Opposition Brief — California v. Deep Sea Research, Inc.

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No. 96-1400 MAY 5S 1997

In The areas

Supreme Court of the Hnited States

October Term, 1996

STATE OF CALIFORNIA,

STATE LANDS COMMISSION,

Petitioner,

vs.

DEEP SEA RESEARCH, INC.,

Respondent.

On Petition for Writ of Certiorari to the United States Court

of Appeals for the Ninth Circuit

RESPONDENT’S BRIEF IN OPPOSITION

STUART M. GORDON

FLETCHER C. ALFORD

Counsel of Record

GORDON & REES, LLP

Attorneys for Respondent

20th Floor

Of Counsel: Embarcadero Center West

DAVID J. BEDERMAN Soy mUnety Saas

ele University of Vireiaia San Francisco, California 94111

School of Law c (415) 986-5900

580 Massie Road

Charlottesville, Virginia 22903-1789

(804) 924-3942

70°01 utz

~ (800) 3 APPEAL « (800) 5 APPEAL « (800) BRIEF 21 t late

’

See eee ee)

QUESTIONS PRESENTED

1. This is an in rem admiralty action brought by Respondent

Deep Sea Research, Inc. against the shipwrecked vessel The

Brother Jonathan. Petitioner State of California, State Lands

Commission, intervened and moved to dismiss the case, citing

a federal statute (the Abandoned Shipwreck Act, 43 U.S.C.

§ 2101 et seq.) which divests the federal courts of their admiralty

subject matter jurisdiction over suits involving shipwrecks that

meet each of the criteria enumerated in the statute. Under these

circumstances, did the district court violate the Eleventh

Amendment to the United States Constitution by convening an

evidentiary hearing to determine whether the shipwreck at issue

meets the criteria set forth in the statute?

2. Did the district court and the court of appeal clearly err

in their factual findings that the shipwrecked vessel The Brother

Jonathan is neither abandoned nor embedded in the submerged

lands of the State of California, and thus, that the Abandoned

Shipwreck Act does not apply here?

3. Does the Abandoned Shipwreck Act preempt a state law

that directly conflicts with its provisions?

PARTIES TO THE PROCEEDING

In addition to those listed in the caption, the parties below

included the in rem defendant The Brother Jonathan, her

appurtenances, furniture, tackle, and cargo, as well as the

intervenor United States of America.

iii

RULE 29.6 STATEMENT

Respondent Deep Sea Research, Inc. is a closely-held

California corporation. It has no publicly-traded stock. It has

no parent, subsidiary, or affiliate companies.

TABLE OF CONTENTS

Reasons for Denying the Writ ....................

1 The District Court Did Not Violate The Eleventh

Amendment By Convening An Evidentiary

Hearing To Determine Whether The Brother

Jonathan Meets The Criteria Set Forth In The

Gn bevtcesdedésdvesseesecedsscaseesses

Il. There Is No Conflict Among The Circuits On The

Il. The Decision Below Does Not Implicate Any

Issues Of Such National Importance As To Merit

A Commitment Of This Court's Time, Attention,

REE duiccuececéndodebbboctusice

ee ——- —

Contents

Page

IV. The Court Of Appeals Did Not Err In Holding

That The ASA Preempts California Public

Resources Code Section 6313. ............. 23

V. Whether The Brother Jonathan Is Abandoned Is

A Question Of Fact Unsuitable For Review By

TEE,“ Scadecceceutecevescdeceecoses 27

Sc cb cdcte debe docs cecedctvécsoceocccss 30

TABLE OF CITATIONS

Cases Cited:

Cobb Coin Company, Inc. v. Unidentified, Wrecked and

Abandoned Sailing Vessel, 549 F. Supp. 540 (S.D.

Pa GED Sedbodecoceccduvevcecedbeutesioses 6

Columbus-America Discovery Group v. Atlantic Mutual

Ins. Co., 974 F.2d 450 (4th Cir. 1992), cert. denied,

507 U.S. 1000 (1993) ..........4... 3, 4, 27, 28, 29, 30

Deep Sea Research, Inc. v. The Brother Jonathan, 102

ee Gh BOSE cdcdectccdescossocdéess passim

Fairport International Exploration, Inc. v. The Captain

Lawrence, 105 F.3d 1078 (6th Cir. 1997) ...... 17, 22, 27

Fitzgerald v. The Unidentified, Wrecked and Abandoned

Vessel, 866 F.2d 16 (ist Cir. 1989) .............. 19

Contents

Goodman v. Lukens Steel Co., 482 U.S. 656 (1987) .. 27

Graver Mfg. Co. v. Linde Co., 336 U.S. 271 (1949) .. 27

Houseman v. The Cargo of the Schooner North Carolina,

40 U.S. (15 Pet.) 40 (1841) .. 2.0... cece eee cene 5

Madruga v. Superior Court of California, 346 U.S. 556

DD ithed didi bdencdenendansheipeddcanialts 6

Maritime Underwater Surveys, Inc. v. The Unidentified,

Wrecked and Abandoned Sailing Vessel, 717 F.2d 6

SD SE abciedédsccdcesdcecvdccocccall 18, 19, 20

Martha's Vineyard Scuba Headquarters, Inc. v.

Unidentified, Wrecked and Abandoned Steam Vessel,

SSS F356 1650 (iat Cie. 1967) ...cccccccccececes 6

Marx v. Guam, 866 F.2d 294 (9th Cir. 1989) ........ 19

MDM Salvage, Inc. v. Unidentified, Wrecked and

Abandoned Sailing Vessel, 631 F. Supp. 308 (S.D.

Dee. GED Shosdncctecéadusncheseecdhcesbus o

Nunley v. M/V Dauntless Colocotronis, 661 F. “upp.

SEP RA Gk NED an cdnviansisdadeecebsiben- 3

Rice v. Sioux City Mem. Park Cemetery, 349 U.S. 70

GUS anccnndcRpéecowies snubs Vbeebd dab och 23

vii

Contents

The Sabine, 101 U.S. 384 (1880) ..........0eeeees 3

Seminole Tribe of Florida v. Florida, 116 S. Ct. 1114

CIDBS) ncccccccccccccccccccccccccccccccceces 22

Zych v. The Lady Elgin, 960 F.2d 665 (7th Cir. 1992)

1“ PITT TITITITTT OTT TT 1, 17, 18, 20, 21, 30

Zych v. The Seabird, 941 F.2d 525 (7th Cir. 1991) ..7, 15, 27

Statutes Cited:

43 U.S.C. § 2101 ef Seg... 00. cece cece eee eeeeees passim

43 U.S.C. § 210S(a) 0... ccc eecececcecceeecces 7, 15, 25

43 U.S.C. § 210S(C) .....ccceccccccccccecccccees 7, 25

43 U.S.C. § 210G(e) .... cc ccccccccccccccccccess 7, 15

43 U.S.C. § 2106(b) .... 66. cece e cece eee eees 7, 15, 24, 26

Calif. Pub. Res. Code § 6313 ..........0eeeeeeeees

duis sedecdedeesecoces 6, 8, 9, 10, 11, 21, 23, 24, 25, 26

Calif. Pub. Res. Code § 6313(a) .........+0eeeeeee 8

Calif. Pub. Res. Code § 6313(c) ...........eeeeeee 8

viii

Contents

Page

United States Constitution Cited:

Eleventh Amendment ...........cccccccccccccees passim

CBD: 0c Cen den Sitedeicccdetéecar 5

Rules Cited:

Supreme Court Rule 10 ........ 2.0... ccc cece eueee 27

Supplemental Admiralty Rule C(1)(a) .............. 5

Other Authorities Cited:

Gilmore & Black, The Law of Admiralty 532 (2d ed.

GOVE dbcCencscdccctunddtowsssbbctbe Chudiecs 3, 4,5

H.R. Rep. No. 100-514, 100th Cong., 2d Sess. Pt. I, at 2

(1988), reprinted in 1988 U.S.C.C.A.N. 365 .....

ooncececdusnteséuuedeubeesetedéeestec 7, 8, 20, 23, 24

APPENDIX

Appendix A — Memorandum and Order of the United

States District Court for the Northern District of

California Dated July 1995 .............ccccuee la

a ee

INTRODUCTION

Respondent Deep Sea Research, Inc. respectfully requests

that this Court deny the petition for writ of certiorari, seeking

review of the Ninth Circuit's opinion in this case. That opinion

is reported at 102 F.3d 379. The opinion of the district court,

which was affirmed by the Ninth Circuit, is reported at 883 F.

Supp. 1343. Because both the district court and the Ninth Circuit

correctly concluded that this in rem suit is not an action “against

a State,” the Eleventh Amendment does not apply here and there

was no error below. Accordingly, no significant legal issue is

presented for review by this Court. Contrary to the petitioner's

suggestion, there is no conflict between the holding below and

the Seventh Circuit's holding in The Lady Elgin, as that case is

clearly distinguishable. Finally, because the decision below turns

on its unique facts, it sets no sweeping precedent and implicates

no issues of national importance warranting review by this Court.

Accordingly, certiorari should be denied.

STATEMENT OF THE CASE

1. a. DSR, And Its Discovery Of The Brother Jonathan.

Respondent Deep Sea Research, Inc. (“DSR”) is a small, closely-

held California corporation. The principals of DSR have been

searching for the shipwrecked vessel The Brother Jonathan for

more than 20 years. Their persistence was finally rewarded when,

in October of 1993, they discovered the wreck resting on the

ocean floor beneath several hundred feet of water, approximately

4% miles off the coast of Crescent City, California. It is entirely

undisputed that DSR was the first finder of The Brother

Jonathan. Until DSR discovered the wreck, neither the State of

California nor anyone else knew its location, and the State had

never inade any attempt to locate it. See Deep Sea Research,

Inc. v. The Brother Jonathan, 102 F.3d 379, 382 (9th Cir. 1996);

Pet. App. A4.

z 2

Since the discovery, DSR has retained a professional

archaeologist, and under his supervision DSR has meticulously

studied, mapped, and videotaped the wreck using the latest

available technology. DSR has also recovered a number of

artifacts from the wreck, which have been carefully preserved

and restored by an internationally-renowned artifact

conservation laboratory and are now on loan to a local museum

for the public to enjoy. See Memorandum and Order Denying

the State's Motion for Stay, attached hereto as Appendix A at

Resp. App. 6a-7a, Ila, 15a.

