This is the third part of a four-part series on the rise of hijack-and-ransom piracy in the shipping lanes off the coast of Somalia, and the costs it poses to the merchant shipping industry -- and global trade as a whole.

>>The Pirates' Toll: Part 1
>>The Pirates' Toll: Part 2
>>The Pirates' Toll: Part 4

WHEN PIRATES ATTACK: SCENES FROM A HIJACKING
According to the International Maritime Bureau's 2008 annual report on world piracy, the attack occurred at about a quarter to eight in the morning, local time.

Flashes of hearsay, of details cobbled from secondary sources: Two speed boats carrying 11 or 12 men (no one seems to know for sure, except, probably, the pirates themselves), overtook the MV Biscaglia in the Gulf of Aden. Slow and low, the ship had fallen two hours behind the convoy led by the French naval frigate. The people on the skiffs, most of them apparently teenagers, carried AK-47s and a rocket-propelled grenade launcher -- the de rigueur weaponry of Somalia's pirate squad.
Pirate Interactive Map

The ship's alarm sounded; the captain sent a distress signal from the bridge. The French warship received the signal, and two helicopters -- one French and one German -- launched, en route to intercept the Biscaglia.

A naval chopper confronts a pirate skiff in a separate incident in the photo above.

The captain gave instructions to the helmsman. The ship went hard to starboard and then hard to port -- an S-turn -- an attempt to kick up a wake. The wake was meant to hinder or, best case, capsize the skiffs. It didn't. Bullets sprayed the wheelhouse. Windows shattered. The Biscaglia's security-guard specialists, two ex-marines, one ex-paratrooper, all three British, aimed the LRAD. They unleashed its noise-ray. The pirates did not collapse in skull-clutching anguish. "It was a total waste of time," one of the guards later said. (The LRAD people have disputed this characterization.)

Two grenades detonated on the deck. No one was injured; damage was light. Smoke rose from the deck and turned the air acrid. The security guards found a few scaffolding poles, put them on their shoulders and fired their flare guns -- red balls whooshing -- through the shafts -- MacGyver bazookas. The bazookas, however, were "wildly inaccurate."

The day was sunny and warm.

Seized pirate armaments are pictured above.

Fire hoses gushed from at least nine points around the ship -- white jets of water arching and spitting into the calm blue GOA in what appears, in photographs taken from one of the naval helicopters, like some great uncorked display of celebration -- a fireboat in New York Harbor on the Fourth of July.

A ladder went up the side of the Biscaglia. The razor wire, to the ascending pirates, presented no particular challenge. Nor did the cascading water. Six men, perhaps more, clamored onto the deck from the ladders.

The helicopters kept their distance, thudding in the background, for fear of provoking the teenagers into shooting the crew. The 28 members of the crew had already assembled at their prearranged emergency muster point on the bridge. The security guards did the same on the "monkey deck," the roof of the superstructure. The pirates pointed their Kalashnikovs at the crewmen, who knelt, hands on heads. The security guards, standing above, jumped 50 feet into the GOA, an area known for sharks. The pirates shot at the guards swimming in the water.

"Let me just say something," says Christodoulou. "They absolutely did the right thing by jumping. In World War I, in World War II , sometimes there was what's called an open city. They fight, they fight, they fight. When they realized that they couldn't win this fight, many times the defenders evacuated the city to save the citizenry, the infrastructure, the buildings. Those guys, people thought it was cowardice, and I will tell you it was not cowardice."

The German helicopter fished out the guards. The crew, coached long beforehand not to resist if pirates breached the ship, did not resist. "Nobody's a hero on this thing," Christodoulou says. "That was their instruction. Everybody's a survivor, nobody's a hero." The pirates ordered the captain to pilot the Biscaglia to a spot a mile or two off the coast of northeastern Somalia, not far from a "known pirate stronghold" called Garacad (though the annual report of the International Maritime Bureau says the ship went to another well-known pirate port, this one called Eyl.)

