The Yacht Law Podcast
The Yacht Law Podcast answers your legal questions about buying, selling, and owning superyachts; working aboard them; and more. Hosted by maritime attorney Michael Moore and yachting journalist Diane Byrne, each episode provides insight into how to better navigate the luxury yachting lifestyle. While we discuss common legal issues, the information shared is not intended as legal advice or as a substitute for the personalized advice of your own attorney. Consider The Yacht Law Podcast as a starting point to better educate yourself about the superyacht world.
The Yacht Law Podcast
Inside Judicial Sales: How Yacht Auctions Really Work
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Thinking about bidding on a seized superyacht? We walk through the real mechanics of judicial sales—what triggers them, how courts run them, and why a properly executed auction can deliver title that holds up worldwide. From sanctions stories like Amadea to bread‑and‑butter arrests for unpaid crew wages, we separate media myths from the rules that actually govern these high‑stakes transactions.
We explain why the U.S. Marshal process is considered the gold standard under the Supplemental Rules for Admiralty and Maritime Claims, including publication, bidding requirements, deposits, and post‑sale confirmation. You’ll hear how foreign courts assess fairness and why cases like Blue Star in Malta matter for cross‑border recognition. We also dig into the uncomfortable stuff, especially how courts judge “prudent” buyers who ignore red flags and chase a bargain. If you’ve ever wondered how KYC, sanctions lists, and source‑of‑funds checks shape who gets to bid, we’ve got stories and specifics.
Finally, being able to conduct a sea trial or survey before bidding is likely impossible, so we share practical due diligence tactics: interviewing crew and former managers, tracing ownership records, and more. We also confront the reality of zombie yachts—uncrewed, uninsured, and decaying fast—and what happens when they result from a judicial sale order. Finally, we outline bidder responsibilities at the courthouse steps, why misrepresenting a principal is a fast track to trouble, and how to make sure the yacht you buy stays yours to enjoy.
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Hiring a lawyer is a big decision. Visit Moore & Company for the legal team's qualifications and experience. And, to learn the latest about superyacht launches, shipyards, designs, and destinations, visit Megayacht News.
Welcome everybody. Michael. I am sitting here looking at the calendar and I am amazed that not only is it December, but we are at the end of our third year of hosting this podcast. Well done.
SPEAKER_02:Crazy. Crazy.
SPEAKER_01:I think it's fantastic.
SPEAKER_02:Time flies, we're having fun.
SPEAKER_01:It has, and it's been incredibly educational. Indeed. So I think it is safe to say that we will go out of 2025 with a bang in terms of the topic that we're covering today. It is a perennial subject and something that's been in the headlines a lot this year, which is the topic of yacht auctions, specifically judicial sales. There are a lot of moving pieces. There are a lot of well-documented processes, too, which because they're well documented, that actually is what has been surprising me this year with a lot of the media coverage. Amadea isn't one that really comes to mind because there was a ton of media coverage. And with that, there were a lot of misassumptions and a lot of misunderstandings in terms of how these sales are held and what happens as a result. But there were a lot of a lot of positing about that nobody other than American would be interested because of the yacht being able to be arrested in another country, the auction being a fire sale, on and on and on. So this is a good opportunity for us to sort fact from fiction when it comes to how this whole process occurs and most importantly, help people understand the issues so that they are better protected if they enter into this as a buyer or in representing a buyer.
