1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 SAUSALITO YACHT HARBOR, Case No. 24-cv-09322-DMR

8 Plaintiff, ORDER GRANTING PLAINTIFF’S 9 v. MOTION FOR INTERLOCUTORY VESSEL SALE 10 M/V SELENE, A 1989 BAYLINER MOTOR YACHT OF APPROXIMATELY Re: Dkt. No. 31 11 38.2 FEET IN LENGTH AND 13.4 FEET IN BEAM, U.S. COAST GUARD 12 OFFICIAL NO. 957265, AND ALL OF HER ENGINES, TACKLE, 13 ACCESSORIES, EQUIPMENT, FURNIS, 14 Defendant.

15 Plaintiff Sausalito Yacht Harbor brings this in rem action to satisfy maritime liens related to 16 Defendant M/Y Selene (the “Vessel”). Default was entered against the Vessel on April 29, 2025. 17 [Docket No. 29.] Plaintiff then filed this Motion for Interlocutory Vessel Sale and Authorization to 18 Credit Bid. [Docket No. 31, “Mot.”] Plaintiff has consented to magistrate judge jurisdiction 19 pursuant to

(c). [Docket No. 13].1 Pursuant to Civil Local Rule 7-1(b), the court 20 found this matter suitable for resolution without oral argument and vacated the June 26, 2026 21 hearing. [Docket No. 33.] 22 For the reasons stated below, the motion is granted. 23 1 Section 636(c) typically requires the consent of all parties, including unserved parties. Williams 24 v. King,

(9th Cir. 2017). However, in “in rem forfeiture proceedings, the Ninth Circuit has held that a putative claimant’s failure to comply with the applicable filing requirements 25 precludes standing as a party to the action, such that the property owner’s consent to magistrate judge jurisdiction is not a prerequisite to the entry of default judgment against his interest in the 26 subject property.” KKMI Sausalito, LLC. V. Vessel “Self Inflicted”,

, 204 (N.D. Cal. 2019) (citing United States v. Real Property,

, 1316-17 (9th Cir. 1998)). Indeed, 27 Williams recognized this in rem exception. Williams,

