In the Matter of Oil Spill by the Amoco Cadiz Off the Coast of France on March 16, 1978

On the morning of March 16, 1978, the supertanker Amooo Cadiz broke apart in a severe storm, spewing most of its load of 220,000 tons of Iranian crude into the seas off Brittany. The wreck resulted in one of the largest oil spills in history, damaging approximately 180 miles of coastline in one of the most important tourist and fishing regions in France. The clean up took more than six months and involved equipment and resources from all over the country. The disaster has had lasting effects on the environment, the economy, and the people of Brittany, and has resulted in numerous lawsuits. Thirteen years later, the matter is before us. In this consolidated appeal, we are asked to resolve a myriad of issues involving jurisdiction, liability, and damages. Before we begin, a brief history of the litigation and its cast of characters is in order.

I.

A.

The origins of the Amoco Cadiz are not difficult to trace. The vessel was born of discussions that began in Madrid, Spain in May 1970 between Astilleros Españoles, S.A., the shipbuilder who constructed the fleet in which Columbus voyaged to the New World, and Standard Oil Company of Indiana (“Standard”) (now called Amoco), an Indiana corporation having its principal office and place of business in Chicago, Illinois. The latter was represented by Robert S. Haddow, vice president in charge of marine operations at Amoco International Oil Company (“AIOC”) and chairman of Amoco Tankers and Amoco Transport. (For simplicity’s sake, we generally will refer to Amoco and its various subsidiaries — Amoco Tankers, Amoco Transport, and AIOC — as “the Amoco parties” or “Amoco.”) Astilleros previously had contracted to build two megatankers for Amoco; Haddow wanted two more. The Madrid meeting covered all the essentials: technical specifications, delivery date, and price. Further negotiations took place in New York and Chicago. On May 30, As-tilleros confirmed the content of the negoti *1286 ations and submitted a bid to build two ships, the Amoco Cadiz and the Amoco Europa. Amoco accepted the bid by letter on June 18, and the parties signed off on the final contract and ship specifications in Chicago on July 31, 1970.

The contract required that the ship be built according to the American Bureau of Shipping’s (“ABS”) Rules for Building and Classing Steel Vessels. The ABS is a not-for-profit maritime classification society headquartered in New York that promulgates rules and sets standards for shipbuilding, design, and seaworthiness. The ABS’s technical staff in London reviewed Astilleros’s proposed plan for the Amoco Cadiz to ensure that it complied with the ABS’s Rules. The ABS examined the “general arrangement” plans — plans featuring the layout and list of components used in the various parts of the ship — as well as drawings related to the detailed design of the ship. (By “detailed design,” we mean items as small as nuts and bolts.) The ABS stamped the plans and drawings with its Maltese cross emblem to signify its approval. The Amoco-Astilleros contract incorporated the general arrangement plans and required Astilleros to submit them to Amoco for acceptance prior to construction. Astilleros did so, but did not pass along to Amoco its detailed design drawings, calculations, or fabrication drawings showing the mechanical details of the steering mechanism’s component parts. Amoco reviewed the design of the steering gear system and approved it on October 19, 1971. Amoco later made two modifications to the system: it designed a low fluid level alarm for the replenishment gravity tank and increased the size of the rudder. It chose not to include an optional hand charging pump. Astilleros’s representatives came to Chicago for a two-day meeting in June 1972 to firm up technical details.

Pursuant to the contract, Astilleros built the behemoth at its shipyards in Cadiz, Spain. It took four years to complete the job. Throughout the construction process, both Amoco and the ABS had representatives on the scene at the shipyard. The Amoco representatives were concerned with deadlines and whether construction conformed to the contract specifications and general arrangement drawings. They also were present to witness tests of equipment and gear and to catch any problems that might have been missed in the plan approval process. The ABS representatives monitored the progress of the ship to ensure that construction was in conformity with the ABS’s Rules. The Amoco representatives deferred to the ABS representatives’ technical and engineering expertise in evaluating whether construction was proceeding as it should.

At long last, the vessel was finished. It measured 1095 feet long and 167 feet wide — the size of three football fields — and weighed 230,000 deadweight tons. It was powered by a 30,000 horsepower diesel engine driving a single screw and was equipped with a single rudder driven by a hydraulic steering engine. It had a hydraulic steering gear with movement of the rudder controlled by two pairs of rams contained in four cylinders that were filled with hydraulic fluid. The four rams were made of rolled steel and their heads were cast steel. Ram isolation valves controlled the flow of oil through the passages in the distribution block. These valves were a critical safety component. They could capture the remaining hydraulic fluid in the rams in the event of a rupture in the piping. The valves also could be closed to isolate the various lines from the rest of the system or to block the passage of oil to or from the cylinder.

