1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 PIER 32 MARINA GROUP, LLC, dba Case No.: 25-CV-2635-GPC-JLB PIER 32 MARINA, 12 ORDER GRANTING PLAINTIFF’S Plaintiff, 13 MOTION FOR INTERLOCUTORY v. VESSEL SALE AND AUTHORIZING 14 CREDIT BID M/V OCEAN EYES, aka M/V REEL 15 DEAL, U.S. Coast Guard No. 1020245, a [Dkt. No. 16.] 16 1993 Bluewater Yacht Builders, Mikelson 64 Motor Vessel of Approximately 67.7- 17 Feet in Length Overall, and 17.3-Feet in 18 Beam, AND ALL OF HER ENGINES, TACKLE, ACCESSORIES, 19 EQUIPMENT, FURNISHINGS, 12- 20 FOOT CARIBE DINGHY (HIN No. D2103K708) AND ALL OTHER 21 APPURTENANCES, in rem, 22 Defendant. 23
24 Before the Court is the motion of Plaintiff PIER 32 MARINA GROUP, LLC, dba 25 PIER 32 MARINA for interlocutory vessel sale and authorization to credit bid. (Dkt. No. 26 16.) No opposition has been filed. Based on the reasoning below, the Court GRANTS 27 Plaintiff’s motion. 28 1 Procedural Background 2 On October 3, 2025, Plaintiff PIER 32 MARINA GROUP, LLC, dba PIER 32 3 MARINA (“Plaintiff”) filed a Verified Complaint against Defendant M/V OCEAN 4 EYES, aka M/V REEL DEAL, U.S. Coast Guard No. 1020245, a 1993 Bluewater Yacht 5 Builders, Mikelson 64 Motor Vessel of Approximately 67.7-Feet in Length Overall, and 6 17.3-Feet in Beam (“Vessel”), and all of her engines, tackle, accessories, equipment, 7 furnishings, dinghy, and appurtenances, in rem for vessel arrest, interlocutory sale, and 8 money damages for breach of maritime contract for necessaries, trespass by vessel, and 9 quantum meruit. (Dkt. No. 1, Compl.) On October 7, 2025, the Court issued an order 10 authorizing the arrest of the Vessel and appointing Plaintiff as Substitute Custodian of the 11 Vessel. (Dkt. Nos. 5, 6.) Pursuant to Plaintiff’s request for entry of clerk’s default, 12 default was entered against the Vessel on January 6, 2026. (Dkt. No. 14.) 13 On March 10, 2026, Plaintiff filed the instant motion for interlocutory vessel sale 14 and authorization to credit bid. (Dkt. No. 16.) No opposition has been filed. 15 Factual Background 16 Plaintiff operates a marina located at 3201 Marina Way, National City, California. 17 (Dkt. No. 1, Compl. ¶ 2.) Defendant is a 1993 Bluewater Yacht Builders, Mikelson 64 18 motor vessel of approximately 67.7-feet in length overall and 17.3-feet in beam, 19 documented with the United States Coast Guard under Official No. 1020245. (Id. ¶ 3.) 20 The Abstract of Title for the Vessel reflects that SRD Excavation Corp. owns the Vessel, 21 and Seth Dixon (“Dixon”) identified himself as the owner and Chief Executive Officer of 22 SRD Excavation Corp. (Id. ¶ 6.) On or about July 31, 2024, Dixon executed a Maritime 23 Contract for Private Wharfage (“Wharfage Contract”). (Id.; id., Ex. A.) 24 Paragraph 7 of the Wharfage Contract provides “[p]ayment of all fees and charges 25 are due on the FIRST (1st) day of each month, with or without a billing statement.” (Id. ¶ 26 7; id., Ex. A ¶ 7.) Due to a failure to pay sums required pursuant to the Wharfage 27 Contract, on August 9, 2025, Plaintiff sent Mr. Dixon a “THREE DAY NOTICE TO 28 COMPLY WITH WHARFAGE AGREEMENT OR QUIT,” demanding payment within 1 three days of unpaid fees due under the Wharfage Contract. (Id. ¶ 8.) Paragraph 9 of the 2 Wharfage Contract provides that either party may terminate the contract “by giving thirty 3 (30) days written notice of termination to the other.” (Id. ¶ 9; id., Ex. A ¶ 9.) On August 4 16, 2025, Plaintiff sent Mr. Dixon a letter informing him of Plaintiff’s election to 5 terminate the Wharfage Contract, effective September 14, 2025, and reminding him that 6 if the Vessel was not removed from the marina by the termination date, wharfage fees 7 would accrue at the then-current guest vessel rate. (Id. ¶ 10.) 