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Lobbyists battle over sunken treasure

While Congress and the White House publicly battled over detainee policy in a new defense bill, a far more obscure fight erupted behind the scenes involving treasure hunters, doubloons and shipwrecks.

A small tweak in the House version of the defense bill — just two words and two commas — could have made it easier for a Florida-based treasure hunting firm to take custody of a $500 million trove of Spanish coins from an Atlantic shipwreck, which is believed to be the single richest bounty ever recovered from the sea.

The little-noticed proposal became the focus of a quintessential Washington lobbying battle waged almost entirely behind closed doors, with the potential fate of hundreds of millions of dollars in booty hanging in the balance.

The change in language, pushed by the company’s lobbyists and a group of Florida lawmakers, alarmed the Spanish government and the Obama administration, which said it feared the impact it might have on the treatment of other sunken warships, which are viewed as both archaeological sites and hallowed graves.

In the end, the arguments backed by the two governments prevailed, with the proposed shipwreck language stricken from a final conference bill approved by House and Senate negotiators late Monday.

“I don’t know who’s right about the dispute over the buried treasure, but it’s in litigation so I think the courts should sort out what’s right,” said Rep. Robert E. Andrews (D-N.J.), who objected to the provision. “This doesn’t strike me as an issue that Congress should be getting involved in.”

This Washington lobbying tale begins at the bottom of the Atlantic Ocean south of Portugal, where a Tampa-based salvage company, Odyssey Marine Explorations, recovered 17 tons of gold and silver coins and other loot in 2007 from a wreck it has dubbed the Black Swan.

But Spain and many marine archaeologists maintain that the treasure comes from the Nuestra Senora de las Mercedes, a 36-gun Spanish frigate sunk by British warships in 1804. The incident marked a key moment in Spain’s history, dragging the kingdom back into the Napoleonic Wars and arguably ensuring the eventual decline of its empire.

The two sides have been battling for custody of the treasure in U.S. federal courts, which have repeatedly sided with Spain, saying the frigate is protected under sovereign immunity laws. The most recent setback for Odyssey came this month, when the 11th Circuit U.S. Court of Appeals declined to revisit a previous ruling.

As the court fight dragged on, however, Odyssey and its Washington lobbying firm, Jenkins Hill Consulting, embarked on an alternate path to help Odyssey’s case: a wording change to a 2004 law called the Sunken Military Craft Act. At issue is a section of the law defining “sunken military craft” as “any sunken warship, naval auxiliary, or other vessel that was owned or operated by a government on military noncommercial service when it sank.”

The U.S. and Spanish governments have said in court documents that the language means all warships are protected by sovereign immunity. But Odyssey and their supporters argue that the statute should be read to mean that warships being used for nonmilitary activity at the time they were sunk are not covered by the law’s protections.

A narrower definition could mean that a wreck such as the Mercedes, which was carrying privately owned coins and other goods from South America to Spain under military protection, would be open for private salvage.

The company and its lobbyists decided that a language change to clarify the issue would be the best solution. Jenkins Hill reached out to several Florida lawmakers, including Rep. Connie Mack (R) and Sen. Marco Rubio (R) for help in getting the language change inserted into this year’s defense authorization bill. Mack was successful; Rubio was not.

Odyssey spokeswoman Laura L. Barton said the language change also was sought to clarify the law for future salvage operations. She accused the Obama administration of playing politics, pointing to WikiLeaks documents indicating that U.S. diplomats offered to help Spain in the case in return for assisting a U.S. citizen’s claim to a painting, now in a Spanish museum, allegedly stolen by the Nazis. (The documents suggest that Spain rebuffed the offer.)

“This administration continues to make it difficult for U.S. businesses to operate and succeed,” C. Scott Barnhart of Jenkins Hill said.

The State Department, U.S. Navy and many marine archaeologists disagree, in part because numerous countries, including the United States, historically have used military ships to aid private citizens or merchants. Opening up the definition, they argue, would run counter to traditional treaty obligations.

“Sunken warships are historic sites and the grave sites of sailors and soldiers lost at sea in the service of their nation,” said James A. Goold of Covington & Burling, who represents Spain. “It’s incredible that in defense legislation of all places someone would try to slip in a measure apparently intended to encourage treasure hunters to loot sunken warships.”

The dispute over the Mercedes is part of a broader, global debate over control of undersea treasure, which has become far easier to locate and retrieve with the help of robots and other advanced technology.

“When it’s just finders keepers and there’s nobody to answer to, all sorts of things can happen,” said James P. Delgado, who testified for Spain and is now maritime heritage director at the National Oceanic and Atmospheric Administration. “Generally, we’ve found that when it’s open season, there is more capacity for abuse.”

Deputy Editor, National Politics


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