SHIPPING: Tanker Truce

To protect the U.S. maritime industry from cheap foreign shipping after World War II, the Government banned the sale of its low-priced surplus ships to foreign investors. But despite all precautions, United Tanker Corp., a Chinese firm with a phony U.S. front, worked out a deal to buy six surplus tankers from a group of promoters headed by Joseph E. Casey,*onetime Democratic Congressman from Massachusetts (TIME, March 3, 1952 et seq.). As a test case the U.S. Justice Department went to court over the sale of one tanker (the Meacham), won the case, seized five ships and sold the Meacham with the proceeds held by the court.

Last week Attorney General Herbert Brownell announced that he had negotiated a settlement with United Tanker. He agreed to return four remaining tankers to the company on its promise to 1) install an all-American board of directors, 2) pay its $3,250,000 mortgage on the ships, 3) let the U.S. have the $1,500,000net proceeds from the Meacham sale.

*By coincidence Federal District Judge Luther Youngdahl last week dismissed two indictments charging Casey with conspiring to defraud the Government in surplus-ship sales to Greek shippers. Casey had won immunity by telling a federal grand jury about the transactions.