Judge approves sale of SS Central America treasure
- Published: Dec 1, 2017, 5 AM
An Ohio judge has approved an agreement to sell the final glittering treasure pulled from the 19th century shipwreck SS Central America.
Franklin County Judge Laurel Beatty-Blunt’s Nov. 30 decision will set in motion the bulk sale of all coins, gold dust and gold ingots found in a 2014 salvage mission to the so-called “Ship of Gold” steamer that sunk off the Eastern Coast of South Carolina in 1857.
As part of a multi-faceted pact, the California Gold Marketing Group LLC is purchasing the 2014 treasure for $30 million from Recovery Limited Partnership and Columbus Exploration LLC, offshoots of the companies that originally located the wreck in the late 1980s and then recovered 3 tons of treasure.
Half of the $30 million will be paid to Odyssey Marine Exploration, which mounted the 2014 salvage mission at the behest of Ira O. Kane, the court-appointed receiver for Recovery Limited and Columbus Exploration.
The rest will be paid to the receivership and to the Dispatch Printing Co., which loaned the receivership millions to pursue the treasure a second time.
Connect with Coin World:
By mid-January, California Gold will have possession of the 2014 find, which includes 3,100 gold coins, 100 pounds of gold dust, more than 10,000 silver coins and 45 gold ingots.
“It’s a positive outcome from a very complicated situation,” said Dwight Manley, managing partner of California Gold. “There were a lot of moving parts getting to this point.”
The sales agreement brings closure to the second chapter of the treasure’s recovery.
The first began in the 1980s when scientist Tommy Thompson convinced 161 people and companies, mostly from Ohio, to invest $12.7 million in his scheme to find the Central America. The side-wheel steamer went down in a hurricane with a shipment from the San Francisco Mint as well as the gold and silver from homebound California prospectors. More than 400 passengers and crew drowned in a sinking that hurtled the ship 8,000 feet deep into the Atlantic Ocean.
For years the ship was lost, until Thompson located it, staked a claim and began recovery in the late 1980s with a then-revolutionary remotely operated underwater vehicle. He and his crew brought up more than 500 ingots and more than 7,500 gold coins, but then faced years of court battles for the right to keep and sell the treasure, estimated to be worth $100 million to $400 million. Finally, in 2000, he sold his companies’ portion of the treasure to California Gold Group for more than $50 million.
But the original investors received nothing, and Thompson faced more lawsuits. He went on the lam in 2012 and Kane was appointed to operate the companies and try to recoup some money for the investors.
Thompson was found hiding in Boca Raton, Florida, in early 2015 and has been in jail since then. He pleaded guilty to criminal contempt and was sentenced to two years in prison. He won’t serve this sentence until he purges himself of an additional charge of civil contempt for not revealing the whereabouts of 500 gold commemorative coins stamped from melted gold from the Central America.
The Nov. 30 agreements are part of two Franklin County Common Pleas Court cases that had been sealed from the public for 11 years before Beatty-Blunt unsealed the cases on Oct. 23.
Thompson, who is now in a Michigan federal prison, watched the Nov. 30 proceedings on a video feed and said he was “happy for the receiver” when asked if he had any comments.
Noting that more than a decade has passed since litigation was filed against Thompson by investors, Kane said after the hearing that the agreement “significantly reduces the time and cost to bring this [new] treasure to market.” He said that “but for the settlement we’d be looking at a number of years” — as well as extensive legal costs — to market the 2014 treasure.
Under its agreement, California Gold will pay more than half of the $30 million it owes immediately and the balance in monthly payments over 12 months.
In addition, California Gold also will pay the receiver 5 percent of the melt value of all the gold ingots, an amount Kane estimated could be $200,000 or more.
In a separate agreement, Odyssey Marine and the receiver agreed to drop pending litigation against each other and to terminate their services agreement with each other.
Kane said he is “hopeful” that the original investors in Thompson’s search-and-recovery mission — many who have died in the three decades since — finally will see a return on their money. Besides the sale of the gold and silver, Kane will be marketing numerous cultural heritage items from the shipwreck, such as a leather saddlebag, gold jewelry and a pipe, which are valued as a group at $1 million. He’ll also be selling company intellectual property as well as the salvage claim for the shipwreck.
Manley said the coins, ingots and dust will be curated next year by geologist Bob Evans, one of the leaders of the original salvage mission and the only original crewmember who returned to the shipwreck with the Odyssey. Manley expects some of the gold coins could be on the market by spring.
“The initial focus will be the gold coins coming to market,” he said. “That’s the largest piece of the treasure as a group value-wise.”
He believes there may be “some very unusual, rare coins” among them, but that won’t be known until they are curated. The coins include 710 Philadelphia Mint gold coins, 1,956 San Francisco Mint gold coins and 216 pioneer gold coins.
“Fleshing that out is exciting as a coin collector and also important economically,” Manley said. He said the sale of the coins would take several years.
Manley doesn’t plan to melt down any of the ingots as his company did with some from the first recovery. He said he and his partners expect to keep many of the ingots for themselves.
He’s also excited about the silver coins. He said they include 9,670 dimes, 646 quarter dollars and 381 half dollars, as well as more than 1,500 foreign coins. He said the foreign coins include an 1855 and an 1856 Australian Queen Elizabeth gold sovereign.
“They look like they were made yesterday,” he said.
Manley said the gold dust likely will be sold in small pinch sizes, and any gold nuggets within the dust would be sold separately.
MORE RELATED ARTICLES
US Coins Aug 10, 2020, 11 AM
World Coins Aug 9, 2020, 3 PM
Paper Money Aug 9, 2020, 12 PM
Paper Money Aug 9, 2020, 12 PM