A nasty legal fight over the ownership of the presidential yacht Sequoia, made famous by former President John F. Kennedy who used it for his final birthday party in 1963, has ended with the ownership of the wooden boat transferring to a Washington based-group with Indian interests.
Long operated by Washington lawyer Gary Silversmith, who often used the boat to entertain wounded troops and for political fundraisers, a court decision released Thursday clears the way for investors FE Partners to buy it for $7.8 million.
FE Partners, which invests in historical vessels, has said previously that it plans to keep the ship in the United States. They plan to wrap up the paperwork and take control of the yacht possibly by December, though they have five years to finish the deal. One investor in FE Partners is the India-based Timblo family, which has shipping and mining interests.
According to court documents, Silversmith, who has owned the ship since 2000, received a $5 million loan from FE Partners and planned to use it to fix the 88-year-old ship. As part of the deal, FE Partners had an option to buy the ship.
When FE Partners claimed Silversmith defaulted on making payments, they moved to seize the ship for $7.8 million, resulting in a claim from Silversmith that they were trying a "dastardly" plot to take the ship sailed by presidents from Hoover to Carter, who sold it in an austerity move.
In the court papers, it was shown that Silversmith's team weren't honest when they said that Russian energy giant Gazprom had offered to buy the boat for $20 million and take it to St. Petersburg, a claim that prompted FE Partners to offer their $5 million loan to help Silversmith keep the ship in the United States. It has at times been docked at Washington's Gangplank Marina.
Delaware Chancery Court Judge Sam Glasscock said the Gazprom offer was "fabricated."
FE Partners, meanwhile, claimed the Sequoia likely owed tens of thousands of dollars in back taxes to the District, but a subsequent audit by the D.C. government found that to be $26,000, Silversmith told Secrets.
He doesn't plan to appeal. "We just can't afford that," said Silversmith.
In a statement to Secrets, FE Partners said: "Assuming we can establish all existing liabilities, it would be our intent to exercise our option, purchase the Sequoia and keep it in the United States. Should that happen, we hope to do our part to preserve and restore the USS Sequoia so that future generations of Americans will be able to enjoy the storied past of this magnificent vessel."
Paul Bedard, The Washington Examiner's "Washington Secrets" columnist, can be contacted at email@example.com.