GOULDSBORO, Maine — August 29, 2012 — Though the company has been inactive for several months, Live Lobster’s presence in Maine seems poised to officially come to an end in about a month
That’s when lender-ordered auctions will be held to find new buyers for three Live Lobster waterfront properties in Gouldsboro, Phippsburg and Stonington.
The properties are listed on the website of Tranzon LLC, a nationwide real estate auction company. Auctions for Live Lobster properties in Gouldsboro and Stonington will be held Wednesday, Sept. 26, and another auction for the company’s former buying station in Phippsburg will be held Thursday, Sept. 27, according to information posted on the auction firm’s website.
No one answered the phone at Live Lobster’s main office in Chelsea, Mass., when a call seeking comment was placed early Wednesday afternoon. Multiple attempts to contact Live Lobster officials in recent months have been unsuccessful.
This past April, Live Lobster’s primary lender, TD Bank, filed suit against the lobster distributor, claiming the firm violated terms of a 2008 loan agreement for $4 million from the bank.
According to federal court documents posted online, TD Bank voluntarily dismissed the lawsuit against Live Lobster last month. Attempts late Wednesday to contact the bank’s attorney for comment about the lawsuit’s dismissal were unsuccessful.
The lawsuit, and another filed against Live Lobster by a former company official and minority owner, are believed to be the primary reason Live Lobster suspended its operations in late March, when its checking accounts were frozen by TD Bank.
In its lawsuit, TD Bank claimed it loaned $4 million to Live Lobster in June 2008. As part of that loan agreement, Live Lobster promised the bank that it would have a “first-priority security interest in substantially all of its business assets … including without limitation, its inventory and accounts and the proceeds thereof,” according to the complaint.
TD Bank accused Live Lobster of failing to make loan payments and of depositing some of its proceeds with another bank, Century Bank and Trust Co. of Medford, Mass., which TD Bank claimed was a violation of the security agreement. TD Bank also claimed that Live Lobster still owed TD Bank $3,403,811.26 in principal and $4,413.93 in interest.
Alan Brown, Live Lobster’s former general manager, sued the company in February for allegedly failing to pay money it had promised him to resolve an earlier lawsuit he filed against the firm two years ago. Brown claims in his suit that he still is owed $235,702, plus interest, legal fees and other costs, of the $460,702 that the company promised to pay him after he sued them in 2010 for breach of contract and fiduciary duty. That case is still pending.
Late last year, Live Lobster drew the ire of lobstermen up and down the coast when it bounced checks it wrote as payment for their lobster.
At the time, Live Lobster President Antonio Bussone said “not that many” checks bounced and the company was having to adjust to new payment schedules associated with its new processing operations in Gouldsboro. Bussone said last December that the company had made good on the bounced checks and ironed out its cash flow problems with the bank.
Since this spring, company officials have kept mum about its financial situation, aside from blaming TD Bank for freezing its checking accounts.
Live Lobster, which has operated in Maine as Lobster Web Co., had buying stations in Phippsburg, Rockland, Spruce Head and Stonington. The buying stations in Rockland and Spruce Head did not involve any real estate, according to a person familiar with the firm’s operations in the state who did not want to be identified. The company’s operations in Rockland and Spruce Head consisted simply of Live Lobster-owned boats that tied up to local piers and bought lobster from local fishermen.
Read the full story in the Bangor Daily News