This effort has not been inexpensive. The expenses incurred

by DSR to date in locating the wreck, mapping and

photographing it, and recovering and treating the artifacts

significantly exceed one-half million dollars. This funding has

come piecemeal from almost 100 individual investors, mostly

people of modest means — plumbers, mechanics, small-business

owners, and others. To date, these investors have yet to see a

single penny of return on their investment.

No funding has been provided by the State of California or

any other governmental entity. Although the State touts itself as

a guardian of The Brother Jonathan, the State admits the State

has done nothing to protect the wreck. Indeed, it has neither the

resources nor the technological capability to recover the wreck,

to preserve its artifacts, or even simply to safeguard it from

vandals and pillagers. See Memorandum and Order Denying the

State’s Motion for Stay, attached hereto as Appendix A at

Resp. App. 12a-15a. Rather, it is DSR who has taken

measures to safeguard the wreck and to preserve its historical

values. Jd.

b. DSR Obtains An Ownership Interest In The Wreck.

DSR’s historical research revealed that several insurance

companies paid claims for loss of the vessel and its cargo shortly

a ee

after the sinking. Those insurance companies took title to the

wreck by operation of law, under the principle of subrogation.

The two insurance companies that paid the lion’s share of the

claims on the wreck assigned their title to DSR by a written

contract, which is part of the record below. In that contract, the

insurance companies represented and warranted to DSR that

they had not abandoned their title to the shipwreck prior to

assigning that title to DSR. Accordingly, DSR now holds an

ownership interest in the wreck.

c. DSR’s In Rem Admiralty Action. DSR brought this in

rem admiralty action against The Brother Jonathan in the United

States District Court for the Northern District of California,

seeking to establish its title to, and its salvage rights in, the

wreck. The State of California is not named in the complaint.

The complaint does not pray for any injunctive relief, damages,

or other eward of any kind against the State.

The law of salvage is of ancient vintage. See Gilmore &

Black, The Law of Admiralty 532-33 (2d ed., 1975). Under the

law of salvage,

compensation [is] allowed to persons by

whose voluntary assistance a ship at sea or

her cargo or both have been saved in whole

or in part from impending sea peril, or in

recovering such property from actual peril

or loss, as in cases of ship wreck, derelict or

recapture.

The Sabine, 101 U.S. 384 (1880). See also Columbus-America

Discovery Group v. Atlantic Mutual Ins. Co., 974 F.2d 450, 459-

460 (4th Cir. 1992), cert. denied, 507 U.S. 1000 (1993); Nunley

v. M/V Dauntless Colocotronis, 661 F. Supp. 1096, 1107 (E.D.

La. 1987) (quoting The Sabine, supra). Under the law of salvage,

the original owner of the imperiled vessel retains title thereto,

but the salvor is entitled to a very liberal salvage award from

the res of the vessel. Columbus-America Discovery Group, 974

F.2d at 459. The courts have recognized that liberal salvage

awards further the fundamental public policy of encouraging

salvage and recovery efforts, and rewarding those who engage

in laborious, costly, and potentially dangerous undertakings.’

1. See Rickard v. Pringle, 293 F. Supp. 981, 984 (E.D.N.Y., 1968);

Gilmore & Black, supra, at $32 (citing numerous cases).

Despite its ancient origins, the law of salvage has readily evolved to

meet modern concerns regarding preservation of historic shipwrecks. Because

the salvor essentially acts as an agent of the district court in recovering the

wreck and bringing it into the jurisdiction of the court, district judges have

broad discretion both in the initial selection and appointment of the salvor,

and later, in deciding the amount of the salvor’s award. The district courts

have exercised that discretion to ensure that the historical values of antiquated

shipwrecks are preserved in the salvage process. For example, in MDM

Salvage, Inc. v. Unidentified, Wrecked, and Abandoned Sailing Vessel, 631 F.

Supp. 308, 310-311 (S.D. Fla. 1986), the district court denied the applications

of two different commercial salvors to recover property from a Spanish

galleon, noting that neither firm had attempted to preserve the “archaeological

integrity” of the wreck. The court noted that, “These factors constitute a

significant element ... to be considered when exclusive salvage rights are

sought.” /d. at 310. See also Columbus-America Discovery Group, 974 F.2d

at 468 (where the court made clear that the salvor's fidelity to archaeological

values is among the elements to be considered in determining the amount of

the salvage award).

In appointing DSR exclusive salvor of The Brother Jonathan, the district

court in this case made a factual finding that DSR has undertaken adequate

measures to preserve the wreck’s archaeological and historical value. See

Pet. App. A53-A54. In a subsequent Order, the district court made a further

factual finding that:

DSR has committed itself to conducting its salvage

(Cont'd)

By operation of law, the salvor has a maritime lien against

the res of the recovered vessel and its cargo. See Gilmore &

Black, supra, at 628, and cases cited therein. The salvor enforces

the lien by bringing an in rem action in federal court against the

vessel and its cargo. See Supplemental Admiralty Rule C (1)(a).

As explained by Chief Justice Taney in the case of Houseman v.

The Cargo of The Schooner North Carolina, 40 U.S. (15 Pet.)

40 (1841), in rem salvage actions against vessels fall squarely

within the exclusive admiralty jurisdiction of the federal courts

conferred under Article III, Section 2 of the United States

Constitution:

Now, the matter in dispute, is merely a

question of salvage .... Upon such

questions, there can be no doubt of the

jurisdiction of a court of admiralty; nor of

its authority to proceed in rem, and attach

the property detained. The admiralty is the

only court where such a question can be tried;

for what other court, but a court of admiralty,

has jurisdiction to try a question of salvage?

(Cont'd)

operations in an archacologically sound manner, under

the on-site supervision of a qualified, experienced

marine archaeologist, and in accordance with a detailed

salvage plan designed to maintain the historical value

of the vessel.

See Resp. App. lla. The district court also warned that “the amount of any

recovery that DSR may ultimately receive as a salvage award, will be

contingent upon DSR's preservation of the historical and archaeological value

of the Brother Jonathan and its cargo.” See id. at | la.

Thus, modern admiralty law in general, and as applied to this case in

particular, provides ample incentives and safeguards for the appropriate

treatment of historic shipwrecks.

Id. at 48. See also Madruga v. Superior Court of California,

346 U.S. 556 (1954); Martha's Vineyard Scuba Headquarters,

Inc. v. Unidentified, Wrecked and Abandoned Steam Vessel, 833

F.2d 1059, 1063-1064 (1st Cir. 1987) (in rem action for salvage

award against artifacts recovered from antiquated shipwreck is

governed by general federal maritime law, and is within the

federal courts’ exclusive jurisdiction); Cobb Coin Company, Inc.

v. Unidentified, Wrecked and Abandoned Sailing Vessel, 549 F.

Supp. 540, 548 (S.D. Fla. 1982) (same).

Because this is an in rem salvage action against a vessel, it

falls squarely within the exclusive admiralty jurisdiction of the

federal courts.

d. The State Of California Intervenes. Although the State

was not named in the complaint, it intervened in the action and

moved to dismiss on the basis that the suit contravenes the

Eleventh Amendment. The State alleged that it owns the

shipwreck under the Abandoned Shipwreck Act (“ASA”), 43

U.S.C. § 2101 et seg., and California Public Resources Code

section 6313 (“Section 6313”), and that for this reason DSR’s

in rem action is actually an action “against the State” barred by

the Eleventh Amendment. The United States also intervened,

but for the sols purpose of defending the constitutionality of

the ASA; it took no position on the Eleventh Amendment issue.

2. a. The Abandoned Shipwreck Act. By its terms, the

ASA applies only to shipwrecks that meet each of the following

criteria:

1. The shipwreck must be “abandoned”; and

2. The shipwreck must be located on “submerged

lands of a state;” and

Pe OO OE Pt le Rx tng

3. The shipwreck must be either embedded in the

sea floor, or be listed in (or determined by the Secretary

of Interior to be eligible for listing in) the National

See 43 U.S.C. § 2105(a). In enacting ASA, the federal

government asserted title to all shipwrecks that meet each of

the above-enumerated criteria. Jd. The federal government then

conveyed that title to the states on whose submerged lands such

shipwrecks are located. See 43 U.S.C. § 2105(c). Thus, in

enacting the ASA, the federal government exercised its sovereign

ive to claim title to shipwrecks that meet the criteria

spelled out in the Act, and then conveyed that title to the states

on whose submerged lands the wrecks are located. See 1988

U.S.C.C.A.N. 367 & 375. The ASA specifies that title to such

shipwrecks shall no longer be determined under the federal

common law of salvage; however, federal salvage law shall

continue to apply to wrecks that do not meet the criteria spelled

out in the Act. See 43 U.S.C. § 2106(a) & (b).

The ASA effectively divests the federal courts of their

admiralty in rem jurisdiction over wrecks that meet the Act's

criteria. See Zych v. The Seabird, 941 F.2d 525, 530 (7th Cir.

1991). However, the ASA makes equally clear that the federal

courts retain their admiralty jurisdiction over shipwrecks that

do not meet the criteria set forth in the Act. See 43 U.S.C.

§ 2106(b) (“This chapter shall not change the laws of the United

States relating to shipwrecks, other than those to which this

chapter applies.”). Thus, Congress cautioned that it

intend[ed] to carve out a limited exception

from general admiralty principles for those

classes of shipwrecks to which this Act

applies. All other shipwrecks ... remain

subject to the uniform principles of admiralty

law, except as may be provided in other

federal law.

Abandoned Shipwreck Act of 1987, H.R. Rep. 100-514(II),

100th Cong., Ist Sess. 2, 1988 U.S.C.C.A.N. 365, 377.

b. California Public Resources Code section 6313.

California Public Resources Code section 6313 purports to vest

the State of California with title to “all abandoned shipwrecks

and all archaeological and historic resources on or in the tide

and submerged lands of California.” Calif. Pub. Res. Code

§ 6313(a). The statute further provides that all shipwrecks that

have been on the State’s submerged lands for more than 50 years

shall be presumed to be archaeological and historic resources,

and thus shall belong to the State — apparently even if not

abandoned. See § 6313(c). Unlike the ASA, section 6313 is not

limited only to wrecks that are embedded in the sea floor or

listed in the National Register of Historic Places.

3. a. The district court Convenes An Evidentiary

Hearing To Determine Whether The ASA Applies To The

Brother Jonathan. Because the parties disputed whether The

Brother Jonathan meets the criteria set forth in tt *SA and

California Public Resources Code section 6313, it was...» ssary

for the district court to convene an evidentiary hearing on that

issue. Indeed, even the federal government recognized the need

for an evidentiary hearing, noting that “[sJeveral key factual

issues must be resolved in order to determine whether the ASA

even applies to the Brother Jonathan.” See May 31, 1994

Memorandum Of The United States in Support of

Constitutionality of the Abandoned Shipwreck Act, at p. 6 (not

reproduced in appendix).

