the temporarily renamed Akademik Sergey Vavilov, along with his “corporate partners” who included — you guessed it — One Ocean Expeditions.

Featured image: Drone shot of RCGS Resolute. Image credit: Island Aerial Media