Part 3 of a 4-Part Series
Note: as more information seems to be coming in daily I am publishing all of these articles now. Some areas of parts one and two have been updated. If you would like to comment, please go to our message boards here: Windjammer Message Boards
The Family Fallout Starting around 2005 details start to get very, very sketchy. While various family members began to disagree in earnest about how the cruise line should be run, at the same time actual ship operations, once the forte of Captain Burke (Michael Sr.) were all but forgotten. Authorities on the islands where Amazing Grace and Flying Cloud were moored decreed they were not fit to carry passengers.
Daughter Susan had been at the helm of marketing and sales, but the consensus is she is conservative and objected to certain groups using the ships for charters (smaller ships, on other cruise lines as well, are often chartered for nude and gay cruises).
Later in 2005 the Captain, CB, replaced Susan with his namesake, Michael D. Burke (MDB) as president of the cruise line. MDB (Michael Jr.) says he realized that the cruise line's biggest problem was his own family taking so much money out of the company. Almost all of the ships desperately needed attention, especially when the laMer and Sail 5 and 10 programs left them obligated to provide cruises to pre-paid customers.
MDB took legal steps to curtail what his attorney described as the "raping and pillaging" of the company by the Burke children - yet more pirate metaphors. Unfortunately, the response from his siblings was that MDB's moves were merely a self-serving power play to get control of the company for himself. Whether or not that is true is subject to interpretation. he claims he was just trying to stop the bleeding and take care of the ships.
MDB decided the pressure was too much and so he quit. The company went without a rudder for three months until Captain Burke persuaded MDB Jr. to try again, and reinstated him with a $300k/year salary. In truth, by now it seems no one really wanted to be named as the head of the company. With new SEC laws adopted since Enron, a CEO can be held personally liable for a company's actions. The days of hiding behind a corporation are long gone.
Sadly, just a few months later the the patriarch, CB, suffered a stroke. While it did not stop him, it did slow him down. Sometime at this point, Joey says came into the office one night and caught Michael on the telephone completing a bank transfer of over $400,000 into an account in his own wife's name. Joey called the police who showed up but informed Joey it was a domestic disagreement and they couldn't do anything.
Now, the family accused MDB (Michael Jr.) of abuse of his father. They claim he forced his father to appoint him president and then refused to pay his medical bills, credit cards, utilities and mortgage. The money is apparently still in MDB's wife's name, and to date he has not been able to show a legitimate reason why it should be. If his company was owed money, or if he was owed salary, that would be one thing, but so far no one has demonstrated any justifiable logic for putting the money in his wife's name.
In September 2006, the Burke siblings agreed to put management in the hands of son Danny, a 6' 4" charmer married with children who resided in a $3.4 million home on Miami's Rivo Alto Island. Danny had the looks and charisma of a star quarterback but also an apparent weakness for chemical dependency.
Still, Danny was thought to be capable by his family and very likable indeed by those who met him. The family thought the company was secure in his hands and believed he was in the process of setting things straight. Unfortunately, Danny's demons were getting the best him.
On March 26th, 2007, he checked into a Biscayne Blvd motel with a woman he had met in a grocery store just a week before. She had a long criminal record of drug offenses. Danny "disappeared." According to my witness, after nine days the Windjammer office realized he was "missing" and called the Dade County Morgue. They found Danny's body, with traces of crack cocaine and Xanax -- a prescription sedative. The police had apparently been trying to contact his wife for several days to no avail.
Naturally, Danny's wife, Dahl was devastated, and she has been one of the participants in helping to get stranded crewmembers on ships in the Caribbean home, having donated a significant amount of money (estimates of $40,000) to the effort organized by people in the non-official "Windjammer Flotilla" message board. No doubt, this has caused a schism between her and with brother-in-law Joey who is currently at the helm of Windjammer, as he has been doing his best to persuade the crews to remain with the ships (although they are not being paid) so he will have a crew if/when these ships ever become sailable again.