Accordingly, the district court convened two evidentiary

hearings in order to determine whether The Brother Jonathan

a eee

SE Ee p> at

Pe ay Ney

meets the criteria set forth in the ASA and section 6313. The

district court later explained that “[t)he purpose of the two

hearings was not to determine the merits of any party's claim to

the Brother Jonathan, it was simply to determine whether the

ASA and California Public Resources Code section 6313 apply

to the Brother Jonathan,” and thus, whether the district court

had jurisdiction to proceed in the matter. See Pet. App. A24 &

n. 3. The district court recognized that if The Brother Jonathan

meets the criteria set forth in the ASA, the court would have no

jurisdiction over the matter; and the court explained that it “has

the jurisdiction to hear matters that decide its own jurisdiction.”

See Reporters’ Transcript of September 9, 1995 Hearing, at p.

10:6-8 (not reproduced in appendix).

The first hearing was held on September 9, 1994 — more

than two years after the State intervened in the action. At that

hearing, California did not present a single witness or other item

of evidence showing that The Brother Jonathan meets any of

the criteria set forth in the ASA or section 6313. This was despite

the fact that the State had more than two years to conduct

discovery, investigate the facts, and otherwise prepare for the

hearing. Nevertheless, the district court continued the matter

until September 27, 1994 to give the State an additional

opportunity to present evidence on the question of whether The

Brother Jonathan shipwreck meets the criteria set forth in the

ASA and section 6313.

At the September 27 hearing, the State presented live

testimony from several witnesses including a professional

historian and a Senior California State Archaeologist. Although

DSR did not present any live witnesses at the hearing, it did file

multiple declarations and other documentary evidence four

months prior to the hearing. These included declarations from a

marine archaeologist, a marine geologist, several salvage

experts, a diving and underwater technology expert, and sonar

and navigational experts — all of whom stated that The Brother

Jonathan does not meet the criteria set forth in the ASA. The

State did not depose any of the declarants, nor did it subpoena

any of them to testify at the hearing — despite the fact that

California had the declarations in its possession for fully four

months prior to the hearing.

After hearing all of the evidence, the district court issued a

comprehensive, 50 page memorandum and order denying the

State's motion to dismiss. The district court concluded that the

evidence showed overwhelmingly that the shipwreck was not

abandoned, not embedded in the sea floor, and not listed in or

determined eligible for listiny in the National Register of Historic

Places.’ Accordingly, the district court concluded that because

the shipwreck does not meet the criteria set forth in the ASA,

California has no claim to the wreck under the ASA and this in

rem action is not barred by the Eleventh Amendment as an action

“against a state.” See Pet. App. A29-A44. The court also ruled

that California Public Resources Code section 6313 is preempted

by the ASA, to the extent that it purports to grant California

title to, or regulatory authority over, ~ class of shipwrecks

ereader than Ghat encempassed by the ASA. See Pet. Agp. AAé-

A47.

Thereafter, the district court issued an order appointing DSR

custodian and salvor of the wreck. See Pet. App., at A60-A61.

However, the district court specifically declined to decide the

issue of title to the wreck. See id. at A61. (“The court does not

at this time make any Order as to . . . title to or distribution of

any artifacts recovered from the wreck.”).

b. Appeal To The Ninth Circuit. The State of California

2. It is undisputed that the State did not even petition the appropriate

agencies to list the Brother Jonathan in the National Register of Historic

Places until after it filed its notice of appeal to the Ninth Circuit in this case.

then appealed to the Ninth Circuit (the panel consisting of Judges

Kozinski, D.W. Nelson and Schroeder), which unanimously

affirmed in a published opinion. See Deep Sea Research, Inc. v.

The Brother Jonathan, 102 F.3d 379 (9th Cir. 1996); Pet.

App. I.

The appellate court agreed that California Public Resources

Code section 6313 is preempted to the extent that it purports to

vest the State with title to shipwrecks not encompassed by the

ASA. The court explained that Congress, in enacting the ASA,

made clear that the states receive title from the federal

government to only those shipwrecks meeting the criteria spelled

out in the Act; title to all other shipwrecks continues to be

governed by federal admiralty law and such shipwrecks remain

subject to the exclusive admiralty jurisdiction of the federal

courts. See Deep Sea Research, Inc., 102 F.3d at 384; Pet. App.

A8. Accordingly, section 6313 is preempted to the extent that it

purports to give the State title to shipwrecks that do not meet

the requirements of the ASA. See id.

Turning to the Eleventh Amendment issue, the Ninth Circuit

held that the district court had properly required the State to

prove that the ASA applies to The Brother Jonathan. The

appellate court explained:

[A] federal court has both the power and duty

to determine whcther a case falls within its

subject matter jurisdiction. [citations).

Therefore, it was appropriate for the district

court to require the State to present evidence

that the ASA applied to the Brother Jonathan,

i.e., that it was abandoned and either

embedded or eligible for listing in the

National Register, before dismissing the case.

Otherwise, as DSR points out, the State could

receive immunity simply by asserting that it

was entitled to it. For a federal court to

renounce jurisdiction over an admiralty case

on the basis of a mere assertion of entitlement

to immunity on the part of the State is

inconsistent with the court's duty to assess

whether it has jurisdiction.

Deep Sea Research, Inc., 102 F.3d at 386; Pet. App. Al1l-A12.

The Ninth Circuit also addressed the State’s assertion that

the district court erred in the merits of the State's

claim to The Brother Jonathan in the context of its Eleventh

Amendment analysis: “We find that ... the party asserting

immunity has the burden to establish that it is entitled to

immunity even if the determination of that issue touches the

merits of the claim.” /d. at 387; Pet. App. A13. The appellate

court also explained that the district court did not adjudicate

the State's rights in the course of determining whether The

Brother Jonathan meets the criteria spelled out in the ASA:

The ASA does not vest title to wrecks that

Satisfy its requirements directly in the state.

Rather, it provides that the federal

government may assert title to such wrecks.

See 43 U.S.C. § 2105(a). Only after the

federal government takes title to the

abandoned shipwreck may title then be

transferred to the state. 43 U.S.C. § 2105(c).

Thus, a federal court may adjudicate the

question of whether a wreck meets the

requirements of the ASA without implicating

the Eleventh Amendment.

Id.; Pet. App. A13-A14 (emphasis in original; footnote omitted).

, the Ninth Circuit concluded that the district court

dons deta tntantinn ten the Suahes Seman wn at

“abandoned” for purposes of the ASA. The appellate court noted

that abandonment could be found either by an express

renunciation of title by the owner, or by circumstances giving

rise to an inference that the owner has relinquished title — such

as the passage of time without any effort on the owner's part to

recove: the wreck. Jd. at 387-88; Pet. App. A15. The Ninth

Circuit concluded that the district court had properly found that

neither test was met here. There was no evidence of any express

renunciation of title by the original owners or their insurers;

and furthermore, the circumstances did not permit an inference

of abandonment. The appellate court noted that several insurance

companies paid claims for loss of the wreck, and they took title

by subrogation. There was no evidence that those insurance

companies did not attempt to recover the wreck or otherwise

engage in conduct giving rise to an inference of abandonment.

Id.; Pet. App. A16-A17. Furthermore, in light of the undisputed

evidence showing that the technology necessary for locating and

recovering the wreck was not available until very recently, the

insurers’ failure to locate or recover the wreck in the years since

its sinking could not support an inference of abandonment. /d.

Given this evidence, the Ninth Circuit concluded that the district

court did not clearly err in finding that the wreck was not

abandoned.

° that

The Ninth Circuit also rejected the State's argument

the allegedly uninsured portions of the wreck should be deemed

abandoned:

We decline to divide the wreck of the Brother

Jonathan into een sary myn

ons for purposes 0 or

ee First, if we were to find that the

vessel had been partially abandoned, both the

federal court and the state court would be

adjudicating the fate of the Brother Jonathan.

It is unlikely that Congress intended such a

confusing and inefficient approach in

adopting the ASA.

Second, such an approach is inconsistent

with the general rule in maritime law of

treating wrecks as a legally unified res... .

Having concluded that the Brother Jonathan

should be treated as a unified res, the

question remains, should the wreck be

considered abandoned ... or should the

vessel be considered not to have been

abandoned . . . ? Because the law is reluctant

to find abandonment [citation], and because

a finding of partial abandonment would

deprive those holding title to the

unabandoned portion of the wreck access to

the federal forum, we hold that the Brother

Jonathan was not abandoned. We reserve the

question of whether there is some point at

which the portion of the wreck that is insured

soonnshduses entueston Sopemte

i for the

the ASA. r

Id. at 102 F.3d at 388-89; Pet. App. A18-A19.

California's Subsequent Petition For Rehearing And

Suggestion For Rehearing En Banc Was Denied By The Full

Ninth Circuit. A timely Petition for Certiorari followed.

REASONS FOR DENYING THE WRIT

THE DISTRICT COURT DID NOT VIOLATE THE

ELEVENTH AMENDMENT BY CONVENING AN

EVIDEN “IARY HEARING TO DETERMINE WHETHER

THE BROTHER JONATHAN MEETS THE CRITERIA SET

FORTH IN THE ASA.

The State of California intervened in this in rem admiralty

action and moved to dismiss the case, citing the Abandoned

Shipwreck Act. The ASA applies only to shipwrecks that meet

each of the criteria enumerated in the Act. The wreck must be:

1) “abandoned”; 2) located on “submerged lands of a state;”

and 3) either embedded in the sea floor, or listed in (or

determined by the Secretary of Interior to be eligible for listing

in) the National Register of Historic Places. See 43 U.S.C.

§ 2105(a). If a wreck meets each of these criteria, several

consequences follow. First, the federal government asserts title

over the wreck. See 43 U.S.C. § 2105(a). Second, the federal

t transfers its title to the state in whose waters the

wreck is located. See id. Finally, the federal admiralty laws of

salvage and finds do not apply to the wreck, and the federal

courts have no in rem admiralty jurisdiction over it. See 43 U.S.C.

§ 2106(a); Zych v. The Seabird, 941 F.2d 525, 530 (7th Cir. 1991).