The Amooo Cadiz’s steering system was supposed to work in the following manner. When the helmsman turned the steering wheel or when the ship operated on autopilot, an electronic signal was generated. In response to the signal, hydraulic fluid was moved by a series of pumps, which in turn moved the rams and, eventually, the rudder. The hydraulic fluid in the cylinders kept the rudder restrained and in the desired position by exerting pressure against the rams. There was no device aboard that could be used to steer the ship if the primary system failed. The ship was not equipped with twin screws, twin rudders, *1287 or bow thrusters that could be used to steer in an emergency. The anchor was underdesigned and could not be used as a stopping device in a crisis situation.

The ABS certified the ship — and its steering gear — as being in compliance with the ABS’s Rules. Even after delivery, the ABS periodically conducted inspections of the Amoco Cadiz to determine if it still was in seaworthy condition. Three times — June 1975, April 1976, and May 1977 — the ABS inspected the steering gear and pronounced it in working order.

B.

Amoco Tankers (“Tankers”), a Liberian corporation all of whose stock was owned by Standard through a chain of wholly owned subsidiaries, took delivery of the Amoco Cadiz on May 11, 1974. Two weeks later, Tankers sold the vessel to Amoco Transport (“Transport”), a Liberian corporation with its principal place of business in Bermuda. Transport was a subsidiary of AIOC. In June 1974, Transport entered into a consulting agreement with AIOC. The agreement provided that AIOC was responsible for the operation of the Amoco Cadiz, including maintenance, repair, and training of its crew. Transport remained the owner of the vessel. Long after delivery, in August 1975, representatives from Astilleros met with Amoco in Chicago to discuss contract guarantee terms. Similar discussions were held in New York in 1976. Just like a home appliance, the Amoco Cadiz came with a one-year guarantee. Astille-ros agreed to repair or replace any defects in the ship or its equipment during its first year of operation, 1974-75. Consequently, during that first year, the ship always had on board an engineer from Astilleros who was attuned to any problem that arose. After the one-year guarantee period had expired, AIOC took care of maintenance problems.

In June 1974, the Amoco Cadiz was chartered to Shell International Petroleum. “Charter hire” is the expense charterers pay owners of vessels per long ton per day. During off-hire periods, such as when the vessel is in for repairs, charter hire payments stop. It thus is in the pecuniary interest of a chartered ship’s owner to keep the vessel running. The Amoco-Shell time charter required annual drydocking of the tanker for maintenance, but for reasons of economy, Amoco unilaterally lengthened the interval between drydockings to eighteen months and made plans to extend the interval to two years. (A two-year interval would save the company $1,250,000 in shipyard costs and $200,000 per year in off-hire losses.) The ABS rules required two-year intervals between drydockings unless the owner received special permission from the ABS. By January 1976, Amoco decided that time-chartered vessels would be dry-docked every two and one-half years.

C.

In February 1978, the fully-staffed Amoco Cadiz took on a load of crude oil at Kharg Island, Iran, and Ras Tanura, Saudi Arabia, destined for Rotterdam around the Cape of Good Hope. The Italian crew was experienced and the officers all were properly licensed. With regard to training, Captain Pasquale Bardari and his officers and crew participated in on-shore classes and on-board safety exercises. The latter were conducted by representatives of Marine Safety Services, a British organization. In addition, the ship’s library contained a collection of films, videos, and technical information pertaining to ship operations.

As the tanker approached western Europe, it sailed into a storm. Retired Royal Navy officer Leslie Maynard, an on-board representative of Marine Safety Services, later testified that he had seen worse weather only once, during a typhoon. The Amoco Cadiz had the capacity to weather severe storm conditions and heavy seas if she was in seaworthy condition. Buffeted by the rough seas and high winds, the ship rolled heavily on March 15 and through the night of March 16. Despite the bad weather, the helmsman reported no difficulty with the steering mechanism. During their normal inspection rounds, the crew members reported no abnormalities in the steering room.

