A federal judge has ruled that a Mamaroneck shipyard owes $1.6 million to the owner of a yacht it was supposed to refurbish.
U.S. District Judge Vincent Briccetti upheld an arbitration finding that Robert E. Derecktor Inc.”™s work on the M/Y Independence was unfinished and defective.
The Independence is owned by Ducky-Momo LLC, a Delaware company managed by Matthew J. Bruderman, chairman of a merchant banking and private equity investment firm.
The 96-foot Independence was built by the Burger Boat Co. in 1984 and purchased by Ducky-Momo for $662,500 in 2013.
Derecktor was founded in 1947 with the goal of building the finest yachts in the world, according to a 2012 affidavit by the founder”™s son, E. Paul Derecktor.
Bruderman asked Derecktor in 2013 for an estimate to refit and repaint the yacht. Derecktor personnel inspected the vessel at the Seawanhaka Corinthian Yacht Club in Oyster Bay, Nassau County, and again at the Mamaroneck shipyard.
Derecktor estimated $343,835 for the job, according to court records, and Ducky-Momo deposited $100,000 to start work in 2014.
But the relationship quickly became cantankerous. The shipyard cut off the back of the yacht, rendering it incapable of being placed back in the water, according to Ducky-Momo. Then Derecktor allegedly advised that painting would cost three times more and other charges would also be higher.
Ducky-Momo refused to pay invoices, according to Derecktor”™s side of the story.
They agreed to settle their dispute in late 2014. Ducky-Momo would pay a $200,000 outstanding balance and the shipyard would continue the repairs.
The dispute boiled over again, with Ducky-Momo claiming that work was not being completed and the shipyard claiming it was owed $535,735.
In 2015, Bruderman and a crew tried to take the Independence back to Seawanhaka. Mamaroneck police were called and the men were escorted off the grounds.
Derecktor demanded arbitration to settle the matter, and had the Independence “arrested” to keep it at the shipyard.
A panel of the American Arbitration Association awarded Derecktor $56,107 in 2016, in the first phase of arbitration, for work that was done.
The Independence was released from arrest in 2017, when both sides made $331,000 security deposits.
Last April, the arbitrators ruled that Ducky-Momo was entitled to $1,628,754 for damages to the yacht, unfinished or defective work, and other fees and expenses.
Ducky-Momo asked federal court to confirm the award. Derecktor moved to vacate or modify the award.
Judge Briccetti disagreed with the shipyard”™s arguments that the arbitrators had exceeded their authority.
He upheld the arbitration award but did not formally enter a judgment against Derecktor, because the shipyard has a pending claim for $248,969 for keeping the vessel safe and seaworthy while the Independence was under arrest.
Until that issue is resolved, Briccetti found, it would be premature to assess damages.
Manhattan attorneys John D. Kimball and Alan M. Weigel represent Bruderman and Ducky-Momo. San Francisco attorney David J. McMahon represents Derecktor.