At his condo in Hoboken, New Jersey, Christodoulou received a fax on his computer. "First Greetings," it said. Handwritten, the fax was a ransom note. It demanded a sum Christodoulou won't now divulge. Negotiations had begun.

Above: An unexploded rocket-propelled grenade on the deck of a ship attacked by pirates

RULES OF ENGAGEMENT
"What was their first number?"

"High."

"More than ten million?"

"Higher."

"More than fifty?"

"No, no. But it was ridiculous. It was more than the value of the ship. It was like, 'Guys, just take the ship, then.'"

A body of common knowledge -- of best practices, helpful contexts, rules of engagement, SOPs -- has evolved over the last few years when it comes to the highly specialized ins and outs of negotiating with Somali pirates.

Christodoulou's introduction to this world came over breakfast at Claridge's, in London. ("I always stay at Claridge's when I'm in London.") Two days after that first phone call on Thanksgiving night, he flew there to meet with his insurance representatives and, most importantly, the professional hostage negotiator assigned to him by his kidnap-and-ransom underwriter. K&R insurers keep such specialists on retainer. Reginald Taylor (not his real name) happened to work for one of the more illustrious firms in this secretive business: Risk Management, which once employed the man on whom the Russell Crowe-vehicle Proof of Life was based.

The average length of captivity is 60 days. The ships are nearly always taken to points off the coast of known pirate strongholds and anchored there. The pirate gangs -- thought to be run by clans, which are thought to be headed by so-called "boards of elders" -- will assign an English-speaking negotiator to each ship. The negotiators are likely subcontractors or middlemen; they're based for the most part on the beach, not onboard the vessels, so as to avoid cases of Stockholm syndrome; they might be working on several hijacked ships at once.

Threats will be made: Running ships aground. Debarking crew members and hustling them into the interior. "It's a long and laborious negotiation," says Dick Hildreth, a kidnap-for-ransom specialist with the firm Corporate Risk International, of Reston, Va. "The negotiators and the pirates will change their minds halfway through. They'll lie."

There will likely be accusations of toxic-waste dumping, of working secretly for the Italian mafia to transport and discharge the toxic waste. There will be wild swings in the ransom asking price. It will be difficult to keep it all straight. All conversations ought to be tape recorded, transcribed immediately, the dialogue studied. "It's a very difficult situation, especially the first 24 to 48 hours," says Stephen Askins, a maritime lawyer. (He has advised a dozen ship-owner clients on such negotiations, including the notorious affair of the MV Faina, the hijacked Ukrainian ship carrying a cargo of arms to Kenya in 2008. In the photo above, the Faina's crew arrives at port after the ordeal .

Ship owners must steel themselves and not immediately cave. Christodoulou says, "The last thing you want to do is pay a ransom and then have them say, 'Thanks for the down payment. Now we want the rest.'"

He says, "The pirates have to make sure they've got every last drop of blood out of you. If you agree too quickly, if you seem too eager, they're like: 'Ah! There's probably more!' And holding the line for days and weeks? If you don' think that's tough, let me tell you something...."

He says, "There's no receipt, there's no return policy, and if you mess up -- you get one chance! You only have one shot at this, and it's got to be right."

Reginald Taylor went back with Christodoulou to Hoboken, where the pair hunkered down at the CEO's apartment, in a high rise overlooking the Hudson, for the duration of the ordeal. (Except, that is, for a brief period when Taylor was replaced with another Risk Management specialist -- a pre-scheduled rotation -- but Christodoulou and the replacement didn't click, and Taylor swapped back in.)

Also in the core group were Christodoulou's lawyer, Larry Rutkowski, and his media-relations man, Tom Rozynski, who helped keep the crew members' families, nearly all of them in India, up to speed on the proceedings. Levity was often required to break the stifling tension. Someone got hold of a life-size cutout -- Johnny Depp-as-Jack Sparrow -- and put it against a wall. The ISEC team threw darts at the pirate of the Caribbean.