*1288 In the morning, while the Amoco Cadiz was approximately nine miles off the French island of Ushant, its steering gear completely failed. The helmsman informed Captain Bardari, who broadcast a message to nearby ships giving the Amoco Cadiz’s position and a caution to stay clear. The crew raised “not-under-command” flags as an additional warning. Almost immediately, the ship’s engineers examined the steering gear only to find that the “De” flange, which had held a pipe that carried oil from the port steering gear pump to the hydraulic oil distribution block, had come off. Oil was spurting everywhere.

The crew members discovered that five of the six steel studs holding the De flange and pipe to the distribution block had broken; no other studs had failed in the system. The failure of the studs allowed the rapid escape of hydraulic fluid out of the steering system and the immediate entry of air. One of the engineers futilely tried to stop the flow of oil by closing the port steering gear pump and the isolation valves on the distribution block. The chief engineer tried to replenish the system by adding hydraulic fluid to the steering gear gravity replacement tank, but the fluid level in the gravity tank did not drop as it should have if the steering mechanism had been functioning normally.

Because of the lack of hydraulic pressure, the rudder was unrestrained. Some of the crew unsuccessfully tried to control the swinging rudder with a block and tackle, while others tried to repair the flange connection and purge the air from the system. As the crew worked, a relief valve pipe blew off, and oil hit the ceiling of the steering compartment. With the relief valve blown, the rudder’s unchecked movement became more violent until it crashed into its stops, breaking apart the steering gear and hurling metal parts in every direction. The chief engineer ordered an evacuation of the compartment after one of the crewmen was struck in the head with a piece of metal. The chief engineer then reported to Captain Bardari that the steering gear could not be repaired.

About two hours after the steering failure, Captain Bardari called for salvage tugboats. In response, the PACIFIC, a salvage tug in the fleet of Bugsier Reederei und Bergungs, A.G., a corporation organized under the laws of the then Federal Republic of Germany, arrived on the scene. Bug-sier undertook salvage jobs only under a “Lloyd’s Open Form” (“LOF”) “No-Cure-No Pay” salvage contract. The tug did not begin operations immediately because Bar-dari had to call Chicago to find out if he could enter into such a deal. While the Amoco Cadiz foundered, Amoco and the tug’s captain, Hartmut Weinert, haggled over the LOF. Finally, Amoco and Captain Weinert came to terms. By then, the island of Ushant was less than six miles dead ahead, the shallow Chenal du Four on the port bow, and the rocky Finistére coast on the port beam. The wind was fierce, the seas high, and the Amooo Cadiz pitched so wildly that her bow repeatedly plunged beneath the surface.

The Pacific approached and secured a fairlead on the bow of the Amoco Cadiz intending to turn the ship to her starboard, head her out to sea, and then tow her in to shore. In hindsight, this strategy proved unfortunate. The Pacific was incapable of turning a ship the size of the Amoco Cadiz into the wind and the towing chain broke. The PACIFIC made a second tow attempt by connecting to the stern of the tanker. By then, tidal currents and heavy winds had carried the Amoco Cadiz dangerously close to the rocky and irregular Finistére coastline. The tanker continued to roll on the rocks and sink into the shoals. As the PACIFIC continued its futile maneuvers, its captain received the following message from Marine Safety Services representative Leslie Maynard, “Sir, we are grounded.” The Amoco Cadiz began tearing in two and the PACIFIC lost contact altogether. Soon, the telltale odor of oil filled the air. Fifteen million gallons spilled into the sea during the first night alone.

D.

The resulting oil slick was eighteen miles wide and eighty miles long, one-fourth of *1289 the Breton coast. Over the weeks following the grounding of the AmoCO Cadiz 4,400 men and 50 vessels (which included ships and personnel from the British Royal Navy) were dispatched to aid in the clean up operations at sea. France sought more than 30 million francs for the cost of the clean up at sea (see infra section V.). The clean up on land took over six months and involved the participation of the French army. Heavy machinery and volunteers were recruited from all over France. Approximately 220,000 tons of oily waste the color and consistency of chocolate mousse were recovered from the beaches along the Cotes du Nord. The infusion of oil upset the delicate ecosystem along the coastline, destroying algae and ruining oyster and lobster beds. Especially hard hit was the Breton economy. Brittany is France’s second most important tourist region after the Riviera. The claimed overall cost to France was an estimated $100,000,000 at the 1978 rate of exchange.

II.

