Bankruptcy filings, nonpayment claims temper Port Royal officials' enthusiasm for shrimp dock deal

emoody@beaufortgazette.comJune 1, 2013 

Jellyfish tumble off a conveyer belt into a storage bin as Millenarian Trading conducted a demonstration in April of how jellyfish would be unloaded from fishing boats at the Port Royal shrimp docks.

JAY KARR — Staff photo Buy Photo

A Florida shrimper is warning Port Royal officials to think twice before making an agreement with a man who wants to set up a seafood operation on its docks, alleging Steven Giese Sr. still owes her money from two business ventures gone sour.

Two seafood brokerages Giese helped run filed for bankruptcy -- the second one as recently as last month -- while owing Verna Eshelby and her husband, Brent, of Hernando Beach, Fla., as much as $36,000 in all.

Port Royal officials said any deal with Giese is on hold while they check court filings and allegations of bad dealings by the companies that did business with the Eshelbys and other Florida shrimpers.

"I just want to find out the truth and make sure what is being said is true," Mayor Sam Murray said. "I do not want to get the town into any problems down the road."

Giese owned Today's Fresh Catch Inc., which went bankrupt in 2007 and is no longer in business. Four years later, he helped his son, Steven Giese II, start Live Seafood Brokers. Giese II filed for personal bankruptcy last month but is trying to pay off his company's debts and continue the business, according to his attorney.

Attempts to reach Giese II were unsuccessful Friday.

Giese Sr. says Hurricane Alberto and personal problems, which have since been resolved, sank Today's Fresh Catch. He says Live Seafood Brokers is floundering in part because his son has been swindled by unscrupulous shrimpers.

Giese Sr. says he is trying to help his son through Chapter 13 bankruptcy. Meanwhile, he also is acting as executive director of operations for Millenarian Trading Co., which incorporated this past November, according to the S.C. Secretary of State's Office.

Giese Sr. says Millenarian Trading could create as many as 250 jobs in Beaufort County. The company aims to lease and repair Port Royal's shrimp docks, unload and sell seafood there, and pay the town fees in return. Giese Sr. also is scouting for a location, possibly on St. Helena Island, for a plant where jellyballs could be processed and sold to Asian markets.

The shrimp dock deal with Port Royal has been discussed for months. Giese recently asked the town to fast-track negotiations so he can get equipment installed there in time for the start of shrimp season, which began Wednesday.

But the pace of negotiations is likely to slow after Verna Eshelby called several town officials last week. Town officials contacted for this story said that until then, they were unaware of the Gieses' bankruptcies.

Eshelby says the company Giese Sr. owned purchased shrimp from her and other Hernando Beach shrimpers, then sold it to overseas buyers. Although the arrangement worked well at first, Eshelby said, Today's Fresh Catch owed her family's company $25,000 to $30,000 when it declared bankruptcy in 2007.

That money was never repaid, Eshelby said, but the family went into business with Giese again in 2011 after he apologized and promised that the company started by his son would pay them top dollar for their catch, which would be sold at a market in New York.

That arrangement also went well for a while, Eshelby said, but in February, Live Seafood Brokers started missing payments. Eshelby said her family eventually quit doing business with Giese II's company, which owes them about $6,000.

Port Royal town manager Van Willis said he is researching the bankruptcies and the shrimpers' claims, and might travel to Florida to investigate before the town makes any agreement with Millenarian Trading Co.

"We're obviously not going to act on it until all of these issues are resolved," he said.


In July 2007, Today's Fresh Catch Inc. of Spring Hill, Fla., filed for Chapter 11 bankruptcy, citing financial problems caused by Hurricane Alberto. Giese Sr. was the sole director, shareholder and officer at the time, according to court documents.

Giese Sr. said expensive research the company was doing did not pay off, Alberto decimated the shrimp crop and a divorce diverted his attention from the business.

According to bankruptcy documents, the company owed more than $360,000 to the IRS and creditors. It had assets of $48,500, about $25,000 of it in machinery.

The Chapter 11 plan would allow the company to restructure its debt. It's taxes would be paid, and over a span of 60 months, creditors were to receive 20 percent of what they were owed.

But in May 2008, the trustee handling the case successfully petitioned the court to switch Today's Fresh Catch to a Chapter 7 bankruptcy plan -- liquidation. The trustee claimed in court documents that the company remained unprofitable and was not filing monthly financial statements or paying quarterly trustee fees.

Angela Welch Esposito was then appointed the company's Chapter 7 trustee.

She reported to the court that Giese Sr. was "evasive" and that she had to hire an attorney to investigate the disappearance of assets such as a truck and insulated bait boxes. Giese Sr. said Thursday those items were stolen from the company.

Attempts this week to reach Esposito for comment were unsuccessful.

Today's Fresh Catch assets were sold, but the proceeds weren't enough to pay all the creditors.

That included the Eshelbys.


In March 2009, Esposito filed two complaints related to the Today's Fresh Catch case.

The first was against Giese Sr.; his wife, Deborah; and his son, Giese II. It alleges breach of trust, embezzlement, fraud and other violations. It said the company was devalued when client lists and distribution routes belonging to Today's Fresh Catch were transferred without the trustee's permission to Deborah Giese and Giese II, two months after the company filed for bankruptcy.

Giese Sr. told the Gazette and Packet that the distribution routes never belonged to the company and always belonged only to his wife.