VERY LESS
Because of ISEC's tiny size, Christodoulou pretty much had to serve as his own negotiator. To his counterpart on the other side of the planet, however, he presented himself as "Gus," a fiction, a second personality for Christodoulou to play-act: a company employee deputized on behalf of ISEC's chieftains to work a deal with the pirates.

Above: Men about to be charged with piracy on the high seas by a court in Mombasa, Kenya.

Gus was the name of Chirstodoulou's grandfather. He wrote the name on a piece of tape and stuck it to a cell phone he bought to handle only pirate phone calls. They plugged a digital voice recorder into the cell phone. They called the whole apparatus the "football."

Using the football, Christodoulou spoke with the negotiator several times a day, mostly in the morning, Somali time, before the pirates had a chance to chew the legendary khat leaf, the mild narcotic cross between tobacco and low-grade cocaine, which Somali pirates are known to enjoy as much as Christodoulou and his team enjoyed, at the end of each tense day, a nightcap of Johnny Walker Blue.

"Mr. Gus. The money you offer, the pirates say it is very less."

"I understand you want more money. But we are a small company. We have only two ships. You have one of the ships."

"Mr. Gus. The pirates they say it is very less. The pirates they say more money."

"I wish I could give you more money ... but you're already putting my company out of business."

"Mr. Gus. The money is very less."

The expression "very less" became a catchphrase in Hoboken.

Some pirate negotiators speak near-native English. The one drawn by Per Gellustrup's Clipper Group -- his hijacking coincided with ISEC's -- reportedly lived for 29 years in the United States. Not so Christodoulou's, a fact that compounded the stress.

"You can't convey frustration. You can't convey nuance. You can't convey complexity," Christodoulou says, his voice rising an octave with each sentence. "You're negotiating life and death -- a multimillion-dollar, life-and-death contract -- on a second-grade level. I mean please! It was hard, man!"

A French marine squad makes a pirate arrest

Partly for this reason, Christodoulou took a rather soft approach to his negotiating style. The Clipper people did not. The Clipper people at one point told their Somali negotiator, in effect, "Enough. We're done. Call us back you when decide to go below two million."

Mr. Gus, on the other hand, opened every conversation by asking after the health of the "Somali gentlemen" and then after the health of his Biscaglia crew.

"Hello, my friend," Gus would say. "Before we start talking about the negotiation -- are you OK, are the Somali gentlemen OK? Do you have enough food? Is there water? Is there anything I can do? I know this is tough on you, too. We'll get through this. We'll be OK. Please don't ... please don't get nervous."

Apart from a simple language barrier, there were other, profounder reasons for taking a light touch. "People would ask me, 'What do you care if the Somalis have enough food?' But think of it. If the Somalis have enough food, chances are my crew has enough food.

"Look, I didn't want anything to happen to the Somalis either. I just wanted them to get off my ship! And I wanted them to get off safely, because if they didn't get off safely, my crew was in trouble.

"My entire strategy was to decompress the situation. For everybody's sake. I never had a call with them where I didn't say: 'How are the Somali gentlemen doing on board the ship? We want everybody, including the Somali gentlemen, to get out of this thing safely -- and just finish with it.' Believe me, I wasn't there to make any kind of statement. I just wanted everybody to go home and be happy. Let God sort it out."

-- Written by Scott Eden in New York

This is the third part of a four-part series on the rise of hijack-and-ransom piracy in the shipping lanes off the coast of Somalia, and the costs it poses to the merchant shipping industry and, perhaps, global trade as a whole.



Scott Eden has covered business -- both large and small -- for more than a decade. Prior to joining TheStreet.com, he worked as a features reporter for Dealmaker and Trader Monthly magazines. Before that, he wrote for the Chicago Reader, that city's weekly paper. Early in his career, he was a staff reporter at the Dow Jones News Service. His reporting has appeared in The Wall Street Journal, Men's Journal, the St. Petersburg (Fla.) Times, and the Believer magazine, among other publications. He's also the author of Touchdown Jesus (Simon & Schuster, 2005), a nonfiction book about Notre Dame football fans and the business and politics of big-time college sports. He has degrees from Notre Dame and Washington University in St. Louis.

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