The Pirate of Black Point

Investors say David Graham used this marina as collateral for a money-making scheme. Too bad it belongs to Dade County

On April 17 Metro-Dade responded. The county suggested that MMI's disclosure was more of a nondisclosure, and reiterated a list of abuses suffered by the public during its relationship with MMI. Among other things, the county noted that MMI was now proposing to shift control of the company and the county lease by issuing preferred stock to new investors Carl Herndon and Mark Sweeney without alerting creditors that this would require prior county approval. Herndon, the owner of Blackfin Yacht Corp. in Miami, was to become the new manager and CEO of MMI under the reorganization plan, and Graham touted Herndon's participation in the National Marine Manufacturers' Association and a governor-appointed state marine advisory board. He didn't mention that Herndon's firm filed for voluntary bankruptcy protection last month. Nor, apparently, did MMI inform Herndon that he would soon be taking over the company. "This is news to me," says Herndon, noting that he specifically declined the job offer months ago in telephone conversations with Graham. "I can assure you that Blackfin and Black Point have no relationship whatsoever, and never have.")

The county also noted that MMI had permitted Blaylock Oil of Homestead and Sheltair Aviation Centers, Inc., to obtain liens on MMI's county lease, to the tune of $47,280 and $295,559 respectively. The latter company had leased luxury office space to MMI at Fort Lauderdale International Airport, some 50 miles north of Black Point Marina.

"MMI is in effect asking creditors to become investors, as it were, in MMI's Reorganization Plan," county attorneys wrote. "Many of the proposals in the Disclosure Statement (such as rent concessions or further encumbrances) require not only prior County Park Department approval, but a written amendment of the county lease."

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Dade County's largest public marina continues to limp along under the care of a federal trustee, with Graham still in control of the lease. To date, more than 40 lawyers are directly involved in the legal proceedings. On one instance, describing the operation at Black Point, Judge Robert A. Mark called the floundering marina "a fish in a barrel that is not quite dead, but it smells pretty bad, yet the bankruptcy court is not quite ready to kill it."

As for the bankruptcy case, Mark described it as "a tangled web."
"Dave is extremely smart and very, very personable," says a lawyer who once negotiated a business deal with Graham and later wound up suing him. "If he threw you down a flight of stairs, you wouldn't realize it till you were at the bottom scratching your head."

According to workers at the marina, the boat barn has no functioning burglar alarm, owing to faulty wiring. Perhaps more serious in a building meant to house 300 fiberglass boats, the emergency fire sprinkler system still lacks a booster pump required by county code. (MMI's lease specifically prohibits "conditions posing a threat to health or safety of public or patrons and not remedied within fourteen days.")

The most recent hearing in the Black Point bankruptcy case was an intimate affair: only a dozen lawyers were present. One of them, Assistant County Attorney Eric Rodriguez, was visibly exasperated by his discovery that MMI had received two more code violation notices, had run out of fuel the previous Sunday, and had recently allowed its flood insurance to lapse.

"It's not something that can be taken lightly," Rodriguez noted, referring to the latest fire-sprinkler citation. "This is a county facility, and things like electrical and fire sprinklers are serious stuff. As for the insurance, I'm very concerned. There was almost a flood last week; we're in the middle of hurricane season, judge." Rodriguez added: "We're starting to see lots of problems with the management. And we're getting lots of customer complaints."

But finally Rodriguez and Ocean Bank attorney Joel Tabas backed down from their initial motion asking the judge to permit them to foreclose on the marina lease. MMI was once again given more time to fix the problems, and once again MMI's lawyer, Susan Lasky, promised a spectacular turnaround.

Tabas, the bank's attorney, was more somber, noting that a review of monthly revenue reports from the marina was "not in my view particularly encouraging." Tabas mentioned an appraisal conducted by the bank two years ago that put the value of MMI's operation at $2.7 million. Now he thinks the Black Point facilities may be worth substantially less. "I'm concerned about the direction of this case, or should I say the lack of direction of this case," Tabas noted, adding he thought MMI's management might be "impairing our collateral, and the county's relationship with the public who uses this facility."

Neither Graham nor MMI attorney Susan Lasky responded to interview requests for this story.

William Irvine became chief of contracts management for Metro-Dade's Park and Recreation Department in mid-November. He says it took a long time for the county to realize that Graham was in fact running the show at Black Point. It's unfortunate but understandable that county administrators knew nothing about Graham, he observes.

"It would appear from reading the file and seeing some of the events that have occurred that David Graham seemed to be the one operating and managing MMI and using his wife as a front person," says Irvine. "As such, he was not subject to a background investigation."

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