Conversely, if a wreck does not meet each of the criteria set

forth in the ASA, it continues to be subject to the in rem admiralty

jurisdiction of the federal courts, and title is decided by the

federal courts under the traditional admiralty laws of salvage

and finds. See 43 U.S.C. § 2106(b); The Seabird, 941 F.2d

at 530.

Here, the State asserted that it owns The Brother Jonathan

under the ASA and that accordingly this case is barred by the

Eleventh Amendment as an action “against a state.” Application

of the ASA criteria turned upon disputed issues of fact.

Accordingly, it was necessary for the district court to convene

an evidentiary hearing to determine those issues. The district

court explained that “[t]he purpose of the two hearings was not

to determine the merits of any party’s claim to the Brother

Jonathan, it was simply to determine whether the ASA ...

applies] to the Brother Jonathan,” and thus, whether the district

court had jurisdiction to proceed in the matter. See Pet. App.

A24 & n. 3. After hearing all of the evidence, the district court

found that The Brother Jonathan does not meet the ASA’s

criteria. Those factual findings were affirmed by the Ninth

Circuit. Having lost, the State now complains that the district

court violated the Eleventh Amendment by deciding the very

question placed in issue by the State: whether

_— the ASA applies

As noted above, the question of whether the ASA applies

to The Brother Jonathan carries with it several aeatiidee

consequences for the federal government and the federal courts

alike: The ASA vests the federal government with title (at least

initially) to all wrecks that fall within the purview of the Act;

the federal admiralty laws of salvage and finds do not apply to

such wrecks, and the federal courts have no admiralty in rem

jurisidiction over them. Surely, the Eleventh Amendment does

not deprive the federal courts of their power to determine the

application of federal statutes — particularly where, as here,

application of the statute carries with it so many important

consequences for the federal government jurisdicti

wane , al g nt and the jurisdiction

Because the holding of the district court, as affirmed by the

Ninth Circuit, clearly does not run afoul of the Eleventh

Amendment, no significant legal issue is presented and further

review by this Court is unwarranted.

a a

—_— _——

Il.

THERE IS NO CONFLICT AMONG THE CIRCUITS

ON THE ELEVENTH AMENDMENT ISSUE DECIDED

BELOW.

The State contends that there is a conflict among the circuits

on the Eleventh Amendment issue decided below. However, that

is not the case. No circuits have endorsed the proposition taken

by California here — i.e., that a state should be permitted to

intervene into an in rem admiralty action, assert a bald and

completely unsubstantiated claim to the vessel under the ASA,

and thereby automatically divest the district court of its

jurisdiction without any evidentiary showing that the wreck

meets the criteria spelled out in the statute. Only two other

circuits have addressed this issue since the enactment of the

ASA: the Sixth Circuit in Fairport International Exploration,

Inc. v. The Captain Lawrence, 105 F.3d 1078 (6th Cir. 1997),

and the Seventh Circuit in Zych v. The Lady Elgin, 960 F.2d 665

(7th Cir. 1992). The Sixth Circuit in The Captain Lawrence cited

with approval the decision below and explicitly followed it. See

105 F.3d at 1083 (also indicating that there was no split in the

circuits on this point).

The State makes much of a supposed conflict between the

decision below and the Seventh Circuit's holding in The Lady

Elgin. However, The Lady Elgin is clearly distinguishable from

the instant case. In The Lady Elgin, the salvor specifically

requested that the district court issue an order requiring that

“all governments, governmental agencies, and states be required

to show cause” why the salvor should not be awarded title. 960

F.2d at 667 (emphasis added). The State of Illinois (on whose

submerged lands the wreck was located) intervened and moved

to dismiss the case based on the Eleventh Amendment, or in the

alternative, to exclude the State from the scope of any judgment.

Although the district court initially granted the State’s motion

and ruled that Illinois would be excluded from any judgment,

the district court later held that the wreck was owned by a

foundation established by the salvor and issued an injunction

against Illinois to that effect. 960 F.2d at 668. The Seventh

Circuit reversed the district court's order granting the injunction

against the State, explaining that the Eleventh Amendment

prohibits the federal courts from granting “relief against a state

in its own name.” 960 F.2d at 670. However, the Seventh Circuirt

specifically declined to hold that the entire action was barred

by the Eleventh Amendment, as advocated by the State here: the

court simply struck down the injunction against Illinois, allowing

the case to proceed in all other respects. 960 F.2d at 670.

In The Lady Elgin, the injunction requested by the salvor

and issued by the district court specifically enjoined the State

of Illinois, by name, from interfering with the salvor’s title to,

or possession of, the wreck. Thus, the injunction was Clearly

“against a state” for purposes of the Eleventh Amendment. By

contrast, in the instant case DSR has never asked for an

injunction against the State of California in its own name.

Indeed, the injunction that was ultimately entered by the district

court was narrowly crafted to enjoin only “competing salvors,

would-be salvors, and divers.” See Pet. App., at A62-A63. The

State readily admits that it falls into none of those categories.

Therefore, this is not an action “against the State” for purposes

of the Eleventh Amendment and The Lady Elgin is

distinguishable.’

3. The State cites a case from the First Circuit, Maritime Underwater

Surveys, Inc. v. The Unidentified, Wrecked And Abandoned Sailing Vessel,

717 F.2d 6 (1st Cir. 1983), as additional support for it argument that there is

a conflict among the circuits with regard to application of the Eleventh

Amendment in in rem admiralty cases. However, in that case, as in The Lady

Elgin, the salvor asked the district court to issue an order requiring that “all

(Cont'd)

on Nei Ona

ee eee ee ae ne

ar A OO a

vessel be cited to appear before this Honorable Court and show cause why

possession should not be delivered to Plaintiff as having full title .... 717

F.2d at 6-7. Because the salvor in Maritime Underwater Surveys sought an

injunction against the State of Massachusetts, in its own name, the action

was clearly “against a state” for purposes of the Eleventh Amendment. 717

F.2d at 8. See also Fitzgerald v. The Unidentified, Wrecked And Abandoned

Vessel, 866 F.2d 16, 18 (ist Cir. 1989) (though nominally an in rem action

against a vessel, case was in fact “against a state” for purposes of the Eleventh

Amendment where salvor prayed for an order enjoining the State from

interfering with the salvage and ordering the State to show cause why title

should not be vested in the salvor.). No such relief was requested against the

State of California in this case.

Maritime Underwater Surveys is distinguishable from the instant case

in several other important respects, as well. Most significantly, in that case it

was undisputed that the vessel in question was both abandoned (it was a 200

year old pirate ship), embedded (it was buried beneath five feet of sand), and

located on the State's submerged lands (less than 1/4 mile off the beach at

Wellfleet, Massachusetts). 717 F.2d at 6. The First Circuit was careful to

note that its holding was narrow and applies only to abandoned wrecks that

are “lodged within the seabed” of a state's submerged lands. 717 F.2d at 8

(emphasis added). In the instant case, however, the district court found thar

the evidence clearly shows the Brother Jonathan is neither abandoned nor

lodged in the seabed; and the Ninth Circuit declined to disturb those findings

on appeal. Accordingly, the rule stated in Maritime Underwater Surveys is

simply inapplicable on its face.

, and perhaps most important, the First Circuit's decision in

e.. ~ sheen Surveys was rendered well before the effective date of

the ASA. Like the Ninth Circuit's earlier decision in Marz v. Guam, 866 F.2d

294 (9th Cir. 1989) — which the Ninth Circuit in the instant case expressly

disavowed as no longer controlling after the enactment of the ASA, see Deep

Sea Research, 102 F.3d at 385-86; Pet. App. Al0-All — the Maritime

Underwater Surveys decision simply cannot be taken as an accurate statement

SS ee an ne

Even if the injunction issued by the district court in this

case could somehow be construed as being “against the State”

— such that the Seventh Circuit’s decision in The Lady Elgin is

pertinent — still there is no conflict between the holding in that

case and the ruling below. The Seventh Circuit recognized that,

even on the facts before it, “some view of the merits [of the

state's claim] is inevitable” in determining whether the case is

barred by the Eleventh Amendment. 960 F.2d at 670. That is all

that occurred here — albeit in a factual context different from

that presented in The Lady Elgin. In the instant case, unlike in

The Lady Elgin, the issue was not whether the Eleventh

Amendment bars a specific injunction admittedly issued against

a state in its name, but rather whether an in rem action against a

vessel is barred in its entirety as being an action “against a state.”

The district court and the Ninth Circuit found that this in rem

action against The Brother Jonathan was not an action “against

the State” of California because the State’s claim to the wreck

(Cont'd)

as & reaction to the confusing and often contradictory line of pre-ASA cases

involving state control of abandoned shipwrecks. In enacting the ASA,

Congress sought to clarify the law in this area once-and-for-all, and in a

uniform way. See H.R. Rep. No. 100-514, 100th Cong., 2d Sess., Pt. I, at 2

(1988), reprinted in 1988 U.S.C.C.A.N. 365, 366. Congress’ solution was

simple, and distinctively federal: The ASA vests the federal government with

title (subsequently transferred to the states) to shipwrecks that meet the criteria

set forth in the ASA, but provides that title to all other shipwrecks shall be

governed by the federal law of salvage and finds.

This is not to say that the ASA in any way abrogates the states’ Eleventh

Amendment immunity. Rather, because the ASA sets forth the standards for

determining title to shipwrecks, the Courts in post-ASA cases must now look

to those standards in deciding whether an in rem action against a wreck is in

fact an action “against a state” barred by the Eleventh Amendment. See Deep

Sea Research, 102 F.3d at 387; Pet. App. All & Al4n. 5. Thus, the analysis

followed in Maritime Underwater Surveys — a pre-ASA case — is no longer

pertinent.

ee ee

was predicated upon the ASA, and the evidence indicated

overwhelmingly that the wreck does not meet any of the

requirements set forth in the ASA. Thus, there is no conflict

between the holding below and the Seventh Circuit's decision

in The Lady Elgin.

To the extent that The Lady Elgin and the decision below

can be construed as conflicting in any respect, the state of the

record below makes this case unsuitable for resolving that

conflict. The State of California intervened below, asserting that

it owns The Brother Jonathan under the ASA and California

Public Resources Code section 6313. However, the State

completely failed to present any probative evidence showing

that The Brother Jonathan meets any of the criteria set forth in

the ASA or section 6313. In fact, DSR presented compelling,

undisputed evidence that The Brother Jonathan does not meet

any of the criteria of the ASA or section 6313: it is not

abandoned, not embedded in the sea floor, and (at least at the

time of the district court’s ruling) not listed in or determined

eligible for listing in the National Register of Historic Places.