The complaint was dismissed without prejudice in December 2009, meaning it could be brought again. However, Florida attorney Paul Decailly, who was not involved in the case but is representing Giese II in the Live Seafood Brokers bankruptcy, said that is unlikely because most trustees don't revisit complaints once they've been dismissed.

Esposito's second complaint was against Giese Sr. and Thomas and Wendy Klingensmith. It alleges that in 2005, before the bankruptcy, the Klingensmiths sold their stock to Giese Sr., who was to repay them by making regular installments.

However, the repayment to the Klingensmiths was made by the company, not Giese, the complaint asserts.

Giese Sr. said that actually, the Klingensmiths were never paid at all -- by either him or the company -- because they were forced out of the partnership when Thomas Klingensmith was charged with a crime unrelated to the company's operations.

Esposito's second complaint also was dismissed without prejudice, in June 2009, according to court documents.


A year and a half ago, Verna Eshelby said, Giese Sr. apologized to her family for the way their business arrangement ended. He said he wanted to work with them again, and he would pay them more than the other shrimp buyer in Hernando Beach.

The new venture, owned by Giese II, made some repairs to the marina where the Eshelbys kept their boats, and the family signed on. Giese Sr. advised the new company.

"When someone comes in and promises you the world and says, 'I'm going to do this for you. I'm going to do that,' and shows a little good faith, then you want to believe," Eshelby said.

But this past February, Eshelby claims, checks shrimpers received from Live Seafood Brokers bounced. On May 23, Brent Eshelby took out his boat at 5 p.m.; when he returned the next morning, Giese's equipment had been cleared out of the marina.

An invoice left for him, which Verna Eshelby showed to the Gazette and the Packet, acknowledged that Giese II owed the Eshelbys $5,232 and said Geise II regretted that he would be unable to pay the debt at this time. Questions were referred to his attorney, Decailly.

Giese II filed for Chapter 7 bankruptcy May 23, according to court records.

He filed for personal bankruptcy, Decailly said, because that process is less expensive and easier than filing for corporate bankruptcy. That route was possible because Live Seafood Broker's loans and contracts were in the name of both the company and Giese II, Decailly added.

As many as 49 creditors are owed money, the bankruptcy petition says. Assets amount to less than $50,000; liabilities are between $100,001 and $500,000.

On Tuesday, a motion was filed to change from Chapter 7, which would entail liquidation of assets, to a Chapter 13, which would restructure debts.

Decailly said Giese II was swindled by shrimpers in Miami, who used his information to ship shrimp without his knowledge, racking up costs of tens of thousands of dollars.

Giese Sr. said his some of the shrimpers he was buying from, including the Eshelbys, preyed on him by selling him inferior product.

"This is my son," Giese Sr. said. "I love him very much, and he's worked with me a lot of years, but he's not tough enough to stand up to those (professional) shrimpers."

Giese Sr. has told Port Royal officials he wants his son to be involved with the Port Royal operation. On Thursday, he said he always intended for his son to have only a minor role.


Giese Sr. has done most of the talking on behalf of the partnership that wants to set up shop in Port Royal. He said he would become part owner of Millenarian Trading if he is able to broker this deal.

Councilwoman Mary Beth Gray-Heyward said even before the bankruptcies came to light that she was wary of an agreement if she could not meet other partners first.

Paul Yang of New York -- referred to as Bin Xian Zhang in incorporation papers, according to Giese Sr. -- was introduced as a partner during a private meeting with some town officials, town manager Van Willis said. It's not clear if others who would invest in the venture have met with Port Royal staff or council members.

Giese Sr.'s most recent proposal lists the venture's partners as Millenarian Trading Inc. of South Carolina, which incorporated in November; Millenarian Trading Inc. of New York, which incorporated in February 2009 and lists Bin Xian Zhang as chief executive officer; and Port Royal Fisheries LLC, which has an incorporation application pending in South Carolina. Willis said Giese Sr. also has referred to Florida-based Raffield Fisheries Inc. and Wood's Fisheries as partners.

Willis said that he called Giese Sr. immediately after talking with Verna Eshelby by phone last week and learning for the first time of the bankruptcies.

"There are obviously two sides of this story, and the only thing we're looking for now is actual, factual information," Willis said.

Mayor Murray and Councilman Tom Klein said they will reserve judgment until they learn more. Neither have contacted Giese Sr. directly.

Klein said he hopes Giese Sr. attends Wednesday's Town Council meeting, and he does not intend to speak with him until then.

"(I want to speak with him) only in an open forum, so that everybody gets to hear the questions and answers," Klein said. "I think it's much better to have it above board like that, and hopefully, he will be at the workshop."

Klein also wants the town attorney present to provide legal advice. Klein has been among the council members who are cautiously optimistic Giese's seafood processing plan could be the lifeline the town's shrimp dock needs. The town consistently loses money on the operation, and the facility needs to be repaired, officials have said repeatedly.

"I would be very disappointed, though, if this falls through," he said. "It's a shame for the town. The town could use something, and this may have been a step in the right direction, but maybe it wasn't."

Follow reporter Erin Moody at

Related content:

Jellyfish-catching operation gets trial run in Port Royal, April 25, 2013

Seafood company wants to bring jellyfish industry to Port Royal, up to 250 jobs to region, March 6, 2013

Town of Port Royal, state enter uncharted waters with proposed jellyfish industry, March 16, 2013

The Island Packet is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service