“The Sequoia, an elderly and vulnerable wooden yacht, is sitting on an inadequate cradle on an undersized marine railway in a moribund boatyard on the western shore of the Chesapeake, deteriorating and, lately, home to raccoons.”
Monday’s ruling stems from a dispute involving a $7.5m loan from FE Partners to the boat’s owners, Sequoia Presidential Yacht Group LLC, led by Washington lawyer and businessman Gary Silversmith.
The USS Sequoia in 2003Wikimedia Commons
Silversmith sued in 2013 to block FE Partners from exercising its right under the loan to buy the yacht, but after the judge found that the loan was fraudulently induced, Sequoia agreed to a default judgment in favor of FE. The judge eventually reduced the price to 0$ after deducting expected repair costs and other liabilities.
“Today the court ruled that the lender can buy the Sequoia with a credit bid that essentially allows them to not pay any additional money at closing. Of course we are disappointed. We remain ready, willing and able to pay off the lender in full but unfortunately it appears that we will be denied that opportunity.”
FE Partners general counsel Richard Graf commented:
“FE Partners is committed to restoring and preserving the Sequoia in cooperation with the US Coast Guard so that future generations of Americans will be able to enjoy the storied past of this magnificent yacht.”