In light of the record below, a ruling for the State in this

case would require the Court to hold that a state can intervene

in any in rem action, assert a bald and completely unsubstantiated

claim to the property that is the subject of the action, and thereby

automatically transform the case into an action “against the

State” barred by the Eleventh Amendment, divesting the district

court of its jurisdiction without permitting the district court to

make any inquiry into the jurisdictional facts. If this Court were

to adopt a rule requiring states in such circumstances to make

anything more than a bald and completely unsubstantiated claim

to the property, such a rule would not disturb the decision below.

Il.

THE DECISION BELOW DOES NOT IMPLICATE

ANY ISSUES OF SUCH NATIONAL IMPORTANCE AS TO

MERIT A COMMITMENT OF THIS COURT’S TIME,

ATTENTION, AND RESOURCES.

The State suggests that the decision below will have

disastrous consequences for the efforts of California and other

States to manage and protect “historically significant resources,”

and that the sky surely will fall unless this Court grants the

petition. That is pure hyperbole. Any burdens faced by the states

in this context have been imposed by Congress — which, in

enacting the ASA, declared that states have title to only those

shipwrecks that meet the criteria set forth in the statute. The

fact that a state which intervenes in a federal in rem action and

moves to oust the federal court of its jurisidction must first

demonstrate that the particular shipwreck in fact meets the ASA

criteria is hardly a novel concept; when a state moves to dismiss

a case on the ground that it is barred by the Eleventh Amendment,

the state has always been required to demonstrate, as a threshold

matter, that the action is indeed one “against a state.” See

a Tribe of Florida v. Florida, 116 §. Ct. 1114, 1131

Although in this case both the district court and the Ninth

Circuit concluded that California had not sustained its burden

of proving that The Brother Jonathon meets the ASA criteria

(leading to the conclusion that this is not an action “against a

state”), there is no reason to believe that this burden will prove

to be unduly onerous to the states in most instances. For instance,

in Fairport International Exploration, Inc. v. The Captain

Lawrence, 105 F.3d 1078 (6th Cir. 1997), the Sixth Circuit

adopted the rule of law followed in the instant case, but reached

a different conclusion on the facts — finding that the State of

Michigan had demonstrated that the wreck in that case meets

the criteria set forth in the ASA.

To the best of Respondent's knowledge, this is the only case

in which a federal court has decided that a state has not made a

sufficient claim to a shipwreck under the terms outlined in the

ASA. In all other post-ASA shipwreck cases, federal courts

determined their own jurisdiction to decide a state’s claim of

Eleventh Amendment immunity, and then promptly dismissed

the case when the state came forward with the necessary

showing. Because the decision below rests upon California's

complete failure to demonstrate that The Brother Jonathan meets

any of the criteria set forth in the ASA, its import is limited to

its facts. For this reason, certiorari should be denied. See Rice v.

Sioux City Mem. Park Cemetery, 349 U.S. 70, 74 (1950) (“This

Court does not sit to satisfy a scholarly interest in such issues.

Nor does it sit for the benefit of particular litigants.”).

IV.

THE COURT OF APPEALS DID NOT ERR IN

HOLDING THAT THE ASA PREEMPTS CALIFORNIA

PUBLIC RESOURCES CODE SECTION 6313.

Throughout this litigation, California has asserted two

separate statutory bases for its alleged claim to The Brother

Jonathan: the ASA and California Public Resources Code

section 6313. However, those two statutes clearly conflict with

one another.

In enacting the ASA, Congress sought to clarify — once

and for all, and in a nationally-uniform way — the considerable

uncertainty and inconsistencies that had existed with regard to

title to abandoned shipwrecks. See H.R. Rep. No. 100-514, 100th

Cong., 2d Sess., Pt. I, at 2 (1988), reprinted in 1988

whose waters the wrecks are located). The ASA specifically

provides that shipwrecks which do not meet the requirements

set forth in the statute shall continue to be subject to the exclusive

admiralty jurisdiction of the federal courts, and title to those

shipwrecks shall be decided in accordance with federal maritime

inten[t] to carve out a limited exception from

general admiralty principles for those classes

of shipwrecks to which this Act applies. All

other shipwrecks - ++ Femain subject to the

uniform principles of admiralty law, except

as may be provided in other federal law.

House ASA Report at 8, 1988 U.S.C.C.A.N. at 377 (emphasis

reat oner he selma ad str sears ure

California might state law would apply, where

the ASA does not. eotert

In enacting California Public Resources Code section 6313,

the State seeks to claim title to a much broader class of

shipwrecks than those defined in the ASA. Whereas the ASA is

limited to abandoned shipwrecks that are either “embedded” in

the sea floor or listed in the National Register of Historic Places,

section 6313 purports to vest California with title to all

shipwrecks on State submerged lands for more than 50 years —

whether or not abandoned, embedded, or listed in the National

Congress’ stated goal of a final, nationally-uniform disposition

of title to abandoned shipwrecks, and would upset the delicate

balance of competing interests that Congress created when it

defined a specific, limited class of shipwrecks to convey to the

stetes. Indeed, as made clear by the legislative history cited

above, the ASA was enacted precisely for the purpose of

eliminating the confusion and uncertainty created by a maze of

differing state legislation regarding shipwrecks.

Not only does section 6313 frustrate Congress’ purpose in

enacting the ASA, but it also plainly conflicts with the ASA in

several important respects. First, the ASA begins from the

premise that the federal government has title to shipwrecks

meeting the criteria spelled out in the Act. See 43 U.S.C.

§ 2105(a). The states obtain title to such shipwrecks only by

grant from the federal government. See 43 U.S.C. § 2105(c).

Section 6313 plainly conflicts with the ASA, in that it purports

to vest California with title to those same shipwrecks in its own

right and by its own legislative fiat — when the federal

government has asserted its original title to such shipwrecks

pursuant to the ASA.

Furthermore, section 6313 also conflicts with the ASA to

the extent that it purports to vest the State with title to shipwrecks

that do not meet the criteria spelled out in the ASA. The ASA

specifically provides that questions of title with regard to

shipwrecks not encompassed by the ASA will continue to be

governed by traditional federal maritime law — not by state

law. Sunply put, Congress has spoken on the question of defining

the class of shipwrecks to which the states may make legitimate

claims of title. The State of California cannot now baldly assert

that the ASA did not mean what it said in limiting that class to

abandoned and embedded wrecks and that “[t)his Act shall not

change the laws of the United States relating to shipwrecks,

can aaa those to which this Act applies.” See 43 U.S.C.

Apparently attempting to re-write the Court of Appeals’

decision in order to provoke certiorari, the State suggests that

the appellate court's preemption analysis was based on an

erroneous assumption that federal admiralty courts have

exclusive jurisdiction to decide questions of maritime law. That

is a classic “straw man” fallacy. A simple examination of the

holding below makes clear that the appellate court concluded

that section 6313 is preempted by the ASA — not by some vague

notion of supposedly exclusive federal jurisdiction over

questions of maritime law. See Deep Sea Research, 102 F.3d at

384; Pet. App. A7-A9. Intentionally or unintentionally, the

State's petition completely mischaracterizes the Court of

Appeals’ preemption analysis.

The Court of Appeals did not err in holding that California

Public Resources Code section 6313 is preempted to the extent

that it purports to vest the State with title to shipwrecks that do

not meet the requirements set forth in the ASA. No other court

has taken a position contrary to that held below. b

no substantial question is presented for this Court in that regard.

Vv.

WHETHER THE BROTHER JONATHAN IS

ABANDONED IS A QUESTION OF FACT UNSUITABLE

FOR REVIEW BY THIS COURT.

With respect to the State's third “question presented,” it is

manifest that the State is simply seeking Supreme Court review

solely in order to dispute factual findings made and affirmed

below.‘ It is well-established that whether a vessel has been

abandoned is a question of fact to be reviewed by the courts of

appeal for clear error only. See The Captain Lawrence, 105 F.3d

at 1082; Columbus-America Discovery Group, 974 F.2d at 467.

Whether a vessel is embedded in the sea floor is also a question

of fact. See The Seabird, 941 F.2d at 530.

After hearing all of the evidence, the district court below

held that The Brother Jonathan is not abandoned and is not

embedded in the sea floor. The Ninth Circuit expressly affirmed

the finding of non-abandonment, and left undisturbed the finding

of non-embeddedness. This Court has frequently held that it

“cannot undertake to review concurrent findings of fact by two

courts below in the absence of a very obvious and exceptional

show of error.” Graver Mfg. Co. v. Linde Co., 336 U.S. 271,

275 (1949); see also Goodman v. Lukens Steel Co., 482 U.S.

656, 665 (1987). Indeed, this Court’s own rules make clear that

a petition for writ of certiorari should not be granted where, as

here, the alleged error consists of an assertedly erroneous factual

finding. See S. Ct. R. 10.

4. Petitioner's intimation, Pet. 20, that the Ninth Circuit's decision, to

treat the Brother Jonathan as a unified res, is in conflict with the Fourth

Circuit's opinion in Columbus-America Discovery Group is purely fanciful.

Even a superficial reading of the Columbus-America decision indicates that

that court there extended every evidentiary presumption so that the property

found on board that wreck would be treated in a unified fashion. See 974

F.2d at 464-465 and n. 6.

Undeterred, Petitioner seeks to create the appearance of a

legal issue (ostensibly worthy of review of this Court) by

suggesting that there is a split among the circuits as to the

meaning of abandonment under the Abandoned Shipwreck Act.

In making this argument, Petitioner is apparently conceding what

it had refused earlier in its Petition to admit: that the ASA is,

after all, relevant to a state’s claim of ownership of a shipwreck.

In any event, the alleged circuit conflict is illusory. Petitioner

contends that the district court and the Ninth Circuit below

committed an error of law in holding that abandonment cannot

be found except by the owner’s express renunciation of title.

Petitioner contends that this alleged error was shared by the

Fourth Circuit in Columbus-America Discovery Group v.

Unidentified, Wrecked and Abandoned Sailing Vessel, 974 F.2d

450 (4th Cir. 1992). In fact, neither the courts below nor the

Fourth Circuit in Columbus-America Discovery Group required

an express renunciation of title as a prerequisite to establishing

abandonment.