. This court therefore has the 1 I. BACKGROUND 2 A. Factual Background 3 The following background is taken from Plaintiff’s Complaint. [Docket No. 1, “Compl.”] 4 Plaintiff operates a 600 slip marina known as the “Sausalito Yacht Harbor,” located at 5 501 Humbolt Avenue, Sausalito, California 94965. Id. ¶ 2. The Vessel is a 1989 Bayliner motor 6 yacht of 38.2 feet in length and 13.4 feet in beam. Id. ¶ 3. The Vessel is documented with the U.S. 7 Coast Guard under Official Number 957265, and is owned by Vincent Weigel. Id. ¶¶ 3, 5. 8 On May 16, 2014, Weigel executed a Maritime Contract for Private Wharfage (the 9 “Wharfage Contract”), in which Plaintiff agreed to provide wharfage and other services for the 10 benefit the Vessel in exchange for monthly fees. Id. ¶¶ 6-7 & Ex A (Wharfage Contract). Under 11 the Wharfage Contract, fees are due no later than the first day of each month and, if not paid by the 12 15th day, are subject to a late charge of 10% of the sum due. Compl. ¶ 7; id., Ex. A ¶ 5. On May 16, 13 2014, Weigel executed an Addendum to License Agreement – Living Aboard (the “Addendum”), 14 whereby Plaintiff allowed Weigel to live on the Vessel while berthed at Plaintiff’s marina. Compl. 15 ¶ 6 & Ex. B (Addendum). 16 Plaintiff alleges that, beginning in August 2023, the Vessel’s account fell progressively 17 further into arrears. Id. ¶ 9. Despite multiple requests for payments, Plaintiff has not received any 18 payments toward satisfaction of accrued arrearages since April or May 2024. Id. ¶ 10 (“Despite 19 multiple requests therefor, beginning in May, 2024 and continuing to date, PLAINTIFF has received 20 no payments whatsoever toward satisfaction of accrued arrearages, or in payment of monthly fees 21 under the Wharfage Contract and Addendum.”); id. ¶ 15 (“[S]ince no payment toward satisfaction 22 of arrearages for currently due fees were received since April, 2024 . . . .”). 23 On August 5, 2024, Plaintiff sent Weigel a letter demanding payment of the arrearages then 24 due, and notified him of Plaintiff’s election to terminate the tenancy effective September 15, 2024. 25 Id. ¶ 16. The letter further informed Weigel that if the Vessel did not vacate the marina by 26 September 15, 2024, the Vessel would be subject to arrest, and “wharfage fees would accrue at 27 marina’s ‘usual guest/transient rate of $2.00 per foot of vessel length or the length of the slip 1 Marshal.’” Id.; see id., Ex. A (Wharfage Contract) ¶ 37. 2 Plaintiff alleges that it “has provided wharfage services in a workmanlike manner that is 3 consistent with the requirements of the Wharfage Contract and the prevailing industry standards, 4 and it has otherwise fully satisfied all contractual obligations required of it as a maritime services 5 provider.” Id. ¶ 17. 6 B. Procedural Background 7 Plaintiff initiated this action on December 22, 2024, seeking arrest and interlocutory sale of 8 the Vessel. See Compl. On that same date, Plaintiff filed an ex parte motion for issuance of warrant 9 in rem, an ex parte motion for appointment of substitute custodian and for authorization for 10 movement of defendant vessel, and a motion for issuance of warrant in rem. [Docket Nos. 3-5.] 11 The court granted the applications and motion on February 18, 2025. [Docket Nos. 16, 17.] 12 On April 17, 2025, Plaintiff filed a motion for entry of default against the Vessel. The Clerk 13 entered default on April 18, 2025. [Docket Nos. 28, 29.] 14 II. LEGAL STANDARD 15 The Supplemental Rules for Admiralty of Maritime Claims and Asset Forfeiture Actions of 16 the Federal Rules of Civil Procedure (the “Supplemental Rules”) govern maritime actions in rem. 17 Fed. R. Civ. P. Supp. R. A(1)(A)(ii). Supplemental Rule E(9)(a)(i) authorizes courts to order a 18 vessel sold if one of three criteria are met: (A) the attached or arrested property is perishable, or liable to 19 deterioration, decay, or injury by being detained in custody pending the action; 20 (B) the expense of keeping the property is excessive or disproportionate; or 21 (C) there is an unreasonable delay in securing release of the property. 22 “A party moving for interlocutory sale of a vessel need only show that one of these three criteria is 23 met.” Sausalito Yacht Harbor v. S/V SOGGY, No. 19-CV-01268-TSH,

, at *2 24 (N.D. Cal. July 5, 2019), report and recommendation adopted as modified sub nom. Harbor v. S/V 25 Soggy, No. 19-CV-01268-JSW,

(N.D. Cal. Aug. 13, 2019) (citation omitted). 26 Courts should not grant a motion for interlocutory sale unless the defendant has had 27 sufficient time—typically four months—to post a bond to secure the vessel’s release. Bay Marine 1 July 23, 2018) (citing Vineyard Bank v. M/Y Elizabeth I, U.S.C.G. Official No. 1130283, No. 2 08cv2044 BTM (WMC),

, at *2 (S.D. Cal. Mar. 23, 2009)). 3 Upon granting a motion for interlocutory sale: 4 All sales of property shall be made by the marshal or a deputy marshal, or by other person or organization having the warrant, or by 5 any other person assigned by the court where the marshal or other person or organization having the warrant is a party in interest; and 6 the proceeds of sale shall be forthwith paid into the registry of the court to be disposed of according to law. 7 8 Fed. R. Civ. P. Supp. R. E(9)(b). 9 III. DISCUSSION 10 Plaintiff argues all three criteria identified in Supplemental Rule E(9)(a)(i) are met here. 11 Mot. at 7-14. 12 A. Deterioration 13 Plaintiff contends that the Vessel is deteriorating as it sits idle.

. In support of its 14 argument, Plaintiff submits the Declaration of Ray Jones, a licensed yacht broker of 42 years and 15 President of Long Beach Yacht Sales, Inc. Docket No. 32-1 ¶ 1 (“Jones Decl.”). Jones describes 16 himself as “an experienced boater” who has “sold many thousands of vessels over the years.”

17 He has also “served as an expert in many cases involving vessel condition and valuation matters[.]” 18

(citing cases). 19 According to Jones, “[i]t is commonly understood among experienced vessel owners, yacht 20 brokers, and others who routinely deal with boats that even well and regularly maintained vessels 21 inevitably deteriorate in condition and value over time.”