In the aftermath of the environmental disaster, various parties brought lawsuits. The Republic of France (“France”) sued Amoco to recover for pollution damages and clean up costs. Similar actions were brought by the French administrative departments of Cotes du Nord and Finistére (“the Cotes du Nord parties”), numerous municipalities called “communes,” and various French individuals, businesses, and associations, including hoteliers and fisherman who lost business as a result of the oil spill (“the French claimants”). The Cotes du Nord parties and the French claimants charged Astilleros with negligence in designing and constructing the tanker. The lawsuits were filed in Illinois and New York. Astilleros appeared and moved to dismiss the claims against it for lack of personal and subject matter jurisdiction and for forum non conveniens. Both the Cotes du Nord parties and Amoco sued Bugsier, the owner of the tug PACIFIC, claiming that it was negligent in attempting to tow the AmoCO Cadiz. The Bugsier suits were stayed pending arbitration in London. Bugsier filed a limitation action in the lawsuits which the Cotes du Nord parties were claimants.

Amoco brought several actions in federal district court in Chicago. It filed a complaint for exoneration from or limitation of liability pursuant to the United States Limitation of Liability Act of 1851, 46 U.S.C.App. §§ 181-196 (“Act”). In addition, the Amoco parties filed a third-party claim and cross-claims against Astilleros. Amoco filed for contribution from the ABS to the extent that the grounding was caused by ABS’s negligence and breach of contract in approving the vessel design, inspecting it, and certifying its seaworthiness. The Cotes du Nord parties and French claimants also sued the ABS. The ABS settled these claims and sued the Amoco parties in New York, seeking reimbursement for expenses in connection with the settlement. Amoco removed the matter to federal court and counterclaimed. Petroleum Insurance Limited (“PIL”), Royal Dutch Shell’s subrogee, sought to recover from Amoco for loss of the oil cargo, claiming loss occurred through Amoco’s lack of due diligence in making the vessel seaworthy and through Amoco’s breach of the charter contract.

The various federal actions were bifurcated and brought before Judge Frank J. McGarr of the Northern District of Illinois. After consolidating the liability issues, Judge McGarr opened the bench trial on May 4, 1982. The liability phase would not end until late November of the same year. In an April 18, 1984 opinion, the court held Amoco Corporation, Astilleros (who neither participated in discovery nor in the trial), and Amoco Production Company jointly and severally liable to France, the Cotes du Nord parties, the French claimants, and to PIL. The court denied Amoco’s petition for limitation of liability. Bugsier was exonerated on the claims brought against it by the Cotes du Nord parties. (Amoco’s claims against Bugsier eventually were resolved in the London arbitration.) Because of its settlement with France and the Cótes du Nord parties, the ABS did not participate in the liability trial. It still is part of a pending “tag-along” action in federal dis *1290 trict court in Chicago in which Amoco is seeking contribution from the ABS.

The court subsequently held a second bench trial on the consolidated damages issues. That trial lasted from April 1986 to June 1987. On October 5, 1987, the court awarded PIL 11,212,349.50 pounds sterling for the loss of Shell’s oil cargo. The court also awarded PIL prejudgment interest, but denied its request for compounded interest. Subsequently, the court amended its opinion by awarding PIL statutory costs and by setting the annual prejudgment interest rate at 7.22 percent. The final award to PIL was 21,215,054.68 pounds sterling. With regard to the other plaintiffs’ damages, on January 11, 1988, the district court applied French law and ordered an award to cover costs of clean up and restoration incurred by France, the Cotes du Nord parties, and the French claimants. The court awarded statutory costs as well as compound prejudgment interest at an annual rate of 7.22 percent for a total of nearly 600 million French francs.

When Judge McGarr retired in late January 1988, the case was reassigned to Judge Charles R. Norgle, Sr., who appointed Judge McGarr as a Special Master to resolve any remaining issues. Special Master McGarr issued his Final Report and Recommendations on October 31, 1989. Pursuant to Rule 53 of the Federal Rules of Civil Procedure, the Amoco Parties, France, the Cotes du Nord parties, Astille-ros, and PIL filed objections. In March 1990, a hearing was held on those objections. Following the hearing, the district court adopted all of the Special Master's Recommendations relating to liability and damages and, on July 24, 1990, issued four separate final judgments awarding claimants damages in French francs and pounds sterling against the Amoco parties and As-tilleros, jointly and severally. These consolidated appeals followed.

III.