The ASA does not define “abandonment.” Therefore, both

the district court and the Ninth Circuit below applied the

‘zaditional definition of abandonment, long-established under

the general maritime law, pursuant to which abandonment can

be established either by demonstrating that the original owner

affirmatively renounced title, or by proof of circumstances

giving rise to an inference of abandonment. See the Ninth

Circuit's opinion below, at Pet. App. A16 (quoting the district

court's holding below). This is the same standard that was

applied by the Fourth Circuit in Columbus-America Discovery

Group, which also recognized that abandonment can be

established by inference. See Columbus-America Discovery

Group, 974 F.2d at 461-462 and 464-465 (recognizing that

shipwrecks may be inferred to be abandoned under certain

circumstances). This standard has been embraced by every

circuit. There is no “split” in that regard.

In the State’s real complaint here is not with any alleged

legal ee conflict among the circuits, but with the factual

findings of the enuita belen ~— beth ot whieh bald Gast So Se

of this case do not support an inference of abandonment.

factual finding is not appropriate for review by this Court.

tioner also excoriates the Ninth Circuit's holding that

on cemhenthetieher tiidaaimmbueates

res for the purpose of determining whether it is abandoned.

Petitioner suggests that this approach differs from the approach

taken in Columbus-America Discovery Group, where the ooo

Circuit concluded that part of a wreck may be abandoned, whi

other parts may be non-abandoned. However, Columbus-

America Discovery Group was not an ASA case. Thus, unlike

here, the abandonment issue in that case did not carry with it

any jurisdictional consequences. The Ninth Circuit below wisely

decided teat, in an ASA cans, tae chigused: erest Bo Sonnet

either entirely abandoned or entirely non-abandoned. To ho

otherwise would be to permit the possibilicy that part of the

wreck could be governed by the ASA (and thus subject to state

jurisdiction), and part governed by federal maritime law (and

thus subject to jurisdiction of the federal courts). Such

conflicting and overlapping jurisdiction would prove completely

unworkable in practice. Because Columbus-America Discovery

Group was not an ASA case, those considerations were not an

issue there. Thus, there is no “conflict” between the holdings

below and the Fourth Circuit’s decision in Columbus America

Discovery Group, because that case is clearly distinguishable.

Once again, however, Petitioner's real complaint is not with

any legal saree applied by the courts below, or any a

“circuit split” with regard to those legal principles. Peti oner

has made clear from the beginning of this litigation that it

demands complete and exclusive control of The Brother

Jonathan, in its entirety. Petitioner's interests would not be

satisfied in any way were this Court to hold that the courts below

should have applied the “partial abandonment” approach adopted

by the Fourth Circuit in Columbus-America Discovery Group.

Such a ruling would resolve nothing; Petitioner would still be

stuck with the lower courts’ factual finding that at least some

parts of the wreck are not abandoned. It is that factual finding

which is the true object of Petitioner's ire. However, this Court

is not in the business of reversing factual findings made by a

district court and affirmed by a court of appeal.’

CONCLUSION

Because both the district court and the Ninth Circuit

correctly concluded that this in rem action is not an action

“against a State,” the Eleventh Amendment does not apply here

and there was no error below. Accordingly, no significant legal

issue is presented for review by this Court. Contrary to the

petitioner's suggestion, there is no conflict between the holding

below and the Seventh Circuit's holding in The Lady Elgin, or

the Fourth Circuit’s holding in Columbus-America Discovery

Group, as those cases are clearly distinguishable. Finally,

because the decision below turns on its unique facts, it sets no

sweeping precedent and implicates no issues of national

importance warranting review by this Court. Accordingly, and

for each of these reasons, Respondent Deep Sea Research, Inc.

respectfuily requests that the petition for writ of certiorari be

denied.

5. Petitioner suggests that the Ninth Circuit's ruling mandates that an

entire wreck be found non-abandoned — and thus, outside the purview of the

ASA — even if only a tiny portion of its cargo is non-abandoned. In fact,

however, that is not the case presented here, and the Ninth Circuit wisely

“reserve(d] the question of whether there is some point at which the portion

of the wreck that is [non-abandoned] becomes so negligible that the wreck

might be considered aoandoned for the purposes of the ASA.” Pet. App. A19.

Because that issue was not decided below, it should not be decided here.

STUART M. GORDON

FLETCHER C. ALFORD

Counsel of Record

GORDON & REES, LLP

Attorneys for Respondent

20th Floor

Embarcadero Center West

275 Battery Street

San Francisco, California 94111

(415) 986-5900

Of Counsel:

DAVID J. BEDERMAN

c/o University of Virginia

School of Law

580 Massie Road

Charlottesville, Virginia 22903-1789

(804) 924-3942

APPENDIX A — MEMORANDUM AND ORDER OF

THE UNITED STATES DISTRICT COURT FOR THE

NORTHERN DISTRICT OF CALIFORNIA DATED

JULY 1995 °

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

C 91-3899 LCB

DEEP SEA RESEARCH, INC.,

Plaintiff,

THE BROTHER JONATHAN, her appurtenances, furniture,

cargo, etc.,

Defendant,

and

THE STATE OF CALIFORNIA, STATE LANDS

COMMISSION, and the UNITED STATES OF AMERICA,

Intervening Defendants.

MEMORANDUM AND ORDER

BECHTLE, J. JULY , 1995

Presently before the court is intervening defendant, the State

of California, State Lands Commission’s (“State”), motion to

stay the court’s Orders of March 15, 1995, as amended on May

4, 1995, and April 5, 1995, pursuant to Rule 62(d) of the Federal

Appendix A

Rules of Civil Procedure. The State has requested that the court

stay these orders pending the State’s appeal of the court’s denial

of its motion to dismiss plaintiff Deep Sea Research, Inc.’s

(“DSR”) admiralty in rem action against defendant, the wreck

of the Brother Jonathan, her appurtenances, furniture and cargo

(collectively “Brother Jonathan”). For the reasons set forth

below, the State’s motion will be denied.

I. BACKGROUND

The State’s motion for a stay of the court’s orders pending

appeal represents the latest chapter in a saga which began with

the sinking of the steamer Brother Jonathan on July 30, 1865.

On that day, the Brother Jonathan sank in a storm off the coast

of Crescent City, California, with the loss of 147 passengers

and crew. Legend has it that the Brother Jonathan was carrying

a shipment of gold coin and specie bound for the Northwest

Territories.' The ship came to rest in 250 feet of water, where it

remained undisturbed for 128 years.

In October 1993, DSR located the wreck of the Brother

Jonathan using sophisticated sonar and diving equipment. The

company promptly filed an admiralty in rem action stating a

1. Recent newspaper articles have reported that the Brother Jonathan

was rumored to be carrying a shipment of $2 million in gold (1865 valuation)

and a $250,000 payroll for the U.S. Army (also 1865 valuation). (Pi.’s Br.

in Support of Mot. for Issuance of Warrant of Arrest, Ex. A.) DSR’s treasurer

and director, David L. Flohr, estimates that the present-day value of the

Brother Jonathan's cargo is between $25 million and $50 million. (Flohr

Decl. ¥ 9.) Other commentators have estimated that the value of the ship's

paxirar aia tetaation million. See Robert Miller, Charting the

uture istorical Shipwreck Legislation in California: Application o

the English Model in the Salvage of the Brother Jonathan, 17 Hastings nd

& Comp. L. Rev. 793, 794 n. 7 (1994).

Appendix A

maritime claim against the vessel under Federal Rule of Civil

Procedure 9(h) and 28 U.S.C. § 1333. DSR is seeking an award

of title to the Brother Jonathan and its cargo under the common

law of finds or, alternatively, to a salvage award under the

common law of salvage. As the 130th anniversary of the ship's

sinking approaches, the State and the United States government

have come forward to assert claims of ownership against the

ship and her purportedly valuable cargo.

Shortly after DSR filed its admiralty in rem action, the State

intervened in the lawsuit and filed a motion to dismiss DSR’s

claim against the Brother Jonathan on procedural grounds. In

support of its motion to dismiss, the State claimed that DSR’s

in rem action against the vessel was really an action against the

State because the State had a possessory interest in the Brother

Jonathan under the federal Abandoned Shipwreck Act (“ASA”),

43 U.S.C. § 2101, et seq., and the California Shipwreck and

Historic Maritime Resources Act (“SHMRA”), §§ 6309, 6313

and 6314 of the California Public Resources Code. The State

further claimed that DSR’s action against it was prohibited by

the Eleventh Amendment, and the district court lacked

jurisdiction to adjudicate the merits of any parties’ claim to the

vessel because the State refused to waive its right to sovereign

immunity.

In September 1994, the court held two evidentiary hearings

to determine whether the ASA and SHMRA applied to the

Brother Jonathan, and whether the court had jurisdiction to

proceed with this matter. The State submitted testimony and

documentary evidence at the hearings to support its claim that

the Brother Jonathan is an abandoned, historic shipwreck,

embedded in the subsurface of the State’s territorial sea, and

eligible for listing in the National Register of Historical Places

(“National Register”).

Appendix A

On March 15, 1995, the court issued a detailed,

comprehensive Memorandum and Oder, including findings of

fact and conclusions of law, denying the State’s motion to

dismiss. See Deep Sea Research v. The Brother Jonathan, 883

F. Supp. 1343 (N.D. Cal. 1995). The court found as, a matter

of law, that the California SHMRA is preempted by the ASA

insofar as the SHMRA grants the State a possessory interest in,

and regulatory authority over, shipwrecks that do not qualify

for coverage under the ASA. Deep Sea Research, 883 F. Supp.

at 1357-59. In addition, after carefully weighing all of the

admissible evidence presented at the evidentiary hearings, the

court found that the ASA did not apply to the Brother Jonathan.

Id. at 1351-57. The court found that the State failed to establish

the factual basis for the ASA’s application; i.e., that the Brother

Jonathan is abandoned and embedded in the subsurface of the

State’s territorial sea, or that it is abandoned and the

of the Interior has determined that the vessel is eligible for listing

in the National Register. Id. Moving on to DSR’s claim against

the vessel, the court found that the conditions for an action in

2. In reply brief dated July 3, 1995, the State asserted that the court

did not make any factual findings that the Brecher Jonathan is not abandoned

or embedded. This assertion is incorrect For the purpose of determining

the applicability of ASA, and hence whether the court had jurisdiction to

proceed with this case, the court fist had to determine whether the Brother

Jonathan met the finite criteria st forth in the ASA — that is, whether the

Brother Jonathan was in fact abandoned and embedded, or abandoned and

eligible for listing in the National Register. The “colorability” of the State's

claim to the vessel is pedicated upon the applicability of the ASA. If the

ASA applies, title tc the vessel is vested in the State pursuant to 43 U.S.C

§ 2105(c). If the ASA does not apply, the State has no claim, colorable or

otherwise, to # Brother Jonathan. Since the court found that the Brother

Jonathan does not meet the factual prerequisites of the ASA, title to the

Brother /onathan has not been transferred to the State under the ASA. DSR's

actios against the vessel is not an action

rn Gn oh ete against the State, and the Eleventh

Appendix A

rem appeared to exist under Supplemental Admiralty and

Maritime Claims Rule C(1). /d. at 1359-61. The court entered a

separate order authorizing the issuance of a warrant of arrest of

the Brother Jonathan, and appointed DSR substitute custodian

of the vessel in the place of the U.S. Marshal. Jd. at 1364.

