For three decades, Nautica International Inc. built high-end rigid-hull inflatable boats in Broward County designed to be used by the well-to-do to scurry back and forth between their yachts and the shore.
But the local company sank around New Year’s Day, costing 57 Nautica employees their jobs. Investor and tech multimillionaire Tom Gonzales and Miami Lakes-based BankUnited Inc., among others, were left to fight over the remains.
BankUnited forced the company into involuntary bankruptcy Feb. 2, and Nautica’s equipment and other assets were sold at auction Oct. 24. The case has also landed in Broward Circuit Court where BankUnited has sued over an unpaid $1.6 million line of credit, and Gonzales’ entity has made a $40 million counterclaim.
“Both parties are at fault. I don’t know who to blame. It’s a tragedy,” said Deborah Young, who co-founded the company in 1983. She later sold her share, but retained ownership of the Pembroke Pines warehouse where it did business.
Gonzales made his money in Silicon Valley through the software company Commerce One Inc., a pioneer in e-commerce, before relocating to South Florida about two years ago. He formed USA RibTech LLC for the purpose of acquiring Nautica’s assets.
The struggling company defaulted on a $1.6 million line of credit from BankUnited. Gonzales positioned himself to renegotiate the debt and take possession of the company’s core assets.
“There was a debt to BankUnited, but Mr. Gonzales did not assume that debt and had no obligation to the debt,” said Miami attorney Steve Mishan, who is of counsel at the Fort Lauderdale firm of Conrad & Scherer and represents RibTech and Gonzales’ interest.
Gonzales appeared optimistic last year.
He released a statement in November 2011 saying: “Nautica will be celebrating its 30th year in business, and we are very excited to be a part of it. While true the current economic conditions did affect Nautica and a lot of other companies, it appears things are changing. We are seeing an influx of welcomed new orders.”
The hopefulness soon dissipated as BankUnited moved to seize Nautica’s assets — physical equipment such as forklifts, fuel tanks and dollies — pledged as collateral for the line of credit.
After BankUnited filed the bankruptcy case, it filed suit in Broward Circuit Court against RibTech and Nautica, seeking repayment of the credit line.
In the counterclaim filed in February, RibTech alleged BankUnited maneuvered to seize the assets illegitimately when it forced Nautica out of business.
“Mr. Gonzales’ effort to keep the business open was principled in keeping those people working,” Mishan said.
BankUnited attorney Anna Marie Hernandez, a partner at Hunton & Williams in Miami, did not return calls for comment by deadline. The bank also declined to comment. Franco Rossi Jr., the former owner of Nautica, could not be reached for comment by deadline.
Gonzales was in negotiations with BankUnited on the money owed late last year, Mishan said. The lawyer said he wasn’t at liberty to say how much he offered to pay to satisfy the promissory note because of attorney-client privilege.
“Gonzales was not out to hurt the bank,” he said.
But BankUnited would not blink. A judge approved an emergency motion of replevin in January to recover Nautica’s assets, which included equipment needed to stay in business.
Once the equipment was seized, Nautica could no longer operate.
RibTech’s counterclaim alleged BankUnited’s motion for replevin was a ruse, telling Chief Broward Circuit Judge Peter Weinstein that RibTech could abscond with the company’s assets.
“There was absolutely no threat the assets were being concealed or disposed of, especially in light of the fact that USA RibTech allowed the bank to inspect its assets,” the counterclaim states. “The plaintiff falsely swore that the assets were in danger of being concealed, moved or dissipated.”
But Young asserted that Gonzales abandoned the Pembroke Pines warehouse after refusing to pay rent, leaving it a shambles. He moved operations to a hangar at Fort Lauderdale Executive Airport where BankUnited caught up with him.
“Talking to Debbie Young is like talking to BankUnited,” Mishan said. “They are arm-in-arm; they are our adversaries.”
He said, just like BankUnited, Gonzales didn’t owe Young for up to $180,000 in back rent. Mishan said Young refused an offer of $45,000, so Gonzales vacated the premises and moved his operations.
RibTech’s counterclaim notes that the Broward court reversed the emergency order of replevin after Nautica’s equipment was seized after Rib Tech presented its argument.
BankUnited, though, refused to return the items so that the company could resume business. And as of Oct. 24, the nuts and bolts and even the intellectual property of what was once Nautica, now belonged to another company.
Eric Rubin, vice president of Moecker Auctions Inc. said the Nautica equipment was sold for $69,000.
The bank had estimated Nautica’s collateral was worth $200,000, according to BankUnited’s state court suit.
Dania Beach-based Nautical Ventures South Inc., a leading retailer of sailboats, kayaks, inflatable and other watersports-related products and accessories, outbid a handful of others. RibTech was not a bidder.
Those in the boating community certainly took notice of Nautica’s plight.
On Yacht Forums, a poster named Shazam wrote on Jan. 1 under the heading “Anyone know what happened to Nautica?” The post reads, “I drove by their factory a couple of weeks ago and all was normal, two days later everything was gone.”
Young said she started the company with her late husband, Franco Rossi Sr., in 1983 and sold her shares in 2008 to her stepson.
“This has broken my heart,” she said of Nautica’s closing. “I was part of this business for a long, long time.”