8 Paragraph 38 of the Wharfage Contract provides that following termination, the 9 Vessel “will be regarded as a trespasser” and wharfage rates “will be calculated at the 10 then current guest vessel rate.” (Id. ¶ 11.) The standard guest vessel rate at Plaintiff’s 11 marina is $6.00 per foot of vessel length per day. (Id. ¶ 12.) Despite termination of the 12 Wharfage Contract, the Vessel was not removed from Plaintiff’s premises and remained 13 there without contractual or other legal justification. (Id. ¶ 20.) Calculated through 14 September 30, 2025, the account for the Vessel was in arrears in an amount not less than 15 $16,239.06, with arrearages continuing to accrue thereafter at the applicable guest vessel 16 rate. (Id. ¶ 13.) Plaintiff alleges that notwithstanding repeated demands for payment, the 17 Vessel and her owner failed to bring the account current and failed to satisfy Plaintiff’s 18 maritime necessaries lien. (Id. ¶ 16.) 19 Discussion 20 Federal courts exercise admiralty jurisdiction under the Constitution and statute. 21 U.S. Const. art. III, § 2, cl. 1; 28 U.S.C. § 1333(1). A “contract for wharfage is a 22 maritime contract”, Ex Parte Easton, 95 U.S. 68, 75 (1877), and within the Court’s 23 admiralty jurisdiction under 28 U.S.C. § 1331 “if wharfage is provided to a specific 24 vessel.” Royal Ins. Co. of America v. Pier 39 Ltd. P’ship, 738 F.2d 1035, 1037 (9th Cir. 25 1984) (citing Ex Parte Easton, 95 U.S. 68 (1877)). A maritime lien on the vessel is 26 established in favor of those who provide necessaries for the benefit of a vessel. 46 27 U.S.C. § 31342(a) (“a person providing necessaries to a vessel on the order of the owner 28 or a person authorized by the owner - (1) has a maritime lien on the vessel; and (2) may 1 bring a civil action in rem to enforce the lien”). In this case, Plaintiff has filed the instant 2 action, in rem, seeking foreclosure on its maritime lien arising under the Wharfage 3 Contract through the interlocutory sale of the Vessel. 4 A. Interlocutory Sale of Vessel 5 “The interlocutory sale of a vessel is not a deprivation of property but rather a 6 necessary substitution of the proceeds of the sale, with all of the constitutional safeguards 7 necessitated by the in rem process.” Ferrous Fin. Servs. Co. v. O/S Arctic Producer, 567 8 F. Supp. 400, 401 (W.D. Wash. 1983). 9 Rule E(9)(a)1 of the Federal Rules of Civil Procedure, Supplemental 10 Rules for Admiralty and Maritime Claims and Asset Forfeiture Claims (“Supplemental 11 Admiralty Rules”) governs interlocutory vessel sales and provides, 12 (i) On application of a party, the marshal, or other person having custody of the property, the court may order all or part of the property sold—with the 13 sales proceeds, or as much of them as will satisfy the judgment, paid into 14 court to await further orders of the court—if:
15 (A) the attached or arrested property is perishable, or liable to deterioration, 16 decay, or injury by being detained in custody pending the action;
17 (B) the expense of keeping the property is excessive or disproportionate; or 18 (C) there is an unreasonable delay in securing release of the property. 19
