Subaqueous Exploration v. Unidentified, Wrecked Vessel

• Citation: 577 F. Supp. 597
• Decision Date: 21 December 1983
• Docket Number: 81-53.,81-52,Civ. A. No. 81-51
• Court: U.S. District Court — District of Maryland
• Parties: SUBAQUEOUS EXPLORATION & ARCHAEOLOGY, LTD., and Atlantic Ship Historical Society, Inc., Plaintiffs, v. The UNIDENTIFIED, WRECKED AND ABANDONED VESSEL, Etc., et al., Defendants.

577 F. Supp. 597

SUBAQUEOUS EXPLORATION & ARCHAEOLOGY, LTD., and Atlantic Ship Historical Society, Inc., Plaintiffs, v. The UNIDENTIFIED, WRECKED AND ABANDONED VESSEL, Etc., et al., Defendants.

Civ. A. Nos. 81-51, 81-52, 81-53.

United States District Court, D. Maryland.

December 21, 1983.

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Raymond J. Cardillo, Baltimore, Md., for plaintiffs.

Stephen H. Sachs, Atty. Gen., Paul F. Strain, Asst. Atty. Gen., Baltimore, Md., for defendants.

OPINION

I. PROCEDURAL HISTORY

RAMSEY, District Judge.

Approximately two hundred years ago, three ships, believed to be carrying a king's ransom in gold altarplate and other riches, sank in the Atlantic Ocean after being battered by a fierce hurricane. The remains of these vessels and their cargo, are currently submerged "under an undetermined amount of sand" off the shore of Ocean City, Maryland.

On January 13, 1981, plaintiffs Subaqueous Exploration & Archaeology, Ltd. ("Subaqueous") and Atlantic Ship Historical Society, Inc., citizens of Maryland, instituted the three,¹ above-captioned, in rem actions against defendants, the three Unidentified, Wrecked and Abandoned Vessels, believed to be the Santa Roselea, Royal George, San Lorenzo de Escoral, and Santa Clara, their respective tackle, armaments, cargo, and other effects pertaining to them.² The complaints expressly invoked this Court's admiralty and maritime jurisdiction pursuant to Rule 9(h) of the Federal Rules of Civil Procedure. Plaintiffs sought title to the abandoned vessels or, alternatively —full and liberal salvage awards to compensate them for their efforts to recover the vessels and their cargo. On January 13, 1981, this Court entered Orders directing that three warrants for arrest be issued for each abandoned vessel. On January 22, 1981, this Court entered Orders appointing Subaqueous as substitute custodian of the vessels effective upon their seizure by the United States Marshal for the District of Maryland. The Marshal arrested the vessels on January 31, 1981.

On March 12, 1981, this Court entered Orders directing the United States Marshal to publish notices of these actions as well as the arrests of the vessels. Such notices were published in the Baltimore Sun newspaper on March 24, 1981.

On April 9, 1981,³ the State of Maryland, entering a special appearance and specifically preserving its sovereign immunity, filed motions to dismiss for lack of subject matter jurisdiction and to vacate the arrests of the seized vessels. In support thereof, the State contends that this forum lacks jurisdiction over the defendant vessels on the grounds that such vessels are the property of the State pursuant to both a state statutory scheme governing property found within its territorial waters and the State's sovereign prerogative, and that the Eleventh Amendment to the United States Constitution therefore bars these actions and plaintiffs' requested relief. The State also contends that this Court lacks subject matter jurisdiction over plaintiffs' admiralty and maritime claims on the grounds that the complaints fail to state causes of action for salvage, that the defendant vessels are not proper objects of petitory suits pursuant to Supplemental Admiralty Rule D, and that even if the defendant vessels were proper objects of petitory suits, plaintiffs have failed to effect proper service pursuant to Supplemental Admiralty Rule B(2).

On April 10, 1981, the State again expressly preserving its sovereign immunity, filed motions for amendments to orders appointing substitute custodian, which were directed at this Court's Orders entered January 22, 1981, appointing Subaqueous as substitute custodian of the defendant vessels. In support thereof, the State contends that the vessels are its property and that it should be appointed substitute custodian to ensure that the defendant vessels remain undisturbed pending final disposition of plaintiffs' claims. On May 11, 1981, this Court approved a stipulation by the parties which provided that plaintiffs would have sixty days within which to file their responses to the State's pending motions; that plaintiffs would not conduct any salvage operations on the vessels until they filed such responses; that the State would not be deemed to have waived any of its arguments or defenses raised in its pending motions as a result of its consent to the sixty-day extension; and that no custodial fees would accrue to plaintiffs between the date that the State filed its motions and fifteen days after the date on which plaintiffs filed their responses thereto, unless the Court subsequently determined otherwise.

