Judge approves Mavericks sale

On Wednesday, the San Mateo County Harbor District Board of Commissioners will consider offering its blessing to the transfer of the permit it issued through 2021. Last season passed without an event and some are hopeful the proposed transaction could land 24 of the world’s bravest men and, for the first time, six women to compete on towering walls of water this winter.

Harbor Commissioner Sabrina Brennan, who has advocated for women to be included in the contest, said she’s thrilled WSL is on track to host a surf competition.

“It’s been a long time coming and I think a change in management is long overdue,” Brennan said. “From everything I’ve heard, the WSL is completely committed to running an event and last I checked they were on course for lining up permits.”

The big wave surf competition just north of Half Moon Bay landed in a Los Angeles courtroom after Cartel and its subsidiary Titans of Mavericks filed for bankruptcy in January. Cartel partnered with local organizers, including Mavericks maven Jeff Clark in 2014, before shocking many when it sought federal bankruptcy protections after announcing it owed millions of dollars to a variety of creditors.

One of the creditors, which earned a nearly $812,000 judgment against Cartel, as well as Clark’s Mavericks Invitational Inc., filed objections to the proposed sale. But the federal judge ultimately agreed Cartel could accept $525,000 from the WSL in exchange for the permit.

The Harbor District’s permit allows for just one entity to host an event at the break near Pillar Point through the 2020-21 season.

This isn’t the first time the WSL has sought to make Mavericks a stop on its Big Wave World Tour as it initiated an application with the Harbor District in 2015. That interest may have contributed in part to the district issuing the first multi-year permit for the competition when in 2015 Cartel and Mavericks Invitational argued the event should be retained by local control.

In announcing the deal it struck with Cartel last month, WSL officials indicated it would collaborate with the coastside community on the event.

 “Mavericks is known everywhere as one of the iconic and dramatic big wave locations in the world, and the WSL is looking forward to work with the San Mateo County Harbor District and the local community moving forward,” Dave Prodan, WSL’s senior vice president of global brand identity, said in an email.

Anyone planning an event at Mavericks must ultimately secure a litany of other approvals, including a permit from the California Coastal Commission. However, since the Harbor District approved a multi-year permit, some note officials inadvertently created an asset over which it now has limited authority to deny.

This week, the district’s leadership will be asked to consider a motion expressly confirming it does not oppose the assignment and transfer of its permit to the WSL. Initially, the district raised concerns about whether the permit could be sold without the board’s consent. But now, officials acknowledge the district may or may not have an effect on the sale, and the prospect of the contest remaining in limbo should the permit remain part of the bankruptcy estate, according to a staff report.

Staff is recommending the board approve the sale, noting it presents the greatest chance of a surf event happening this season and includes Cartel agreeing it would waive any legal claims against the district.

Virginia Chang-Kiraly, vice president of the Board of Commissioners, said she’s heard from some who want the event retained by local organizers, and others whose focus is solely on the contest regardless of who hosts it.

Still, “at the end of the day the bankruptcy court really has control over the process,” Chang-Kiraly said. “But I do want to hear what the public has to say about this. … People who are in the know have very strong feelings one way or the other; but people who aren’t in the know, which is probably the majority of people, they could care less who holds the permit.”

Mavericks Invitational — which previously held contests under oversight by Clark, his wife and local business owner Brian Overfelt — filed an objection to the sale contending the permit actually belongs to them and that Harbor District staff erred in listing Cartel as the holder.

A second objection was filed by the Texas-based Segler Holdings, one of Cartel’s largest creditors. Segler, which operated a sunless tanning company, won a $1 million judgment in a breach of contract lawsuit against Cartel and owner Griffin Guess’ supermodel wife Marisa Miller.  

Stewart Schmella, an attorney representing Segler, said he was disappointed by the federal judge’s ruling but is looking forward to learning how Cartel plans to restructure and repay its creditors.

Originally, Cartel proposed auctioning off its assets for a minimum $1 million bid before it announced the deal with WSL. Schmella said although Cartel has characterized Mavericks Invitational claims as frivolous, he believes the debate regarding ownership of the permit scared off other potential buyers.

“We were concerned that in many ways Cartel and Titans of Mavericks were putting the cart before the horse in trying to conduct the sale of the permit before resolving the issue of ownership with Mavericks Invitational,” Schmella said, adding he’s pleased the court at least listened to their arguments.

But back on shore where the Harbor District and locals long for an event, Brennan said she just wants to see female athletes compete as the contest window nears opening.

“I hope everyone will be supportive and try to do everything in their power to make it a successful event,” Brennan said. “We’re just really thrilled that it looks like it’s around the corner.”