Germany exempts passenger vessels from attack and the U-boat commanders obey orders so Bryan remains secretary of state. The Barralong incident goes ahead and the US makes a few mild protests
The problem as I understand it was that this is a broad definition - since passenger liners were converted to AMCs and troop ships, then the Germans are preventing themselves from attacking a load of legitimate targets.
Smaller passenger liners are probably not easily distinguishable from larger merchant ships, I don't know
Best Regards
Grey Wolf