Never done Admiralty Law.
Frankly I doubt if this company has any assets or liability insurance. The passengers may have paid in advance and the checks deposited, but other than getting their money back, I don’t think the families have any recourse. And good luck with that.
You need money to go after money. If there is no pot of gold at the end of the rainbow, then chasing rainbows is a fools errand.
Absolutely - without a carrier the case is truly a barker. As I have posted in this thread, a case will never be filed because the plaintiffs will will not want to be subjected to discovery.
I have drafted liability releases that attack this public policy issue. You disclose in the release language the public policy prohibition for releasing gross negligence and then release it anyway. Then you can hammer the freedom to contract argument all day long. It’s never been tested but would make for an interesting argument.