(emphasis in original). He opines 22 that “deterioration is substantially exacerbated when vessels (as in this case) sit idle for extended 23 periods in a salt water environment” and that the “VESSEL can be expected to further deteriorate 24 in condition and value as she sits idle.”

(emphasis in original). This is because “[w]hile an 25 arrested vessel sits idle, her engines, generators and other equipment are not operated under load (if 26 at all), and such disuse can detrimentally impact the condition and value of the vessel.”

Thus, 27 “[t]he longer the DEFENDANT VESSEL remains under arrest the greater the extent of the 1 Plaintiff further argues that the Vessel’s “maintenance is of necessity limited – the focus 2 simply being on preservation from accident,” as required by the Order Appointing Substitute 3 Custodian and Authorizing Movement of Defendant Vessel (“Custodian Order”). Mot. at 8 4 (emphasis in original); Docket No. 17 ¶¶ 4(a)-(f) (ordering Plaintiff to “provide, as necessary under 5 the circumstances, [inspection, general custodial, and minor maintenance] services for the 6 safekeeping and preservation of the DEFENDANT VESSEL”). Thus, while Plaintiff has ensured 7 that the Vessel is preserved, no one has conducted the general maintenance on the Vessel required 8 to prevent deterioration since at least February 18, 2025. 9 The court finds that the Jones Declaration,2 as well as the limited maintenance that is being 10 performed on the Vessel, supports a finding that the Vessel is “liable to deterioration, decay, or 11 injury by being detained in custody pending the action[.]” Fed. R. Civ. P. Supp. R. E(9)(a)(i)(A). 12 A number of California federal courts have accepted Jones’ opinion in connection with a motion for 13 interlocutory vessel sale, including his opinion that vessels that sit idle inevitably deteriorate in 14 condition and value. See, e.g., Tindini P/L v. Bruce, No. 18-CV-04639-EDL,

, 15 at *2 (N.D. Cal. Jan. 15, 2019), report and recommendation adopted, No. 18-CV-04639-RS, 2019

(N.D. Cal. Feb. 6, 2019) (“It is both common sense and supported by Mr. Jones’s 17 declaration that the vessel is likely to deteriorate in condition as it remains arrested without 18 maintenance, which is likely to impact the vessel’s vale.”); Sausalito Yacht Harbor,

5091171, at *2; Pier 32 Marina v. S/V LORENA GRAYCE, No. 19CV1495-MMA (AGS),

584092, at *1 (S.D. Cal. Feb. 6, 2020); Bartell Hotels v. S/L Talus,

, 988 (S.D.

). 22 B. Excessive or Disproportionate Cost 23 Plaintiff contends that the cost of keeping the Vessel in custody is excessive and 24 disproportionate. The Custodian Order sets “wharfage services at the marina’s standard transient 25

26 2 A number of California federal courts, including courts in this District, have accepted Jones’ opinions in connection with a motion for interlocutory vessel sale, including his opinion that vessels 27 that sit idle inevitably deteriorate in condition and value. See, e.g., Tindini,

, at 1 rate of $2.00 per foot of vessel length per day[;]” “custodial services at a rate of fifty cents per foot 2 of vessel length per day[;]” and an inspection of the Vessel’s interior at an inspection rate of $50.00 3 per inspection, to occur at least once a week.

(b)-(d). Plaintiff asserts that, “through June 24, 4 2025 [or 110 days since the Custodial Order], custodial fees will have accrued in a sum of not less 5 than $11,200.00”: vessel storage and general custodial fees in the amount of $10,450 (110 days x 6 $95), plus inspections in the amount of $750 (110 days / 7 days – 15 weeks x $50). Mot. at 11. 7 Based on Jones’ review of “detailed photographs” of the Vessel’s “engines, generator, gear 8 and other appurtenances[,]” he opines that the Vessel has a fair market value of approximately 9 $25,000. Jones Decl. ¶¶ 2-3. This figure incorporates a number of factors that Jones states reduce 10 the Vessel’s value, including significant deferred maintenance, degradation of sacrificial anodes,3 11 contaminated or degraded diesel fuel, potentially compromised fuel injectors, and potentially 12 damaged underwater running gear, such as propeller, struts, and shafts.