On April 5,1995, the court entered a preliminary injunction

appointing DSR exclusive salvor of the Brother Jonathan,

protecting DSR’s continued right to exclusive possession of

the Brother Jonathan, and protecting DSR from interference

from rival saivors. Jd. at 1361-63. All competing salvors, would-

be salvors, or divers, were enjoined from conducting salvage

operations or collecting artifacts within an are described as a

circle having a radius of 5,200 feet (i.e., a diameter of 10,400

feet), having as its center point a specific geographic coordinate.

Id.

On May 4, 1995, the court amended its March 15, 1995

Order to appoint DSR substitute process server in the place of

the U.S. Marshal. DSR was ordered to serve the warrant of

arrest upon the vessel, and to procure insurance to protect the

Marshal and DSR from any liability assumed in arresting the

vessel and maintaining artifacts recovered from the vessel! in

the court's custody.

The State has never moved the court to reconsider any of

its previous orders. Instead, on April 13,1995, the State filed a

notice of appeal of the court’s March 15, 1995 Order denying

this motion to dismiss.On June 8, 1995, the State filed the instant

motion for a stay of the court's Orders of March 15, 1995, as

amended on May 4, 1995, and April 5, 1995, insofar as these

orders permit DSR to engage in salvage activities at the wreck

site, pending the outcome of the State’s appeal.

Appendix A

The State contends that its “major concern” and purpose in

requesting a stay of the court's order is to “protect and preserve

the shipwreck by maintaining the status quo” while the Ninth

Circuit considers the merits of its appeal. (State’s mem. in

Support of Mot. for Stay, at 2.) The State argues that there is a

strong likelihood that it will succeed on the merit of its appeal

because it believes that it has demonstrated a “colorable claim”

to the Brother Jonathan under Marx v. Government of Guam,

866 F.2d 294 (9th Cir. 1989), a pre-ASA case which the State

contends is the law of the circuit. The State also argues that it

will be irreparably injured if the court's orders are not stayed

because “[)Jermitting salvage activity would be a disaster second

only in magnitude to the sinking of the ship.” (Jd. at 4.) The

State further argues that permitting salvage operations would

harm the public's interest because DSR lacks the funds to

perform a proper archaeological recovery operation “under an

appropriate research design and by a qualified marine

archaeologist.” (/d. at 4-5.) Finally, the State argues that it should

not be required to post a supersedeas bond under Rule 62(d)

because a bond is only required to protect a money judgment,

which does not exist in this case.

DSR vigorously opposes the imposition of a stay of the

court's orders pending the State's appeal. DSR argues that the

State has not made a strong showing of the likelihood of success

on the merit of its appeal. DSR further argues that the interests

of DSR and the public will be irreparably injured if a stay is

implemented because there is a very acute possibility that the

Brother Jonathan will be pillaged by competing salvors or

unscrupulous divers during the time that the Ninth Circuit will

taken to consider the State's appeal. DSR has also pledged to

conduct its salvage operations pursuant to an appropriate

research design and under the supervision of a qualified marine

Appendix A

archaeologist. To this end, DSR has retained James R. Reedy,

Jr., a qualified marine archaeologist, and his company, R2

Underwater consultants, to design its salvage plan and oversee

salvage operations.’ Finally, DSR argues that, if the court is

inclined to grant a stay, the court should require the State to

post a bond in an amount equal to DSR’s expenditures to date,

as well as the value of any gold that may be recovered from the

Brother Jonathan.

the reasons set forth below, the court finds that the

cuss tan toned tn Gunatemias Gh 0 tty Gnas CTT

is warranted. To the contrary, the State’s chances of success on

appeal are minimal, and now that the circumstances of the value,

location and accessibility of the wreck have been widely

there is dangerous ity that the interests of

DSR and the public will be irreparably harmed if DSR does

not immediately begin salvage operations to eliminate the

possibility that the wreck will be plundered.

Il. STANDARD FOR ISSUING A STAY PENDING

APPEAL

Rule 62(d) of the Federal Rules of Civil Procedure,

when on appeal to then fom 0 fieal order or judgment of the

district court, an appellant, upon the filing of a supersedeas

bond, may seek a stay of the district court's order pending

appeal. Fed. R. Civ. P. 62(d). In determining whether < issue 8

stay pending appeal, the district court may consider

following factors: (1) whether the stay applicant has made a

strong showing that he is likely to succeed on the merits,

b DSR submited copies of Reedy’s resume and preliminary salvage

plan as exhibits o its response tothe State's motion fora stay pending appeal.

Appendix A

(2) whether the applicant will be irreparably injured absent a

stay; (3) whether the issuance of a stay will substantially injure

the other parties interested in the proceeding; and (4) where the

public interest lies, Hilton v. Braunskill, 481 U.S. 770, 776

(1987). For stay to issue, each of these elements must be proven

independently. Warm Springs Dam Task Force v. Gribble, 565

F.2d 549 (9th Cir. 1977). Therefore, a showing of a likelihood

of irreparable injury to the appellant will not suffice if it is

unlikely that the appellant will not succeed on the merit of his

appeal. Gribble, 565 F.2d at 551.

Ill. DISCUSSION

A. The State Has Not Demonstrated A Likelihood

Success On The Merits Of Its Appeal “"

In support of its motion for a stay of the court’s orders

pending appeel. the State has simply restated the same logs

arguments that it submitted in support of its earlier motion to

dismiss without offering any new or different legal authority or

evidence to persuade the court that its earlier ruling was incorrect.

The court has already examined and rejected each of the State's

arguments, and it will not, except where necessary, repeat its

seasoning Ser doing 20 in this opinion. There ase, however

arguments advanced the State whi nN

te ~ by which the court will

First, the State has renewed its earlier

argument that the

Se neath henantnaan ty Crating Ge Gime t

prove the factual prerequisites of the ASA. Once again, the State

is incorrect. Under the most basic tenants of our legal system, a

moving party is required to prove that it is entitled to the relief

that it seeks. In this case, the State intervened in DSR’s action

Appendix A

to challenge the court’s jurisdiction; therefore, the court was

required to determine whether the State’s claim that the ASA

divested the court of jurisdiction was valid.

Additionally, it is important to note that the court lowered

the evidentiary threshold that was necessary for the State to

prove that the ASA applied to the Brother Jonathan. Under

traditional principles of admiralty law, abandonment must be

proven by “strong and convincing evidence.” Columbus-

America Discovery Group v. Atlantic Mutual Insurance Co.,

974 F.2d 450, 461-65 (4th Cir. 1992), cert. denied, 113 S. Ct.

1625 (1993). In this case, however, the court lowered the

standard of proof to a of the evidence for the

purpose of its evidentiary hearings. Even under this relaxed

standard of proof, the State was unable to provide sufficient

credible, admissible evidence to establish that either the original

owners of the Brother Jonathan and its cargo, or the successors-

in-interest to the insurance underwriters that paid claims for the

loss of the vessel, have abandoned their ownership interests in

the vessel or its cargo. Nevertheless, the State, unyielding in its

belief that it should not have to prove anything to obtain the

relief that it seeks, has appealed the court's findings. After

reexamining its earlier ruling, the court is not persuaded that its

decision will be overturned on appeal.

Second, the State has put additional emphasis on its earlier

argument that the California SHMRA gives it a possessory

interest in the Brother Jenathan. The court's earlier finding on

this argument is worth repeating: the California SHMRA, insofar

as it grants the State a possessory interest in, and regulatory

authority over, shipwrecks that do not qualify for coverage under

the ASA, is preempted by the ASA.

10a

Appendix A

By enacting the ASA, Congress created a limited exception

to the application of traditional admiralty law to “certain

abandoned shipwrecks, which have been deserted and to which

the owner has relinquished ownership rights with no retention.”

43 U.S.C. § 2101. Under ASA, title to these shipwrecks was

transferred to the states in or on whose submerged lands the

shipwreck is located, and the states were given the authority to

promulgate regulations to guarantee the public’s right to access

and recover these shipwrecks. 43 U.S.C. §§ 2103 and 2105.

The ASA expressly states that all shipwrecks not covered by

the Act shall remain subject to the laws of the United States. 43

U.S.C. § 2106. The California SHMRA, which was enacted

one year after Congress enacted the ASA, goes far beyond the

authority granted to the states to regulate access to abandoned

shipwrecks. The California SHMRA grants the State title to al!

shipwrecks and artifacts resting in State waters for more than

fifty years, regardless of whether these ships have been

abandoned by their owners. To the extent that the California

SHMRA attempts to usurp matters specifically preserved within

the exclusive jurisdiction of federal admiralty law by claiming

an ownership interest in, and regulatory authority over,

shipwrecks that are not covered by the ASA, it is preempted.

B. The State Has Not Demonstrated It Will Suffer

Irreparable Injury If A Stay Is Not Granted

The State contends that it will be irreparably injured if the

court's orders are not Stayed because “[p)ermitting salvage

activity would be a disaster second only in magnitude to the

sinking of the ship.” (State’s Mem. in Support of Mot. for Stay

at 4.) This argument is disingenuous.

First by its own admission, the State has been issuing

lla

Appendix A

permits to salvage the Brother Jonathan since at least 1969.

(State’s Reply Br. to DSR’s Mot. for Issuance of Warrant of —

Arrest, at 4.) It is difficult to imagine why DSR’s court-

supervised salvage of the Brother Jonathan, as opposed to a

State-supervised salvage, would be as disastrous as the loss of

147 lives in thunderous sea.