20 Fed. R. Civ. P., Suppl. Adm. R. E(9)(a)(i).
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 PIER 32 MARINA GROUP, LLC, dba Case No.: 25-CV-2635-GPC-JLB PIER 32 MARINA, 12 ORDER GRANTING PLAINTIFF’S Plaintiff, 13 MOTION FOR INTERLOCUTORY v. VESSEL SALE AND AUTHORIZING 14 CREDIT BID M/V OCEAN EYES, aka M/V REEL 15 DEAL, U.S. Coast Guard No. 1020245, a [Dkt. No. 16.] 16 1993 Bluewater Yacht Builders, Mikelson 64 Motor Vessel of Approximately 67.7- 17 Feet in Length Overall, and 17.3-Feet in 18 Beam, AND ALL OF HER ENGINES, TACKLE, ACCESSORIES, 19 EQUIPMENT, FURNISHINGS, 12- 20 FOOT CARIBE DINGHY (HIN No. D2103K708) AND ALL OTHER 21 APPURTENANCES, in rem, 22 Defendant. 23
24 Before the Court is the motion of Plaintiff PIER 32 MARINA GROUP, LLC, dba 25 PIER 32 MARINA for interlocutory vessel sale and authorization to credit bid. (Dkt. No. 26 16.) No opposition has been filed. Based on the reasoning below, the Court GRANTS 27 Plaintiff’s motion. 28 1 Procedural Background 2 On October 3, 2025, Plaintiff PIER 32 MARINA GROUP, LLC, dba PIER 32 3 MARINA (“Plaintiff”) filed a Verified Complaint against Defendant M/V OCEAN 4 EYES, aka M/V REEL DEAL, U.S. Coast Guard No. 1020245, a 1993 Bluewater Yacht 5 Builders, Mikelson 64 Motor Vessel of Approximately 67.7-Feet in Length Overall, and 6 17.3-Feet in Beam (“Vessel”), and all of her engines, tackle, accessories, equipment, 7 furnishings, dinghy, and appurtenances, in rem for vessel arrest, interlocutory sale, and 8 money damages for breach of maritime contract for necessaries, trespass by vessel, and 9 quantum meruit. (Dkt. No. 1, Compl.) On October 7, 2025, the Court issued an order 10 authorizing the arrest of the Vessel and appointing Plaintiff as Substitute Custodian of the 11 Vessel. (Dkt. Nos. 5, 6.) Pursuant to Plaintiff’s request for entry of clerk’s default, 12 default was entered against the Vessel on January 6, 2026. (Dkt. No. 14.) 13 On March 10, 2026, Plaintiff filed the instant motion for interlocutory vessel sale 14 and authorization to credit bid. (Dkt. No. 16.) No opposition has been filed. 15 Factual Background 16 Plaintiff operates a marina located at 3201 Marina Way, National City, California. 17 (Dkt. No. 1, Compl. ¶ 2.) Defendant is a 1993 Bluewater Yacht Builders, Mikelson 64 18 motor vessel of approximately 67.7-feet in length overall and 17.3-feet in beam, 19 documented with the United States Coast Guard under Official No. 1020245. (Id. ¶ 3.) 20 The Abstract of Title for the Vessel reflects that SRD Excavation Corp. owns the Vessel, 21 and Seth Dixon (“Dixon”) identified himself as the owner and Chief Executive Officer of 22 SRD Excavation Corp. (Id. ¶ 6.) On or about July 31, 2024, Dixon executed a Maritime 23 Contract for Private Wharfage (“Wharfage Contract”). (Id.; id., Ex. A.) 24 Paragraph 7 of the Wharfage Contract provides “[p]ayment of all fees and charges 25 are due on the FIRST (1st) day of each month, with or without a billing statement.” (Id. ¶ 26 7; id., Ex. A ¶ 7.) Due to a failure to pay sums required pursuant to the Wharfage 27 Contract, on August 9, 2025, Plaintiff sent Mr. Dixon a “THREE DAY NOTICE TO 28 COMPLY WITH WHARFAGE AGREEMENT OR QUIT,” demanding payment within 1 three days of unpaid fees due under the Wharfage Contract. (Id. ¶ 8.) Paragraph 9 of the 2 Wharfage Contract provides that either party may terminate the contract “by giving thirty 3 (30) days written notice of termination to the other.” (Id. ¶ 9; id., Ex. A ¶ 9.) On August 4 16, 2025, Plaintiff sent Mr. Dixon a letter informing him of Plaintiff’s election to 5 terminate the Wharfage Contract, effective September 14, 2025, and reminding him that 6 if the Vessel was not removed from the marina by the termination date, wharfage fees 7 would accrue at the then-current guest vessel rate. (Id. ¶ 10.) 