Astilleros was named as a defendant or third-party defendant by Amoco, the Republic of France, the Cotes du Nord parties, and the French claimants in cases filed in both Illinois and New York. The Illinois and New York cases were consolidated in the Northern District of Illinois by the Judicial Panel on Multidistrict litigation. 1 Three of the judgments now on appeal were entered in Illinois cases (Nos. 78 C 3693, 79 C 3548, and 79 C 3761) and one in a New York case (No. 79 C 2774). Astille-ros contends that neither Illinois nor New York courts had personal jurisdiction over it.

Astilleros moved to dismiss each case against it for lack of personal jurisdiction. The court initially denied the motion in No. 78 C 3693, 491 F.Supp. 170 (N.D.Ill.1979) (Order 4), and later denied the motions in the other cases (Orders 5, 6, 10, 26). After the motions were denied, Astilleros did not significantly participate in any further proceedings in the district court. Default judgments finding Astilleros liable but leaving the calculation of damages for later determination were entered in the three Illinois cases in 1982. (Orders 16, 20) Astilleros appealed from these judgments under 28 U.S.C. § 1292(a)(3), which allows appeals from certain interlocutory orders in admiralty cases. This court affirmed the judgment of the district court. In re Oil Spill by the Amoco Cadiz off the Coast of France on March 16, 1978, 699 F.2d 909 (7th Cir.1983) (Astilleros I), cert. denied, 464 U.S. 864, 104 S.Ct. 196, 78 L.Ed.2d 172 (1983). Although Astilleros sought dismissal in No. 79 C 2774, the New York case, in 1980, and its motion was denied in 1982, no default judgment was then entered, and the present appeal is the first to arise from that case.

After the district court resolved the liability of other parties and made damages calculations, Astilleros objected to the damages again claiming that it was not subject *1291 to the jurisdiction of the court. The court rejected the attempt to relitigate this issue. After final judgments, Astilleros appealed claiming that neither the New York nor the Illinois district court had personal jurisdiction over it. 2

Because a panel of this court has already determined that Astilleros was subject to the jurisdiction of the district court in Illinois, the doctrine of law of the case applies to this issue. “Ordinarily, matters decided on a prior appeal become the law of the case to be followed on a later appeal.” Parts and Electric Motors, Inc. v. Sterling Electric, Inc., 866 F.2d 228, 231 (7th Cir.1988), ce rt. denied, 493 U.S. 847, 110 S.Ct. 141, 107 L.Ed.2d 100 (1989). Astilleros’s arguments that the prior panel’s decision is not law of the case because it was an affirmance of an interlocutory decision of the district court and because the prior panel must have found only that there was a prima facie case of jurisdiction are not correct.

It is well established that a decision of an interlocutory appeal may be the law of the case. See, e.g., Illinois ex rel. Burris v. Panhandle Eastern Pipe Line Co., 935 F.2d 1469, 1478-79 (7th Cir.1991); Citr onelle-Mobile Gathering, Inc. v. Herrington, 826 F.2d 16, 23 (Em.App.1987), cert. denied, 484 U.S. 943, 108 S.Ct. 327, 98 L.Ed.2d 355 (1987); Erkins v. Bryan, 785 F.2d 1538, 1542 (11th Cir.1986), cert. denied, 479 U.S. 960 & 961, 107 S.Ct. 455, 93 L.Ed.2d 402 (1986); Appleton Electric Co. v. Graves Truck Line, Inc., 635 F.2d 603, 607 (7th Cir.1980), cert. denied, 451 U.S. 976, 101 S.Ct. 2058, 68 L.Ed.2d 357 (1981); United States v. Turtle Mountain Band of Chippewa Indians, 612 F.2d 517, 520-21, 222 Ct.Cl. 1 (1979). Also, the Fifth Circuit has held that decision of an interlocutory appeal in an admiralty case is law of the case. Todd Shipyards Corp. v. Auto Transportation, S.A., 763 F.2d 745, 750-51 (5th Cir.1985). There is no reason to refrain from treating a decision of an interlocutory appeal as law of the case when, as is very clear in this case, the issue necessarily addressed in the earlier decision is the same as the one we are asked to consider anew, and there was no clear error in the decision. The Supreme Court recently said, “ ‘when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case.’ ” Christianson v. Colt Industries Operating Corp., 486 U.S. 800, 816, 108 S.Ct. 2166, 2177, 100 L.Ed.2d 811 (1988) (quoting Arizona v. California, 460 U.S. 605, 618, 103 S.Ct. 1382, 1391, 75 L.Ed.2d 318 (1983) (dictum)).