. 13 As the custodian fees through June 24, 2025 amount to approximately 45% of the Vessel’s 14 estimated fair market value, the court finds that the costs are excessive and disproportionate. Fed. 15 R. Civ. P. Supp. R. E(9)(a)(i)(B); see Sausalito Yacht Harbor,

, at *3 (fees that 16 amount to over 40% of vessel’s estimated value were excessive); Pier 32 Marina,

, 17 at *1 (“‘Maintenance costs of several thousand dollars per month, particularly where [no attempt 18 has been made] to answer Plaintiff’s Complaint or secure the Vessel’s release, are excessive and 19 disproportionate.’”) (quoting Vineyard Bank,

, at *2; alterations in original). 20 C. Delay in Securing Release 21 Plaintiff argues that an interlocutory sale is also warranted because there has been no attempt 22 to secure the Vessel’s release. Mot. at 9-10. A person or entity may seek the release of an arrested 23 vessel by posting adequate security or by entering into a stipulation to release the vessel. Fed. R. 24 Civ. P. Supp. R. E(5)(a)-(c), E(9)(a)(ii). A person claiming an interest in the arrested vessel is also 25 entitled to a hearing on whether the arrest was proper. Fed. R. Civ. P. Supp. R. E(4)(f). 26 27 1 The record shows that no one has posted security, entered into a stipulation regarding the 2 Vessel’s release, or requested a hearing. “As a general rule, defendants are given at least four 3 months to bond a vessel absent some other considerations.” Bartell Hotels, 445 F. Supp. 3d at 988 4 (quoting Vineyard Bank,

, at *2); see Sausalito Yacht Harbor,

, 5 at *3 (collecting cases finding that a delay of four to six months is unreasonable). 6 The Vessel was arrested on March 6, 2025, 110 days ago as of the date of this order. [Docket 7 No. 20.] While this is just short of the four-month timeframe that courts generally use as a guideline, 8 it does not weigh against a finding of unreasonable delay, particularly where the other criteria of 9 Supplemental Rule E(9)(a) have been met. 10 D. Credit Bid 11 Plaintiff requests authorization to credit bid the lien amount because no other party has 12 asserted any maritime liens against the Vessel, making Plaintiff the senior lienholder. Mot. at 14- 13 15. Local Admiralty Rule 9-2(b) provides that 14 a plaintiff or intervening plaintiff foreclosing a properly recorded preferred mortgage on, or other valid security interest in the vessel 15 may bid, without payment of cash, certified check or cashier’s check, up to the total amount of the secured indebtedness as established by 16 affidavit filed and served by that party on all other parties no later than 14 days prior to the date of sale. 17 18 Plaintiff requests authorization to credit bid the lien amount attested to under oath in the 19 verified Complaint ($19,098.88 in wharfage fees), which will be established by affidavit as required 20 by Local Admiralty Rule 9-2(b), plus its actual and demonstrable costs of suit (including substitute 21 custodian and other custodia logis expenses, but excluding attorneys’ fees), to be calculated through 22 the date of the Vessel’s sale at the rates set forth in the Custodian Order. Mot. at 15. As set forth 23 above, Plaintiff’s custodial fees amount to $11,200. Mot. at 11. 24 The court authorizes Plaintiff to credit bid at the interlocutory sale in the amount of 25 $30,298.88 ($19,098.88 in wharfage fees + $11,200 in custodial costs), provided that Plaintiff files 26 and serves an affidavit 14 days prior to the date of sale that establishes the total amount of the 27 secured indebtedness. See Bartell Hotels, 445 F. Supp. 3d at 989 (granting request to credit bid 1 IV. CONCLUSION 2 For the reasons stated above, the court grants the motion for interlocutory sale and authorizes 3 Plaintiff to credit bid in the amount of $30,298.88, as well as other actual costs of suit, excluding 4 || attorneys’ fees. 5 No later than August 25, 2025, Plaintiff shall file a status report indicating whether the sale 6 of the Vessel has taken place or, if not, when Plaintiff expects such sale to occur. 7 8 IT IS SO ORDERED. 9 10 Dated: June 24, 2025 ll Donna M. Ryu 12 Chief Magistrate Judge

14

15 16 € = 17 6 Zz 18 19 20 21 22 23 24 25 26 27 28