Raleigh —The Florida company that found the Queen Ann’s Revenge, flagship of the pirate Blackbeard, has filed a civil complaint against the state, alleging a breach of contract that’s resulted in over $8 million in damages.
Intersal Inc. filed on Monday a civil complaint in Wake County Superior Court against Susan Cluttz, N.C. Department of Cultural Resources secretary, the DCR itself and the State of North Carolina. The company is alleging the secretary, the department and the state have committed a breach of contract with the company and are seeking a declaratory judgment from a trial by jury, a temporary restraining order, preliminary injunction and permanent injunction due to alleged violations of a settlement agreement.
The company seeks to enjoin the secretary, department and state from further alleged violations, as well as from recovering artifacts from the QAR site about one mile off Bogue Banks near Beaufort Inlet. It’s also seeking judgment in an amount greater than $25,000, to be determined by a jury, plus prejudgment and post judgment interest.
Cost, expenses and fees, including reasonable attorneys’ fees, are also being sought by the company.
According to the complaint, Intersal discovered the QAR on Nov. 21, 1996 while operating under a permit from the DCR. On Sept. 1, 1998, the company executed an agreement with the state and the department, which the company said in its complaint granted Intersal commercial rights to partner in all aspects of the QAR project, including oversight and exhibition activities.
The agreement also granted the company the right to produce high-quality exact or miniature replicas of the artifacts of the company’s choosing. It also granted exclusive right to all commercial narrative of the project, including operation and exhibition activities, and to produce, co-produce or commission for a documentary film detailing the story of the research, search, discovery and salvage of the QAR.
Intersal says that pursuant to this agreement, it agreed to forego entitlement to any coins and precious metals, to ensure the artifacts remained as one intact collection. The agreement also said the DCR was permitted to determine the ultimate disposition of the artifacts.
This agreement, according to the complaint, was renewed twice, once on Oct. 28, 2012 and again on Dec. 4, 2012, with at least one amendment. Intersal alleges Ms. Cluttz, the DCR and the state violated the agreement by not recognizing the contract renewal option, however.
The company also alleges they violated the agreement’s conflict of interest provisions; DCR employees responsible for oversight of both the QAR project and the company’s El Salvador search permit were allegedly serving on the board of the Friends of Queen Ann’s Revenge, a nonprofit corporation.
Insteral alleges these employees undertook “a pattern of obstruction, delay and failure to follow established procedure” concerning the company’s permit renewal process for its El Salvador search permit. It also alleges the company’s exclusive media rights were violated by the FoQAR an independent media company to create educational documentaries.
On July 26, 2013, Intersal filed a petition for a contested case with the N.C. Office of Administrative Hearings. The office ordered mediation in the matter, and a new agreement was executed Oct. 15, 2013.
In this new agreement, all non-commercial digital media, regardless of the producer, had to bear a time code stamp and watermark from Nautilus Productions LLC (Intersal’s chosen video designee) and/or the DCR, as well as links to DCR, Intersal and Nautilus websites. DCR agreed to display this media only on its own website.
Intersal, however, alleges that despite this, the settlement agreement was violated. It says over 2,000 QAR digital media images and over 200 minutes of QAR digital media video have been displayed on websites other than the DCR’s. These have allegedly been displayed without the required watermark, time code stamp or website links.
It also alleges the company’s permit renewal for the El Salvador search permit continues to be obstructed and delayed and specific settlement mandates haven’t been implemented.
The company alleges settlement agreement partners weren’t properly informed of project activities and opportunities. It said Nautilus didn’t have all the videos it produced returned to it, and “arbitrary and capricious standards and requirements” were set for Nautilus to participate in recovery operations in 2014, which weren’t required of other non-DCR employees and volunteers.
Intersal alleges that it’s incurred at least $8,187,000 in damages, including $6,240,000 for the QAR images and $1,947,000 for the video footage. It said this amount is likely to increase as discovery progresses.
Contact Mike Shutak at 252-726-7081 ext. 206, email email@example.com; or follow on Twitter at @mikesccnt.