8 Paragraph 38 of the Wharfage Contract provides that following termination, the 9 Vessel “will be regarded as a trespasser” and wharfage rates “will be calculated at the 10 then current guest vessel rate.” (Id. ¶ 11.) The standard guest vessel rate at Plaintiff’s 11 marina is $6.00 per foot of vessel length per day. (Id. ¶ 12.) Despite termination of the 12 Wharfage Contract, the Vessel was not removed from Plaintiff’s premises and remained 13 there without contractual or other legal justification. (Id. ¶ 20.) Calculated through 14 September 30, 2025, the account for the Vessel was in arrears in an amount not less than 15 $16,239.06, with arrearages continuing to accrue thereafter at the applicable guest vessel 16 rate. (Id. ¶ 13.) Plaintiff alleges that notwithstanding repeated demands for payment, the 17 Vessel and her owner failed to bring the account current and failed to satisfy Plaintiff’s 18 maritime necessaries lien. (Id. ¶ 16.) 19 Discussion 20 Federal courts exercise admiralty jurisdiction under the Constitution and statute. 21 U.S. Const. art. III, § 2, cl. 1; 28 U.S.C. § 1333(1). A “contract for wharfage is a 22 maritime contract”, Ex Parte Easton, 95 U.S. 68, 75 (1877), and within the Court’s 23 admiralty jurisdiction under 28 U.S.C. § 1331 “if wharfage is provided to a specific 24 vessel.” Royal Ins. Co. of America v. Pier 39 Ltd. P’ship, 738 F.2d 1035, 1037 (9th Cir. 25 1984) (citing Ex Parte Easton, 95 U.S. 68 (1877)). A maritime lien on the vessel is 26 established in favor of those who provide necessaries for the benefit of a vessel. 46 27 U.S.C. § 31342(a) (“a person providing necessaries to a vessel on the order of the owner 28 or a person authorized by the owner - (1) has a maritime lien on the vessel; and (2) may 1 bring a civil action in rem to enforce the lien”). In this case, Plaintiff has filed the instant 2 action, in rem, seeking foreclosure on its maritime lien arising under the Wharfage 3 Contract through the interlocutory sale of the Vessel. 4 A. Interlocutory Sale of Vessel 5 “The interlocutory sale of a vessel is not a deprivation of property but rather a 6 necessary substitution of the proceeds of the sale, with all of the constitutional safeguards 7 necessitated by the in rem process.” Ferrous Fin. Servs. Co. v. O/S Arctic Producer, 567 8 F. Supp. 400, 401 (W.D. Wash. 1983). 9 Rule E(9)(a)1 of the Federal Rules of Civil Procedure, Supplemental 10 Rules for Admiralty and Maritime Claims and Asset Forfeiture Claims (“Supplemental 11 Admiralty Rules”) governs interlocutory vessel sales and provides, 12 (i) On application of a party, the marshal, or other person having custody of the property, the court may order all or part of the property sold—with the 13 sales proceeds, or as much of them as will satisfy the judgment, paid into 14 court to await further orders of the court—if:
15 (A) the attached or arrested property is perishable, or liable to deterioration, 16 decay, or injury by being detained in custody pending the action;
17 (B) the expense of keeping the property is excessive or disproportionate; or 18 (C) there is an unreasonable delay in securing release of the property. 19
20 Fed. R. Civ. P., Suppl. Adm. R. E(9)(a)(i). “To justify an interlocutory sale, Plaintiff 21 need only establish the existence of one of the three provisions listed in Rule E(9)(a)(i).” 22 Rainaldi Family Trust Dated February 26, 2004 v. M/Y Excalibur, U.S.C.G. Official No. 23 1057893, Case No. SACV 19-00684 AG (JDEx), 2019 WL 6794218, at *2 (C.D. Cal. 24 Aug. 6, 2019) (citation omitted); Merchants Nat’l Bank of Mobile v. Dredge Gen. G.L. 25 26
27 1 In its motion, Plaintiff is referencing the former Rule (E)(9)(b) of the Federal Rule of Civil Procedure, 28 1 Gillespie, 663 F.2d 1338, 1341 (5th Cir. 1981) (“In order to prevail, the lienors need only 2 show one of the three criteria.”). 3 Plaintiff argues that all three conditions have been met. First, Plaintiff asserts that 4 the Vessel is deteriorating in condition and value by reason of her idleness while in 5 custody. (Dkt. No. 16-1 at 15-16.2) Plaintiff presents the declaration of Ray Jones 6 (“Jones”), who has been a licensed yacht broker for approximately 43 years, during 7 which time he served as President of Long Beach Yacht Sales, Inc., has been a long-time 8 member of various trade organizations, and has sold thousands of vessels. (Dkt. No. 16- 9 2, Jones Decl. ¶ 1.) Jones further states that he has offered expert opinions regarding the 10 condition