SPEAKER_02:Exactly. I think it's not just it's like so many things, you know, it's not just your imagination. There have been more auctions this in the past several years. It's hard to believe, but Amadea was seized about three years ago. There's various estimations as to what it costs. I think the number that I keep hearing is about seven million a year. So the good news is somebody got paid twenty-one million dollars, somebody made money. Auctions have been a way to dispose of assets, and they have become more used in the last two or three years than ever before. There's a lot of reasons for that, but it's something that would behoove somebody who's out there thinking of, you know, they have a situation. Is it a candidate for auctions? So we have we have the auctions that come up through something as simple as an estate liquidation where someone inherits a yacht and now for the first time realizes it's an incredibly expensive asset to deal with, and so that becomes a problem, and you can then maybe use a private auction, but not so much a judicial auction. If things don't get worked out, maybe it'll end up being in the probate proceeding per se, and you'll have uh court orders to get rid of the boat. You have the Amadea situation, which was a Russian oligarch situation. It was just decided on some basis that yachts could be seized for oligarchs ending up on sanctions list in basically the United States, the U.K., and the European Union. They sold this voted auction just recently. It was a by order of a U.S. District Court of the Senate District of New York, and kind of on the virtual courthouse steps, and had a global auction that hit all the bells and whistles. You had a very detailed package, a bid package. You had to, you not only had to fill out that form and do the things that required to enable you to even bid, which is prove you have a net worth of more than$500 million, and then you had to put in a$10 million deposit, and then you had to pass the KYC investigation, and ultimately the boat would be sold at auction to an unnamed individual said to be out of the country of Dubai. But I think that ordinarily what people are aware of is you know, you have unpaid maritime liens. It can be dockage or true wages or mortgages in default or disputes of some sort, things that give rise to a maritime lien. The maritime lien is the hammer of the yacht world. And in places where the liens are recognized, they attach to the vessel. And ultimately, in a number of jurisdictions around the world, that you you'll end up seeing a judicial sale at the vessel.
SPEAKER_01:Trevor Burrus, Jr. Right, right. You know, I'm glad that you were mentioning that there are different reasons why a judicial sale can result. Those are not the only reasons why an asset like a yacht can be seized. Private jets are seized, cars, homes, lots of different things can be seized and ordered to be sold at auction. For our purposes, why don't we go almost kind of like to the ABCs? I think it would be interesting for people to understand that, and you even use the term, there's a whole process in place. There's a very well-documented, long-established process behind how a judicial sale occurs, whether it is for an asset like Amadea that was seized due to sanctions or to something where, say, crew wages are unpaid and a lien was put forth or the owners devote on their mortgage or something along those lines. So how does the whole process start? It's a public process, too, by the way. That's I think something else we should make sure that people understand. It's not a behind closed doors, nobody understands what's going on type of process.
SPEAKER_02:That's correct. The whole idea is you're trying to convert the yacht that's been seized to a liquid asset through the Marshall sale. The person who puts down their money and navigates the yacht away, they want to believe that down the road, whatever they've done will hold up. They're now out of pocket. Now they have a new vessel. What is going to guarantee that that vessel has good title and they'll enjoy what is called quiet enjoyment. They'll have it without being interrupted in their enjoyment of the yacht. So the process, the gold standard that I always call it is the United States Marshal Process. That's where the federal judge has told the marshal to sell an asset, and he does it by the rules. There's a very well-developed set of rules. It's called the Supplemental Rules for Admiralty and Maritime Claims. And it involves, among other things, publication. The first thing you do is publish in a paper of general jurisdiction where the asset is located. You publish twice, 14 days before the sale, and seven days before the sale. Now, you say to yourself, well, that doesn't seem like a lot of notice, 14 days and seven days. But you can always do more. And the Yachty world, I tend to do a lot more most of the time to publicize the sales. I published ads in the New York Times, the Wall Street Journal, places where rich people are tend to read business people or rich people who uh business people who represent rich people. It's always trying to get the word out as much as you can. If a vessel is purchased and somehow ends up being arrested in a different jurisdiction, that will be the line of inquiry by the court in that jurisdiction. They will want to know what did you do? Did you publish the notice? Did you conduct the valuation? Was there a minimum bid? Was it sealed bid auctions, or was it what they call the English auction, which is, you know, one guy bids and it goes up and goes up and goes up. There's an Italian auction, by the way, which the price goes down and down and down until you get an offer. It's crazy. But I mean, these are just historical anomalies. You know, it's finding a buyer for a very expensive asset, and then once you sell it, the court will confirm the sale and the marshal will issue the Marshall's Bill of Sale, which is said to be a powerful document to convey ownership and title to the buyer. And I think that if you think about it, the United States has this overwhelming interest in making sure that these sales are acknowledged and recognized around the world. For example, in Amade, I must have been asked a hundred times if the United States would intervene to defend the title. And I said, I actually have no way of knowing because nobody's asking me that question. But I can assure you the United States is not going to just sit idly by. I think they will intervene to some extent to say we did this thing the right way. And we think it should be a fail. A big deal occurred in 2023 when this lawyer from Malta, I think she got the bit in her teeth on her own. I'm not sure why, but there had been this fairly celebrated case of a ship called Blue Star being arrested in Malta. And I recall that she was involved in that case where the arresting party in Malta tried to say that the judicial sale in Jamaica was invalid. And the court in Malta found that no, it was actually valid, it was done the right way, and therefore the person in possession who had bought the yacht at the judicial sale in Jamaica was in fact the proper owner. But the the whole process is the thing that guarantees the sense of fairness. You know, was it fair? And the court will ask all kinds of questions to see if it was a fair process. That's what it comes down to.