On August 26, 1981, plaintiffs filed their responses to the State's motions for orders appointing substitute custodian, and the motions to vacate arrests and to dismiss for lack of jurisdiction. In support thereof, plaintiffs contend that federal admiralty and maritime law governs these actions, not the state statutory scheme or the doctrine of sovereign prerogative as the State contends, even though the defendant vessels are located on submerged lands belonging to the State of Maryland; that the state statutes in question are unconstitutional in that they impermissibly intrude upon federal legislation regulating admiralty and salvage as well as the Submerged Lands Act, and are vague; and that the Eleventh Amendment does not bar federal jurisdiction over in rem proceedings in which the state's claims of ownership of the defendants are contested.

The Court stayed resolution of these questions pending the Supreme Court's decision in Florida Department of State v. Treasure Salvors, Inc.,⁴ 458 U.S. 670, 102 S.Ct. 3304, 73 L.Ed.2d 1057 (1982). Pursuant to this Court's request, plaintiffs and the State filed supplemental memoranda addressing the jurisdictional questions presented in the instant proceedings in light of Treasure Salvors. In its supplemental memorandum on jurisdictional issues, the State of Maryland has advanced a two-pronged attack in support of its contention that this forum lacks jurisdiction to entertain these proceedings. First, the State argues that the Eleventh Amendment bars the invocation of this forum's jurisdiction on the grounds that these actions are suits against the State; that the seizures of the defendants' vessels were improper; that the State's claim of ownership over the defendant vessels is either valid or colorable within the meaning of Treasure Salvors; that further proceedings would serve no useful purpose; and that the State has not waived its Eleventh Amendment protection. The State also contends that its statutorily-based assertion of ownership of and jurisdiction over abandoned shipwrecks and its regulation of recovery activities do not violate the United States Constitution or impermissibly intrude upon federal laws regulating admiralty on maritime affairs. The State maintains that its challenged statutes are valid exercises of its police powers and within the powers granted by the Submerged Lands Act. Second, assuming the Eleventh Amendment does not bar these proceedings, the State contends that this Court lacks subject matter jurisdiction over these proceedings notwithstanding plaintiffs' invocation of this forum's powers respecting admiralty and maritime claims, on the grounds that plaintiffs have failed to state a cause of action under the law of salvage and finds, and that these actions do not bear a substantial relationship to maritime navigation or commerce.

In their supplemental memorandum, plaintiffs rely on their earlier memorandum, but further contend that the instant proceedings are not barred by the Eleventh Amendment in light of Cobb Coin Co. v. The Unidentified, Wrecked and Abandoned Sailing Vessel, 549 F.Supp. 540 (S.D.Fla.1982) (King, J.) (hereinafter "Cobb Coin II"), apparently the first reported case applying Treasure Salvors.

On October 21, 1982, this Court heard oral arguments by plaintiffs and the State of Maryland respecting the jurisdictional questions presented by these cases, and invited the State to submit a second supplemental memorandum addressing the jurisdictional issues in light of Judge King's opinion in Cobb Coin II. The State subsequently filed a second supplemental memorandum on the jurisdictional issues that substantially reiterates the contentions detailed in its first supplemental memorandum.

Subsequently, John L. Amrhein, Jr., proceeding pro se, filed a motion to intervene in these proceedings pursuant to Rule 24(b) of the Federal Rules of Civil Procedure. In support thereof, Amrhein contends that he is a shareholder of Subaqueous; that he purchased his stock based on the claim by an officer of Subaqueous that the defendant vessels in these proceedings exist; that the defendant vessels are neither within the territorial jurisdiction of this forum "... nor in any other area of the world"; and that consequently, a certain officer of the plaintiff corporation committed fraud in selling him shares of Subaqueous. Neither plaintiffs nor the State of Maryland have filed responses to Amrhein's motion.

The Court denies Amrhein's motion to intervene. Rule 24(b),⁵ Fed.R. Civ.P., which governs permissive intervention, provides in pertinent part that "upon timely application anyone may be permitted to intervene in an action: .... (2) when an applicant's claim or defense and the main action have a question of law or fact in common." The grant or denial of a motion to intervene pursuant to Fed.R.Civ.P. 24(b) rests within the discretion of the court, and its decision thereon will not be disturbed on appeal absent an abuse of such discretion. See Wright & Miller, Federal Practice and Procedure: Civil § 1913 (1972) and cases cited therein. A review of applicable caselaw reveals that permissive intervention should be denied where such intervention would delay or prejudice the adjudication of the rights of the original parties, see, e.g., Degge v. City of Boulder,...