A federal jury trial is scheduled to start June 27 in Columbus,
Ohio, in a lawsuit filed by investors who financed the salvage firm
that found and recovered tons of gold ingots and coins from the wreck
site of the SS Central America.
More than 600 documents have been filed in the matter, which was
initiated in a Columbus common pleas court in 2005. The federal trial
starts at 9 a.m. June 27.
The suit was filed by investors who funded efforts by Thomas
“Tommy” Thompson, who founded an Ohio company — Recovery Limited
Partnership — in the mid-1980s for a search-and-recovery project for
the shipwreck of the SS Central America, a steamer ship operated by
the United States Mail Steamship Co. that sunk off the Carolina coast
in 1857. In total, 161 investors participated in Recovery LP and
raised $12.7 million to find the shipwreck.
The Central America had been bound from the east coast of Panama
to New York City, carrying 500 passengers, 38,000 letters and nearly
$1.6 million in gold (valued in 1857 dollars) including approximately
5,200 newly struck 1857-S Coronet gold $20 double eagles.
Ship found, gold recovered
Thompson and his team embarked on a 40-day sonar search of areas
of the Atlantic Ocean. They discovered a ship in 1987 approximately
160 miles off the coast of South Carolina and on Sept. 11, 1988, found
the SS Central America’s flywheel. A month later the ship’s bronze
bell was recovered and the ship was conclusively identified.
Recovery operations began in 1989 and in the next several years,
more than a ton of gold, silver and other artifacts valued at more
than $400 million were recovered, including 7,500 Coronet double eagles.
In November 1998, Columbus Exploration LLC was formed to handle
the recovery and marketing of the wreck, led by Thompson as the
chairman of its board of directors. Columbus Exploration had
ultimately been awarded 92.2 percent of the treasure, the rest going
to insurance companies that had paid out claims when the ship sank and
had been fighting for their share of the treasure in the courts since
1990. The legal dispute between the salvors and the insurance
companies lasted for years and was appealed by the parties to the
United States Supreme Court, although the high court decline to hear
the case. Partners in Recovery LP were given ownership interests in
the new endeavor.
A new entity established by a consortium of coin dealers,
California Gold Marketing Group LLC, was formed in California to
market and sell the coins. Filings indicate that Thompson sold the
gold to the California Gold Group in 2000 and the original investors
say that they were shut out of the profits.
The issues in the case are laid out in the initial complaint,
filed in 2005 in Ohio’s Franklin County Court of Common Pleas. In the
complaint, the Dispatch Printing Co. and Donald C. Fanta — investors
in Columbus Exploration —claimed that Columbus Exploration failed to
provide investors with information on the finances and operations of
the company and failed to pay investors.
The initial complaint stated, “Since approximately 2000,
Defendants [Columbus Exploration and its directors] have refused to
provide the members of Columbus Exploration, including Plaintiffs,
with any meaningful information regarding the company’s finances and
operations or what happened to Plaintiffs’ investment.”
No payments, profit
The investors claim that they have yet to see any profit from the
investment and Thompson’s attorney has stated that while no payments
have yet been made to investors, “the plan is ultimately to make payments.”
Others, hired by Thompson to help find the wreck, claim that they
have not been paid the full amount of what has been owed to them and
filed a suit in federal court in 2006. Thompson has stated that the
ongoing litigation has kept him from being able to raise money to
recover what he claims is more gold from the SS Central America — as
much as 18 tons that still may be lying on the ocean floor according
The case is set for a final pretrial conference scheduled for June
13. U.S. District Judge Edmund A. Sargus in a May 27 order denying
motion by Thompson for a continuance, wrote “this case has already
been pending for over five years, and the Court is not confident that
Thompson’s motion for a continuance is not a means to further delay
adjuration of the Party’s claims. …”
Most of the gold recovered from the shipwreck has entered the
marketplace through auction and private treaty transactions. While the
gold that was found is tangible and now safely housed in thousands of
collector’s collections, much of the money made from the original
recovered treasure has been spent on legal fees, expenses, payments to
insurance companies, and other various transaction costs, according to
Editor's note: The image courtesy line is corrected from an
earlier version of this article.