SPEAKER_01:That makes sense. From another standpoint, they're not in the business of holding on to homes, jets, jewelry, cars, yachts, etc. They don't want to be landlords, they don't want to be asset holders that are just going to sit there and deteriorate. So it's it is in their best interest to dot every I and cross every T.
SPEAKER_02:Oh, you know It's sad sometimes when you see these things when they are overturned, when the I's were not dotted and the T's were not crossed. I think you want to just be afraid of that. So you're always trying to do what else can we do? We're not trying to pull a fast one.
SPEAKER_00:Right.
SPEAKER_02:Or we're not trying to blow something by people.
SPEAKER_00:Right.
SPEAKER_02:It's a short-sighted way of going about. These are incredibly expensive assets. You want them to get sold and stay sold. In the Amadea case, there's still a proceeding going on in the United States district courts with the Southern District of New York. There's still a process where a Russian interest is claiming the ownership. But so far they've gotten nowhere. It's not going to affect the sale. The money got put in the court registry. The boat saw it sailed away. I know this. Whenever Moore companies involved in the sale of a vessel, the binder is always a major document of documents. It's the proof who is the beneficial owner. This information may not be known to the world, but it's known to the lawyers about who is your client. And under the KYC rules these days, more often than not, you have to prove who is your client. And so for someone to prove that something was owned by somebody back in the day, I just don't see why that's such a high bar heavy lift.
SPEAKER_01:In reading some of these court proceedings, and particularly the Amadea case, I was actually surprised by how many times that very issue of you have not produced any documentation proving that you are indeed the owner you claim to be has come up. Trevor Burrus, Jr. It's not anything esoteric. It's not anything that anybody would not be accustomed to having to show at some point for some reason to get a flag, to get insurance, to have the bank involved, you know, all the different parties that are always involved in these transactions. There's got to be a paper trail somewhere. It's not, let's just put it this way it's not normal for a handshake to be the purchasing method.
SPEAKER_02:We had a case which I hopefully these moments, these teaching moments, these war stories are helpful and maybe more memorable because of the facts. The court was in the middle of trying to decide if a sale that was valid. Remember, Admiralty is maritime, it's written in the Constitution, it's Article III, Section 2. Boats are a very privileged kind of asset because they move around, they go to different nations, they fly flags of the nations that they are part of. So all of these things are basically part of a global regime. So we're in court in Southern District of Florida, and uh the federal judge in the case basically is listening to these two parties go back and forth as to who should end up without the vote or without the money or vice versa. And uh there had been a woman who had showed up in the court proceeding, and she had been referenced as a lawyer in South Florida trying to sell insurance for yachts to ensure the title. In other words, how do you know that you're getting good title? And so this is the very issue the judge is trying to grapple with, and he said, Would you do the court a favor? Would you take the stand and let me ask you some questions? And what is she gonna do? She's a lawyer by profession, is selling insurance at this point and title insurance. And she took the stand and he said to her, Well, when you're asking for documentation, what do you ask for? And she went through her list. And uh he said, That's the way you know that the person you're selling your title insurance to is now the owner of the boat. That's correct. And through that process, you can also try to establish that then there liens against the vessel. Is that really the major problem with buying boats? And she says, That's right, Your Honor. It's the secret liens, the nature of the liens. They can be secret. They don't have to be recorded. He says, Okay. He told her she could step down. He said, Oh, by what they one more question, how many policies have you sold so far? She says, none. He said, Is the problem, the very problem, the fact that it those are secret liens, and they kind of try to stay secret if they're not disclosed? She says, that's exactly the problem. The people that want to buy the insurance want to be protected against secret liens, but there's really no way to give them decent insurance to protect them against unrecorded liens or so-called secret liens. He then ruled right down the line that a prudent buyer would have asked for the following documents. He went right down her list of her documents. He said, I therefore find that this buyer was not a prudent buyer. In fact, this buyer engaged in willful blindness. This buyer did not have an interest in knowing more about the title because this buyer was getting an$8 million yacht for$4 million. That should have been a clue right there that something was wrong with the deal.