Second, contrary to the State’s assertion, DSR is not about

to tear down the pyramid to plunder the pharaoh’s tomb. DSR

has committed itself to conducting its salvage operations in an

archaeologically sound manner, under the on-site supervision

of a qualified, experienced marine archaeologist, and in

accordance with a detailed salvage plan designed to maintain

the historical value of the vessel. According to the salvage plan

submitted to the court, the Brother Jonathan will be thoroughly

mapped and photographed prior to the removal of any artifacts,

any artifacts recovered will be carefully preserved and stored,

and DSR will make its collected data available to the public

through publication in popular and scientific literature. (DSR’s

Resp. Br., Ex. B.) Moreover, the renewal of the court's

preliminary injunction in 1996 and the amount of any recovery

that DSR may ultimately reccive as a salvage award, will be

contingent upon DSR’s preservation of the historical and

archaeological value of the Brother Jonathan and its cargo.

See Deep Sea Research, 883 F. Supp. at 1363.

Given the State’s admission that it has been willing to permit

salvage activities on the Brother Jonathan for more than 25

years, the question before the court is not whether to allow

salvage activities at all, but whether DSR is able to carry out its

salvage activities in an archaeologically sound manner. After

carefully examining the entire record of this case, the court is

satisfied that the State’s avowed interest in preserving the

12a

Appendix A

historical and archaeological integrity of the Brother Jonathan

will not be irreparably injured if DSR is allowed to proceed

with its salvage operations under the court’s strict supervision.

C. DSR Will Be Irreparably Injured If The C

Grants A Stay Pending Appeal . ae

DSR has objected to the court’s issuance of a stay of salvage

operations pending the State’s appeal because DSR believes

there is a substantia! likelihood that the Brother Jonathan will

be pillaged or even destroyed by unscrupulous divers or

competing salvors while the parties await the outcome of the

State’s appeal. DSR’s fear is well founded.

The approximate location of the Brother Jonathan is now

a matter of public record. It has been described at length in the

court's previous opinions, and the plaintiff's exclusive salvage

area was outlined in the court’s preliminary injunction.

Moreover, DSR’s exclusive salvage area is visible from shore.

Additionally, DSR has submitted evidence that the discovery

of the Brother Jonathan has attracted much attention in the

salvage and technical diving communities, and many people in

these communities believe that the wreck contains a significant

quantity of gold or other treasures. (See DSR’s Resp. Br., Ex.

B at 5; Harrington Decl. at J] 5-6; Lawson Decl. at ¥ 3; Flohr

Decl. at ] 7-9.) Due to recent advances in diving technology,

the Brother Jonathan is readily accessible to virtually any

experienced diver. (See DSR's Resp. Br., Ex. B at 5; Harrington

Decl. at 6, Lawson Decl. at { 2.) Finally, there is a history of

archaeologically significant shipwrecks in California, including

gold rush era shipwrecks, being destroyed by unscrupulous

divers searching for treasure. (See DSR’s Resp. Br., Ex. B at 5;

Harrington Decl. at {] 7-8; Lawson Decl. at $9 3-8.)

13a

Appendix A

In this case, the combination of access plus incentive creates

an acute risk that the Brother Jonathan will be pillaged by

unscrupulous divers during the several months that this matter

will be in limbo pending the outcome of the State’s appeal.

Under the circumstances, the best alternative is to allow DSR to

begin salvage operations, establish a presence on the wrecksite,

isolate and retrieve any valuable artifacts, and bring these artifacts

into the custody of the court.‘ This will remove any incentive

that exists for outsiders to plunder the wreck. Otherwise, if this

matter is stayed pending the State’s appeal and the wreck is

pillaged or destroyed, all parties will suffer irreparable injury.

There is a second, independent basis for not granting the

State’s motion for a stay pending appeal. As first finder of the

vessel, and by acting in good faith, DSR has earned the right to

exclusive possession of the shipwreck and to be free from

interference by rival salvors. See Deep Sea Research, 883 F.

Supp. at 1362. DSR has expended many years and several

hundred thousand dollars attempting to locate and recover the

Brother Jonathan. Under the law of salvage, DSR is entitled to

recover reasonable compensation for its investment of time,

capital anc industry. See Columbus-America Discovery Group

v. Atlantic Mutual Insurance Co., — F.3d —, 1995 WL 354289

(4th Cir. June 14, 1995). If a stay is implemented, DSR will be

forced to sit idle for several months, or even a year, without

receiving any return on its investr.ent. Although a salvor's

expenses or expected return on investment are not ordinarily

factors to be considered when determining whether the salvage

4. DSR believes the Brother Jonathan's shipment of gold was carried

in 13 Wells Fargo transfer boxes and the ship's safe. (DSR's Resp. Br., Ex.

B at 2; Harrington Decl. at ¥ 5.) Once the shipwreck is thoroughly mapped

and photographed, DSR intends to begin recovery of these items. (DSR’s

Resp. Br., Ex. B at 2, 5.)

l4a

Appendix A

services rendered are meritorious, see Columbus-America, 1995

WL 354289, *14, it would be inequitable for the court to

consider granting a stay of its earlier orders without first

considering the significant time and money expended b, DSR

to achieve its success to date. Based on the poor showing that

the State has made throughout the course of this litigation, the

court finds that DSR would be substantially harmed if it were

divested of its right to exclusive possession of the Brother

Jonathan and forced to wait another year before beginning its

salvage operations.

D. The Public Interest Does Not Favor A Stay

The State contends that the public interest lies in preserving

and protecting the historic cultural value of the Brother

Jonathan, and that “maintaining the status quo” is the best way

to protect the public’s interest. While the court agrees with the

State’s first contention, it disagrees with the second.

First, “maintaining the status quo” does not favor the public

interest because the Brother Jonathan will be salvaged by

someone — if not by DSR, then by the State, a competing

salvor, or by someone more concerned with a quick recovery

of several million dollars than with preserving the historical

value of the wreck. The shipwreck is allegedly worth tens of

millions of dollars, it is resting just four miles off the coast, and

its approximate location has been published across the nation

in the Federal Supplement. It would be naive to think that the

Brother Jonathan will not be the subject of attempts to raise

her cargo if the court's orders are stayed for several months.

Second, staying the court’s orders would have the practical

effect of leaving the ship unguarded for nearly a year. DSR

15a

Appendix A

not be expected to incur the expense of maintaining a 24

on vigil Aone the wrecksite for months on end, and the State

has not expressed a willingness to do so. Moreover, the State

has argued that it should not be required to post a bond to

secure against any potential loss that could be caused by the

unauthorized salvage or destruction of the ship. Without

adequate security, a stay of the court’s orders cannot issue.

inally, DSR has demonstrated that it is committed to

ieee archaeological and historical value of the ship,

and to sharing whatever data or artifacts that it collects with the

public. DSR has retained the services of a qualified, experienced

marine archaeologist to plan and oversee its salvage operations,

and it has pledged to conduct all of its operations with an eye

toward gathering information to share with the public. All of

the artifacts that have been recovered from the Brother Jonathan

to date have been carefully stored and preserved in accordance

with standard archaeological practices. Additionally, DSR is

currently working with the Del Norte County Historical Society

to publicly display these artifacts as part of a local celebration

to commemorate the 130th anniversary of the sinking of the

Brother Jonathan on July 30, 1995. (Harrington Decl. at

4 11.) DSR is also working with the Del Norte County Historical

Society to arrange a permanent display of artifacts recovered

from the Brother Jonathan in a local museum. (J/d.)

In sum, the public cannot enjoy its interest in the Brother

Jonathan unless the shipwreck is properly recovered and the

ship’s artifacts are properly preserved. DSR is ready, willing

and able to carry out salvage activities that protect the interests

of all parties. The court has not basis to find that DSR will not

adequately safeguard the public interest during the course of its

salvage operations. To the contrary, the court finds that an

16a

Appendix A

immediate, professional, strictly supervised, and properly

executed salvage operation conducted by DSR is the best

alternative for protecting the public’s interest, and that a stay of

the court’s orders will be harmful to the public.

E. The Court Will Not Grant A Stay To Give The State

Additional Time To Seek The Inclusion Of The Brother

Jonathan In The National Register

As an alternative basis for seeking the imposition of a stay,

the State has requested that the court grant a stay of its earlier

orders to give the State additional time to nominate the Brother

Jonathan for inclusion in the National Register. The court will

not grant a stay on this basis.

First, the Brother Jonathan's eligibility for listing in the

National Register is speculative, at best. The State has not

presented any convincing evidence to the court that the wreck

meets the criteria for eligibility set forth in 36 C.F.R. § 60.4.

Second, although the State has had years to nominate the

Brother Jonathan for inclusion in the National Register, it did

not see fit to do so until after it filed its notice of appeal.

Presumably, if the State’s nomination is successful, the State

will seek to reopen the record so it can bolster its argument that

the court should not permit the salvage of an historically

significant shipwreck, which is, or may be, a question left to

another day.

Finally, assuming for the moment that the wreck is eligible

for inclusion in the National Register, its listing at some future

date would not change the outcome of the court’s prior decision.

Even if the Brother Jonathan is eligible for listing in the National

17a

Appendix A

i less it was

pre rea by its owner, and the court has already found that it

was not. For all these reasons, the court will deny the State's

request for a stay on this basis.

IV. CONCLUSION

For the reasons set forth above, the court finds that the

State has failed to adequately demonstrate that a stay of the

court’s orders permitting DSR to salvage the Brother Jonathan

is warranted pending the State’s appeal of the court s March

15, 1995 Memorandum and Order denying the State’s motion

to dismiss DSR’s admiralty in rem action against the Brother

Jonathan. The State has not shown a sufficient likelihood of

success on the merits of its appeal, nor has it shown that it will

suffer irreparable injury if a stay is not issued. Consequently,

the State’s motion for a stay of the court’s orders pending appeal

will be denied.

An appropriate Order will be entered.

18a

Appendix A

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

C 91-3899 LCB

DEEP SEA RESEARCH, INC.,

Plaintiff,

Vv.

THE BROTHER JONATHAN, her appurtenances, furniture,

cargo, etc.,

Defendant,

and

THE STATE OF CALIFORNIA, STATE LANDS

COMMISSION, and the UNITED STATES OF AMERICA,

Intervening Defendants.

ORDER

AND NOW, this __ day of July, 1995, upon consideration

of defendant, the State of California, State Lands Commission’s

(“State”), motion to stay the court’s Order of March 15, 1995,

as amended on May 4, 1995, and April 5, 1995, pursuant to

Rule 62(d) of the Federal Rules of Civil Procedure, and plaintiff

Deep Sea Research, Inc.’s response thereto, IT IS ORDERED

that the State’s motion is denied.

LOUIS C. BECHTLE, J.

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.