and fair market value of arrested vessels in dozens of cases. (Id. ¶ 2.) Jones 11 opines that it is “commonly understood among experienced vessel owners, yacht brokers 12 and others who routinely deal with boats that even well and regularly maintained vessels 13 inevitably deteriorate in condition and value over time.” (Id. ¶ 3.) According to Jones, 14 such deterioration is “exacerbated” when vessels sit for extended periods in a salt-water 15 environment without regular, routine maintenance. (Id.) Jones further explains that 16 while an arrested vessel sits idle, “her equipment, systems, generators and engines are not 17 operated under load (if at all),” and that such disuse can detrimentally impact the vessel’s 18 condition and value. (Id.) In Jones’s professional opinion, it is “unavoidable” that the 19 Vessel will deteriorate in condition and value while sitting idle in salt water, and that “the 20 longer she remains under arrest the greater the deterioration will be.” (Id. ¶ 4.) Jones 21 further opines that, in the interest of preserving the Vessel’s value, she should be sold “as 22 soon as possible” because every day the Vessel remains unused “results in a diminution 23 in her condition, and accordingly her value.” (Id.) 24 Because the Court, previously, based on similar declarations by Jones, found that 25 the plaintiffs had shown the deterioration criteria under Supplemental Admiralty Rule 26 27 28 1 E(9)(a)(i)(A), it also finds that Plaintiffs has shown that the Vessel is deteriorating in 2 condition and value as it sits idle. See Bartell Hotels v. S/L Talus, 445 F. Supp. 3d 983, 3 988 (S.D. Cal. 2020); Shelter Cover Marine, Ltd. v. M/Y Isabella, Case No. 17cv1578- 4 GPC-BLM, 2017 WL 5906673, at *2 (S.D. Cal. Nov. 30, 2017) (finding deterioration to 5 vessel if it remains arrested based on Jones’ analysis); see also Tindini P/L v. Bruce, Case 6 No.18-cv-04639-EDL, 2019 WL 1095824, at *2 (N.D. Cal. Jan. 15, 2019), report and 7 recommendation adopted by 2019 WL 1095798 (N.D. Cal. Feb. 6, 2019) (accepting a 8 similar declaration from Jones as evidence sufficient to establish deterioration criteria 9 under Rule E(9)). 10 Next, Plaintiff argues that the cost of keeping the Vessel in custody is excessive 11 and disproportionate where no payments are being made to creditors, the Vessel is idle, 12 and custodial costs continue to accrue. (Dkt. No. 16-1 at 17-18.) Jones reviewed dozens 13 of detailed photographs of the interior and exterior of the Vessel and concluded that the 14 Vessel’s fair market value is about $150,000. (Dkt. No. 16-2, Jones Decl. ¶ 5.) The 15 Substitute Custodian Order authorizes ongoing wharfage charges of $234.50 per day and 16 custodial services charges of $67.00 per day. (Dkt. No. 6, Order Appointing Substitute 17 Custodian ¶¶ 4(b)&(c).) Accordingly, custodial expenses have been accruing at a 18 combined rate of $301.50 per day for 191 days, from the day the Vessel was arrested on 19 November 26, 2025, (Dkt. No. 9), until the date of the hearing on June 5, 2026, for a total 20 of $57,586.50. Further, the Substitute Custodian Order provides that the Substitute 21 Custodian must inspect the interior of the Vessel, twice monthly, at a rate of $50.00 per 22 inspection for watertight integrity, excessive bilge water, fuel leaks and other problems. 23 (Dkt. No. 6, Order Appointing Substitute Custodian ¶ 4(d).) The Substitute Custodian 24 will have inspected the interior of the Vessel a total of 13 times between November 26, 25 2025, the date she was arrested, and the hearing date of June 5, 2026 for a total of 26 $650.00. Therefore, the total amount of fees is $58,236.50 which amounts to 38.8% of 27 the Vessel’s presumed fair market value and have been found to be excessive and 28 disproportionate within the meaning of Rule E(9)(B). See Shelter Cove, 2017 WL 1 5906673, at *3 (finding that maintenance costs amounting to 30 percent of the vessel's 2 total value were excessive and disproportionate); GB Cap. Holdings, LLC v. S/V Glori B, 3 No. 18CV312-WQH-AGS, 2019 WL 277387 (S.D. Cal. Jan. 22, 2019) (concluding costs 4 of $2,430 per month excessive and disproportionate to the vessel's $6,000 fair market 5 value). Thus, the Court concludes that Plaintiff has shown that the “expense of keeping 6 the property is excessive or disproportionate.” 