Astilleros cites three cases which say that law of the case applies only to final judgments, but we do not find those cases controlling. United States v. United States Smelting Refining & Mining Co., 339 U.S. 186, 198-99, 70 S.Ct. 537, 544, 94 L.Ed. 750 (1950), involved a proceeding before the Interstate Commerce Commission to determine the beginning and end of line-haul service at appellee smelters’ plants. On review a three-judge district court decided that a finding was not supported by evidence, and remanded the matter. There was no appeal from this judgment. The Commission took no more evidence and simply restated the ground for its action. The district court again held the orders unlawful. The Supreme Court reversed. In rejecting the argument that the first district court decision became law of the case which bound the Supreme Court, the Court reasoned that “when the case was first remanded, nothing was finally decided.” Id. at 198, 70 S.Ct. at 544. This language is not relevant to this case where the issue is whether law of the case applies in a court that has already decided the issue and not whether an unappealed decision which might have been law of the case in the lower court binds the appellate court. Similarly, we think the Supreme Court’s further statement that law of the case, like res judicata, requires “a final judgment,” id. at 199, 70 S.Ct. at 544, was meant to apply only when a party is arguing that law of the case precludes a court that has *1292 not yet considered the issue from reaching the merits of the issue on appeal. Furthermore, this court’s decision on the earlier appeal in this case was an unequivocal appellate decision on the record before it, and was “final” in that context. See Turtle Mountain, 612 F.2d at 520 n. 2 (interpreting Smelting). Cases generally have not relied on Smelting to limit law of the case to a decision on appeal from a final judgment, as the cases previously cited demonstrate.

In Hunter v. Atchison, Topeka and Santa Fe Railway Co., 188 F.2d 294, 299 (7th Cir.), cert. denied, 342 U.S. 819, 72 S.Ct. 36, 96 L.Ed. 619 (1951), this court declined to treat its earlier decision on appeal from a preliminary injunction as law of the case. The court relied on the fact that a preliminary injunction is not a decision on the merits and its object usually is to preserve the status quo. Id. at 298. The same considerations do not apply to appeals from other interlocutory orders where the issue addressed on the earlier appeal is identical to the issue which a party wishes to have reexamined on the later one.

In Gage v. General Motors Corp., 796 F.2d 345 (10th Cir.1986), the plaintiff had first filed in state court, and the state court dismissed his complaint for failure to state a claim. He then filed in federal district court, and that court dismissed his complaint saying in part that the state court decision was law of the case. The Court of Appeals held the law of the case rule was properly applied. It cited, but does not appear to have relied on, the statement in Smelting requiring a final decision. Id. at 349.

Astilleros’s claim that Astilleros I established only that there was a prima facie case for jurisdiction is similarly unavailing. Astilleros argues that the procedural posture of the case has changed since the first appeal because the first appeal concerned a motion to dismiss and this appeal concerns a final judgment against Astilleros. Astilleros relies on several cases which say that a motion to dismiss is based on a prima facie case supporting personal jurisdiction and before judgment can be entered a court must hold an eviden-tiary hearing and find the facts upon which jurisdiction is based by a preponderance of the evidence. Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir.1985); CutCo Industries, Inc. v. Naughton, 806 F.2d 361, 363 (2d Cir.1986); Travelers Indemnity Co. v. Calvert Fire Ins. Co., 798 F.2d 826, 831 (5th Cir.1986), as modified, 836 F.2d 850 (5th Cir.1988). The first appeal, however, was not from the denial of the motion to dismiss. The appeal was from a default judgment as to liability against Astilleros. In granting the default judgment, the district court specifically found that it had jurisdiction over Astille-ros. If Astilleros believed the default judgment rested upon improper procedure, it should have so argued on appeal. On appeal, this court affirmed the district court’s finding of personal jurisdiction and in doing so implicitly held that the proper procedure and standard were used to find jurisdiction. Because implicit holdings constitute law of the case, Christianson v. Colt Industries Operating Corp., 486 U.S. 800, 817, 108 S.Ct. 2166, 2178, 100 L.Ed.2d 811 (1988); Parts and Electric Motors, Inc. v. Sterling Electric, Inc., 866 F.2d 228, 231-32 (7th Cir.1988); Conway v. Chemical Leaman Tank Lines, Inc., 644 F.2d 1059, 1062 (5th Cir. Unit A 1981), this issue is governed by Astilleros I.

