Marquis Yachts reached a settlement with European builder VanDutch Marine after filing a lawsuit alleging that VanDutch had breached an agreement for the Wisconsin builder to produce its yachts.
Under the original contract, Marquis agreed to manufacture 120 VanDutch yachts, consisting of all five models, which prompted Marquis to hire additional staff and dedicate part of its manufacturing facility exclusively to building VanDutch yachts, according to a complaint filed in U.S. District Court in the Eastern District of Wisconsin.
“The necessary tooling and molds were delivered late and on a haphazard, piecemeal basis,” court documents read. “When the equipment variously arrived at Marquis’ factory in Pulaski, Marquis' personnel inspected the equipment and found the components largely unusable without substantial refurbishing and rehabilitation.”
The complaint also said VanDutch couldn’t deliver the molds and tooling because of a dispute with S2 Ltd., the company that it had contracted to build its yachts prior to setting up its arrangement with Marquis in late 2013 — a factor that was “unbeknownst” to Marquis.
As a result of that dispute, S2, which is the umbrella company for Tiara Yachts and Pursuit Boats, refused to release the molds, tooling and equipment needed to manufacture the yachts.
Marquis Yachts is owned by J&D Acquisitions, an investment firm led by Irwin Jacobs, who had headed up several Genmar brands, as well as Marquis, as they entered into a high-profile bankruptcy during the Great Recession. He later purchased some brands, including Marquis, back as part of J&D Acquisitions.
“There were some original commitments that they did not meet, and that resulted in some layoffs of some people,” Marquis president Rob Parmentier told Trade Only Today.
Terms of the settlement were not disclosed, but documents said “fraudulent misrepresentations caused Marquis to suffer millions of dollars in damages, which VanDutch promised to pay but has not paid.”
Documents showed that Marquis was seeking to recover “millions of dollars, including all direct, consequential and incidental damages allowed by law.”
Under the new agreement, Marquis will build all VanDutch models, including its 30-foot, 40-foot, 40-foot walkaround and 55-foot boats. New 47- and 75-foot models are in the final design stage and production will start this year
Parmentier said the agreement is stronger as a result of the settlement.
“They were aggressive in their original estimates, and the market didn’t come back maybe as fast as they expected,” Parmentier said. “So we’ve come to a meeting of the minds on production and what the market can really swallow. What transpired ended up being very good. It was a little convoluted before.”
“Now we’ve got everything back to normal,” he added. “Originally there were pretty high expectations on their end, and that didn’t happen. So now, we’ve re-evaluated everything and put in some very relevant, correct figures. We’ll be hiring a lot of those people back. In fact, we are hiring right now to get the VanDutch line up to speed.”