Who Runs San Diego? How Do You Solve a Problem like Sea World?

By Linda Perine

For most of us it has been a slow, painful process to understand that our love affair with cute, cuddly, smiley Shamu has made us participants in a cold-blooded business that imprisons and mistreats sentient, social creatures in ways that turn the stomach and shock the conscience.

Concerned environmentalist and civic leaders have been telling us for years that the capture of orcas was nasty and brutal involving bombs and machine guns, the violent separation of babies from their mothers and resulting in injury and death to many orcas in the wild. Books and PBS presentations criticizing the Sea World business model and its exploitation of captive whales and dolphins just did not register.

We didn’t know, or didn’t care, that the magnificent mammal jumping and breaching and smiling and being petted for some tossed fish and our applause has a brain capable of complex language, dialects and generational transfers of knowledge.

We didn’t concern ourselves that caging a 30 foot long 8 ton mammal, built to range 100 miles a day in deep wild ocean, in enclosures less than one ten-thousandth of one percent the size of the species’ natural home range, was akin to putting a human in solitary confinement in a closet for life.

Killer whales live in a complex matriarchal society, in which sons and daughters live with their mother throughout their lives, even after they have offspring of their own, creating “matrilines that combine into pods with which they share unique dialects and then interact with other pods to form clans. We failed to acknowledge that, as Jean-Michel Cousteau said, “we have outgrown the need to keep such wild, enormous, complex, intelligent and free-ranging animals in captivity”.

If we felt uneasy or that something wasn’t quite right, the excited squeals of the children splashed by the final orca breach, or the cute stuffed animal or t-shirt, or the myriad corporate images of a happy Shamu made us put such thoughts aside.

But in 2010 a beautiful young trainer at Sea World Orlando was killed by an orca named Tilikum. This was the third human death associated with Tilikum who has sired 21 calves. Gabriela Cowperthwaite began to examine in earnest the business of using Cetaceans for entertainment and corporate profit. In 2013, the resulting documentary Blackfish made it impossible for people like you and me to ignore the ugly truth about what we are doing to Shamu.

San Diego, We Have a Problem

For those of us in San Diego, this sudden and disquieting awareness has far reaching implications.

The City of San Diego is Sea World’s landlord. Since the money the city receives is tied to how much money Sea World makes, we are more than just consumers who can stop going to Sea World as a manifestation of our disapproval of their business.

We are business partners with Sea World. If you think what Sea World is doing to Shamu is a crime, we are accessories before and after the fact. If it is morally wrong, we are passive enablers. If we are in the business of making money off the imprisonment and mistreatment of sentient beings, then we are profiteers.

But even if you are not personally moved by the overwhelming evidence Cetaceans should not be held in captivity for entertainment and profit, a lot of people are. Willie Nelson, the Beach Boys, Heart, Southwest Airlines, Taco Bell, Virgin Airlines and, of course, the stock market have all voiced their displeasure with the Sea World business model. So whether your motivation is compassionate or materialistic: San Diego, we have a problem.

Sea World’s Corporate Situation

Sea World (SEAS on the NYSE) is a company with some serious problems. Blackstone Group LP (BX), the world’s largest private-equity firm, owns 22 percent of SeaWorld shares. The New York-based firm bought SeaWorld from Anheuser-Bush Cos. in 2009. On April 19, 2013 Blackstone took Sea World public on the NYSE. Perhaps ironically, stock values seem to have hit their highest point of nearly $39 in mid July 2013, just around the July 19, 2013 official New York release of the documentary Blackfish.

Independent of the Blackfish public relations nightmare, Sea World was brought public in a leveraged buyout and is massively indebted. Some analysts see SEAS as overvaluedfor a company of its maturity and compared to peers with less forward-looking risks.

But for most of us, Sea World is Shamu. This is a deep structural issue for the company. 60+% of revenues come from admissions. Admissions are driven by– Shamu the Killer Whale and the dolphins. This makes the Sea World business model extremely vulnerable to the issues surrounding cetacean captivity.

Sea World initially denied that concerns about its treatment of the orcas was impacting its business. But on August 13 shares of SeaWorld Entertainment plunged 33% after the company’s earnings missed Wall Street expectations. Share prices have dropped from roughly $39, when Blackfish was released, to $20.

Large hedge funds may be losing faith in Sea World’s business model. Southwest Airlines has ended a 26 year relationship with Sea World. Blackstone appears to be sharply reducing its stake in the company it took public and is increasing its stake in competitor Merlin.

Sea World has dropped an appeal of OSHA citations it received after the 2010 drowning that inspired Blackfish, ending any chance of trainers ever again swimming with orcas during shows.

While the “Blackfish Bill” introduced in April, 2014 to make it illegal to “hold in captivity, or use, a wild-caught or captive-bred orca for performance of entertainment purposes” died in committee, it will almost certainly be brought up again in the CA legislature. The fact that 1.2 million people signed a petition in favor of the bill does not bode well for the future of orca performances.

On Sept 9, 2014 shareholders filed suit in San Diego against Sea World. The suit alleges that SeaWorld failed to disclose it had improperly cared for its orca population and continued to feature and breed a whale that had killed and injured numerous trainers.

SeaWorld has refused to recognize the growing movement for more humane and ethical treatment of animals by corporations worldwide. From cruelty-free cosmetics, toiletries and household products (animal testing for these products is now banned in the European Union) to 2008 Proposition 2 providing more humane captivity conditions for farm animals,concern for animal welfare is reshaping the bottom line for many industries.

South Carolina banned dolphin and porpoise shows in 1992 and extended this ban in 2011 to whales (all cetaceans). There hasn’t been a captive cetacean show in the UK since 1993.

In 2013, India became the first country to acknowledge that cetaceans’ high level of intelligence grants them the status of “non-human persons”. It also joined three other countries Chile, Costa Rica and Hungary in banning cetacean shows.

As you can see, Sea World is being battered from many angles. It is simply on the wrong side of the powerful and growing realization that humans have a moral obligation to treat fairly and kindly with other living beings and this ethical failure has created a financial firestorm.

We will continue this conversation about Sea World and its place in the discussion of Who Runs San Diego? We will look at its influence in our community and how it ranks as a neighbor to its Mission Bay cohabitants. We will also look at the very favorable terms of its lease with the City of San Diego and what alternative business practices might help it and San Diego out of an unpleasant financial and public relations problem.

Linda Perine is the President of the Democratic Woman’s Club. She was chair of the LGBT Redistricting task Force in 2011 and served as Mayor Filner’s Director of Community Outreach.

This article first appeared in the San Diego Free Press September 19, 2014.