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Supreme Court takes up sunken treasure case

Salvaged gold
Millions of dollars worth of salvaged gold are at the center of a Supreme Court case   
December 1, 1997
Web posted at: 1:31 p.m. EST (1831 GMT)

WASHINGTON (CNN) -- The Supreme Court was to begin Monday hearing a case that involves the state of California, a deep sea research company and a sunken treasure worth millions of dollars in gold.

The case focuses on a sidewheel steamer called "Brother Jonathan," which left San Francisco with gold bullion and an army payroll in 1865. The steamer went down in a storm off Crescent City, where it lay undisturbed for over a century -- until a salvage company called Deep Sea Research hit the gold jackpot, five miles from the coast and 200 feet down.

"The gold that was aboard the ship was valued at about $826,000. Extending that forward to modern day gold value, the value runs up to about $108 million," said company spokesman David Flohr.

The Supreme Court is to decide who really owns this treasure, which is also claimed, at least in part, by the state of California.

"Under the abandoned shipwreck act, the state of California claims that this is a vessel that, one, is abandoned and, two, has been determined eligible for the national register of historic places," said California Assistant Attorney General Joseph Rusconi.

Apart from the ownership issue, the Supreme Court also must decide whether California's 11th Amendment state rights have been interfered with by dredging the case through federal courts. The justices' decision could further bear on the ownership of thousands of wrecks off the coast of many states.

In a recent case off the North Carolina coast, salvagers and state authorities worked together to raise cannons from what was believed to have been the ship of the pirate Blackbeard.

Salvage equiptment
Deep sea salvage has become an issue as new technology makes wrecks more accessible   

California authorities said they would favor a similar kind of partnership. "The way we envision our shipwreck management program working is that it is a cooperative effort between the salvager, the finder and the state," Rusconi said.

But so far the partnership has not come off, apparently because of a disagreement over money. Deep Sea Research offered California 20 percent at most but the state wanted a 50-50 split. "Because we haven't done that they've labeled us pirates and brigands and pillagers," Flohr said.

In the meantime, the multi-million dollar gold treasure remains locked up, until the Supreme Court decides who really owns the gold.

Correspondent Charles Bierbauer contributed to this report.
 
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