Astilleros next argues that even if As-tilleros I is the law of the case, this panel is not bound by that decision because (1) substantial new evidence was introduced after the first appeal, (2) subsequent decisions of the Supreme Court are contrary to the prior decision, and (3) the decision of the first court was clearly erroneous. Parts and Electric Motors, 866 F.2d at 231.

In its brief, Astilleros presents only one fact which it claims to be substantial new evidence: the oil spill was found to have been partially caused by Amoco’s negligence. Astilleros argues that this fact is significant because in Astilleros I this court said, “If, as the cross-claim alleges, the oil spill was due not to any fault on *1293 Amoco’s part but to Astilleros’ negligence in designing or constructing the ship, this implies that Astilleros could have avoided a disastrous accident, for which both parties may be liable, more easily than Amoco could have.” Astilleros I, 699 F.2d at 915 (emphasis added by Astilleros). Astilleros claims that this sentence shows that the prior panel’s holding was not intended to apply were it found that the oil spill was partially caused by Amoco’s negligence. The rest of the opinion, however, shows that the court held that Astilleros was subject to the jurisdiction of the court regardless of whether Amoco was partially negligent. The quoted sentence was part of the court’s discussion of Amoco’s claim for indemnity, which “can be said to ‘arise from’ the negotiation and signing of the shipbuilding contract.” Id. The court went on to discuss Amoco’s claim for contribution, which necessarily presupposes that Amoco would be found at fault, and to hold it sufficiently related to the contract claim to be within reach of the Illinois long-arm statute. Id. The court also held that there was jurisdiction in the cases brought by the French plaintiffs against Astilleros because “the negotiation and signing of the contract were critical steps in the chain of events that led to the oil spill,” and this reason does not depend on whether Amoco was liable. Id. at 917. The court’s conclusion contains no suggestion that the holding is conditional: “Since the district court has jurisdiction over both the complaint and cross-claim against Astilleros, the default judgments are AFFIRMED.” Id. at 917. The facts which the court considered in finding personal jurisdiction are that As-tilleros’s representatives spent two weeks in Chicago intensively negotiating with Amoco, signed the contract for the construction of the Amooo Cadiz in Chicago, and later returned to Chicago for other meetings related to the contract and to the contracts for other ships; no new evidence contradicts these facts.

Astilleros argues that subsequent decisions also require that we reconsider this court’s prior judgment because these decisions “reflect an increasingly firm and specific admonition, particularly by the U.S. Supreme Court and the Illinois Supreme Court that, for domestic U.S. purposes, and particularly in the international context, courts should exercise care and restraint in using long-arm statutes to assert in per-sonam jurisdiction over defendants, and especially over defendants residing outside the U.S.” Astilleros brief at 60. Astilleros emphasizes that in Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102, 115, 107 S.Ct. 1026, 1033, 94 L.Ed.2d 92 (1987), the Court said,

the Federal Government’s interest in its foreign relations policies, will be best served by a careful inquiry into the reasonableness of the assertion of jurisdiction in the particular case, and an unwillingness to find the serious burdens on an alien defendant outweighed by minimal interests on the part of the plaintiff or the forum State.

See also Wiles v. Morita Iron Works Co., 125 Ill.2d 144, 125 Ill.Dec. 812, 816, 530 N.E.2d 1382, 1386 (1988) (burden of defending in foreign jurisdiction should be primary concern when international defendant is involved). The subsequent decisions cited by Astilleros, including the Illinois Supreme Court decision, address the constitutional due process prong of the jurisdictional question. Astilleros has cited no subsequent decision interpreting the Illinois long arm statute, thus calling this court’s earlier analysis of that statute into question.

With respect to the due process prong of the jurisdictional question, we do not view the language from Asahi quoted above as a new rule in the light of which this court’s earlier due process analysis has become clearly erroneous. In Asahi, this language referred to one of several factors which the Court relied upon, and the weight which this factor deserves is not apparent. Also, even if foreign relations were a crucial factor in Asahi, it is not clear that it would deserve the same weight in this case because of the difference in facts. In Asahi, the foreign defendant’s only knowledge that its product would be in the forum state came from its knowledge that the product was travelling in the stream of commerce, but Astilleros purposefully and *1294 voluntarily entered the forum state in order to conduct business.

It is not clear that the only relevant contacts are Astilleros’ contacts with Illinois. This is a suit under the federal admiralty laws. The