State of Fla., Dept. of State v. Treasure Salvors, Inc., 78-2950

CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)
Citation621 F.2d 1340
Docket NumberNo. 78-2950,78-2950
PartiesIn re STATE OF FLORIDA, DEPARTMENT OF STATE, Petitioner-Appellant, v. TREASURE SALVORS, INC., a corporation, and Armada Research Corp., a corporation, Plaintiffs-Appellees, The Unidentified Wrecked and Abandoned Sailing Vessel, etc., Defendant.
Decision Date24 July 1980

Bernard S. McLendon, Sp. Asst. Atty. Gen. of Fla., Jacksonville, Fla., for petitioner-appellant.

David P. Horan, Key West, Fla., for plaintiffs-appellees.

Appeals from the United States District Court for the Southern District of Florida.

Before GEWIN, RUBIN and SAM D. JOHNSON, Circuit Judges.

SAM D. JOHNSON, Circuit Judge:

This appeal offers this Court its second opportunity to determine ownership rights in artifacts recovered from the Spanish vessel, Atocha. In this Court's first opinion, Treasure Salvors, Inc. v. Unidentified Wrecked and Abandoned Sailing Vessel, 569 F.2d 330 (5th Cir. 1978) (hereinafter Treasure Salvors I ), it was held that Treasure Salvors and Armada Research Corp. 1 had title to the vessel and its cargo as against the United States. In the instant case this Court affirms the district court's holding that these two Florida corporations have title to various artifacts as against the State of Florida. 2


The historical backdrop for this case was detailed in Treasure Salvors I, 569 F.2d at 333, and was the subject of a National Geographic article, Lyon, The Trouble with Treasure, 149 National Geographic 787 (June 1976), but is well worth repeating. This case dates back to the early 17th Century when Spain was using the riches of the New World to finance her European military adventures. On September 4, 1622, a fleet of 28 ships, known as the Tierra Firme Flota, commanded by the Marquis of Cadereita, set sail from Havana for Cadiz laden with bullion, spices, and tobacco for King Phillip IV. As the ships entered the Florida Straits in search of the favorable Gulf Stream currents, bad weather set in, and the vessels soon found themselves in the midst of a hurricane. The destructive winds from the northeast stripped the vessels of their masts, sails, and standing rigging. The winds then shifted to the south and eight of the ships were driven toward the dangerous waters of the lower Florida Keys, where they were soon lost. The remaining vessels limped back to Havana. One of the eight ships that went down was the Nuestra Senora de Atocha. When the Atocha set sail from Havana, she was carrying in excess of one million pesos of registered bullion and specie. Her hold contained a treasure worthy of Midas: 160 gold bullion pieces, 900 silver ingots over 250,000 silver coins, 600 copper planks, 350 chests of indigo and 25 tons of tobacco. 3

The Spaniards began a salvage effort as soon as the news of the disaster reached Havana. Under the direction of Captain Gasper de Vargas, the salvors located the Atocha intact in 55 feet of water, with her mast peering above the surface. The divers, however, were unable to enter the holds containing the treasure, as they were all battened down. Only two bronze cannons from the upper deck of the stern castle could be retrieved.

De Vargas opted to place surface buoys to mark the position of the Atocha and sail west to salvage the Rosario, another of the eight vessels that sank in the hurricane. In early October, another hurricane ravaged the Lower Keys, breaking up the hull of the Atocha and spreading her treasure beneath the sands. When Vargas returned, he found the storm had removed the protruding mast and his surface buoys. He was unable to relocate the vessel.

Early in 1623, the Marquis of Cadereita sailed from Havana to personally supervise the search. 4 The continued efforts proved fruitless. Finally, in late 1623, the Spaniards abandoned the search.

The Cuban authorities, however, did not give up hope. They continued to keep the general area buoyed in anticipation of future salvage efforts. 5 In 1626, Francisco Nunez Melian began searching for the Atocha and Santa Margarita under a Royal salvage contract. Using state of the art equipment, including a 600 pound bronze diving bell with windows, Melian was able to find the Santa Margarita and, over four years, salvage her cargo. Dutch raiding parties, hostile Indians, 6 and political opportunities 7 eventually brought the search for the Atocha to a close in 1641. Finally, in 1683, the Spanish House of Trade published a list of ships still missing. The Atocha headed the list. Melian's salvage accounts were sent from Havana to the Archive of the Indies in Seville, and the Atocha passed into history.