7 Finally, Plaintiff contends that no security has been posted, and no offer has been 8 made to post security for over six months since the Vessel’s arrest. (Dkt. No. 16-1 at 16- 9 17.) “As a general rule, defendants are given at least four months to bond a vessel absent 10 some other considerations.” Vineyard Bank v. M/Y Elizabeth I, No. 08cv2044 BTM 11 (WMC), 2009 WL 799304, at *2 (S.D. Cal. Mar. 23, 2009) (quoting Bank of Rio Vista v. 12 Vessel Captain Pete, No. C 04–2736CW, 2004 WL 2330704, at *2 (N.D. Cal. Oct. 14, 13 2004)); see also California Yacht Marina—Chula Vista, No. 14–cv–01215–BAS(BGS), 14 2015 WL 1197540, at *4 (S.D. Cal. Mar. 16, 2015) (nine-month delay was 15 unreasonable); Ferrous Fin. Servs. Co., 567 F. Supp. at 401 (no attempt to secure release 16 of vessel within four months since arrest was unreasonable delay); Merchants Nat'l Bank 17 of Mobile, 663 F.2d at 1341-42 (failure to secure the release of the vessel eight months 18 after arrest constitutes unreasonable delay). 19 Here, the Vessel was arrested on November 2, 2025, more than six months ago. 20 (Dkt. No. 9.) Default was entered against the Vessel and no person claiming interest has 21 come forward to secure the Vessel’s release. Therefore, there has been an unreasonable 22 delay in securing the release of the Vessel. 23 Because Plaintiff has demonstrated that all three factors of Rule (E)(9)(a)(i) have 24 been met, the Court GRANTS Plaintiff’s motion for interlocutory vessel sale. 25 B. Authorization to Credit Bid 26 Plaintiff also asks the Court to authorize it to credit bid at the auction because no 27 party has asserted any maritime lien against the Vessel and as a result, it is the senior 28 lienholder. (Dkt. No. 16-1 at 24-25.) Under the Local Civil Rules, 1 When the court determines on the merits that a plaintiff or plaintiff in intervention has a valid claim senior in priority to all other parties, that 2 plaintiff in intervention foreclosing a properly recorded and endorsed 3 preferred mortgage on, or other valid security interest in the vessel may bid, without payment of cash, certified check or cashier’s check, up to the total 4 amount of the secured indebtedness as established by affidavit filed and 5 served on all other parties no later than seven (7) days prior to the date of sale. 6
7 Civil Local Rule E.1 (e)(2). In this case, no party has asserted any maritime lien claim 8 against the Vessel and Plaintiff is the only maritime lien claimant. Plaintiff requests the 9 Court to authorize a credit bid at the auction up to the lien amount attested to under oath 10 in the Verified Complaint ($16,239.06) and which will be established by affidavit 11 pursuant to Civil Local Rule E.1(e)(2), plus its actual and demonstrable costs of suit, 12 including U.S. Marshal, substitute custodian and other custodia legis expenses, to be 13 calculated through the date of the vessel sale at the rates provided by this Court’s Order 14 Appointing Substitute Custodian. (Dkt. No. 6.) The Court finds it is appropriate to 15 GRANT Plaintiff’s request to credit bid at the auction of the Vessel. 16 C. Marketing Vessel Prior to Auction 17 Plaintiff also requests authorization to conduct additional marketing and 18 advertising of the Vessel in advance of the United States Marshal auction. (Dkt. No. 16-1 19 at 21-24.) Plaintiff anticipates that its maritime lien claim and custodia legis expenses 20 will total approximately $60,000 to $65,000, while the estimated fair market value of the 21 Vessel is approximately $150,000. (Dkt. No. 16-1 at 21-22.) Plaintiff contends that 22 enhanced marketing efforts would increase exposure to prospective purchasers, maximize 23 competitive bidding, and reduce the likelihood of post-sale disputes concerning the 24 adequacy of the purchase price. (Id.) Plaintiff further contends that additional 25 advertising would “greatly enhance” public exposure to the Vessel and likely increase 26 buyer interest and the ultimate sale price at auction. (Id. at 22.) 