SPEAKER_01:Right.
SPEAKER_02:So I find that the title stays with the seller, the real seller, not the one that claimed to be the seller, and had his interest sold, and that the buyer who spent$4 million thinking he was buying an$8 million boat for$4 million, he's he'll have to give the boat back. And good luck on finding your money. But I mean, it's a real world thing. All of these things are kind of related. So I want to mention one of the because sometimes you see things that are just absolutely crazy. The so-called Magnitsky Act and the Klepto Asset Recovery Initiatives was a recent thing by the United States government to try to help little countries around the world recover assets that were gained by dishonesty in the host countries paying off government officials and using the payoffs, the bribes to buy yachts. And so now you have the yacht in court, and the question is who's the owner of the yacht and do they get to keep it, blah, blah, blah. But I can tell you that very interesting analysis and fact findings by the court as they get into who are you and where did you get your wealth? I think all of that kind of led to the KYC. Where does your wealth come from? How did you make your money? You know, if you if you're a you're operating a 7-Eleven or something, you're not gonna be buying a$40 million motor yacht, you know.
SPEAKER_01:Right.
SPEAKER_02:Anyway.
SPEAKER_01:One of the things that has come up when friends and family have talked to me about what they read in terms of these auctions. One of the questions that has come up, which I think is something that an interested buyer would also n be keen to understand, is having a survey performed with a traditional yacht sale. If they're very interested in the yacht, the buyer will then, of course, pay for the survey to be done. What happens in the case of an auction? Do the bidders themselves say, I would like to not just visit the yacht, but I also want to perform a survey so I understand the condition it truly is in, or does the court have one performed in advance?
SPEAKER_02:They don't. I don't think they do at all. I think that this is a big problem. It's the reason you can get such a deal when you buy these boats at public auction or judicial auction, omartial sales, kind of all the variations of the same thing. But you're rarely entitled to have a sea trial or a survey. You might have a walkthrough, like the Ahmedea, they allowed potential buyers to spend as much time as they wanted on board, but they could not do a sea trial, they could not do a search survey. In actual fact, if once a vessel leaves the jurisdictional limits of the court's jurisdiction, the court no longer has jurisdiction. So the courts are always concerned that vessels will somehow get away. And so this is the reason the price is so much lower. But I I can tell you that if you really know what you're doing to find out about these vessels, interview all of the crew, the people that are on board these boats, they'll talk to you. Sometimes they may want to be paid if they're destitute and they're desperate. You know, will you pay me for my time? But they sure as hell are not going to be flying in on their nickel to help you out. But you can call people and just talk to them. This vessel has any known problems. They're now former employees of a boat. Just ask them, is there anything that you know you'd be concerned about if you're a buyer? You can do a lot of due diligence if you kind of know the drill. I run into this kind of stuff. It's a fairly common thing. Former crew needs a C letter, how much time did you spend on board the vessel? And I have to track down the managers. Maybe the owners are uncooperative. They've just disappeared or what have you. Maybe they got sued and they're angry. But there's a lot of people out there that will always have some ability to help out.
SPEAKER_01:Right. Now, what about a situation where a yacht is what has been referred to sometimes as being a zombie yacht where there's not even a skeleton crew. It's bare minimum if there's even crew on board at all. That I just saw some photos recently of luminosity taken, maybe in the past month. The condition is utterly shocking how poor condition the boat is in. What are the due diligence challenges when it comes to zombie yachts?
