Carnival Still Feeling the Heat

NEW YORK (TheStreet) -- Carnival Cruise Lines  (CCL) is still fighting bad publicity from February's "poop cruise," in which a ship called the Carnival Triumph suffered a fire traveling in the Gulf of Mexico and had to be towed to port while the whole world watched.

So far, however, the stock is holding up to the heat, thanks in part to a lot of investment support by hedge funds. It doesn't hurt that the chairman of Carnival, Mickey Arison, also owns the Miami Heat basketball team.

CNN's "Anderson Cooper 360" reported this week on documents it claimed prove the cruise line knew about problems on the Triumph before its fire -- charges Carnival quickly tried to refute.

A class-action lawsuit was filed against Carnival within days of the Triumph returning to port on Feb. 14, after the line offered passengers refunds, vouchers for future cruises and other compensation.

The Triumph's problems came a year after a ship owned by a Carnival subsidiary, the Costa Concordia , ran aground off the coast of Italy and another Costa ship, the Allegre, caught fire off the Seychelles, knocking out its power.

The problem in both the Carnival Triumph and Costa Allegre fires was traced to leaks from flexible engine fuel hoses. Carnival said the Triumph's hoses passed inspection before the ship left port. A lawyer for passengers suing the company told CNN, however, that notice had been sent before the voyage recommending spray shields be installed over the hoses, thus making Carnival negligent.

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