Over three centuries later, in the mid-1960's, treasure searchers renewed their efforts to locate the Atocha and her rich treasure. By 1968, the search was concentrated in the Middle Keys, near Upper Matecumbe Key. This area was isolated by the searches after pouring through the Spanish archival records in Seville. 8 Years of searching yielded nothing.

Finally, in the late 1960's, Dr. Eugene Lyon, working as a consulting historian for Treasure Salvors, uncovered documentary evidence which indicated to him that the current salvage efforts were directed at the wrong set of keys. He discovered that "Matecumbe" was a general term used to denote the Florida Keys as a whole. A thorough search of Melian's salvage records revealed that the search for the Atocha had been centered near "Cayos del Marques." This placed the wreck of the Atocha somewhere between the Dry Tortugas and Sand Key in the Lower Keys.

Once Dr. Lyon ascertained what he believed to be the correct general area of the Atocha's watery grave, "all" that remained for Treasure Salvors was to pinpoint the exact location. It was a task easier said than done. For one year they searched some 120,000 nautical miles of seabed 24 hours a day before detecting a large galleon-size anchor in the spring of 1971. Additional shipwreck material was recovered in the immediate vicinity of the anchor. Soon the wreck was identified as part of the break-up of the Atocha. 9

In April 1971, Treasure Salvors and the State of Florida executed a one year contract allowing Salvors to conduct their underwater salvage operations on the Atocha. Both parties entered into this agreement under the belief that the Atocha was resting on land owned by Florida. Eventually, four contracts were signed (the last in November 1974) each running about one year. Under the contracts, the State was entitled to 25% of the finds. In June 1973, Florida's Division of Archives in Tallahassee received its share 10 of the first batch of artifacts recovered by Treasure Salvors. In February 1975, the Salvors delivered what turned out to be the State's last batch.

The Atocha's legal odyssey began with the Supreme Court's decision in United States v. Florida, 420 U.S. 531, 95 S.Ct. 1162, 43 L.Ed.2d 375 (1975). The Court affirmed the report of Special Master Maris, rejecting Florida's ownership claim of submerged lands, including that part of the continental shelf on which the Atocha rests. The report established that Florida had never owned an interest in any of the lands involved in the case at bar. On July 18, 1975, four months after the Supreme Court's holding, Treasure Salvors filed an in rem action in the Southern District of Florida for possession or confirmation of title to the abandoned vessel believed to be the Nuestra Senora de Atocha.

The United States intervened in the action and asserted title to the vessel. The district court entered judgment for Treasure Salvors and this court affirmed the trial judge's ruling that as between Treasure Salvors and the United States, Treasure Salvors had title to and right to possession of the vessel and its cargo. Treasure Salvors I.

The State of Florida initially refrained from intervening in the action. Instead the State prepared for the eventuality of a judgment in favor of the federal government. Florida assisted the United States in the lawsuit 11 and entered into preliminary negotiations regarding the disposition of the Atocha's treasure should the federal government prevail. 12 The adverse judgment left Florida in the cold.

In April 1978, after this Court's judgment for Treasure Salvors, the district court issued a warrant for arrest in rem. The warrant directed the marshal to take possession of all artifacts from the vessel in the custody or control of the State's Division of Archives' office in Tallahassee. 13 Florida filed a motion to quash the arrest warrant and successfully sought an emergency stay of the district court's order from this Court. In Re: State of Florida, Department of State, No. 78-1763 (5th Cir. April 12, 1978). In accordance with this Court's order, on April 14, the district court stayed the execution of the arrest warrant.

This temporary ban on the execution of the warrant for arrest did not halt the legal maneuvers. The district court denied Florida's motion to quash the warrant and granted Treasure Salvors' motion of April 17 to require the State of Florida to show cause 14 why it should not be ordered to transfer the artifacts in its possession to the custodians appointed by the district court. 15 The State answered, asserting that the court lacked jurisdiction and that Florida owned the artifacts in the possession of the Tallahassee office of the Division of Archives. On July 27 and 28 the district judge held a full evidentiary hearing on the jurisdictional issues and the merits of the order to show cause. 16

After the hearing, the district judge filed a Memorandum Order containing extensive findings of fact and conclusions of law. 459 F.Supp. 507. The judge found that the order to show cause was properly issued. The court then held that the State of Florida was bound by the earlier judgment in Treasure Salvors I. Alternatively, the trial judge held that the suit to determine title to the artifacts was not barred by the eleventh amendment and that Florida's claim...

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