SPEAKER_02:Well, I think one of the problems is by definition, almost universally, if your crew walks off the boat, it's at that moment uninsured. It's just a boat that's out there on its own. This much you can take to the bank. Yachts are living in a very hostile environment, which is salt water, the combination of those two things, very damaging, goes down in a hurry, rapid deterioration. If engines aren't used and turned over on a regular basis, they freeze up, they become almost useless. I think the bane of South Florida, by the way, is mold. If you come in from Seattle and you don't understand that you should keep your air conditioning running 24-7, your boat will fill up with mold pretty quickly. You've got to have millions of dollars of damages very quickly. I think that this is part of the problem. I mean, you need to move as quickly as you can to get these vessels that are arrested. If I have a client who's got an arrested vessel, rule number one is get it out from under arrest as soon as possible. Just you can reserve your rights later. Don't try to play games. Well, let's let them pay for it for a while. No, no, you don't want to do that. If you do that, anytime a yacht is arrested, it it's a true wasting asset, deteriorating, rapidly wasting away with the cost rising and the condition plummeting. The zombie yachts are terrible because people don't know what to do with them. A lot of these boats, they're on the quarterhouse steps for a reason. They didn't get there because it's a temporary cash flow problem a lot of times. It's they reach their useful end of their useful life in many cases, right down to the point where they have not paid their crew. That's the probably the senior lien is crew wages. So if you haven't paid your crew, that is a definite sign that the owner is out of money. And if there's no income coming in, it's vessels registered offshore, it's under Liberian flag or you know, some other some other flag. No real way to get to the beneficial owners. And, you know, just generally there's no way to enforce anything. So the crew is just screwed and tattooed, they're on board, and the question they have to decide is, you know, do they just need to get off now and fend for themselves? But only this week we were talking with some shipbreakers out of Pakistan. And it's a very interesting world. And when all else fails, what they're doing is they're gonna they're gonna take that boat apart. They're gonna run it up on the coast. It's not a sophisticated operation in some senses. They'll have two tugboats that do a slingshot. The slingshot is to get that vessel up to speed and heading toward the shore, and it'll just simply drive up on the beach. And then it'll be set upon by thousand shipbreakers. And these are people that just one piece at a time will dismantle the entire vessel and sell the metal off for weight, whatever the going rate is for steel, for example. And that's the end of the line. That is the end of the whole process. But if you're in Miami, Florida, and you have a judicial sale and the rust bucket is put on the courthouse steps, no one bids on it, what are you going to do? And I can tell you what the court will do is declare a non-sale and then have the vessel removed at government expense to put a metal recycled or the Miami River, for example, using the Miami example, and it will be dismantled and torn apart and it will cease to exist. And, you know, hopefully the recycler will make a few bucks. But uh it's a problem that does, in fact, come out of the judicial cell context quite often. What happens when a guy, this happened recently, because he was he was so worried he was going to get killed by drug smugglers, he contacted me and he had the vessel was floating free. This is an inherently dangerous thing. It's a hazard of navigation, it's in marine peril, and he took the boat in, and the boat was being sold on the courthouse steps. There's nothing, there's no title papers on board. Hey, look, it was run by drug smugglers. They don't exactly have titles sometimes. And it's been abandoned basically after any papers were removed, and what was maybe once title documents, the whole numbers erased everything. And so now you just got a can you got a tangible object that needs to needs to be twenty basically torn. In the old days, we just take them out to the middle of five miles off the coast of Florida and scuttle them, but that didn't work so much. That doesn't work so well in the world.
SPEAKER_01:Not so much.
SPEAKER_02:The old days, you know, not good.
SPEAKER_01:Yeah.
SPEAKER_02:But that that's the zombie, the zombie yacht. You got a real lesson in reality.
SPEAKER_01:Yeah.
SPEAKER_02:Global reality.
