Gunboat International, the manufacturer of luxury carbon fiber sailing catamarans, will be sold at auction to the highest bidder, a bankruptcy court has decided.
Johnstone filed for Chapter 11 back in November of 2015, stating that "Gunboat has been quietly struggling behind the scenes for nearly two years."
These struggles included the dismasting and abandonment of Rainmaker, problems with the Chinese-built Gunboat 60, a G4 capsize in April 2015, and production costs at the North Carolina yard. Further investigation into filing documents show that Gunboat had over 100 creditors, with unsecured claims totaling $10,133,947.32.
Gunboat does have the ability to entertain a "stalking horse bidder," which means that if there is a viable initial bid on the business, they can take that as opposed to having to entertain low bids by everyone and their mother.
One of the key components of the filing is a dispute between Gunboat and Hudson Yacht and Marine Industries, a Chinese builder. Johnstone had a contract with the company to build the 60, but currently Johnstone is suing HYM for breach of contract. Johnstone says that HYM never did some work, refused to pay warranty claims on other poorly constructed yachts, is guilty of fraudulent inducement, interference with contractual relations, unjust enrichment, and breach of a non-compete agreement. Johnstone has filed claims that say HYM went and produced a similar brand of carbon fiber catamarans despite the non-compete agreement.
As of April 2014, HYM had completed the manufacture of five of eight vessels for Gunboat, court documents said. Two vessels were in process and one had not been started. “Almost immediately after delivery of each of the completed vessels to Gunboat’s customers, Gunboat began receiving complaints from said customers regarding the integrity of the vessels and/or components manufactured by HYM,” said the amended complaint, which was filed in August.
“They sent out boats knowingly with a lot of items incomplete, with issues, and wouldn’t stand behind them, fix them, visit them, inspect them,” Johnstone said. “They wouldn’t engage with us in any way to sort out the boat and were demanding payments in full.”
The claims against HYM predated Gunboat's Chapter 11 filing. Hudson Marine has, in return, denied the claims and filed a countersuit blaming Gunboat.