27 Plaintiff proposes engaging Jones to develop and implement a coordinated 28 marketing campaign for the Vessel. (Id.) The proposed advertising efforts include 1 publication in boating and yachting publications, online advertising, circulation through 2 marine industry media sources, obtaining a marine survey report for prospective buyers, 3 and conducting open houses to permit inspection of the Vessel. (Id.) Plaintiff further 4 represents that Jones would charge $3,000, plus five percent of the selling price for his 5 services, and that the marine surveyor would charge approximately $1,675 to $2,010 for 6 preparation of a survey report. (Id. at 23.) 7 Courts have recognized that supplemental advertising and marketing expenses 8 incurred in connection with judicial vessel sales may properly be treated as custodia legis 9 expenses payable from the sale proceeds. Recently, in Centennial Bank v. M/Y Marluv, 10 the Central District of California authorized pre-sale marketing of an arrested vessel by a 11 third-party liquidator for compensation specified in the plaintiff’s motion. 808 F. Supp. 12 3d 1080, 1087-88 (C.D. Cal. 2025). There, the plaintiff sought authorization for the 13 third-party liquidator to market the vessel before the U.S. Marshal auction “for a fee of 14 8% of the gross sales price.” Id. at 1087. The court reasoned that Supplemental 15 Admiralty Rule E(9)(a)(i), together with the court’s equitable admiralty powers and the 16 Civil Local Rule E.1(e), minimum notice requirements, permitted additional marketing 17 designed to maximize the vessel’s sale price. Id. The court further ordered that the sale 18 shall occur 40 days after the entry of the court’s order “to facilitate the marketing” of the 19 vessel by the third-party. Id. at 1087-88; see Am. W. Bank v. P/V Indian, No. 12cv1786 20 AJB (BGS), 2013 WL 784756, at *4 (S.D. Cal. Mar. 1, 2013) (granting plaintiff’s request 21 to allow a third-party to market the vessel for a period of 45-60 days). 22 Likewise, in E.N. Bisso & Son, Inc. v. M/V Bouchard Girls, the court authorized 23 additional advertising beyond the required public notice and provided that the plaintiff 24 “may effect such other advertising covering a more extensive area as can be reasonably 25 secured at a reasonable cost,” and that “[t]he expenses of such additional advertisement 26 shall be taxed as custodia legis expenses.” 482 F. Supp. 3d 527, 534 (E.D. La. 2020). 27 The Supreme Court has similarly explained that services furnished “for the common 28 benefit of those interested in a fund administered by the court” may properly be paid 1 from the fund as an “expense of justice.” New York Dock Co. v. The Poznan, 274 U.S. 2 117, 121 (1927). 3 The Court concludes that Plaintiff’s request for supplemental advertising and 4 marketing is appropriate under the circumstances and consistent with the Court’s 5 authority under Supplemental Admiralty Rule E(9)(a)(i) and its equitable admiralty 6 powers. Accordingly, the Court GRANTS Plaintiff’s request to conduct commercially 7 reasonable additional advertising and marketing of the Vessel prior to the U.S. Marshal 8 auction. The Court further authorizes reasonable associated advertising and marketing 9 expenses to be treated as custodia legis expenses payable from the sale proceeds. 10 Conclusion 11 Accordingly, considering the Motion of Plaintiff for an Order directing the 12 interlocutory sale of the Vessel, the Memorandum of Points and Authorities, the 13 Declaration of Jones, the file of record in this action, and good cause appearing therefor, 14 and having concluded that the interlocutory sale of the Vessel is warranted pursuant to 15 Supplemental Admiralty Rule E(9)(a)(i) because she is subject to deterioration while in 16 custody, because the expense of keeping her is excessive or disproportionate, and because 17 there has been an unreasonable delay in securing her release, 18 IT IS HEREBY ORDERED that, consistent with Supplemental Admiralty Rule 19 E(9)(b) and Civil Local Rule E.1(e), the United States Marshal is hereby directed and 20 empowered to sell said Vessel and her