SPEAKER_01:Well, the implications of a judicial sale certainly touch a lot of different people. They can help a lot of different people who might be in a very difficult situation. The court itself has to make sure that they do their part in making sure that every procedure was followed. And that's why you get a maritime lawyer involved if you are indeed considering buying. You make sure that every procedure has been followed. You make sure you can get all the documentation possible. And if something doesn't pass the sniff test, then you don't need to buy it.
SPEAKER_02:Yeah, you know, a lot of times the the day you buy it is the it can be a bad decision. We just had two boats sold up in the panhandle. Both were owned by a judgment debtor. The creditor had both boats arrested as another form of judicial sale. The Brit of Execution goes out to seize the boats. They were seized, or now sold on the courthouse steps. World of the street with one of the boats is it was sold within a week for several hundred thousand dollars less than a bidder had paid at the office. Now ouch. You know, you know, you you it's a small world. One of the boats was bought by a yacht broker who basically chances are the yacht broker is representing a principal. Now the chances are further that that principal may have decided that he didn't really want the boat. So now the yacht broker is on the paperwork, having held himself out to the federal marshal as a principal and the registered bidder, is not now coming up with the money. You can imagine being hauled in front of a federal judge and saying, Well, hang on a second, sir, you showed up with the marshal's sale and declared yourself to the officer of this United States court. And I think what you're trying to tell me now is that that was just, you were just kidding or something, that you're not really the principal. You were actually fronting for someone that you cannot now contact, who's not backing up their play. They wanted to disrupt the sale, or who knows, but all of this is interfering with the administration of justice. So you've got a problem. So here's what we're gonna do. We're gonna give you three days to come up with the money. And uh at the end of that third day, you better be back in front of this shot and in front of this court to explain where we go from here.
SPEAKER_01:Word to the lies, everybody.
SPEAKER_02:Not a good thing. Well, I'll I'm gonna leave you with this. I will just simply tell you if you don't think it's real, you have to be in the courtroom where the woman who had lied to the court that the little man from and he was a diminutive man, he was from Thailand, had come into the court and had testified he was totally credible. He cannot answer questions like, Do you know why you're here? Not really. How did you get here? Well, Mr. Steinberg flew me in. What did Mr. Steinberg tell you? Well, he told me that I would have to take the stand and just read these, explain these numbers on the back of these garments. And uh, did you and that's what you did, isn't it? And he says, That's right. He says, Do you understand? He says, That's what I do for a living. Every number means something. Data manufacture, data delivery. And so basically, this nice gentleman from Thailand, who's in a far and away country, does barely speaks English, but does speak English, has just proven with an absolute fact that the woman had lied on the stand to the court. At that point, these two gentlemen appear in court. One is obviously a United States Marshal, he's got the big badge and so forth. And the judge says, I can see that the deputy marshals have arrived because I have this way of calling those a button underneath the bench. The judge says, take this lady into your custody, give her the Miranda warnings, and take her to the holding facility downstairs until further notice of this court. And you don't want to see that where these two big men go over to this woman and take her to this little elevator that has a metal gate. It goes right downstairs to the judge to the jail, to the federal jail. And the judge looks at everybody in the room, everybody's dead silent, you know, thinking they might be next. Judge says that courts adjourn for today, and we'll see you all back here tomorrow morning at nine o'clock to continue the proceedings. Thank you all. And he walks away. The lies do come up at judicial auctions because people show up off the street and they think they're gonna be funny. They drive up the price or they try to disrupt the proceedings or they try to do things. No, no, you don't want to do that.
SPEAKER_01:Definitely this has been incredibly educational as usual. Thank you for your insight. Everybody, as always, thank you. And especially at the end of the year, we thank you for listening. And we thank you for your suggestions for the topics that we've been covering over these past three years. We look forward to covering more topics of interest to you in the coming years. If you have something you would like us to discuss, if you have a question, even our emails are in the show notes for this episode. Until next time, I'm Diane Byrne. Michael, I will give you the final word for the Yachtlaw Podcast for 2025.
SPEAKER_02:Well, thank you. So I'm Michael Moore, pleased to be signing off. All the best to all of you for a happy holidays and a happy new year.
SPEAKER_01:Happy holidays, everybody.
