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Goldfinch faces civil suit over marine salvage

  • Thursday, January 2, 2014

State Representative Stephen L. Goldfinch Jr. faces a civil lawsuit over a marine salvage company he helped organize in 2013.

Goldfinch, an attorney who represents the Murrells Inlet area in the South Carolina House of Representatives, was sued by Port Isabel, Texas business associate William E. Kenon Jr.

Kenon claims Goldfinch misrepresented himself in a marine salvage business.

In his complaint, Kenon also states that Goldfinch has been indicted by a federal grand jury over a stem cell business he had. In that case, Goldfinch told the Georgetown Times, he intends to plead guilty because he was a principal of Caledonia Consulting, even though his employee at the time is the one who sold mislabeled stem cells.

Speaking about Kenon’s civil complaint, “The whole thing is baseless and frivolous,” Goldfinch told the Georgetown Times Monday evening. “We’re going to be coming out strong against it.”

Kenon’s attorneys filed the civil lawsuit against Goldfinch on Dec. 24 in federal court in Brownsville, Texas. Port Isabel is near the city on the U.S.-Mexican border.

While Goldfinch said he hasn’t yet been served with the legal documents, he said one allegation reported in a story in the Brownsville Herald “is that somehow, some way I was using my legislative powers.

“I have a salvage agreement that we signed, months and months before I was ever a legislator.”

In addition, Goldfinch said, Kenon claimed that he was going to smooth things over with the state archives department, even though the shipwrecks that form the basis of the salvage efforts are in federal waters.

In his 13-page complaint, Kenon said his salvage vessel Rio Bravo was working off the coast of South Carolina exploring a shipwreck known as The North Carolina. Goldfinch made a “cold-call” to Kenon in Port Isabel and that they could make a lot of money.

Kenon said Goldfinch misrepresented himself, committed fraud, a breach of his fiduciary duty, and converted Kenon’s rights when he formed a LLC (Limited Liability Corporation) that Kenon didn’t agree to do.

In his complaint, Kenon seeks a minimum of $250,000 in damages for his costs in exploration and recover of shipwrecks, to void the Lowcountry Marine Salvage LLC, and to recover attorney’s fees and expenses and court costs.

Goldfinch denies claims

While Goldfinch said he has not been served with the legal documents, he said there is no basis to Kenon’s complaint.

He said Kenon, Goldfinch, Kent Rogerson and several other people met in the same room in Goldfinch’s Murrells Inlet law office with a maritime attorney. That attorney said they needed to form an LLC in order to “arrest” the shipwrecks. That admiralty court term means the group would seek and likely be granted salvage rights to the shipwrecks.

“I tried to get him to sign an operating agreement six or seven times,” Goldfinch said. “He never did.”

“Him claiming that this LLC is a breach of my fiduciary duty is false.

“All of this is an effort to try to push me out of the company,” Goldfinch said.

Kenon called him about two weeks ago, saying he wanted to renegotiate the agreement.

“Kent Rogerson and I have been working for months to try to donate most if not all of the artifacts that we’ve recovered from shipwrecks,” Gold Finch said.

“We have been trying to save these all along, and he has not been helpful.

“I’m hopeful we will be able to donate most of these to the Maritime Museum.”

“There are no assets in the LLC other than the shipwreck arrests,” Goldfinch said. “No money has ever changed hands. He’s never given me a dime.”

“This story is 100 percent false and frivolous,” Goldfinch said.

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