engines, tackle, accessories, equipment, 21 furnishings and appurtenances, as is, where is, at public sale at the first available time and 22 date, after having first caused notice of said sale to be published daily in a newspaper of 23 general circulation within the City of San Diego, California for at least seven days 24 immediately before the date of sale; and 25 IT IS FURTHER ORDERED that such public notice shall specify the date, time 26 and location for the sale of the Vessel; and 27 IT IS FURTHER ORDERED that prior to the U.S. Marshal auction of the Vessel, 28 Plaintiff may engage the services of Ray Jones, for the compensation specified above, to 1 advertise the auction in the manner specified therein, for a period of 60 days following 2 issuance of this Order, for the compensation specified (including hiring a professional 3 marine surveyor to inspect the Vessel and provide a condition report), and that Plaintiff 4 may recover such costs as custodial legis expenses; and 5 IT IS FURTHER ORDERED that, consistent with Civil Local Rule E.1(e)(2), such 6 public notice specify that the last and highest bidder at the sale will be required to deposit 7 with the U.S. Marshal a certified check or a cashier's check in the amount of the full 8 purchase price not to exceed $500, and otherwise $500 or ten percent (10%) of the bid, 9 whichever is greater, and that the balance, if any, of the purchase price shall be paid by 10 certified check or cashier's check before confirmation of the sale or within three days of 11 dismissal of any opposition which may have been filed, exclusive of Saturdays, Sundays 12 and legal holidays; and 13 IT IS FURTHER ORDERED that any proceeds of said sale shall be held by the 14 United States Marshal or deposited by the United States Marshal in the Registry of this 15 Court, pending further order of this Court; and 16 IT IS FURTHER ORDERED that Plaintiff, having a secured maritime lien 17 interest in the Vessel pursuant to the Commercial Instruments and Federal Maritime Lien 18 Act (46 U.S.C. §§ 31301-31343) and being the only claimant in this action asserting a 19 maritime claim against her, is authorized pursuant to Civil Local Rule E.1(e)(2) to credit 20 bid at the auction of the Vessel, without payment of cash, a sum equal to its secured interest 21 in the Vessel, consisting of the lien amount specified in Plaintiff's Verified Complaint 22 ($16,239.06), plus its actual costs of suit through the date of the sale, including U.S. 23 Marshal and other custodia legis expenses, with such costs and expenses to be calculated 24 at the rates specified and authorized in the Order Appointing Substitute Custodian and 25 Authorizing Movement of Vessel. However, as Plaintiff's maritime necessaries lien 26 interest in the Vessel does not, as a matter of law, include attorneys’ fees, such fees are not 27 to be included in any credit bid Plaintiff makes; and 28 1 IT IS FURTHER ORDERED that should Plaintiff elect to credit bid, it shall file 2 ||and serve any appearing parties with its Notice of Intent to Credit Bid no later than seven 3 ||(7) days prior to the date of the sale of the Vessel, as required by Civil Local Rule E.1(e)(2); 4 || and 5 IT IS FURTHER ORDERED, pursuant to Civil Local Rule E.1(e)(2), that if within 6 three days of the auction date, exclusive of Saturdays, Sundays, and legal holidays, no 7 || written objection is filed, the sale shall stand confirmed as of course, without the necessity 8 || of any affirmative action thereon by a judge, except that no sale shall stand confirmed until 9 || the buyer has complied fully with the terms of the purchase; and 10 IT IS FURTHER ORDERED, that if no objection to the sale of the Vessel is filed 11 || within three days of the auction date, exclusive of Saturdays, Sundays and legal holidays, 12 U.S. Marshal shall forthwith issue to the high and successful bidder Bills of Sale for 13 Vessel, and for her dinghy, bearing Hull Identification Number D2103K708. 14 The hearing currently set for June 5, 2026 is VACATED. 15 IT IS SO ORDERED. 16 Dated: June 2, 2026 <=
18 United States District Judge 19 20 21 22 23 24 25 26 27 28