A Rudderless Ship Months of chaos ensued while all but two ships were tied up. All the ships were becoming more and more dilapidated, and no progress was made on the laMer project. When the board of directors asked MDB for an accounting of the money during his tenure as president he refused to comply. They then officially removed him from the company. Michael D. Burke counter-sued his family in Miami and the island of Trinidad, apparently tying up control of the yard in Trinidad where the other Windjammer ships are still in the process of being renovated to qualify for passenger certification. Using their father's medical setback as a reason, MDB (Michael Jr.) had the Captain declared incompetent.
Soon after this, Captain Burke's castle was sold in Miami, apparently at auction. Public records indicate that it fetched $7.5 million. By now the number of Burke family members involved in Windjammer operations had dwindled to two, or three if you include Polly who is apparently still focused on merchandising. The board of directors still seemingly has little actual involvement with or control over the company.
Amazingly, while passengers were flying to ships and being turned away at the port, little of the story was hitting the press. Many of these passengers actually refused to be interviewed. Possibly they decided not to say how bad things had gotten with Windjammer for fear a bankruptcy would negate their pre-paid Sail 5 , Sail 10 and LaMer cruises. Or possibly the constant promises by the Burkes of better days right around the corner on the Flotilla web site were reassuring enough to keep them quiet. In any case, news of the Windjammer problems had not gone much beyond the immediate family and upset passengers until word of mouth about the unpaid crewmembers got out. Then the situation deteriorated rapidly.
In July 2007, with the company desperately in need of money and management, someone affiliated with Windjammer made an agreement with a Miami investor, Jerry Cedar. Cedar agreed to help out with an infusion of $273,000 based upon a verbal agreement that he would subsequently be given a controlling interest in the Windjammer cruise line.
Joey Burke Takes Command By August the line had fallen almost completely apart, yet no records indicate any of the Burkes were willing to commit any personal money to save it. Three of the four remaining ships had their certificates of compliance to carry passengers withdrawn by island authorities in Granada. This left the company with but one ship, the Legacy.
By now a call went out to help the many homeless crewmembers that were stuck with their ships. In all, over $30,000 in donations for Windjammer crew was raised by the Flotilla, and Danny's widow, Dahl Burke, is said to have donated possibly another $40,000.
At this time, some questions must be asked. What had happened to all the money from the timeshare and Sail 5 and 10 pre-sales? Oddly, MDB (Michael Jr.) is believed to be the person who received the money from the timeshare sales for LaMer, yet he is now the person who is said to be negotiating to buy the LaMer ship. The original money for the timeshare sales should have been specifically held for the LaMer buyers and Windjammer's obligation to refurbish it for timeshare occupation. Yet, the agreement between Joey and MDB, according to Joey, will transfer the same ship from Windjammer to Michael for his own use (to start a new company perhaps). Many people see this as double dipping; it is conjectured he received the original timeshare money, and now he is getting the ship as well. Once again, details here are very sketchy, but no reasonable alternative public explanation has been presented.
More questions being asked; when Burke kids like Susan are living in mortgage-free multi-million dollar homes, and the Captain's castle had just sold for $7.5 million, why would they agree to give an outside investor a majority of the company for a comparatively paltry $273,000?
Or were the Burkes indeed planning to do that? A month later (September) Windjammer told Jerry Cedar the company needed an additional $100,000 immediately, and if he didn't give it to them then they would fall back on their original oral agreement to give him any shares in Windjammer and he would have nothing. Cedar handed over an additional $100,000.
If this sounds similar to the Contessa story at the beginning of this article, it is. It is practically identical, except we know the Captain bought engines with his $4,000 "investment." There is no accounting of where Cedar's money went, but indications are it went to pay crewmembers back salaries and money owed to vendors and island governments. Nowhere is that stated, but it is fact that Joey started saying crewmembers and vendors were getting paid just after the Cedar money was acquired.
Unfortunately for Cedar, history repeated itself. Even after he forked over some $373,000 he was then told that the rest of the family had trumped his word of mouth agreement. He would not be given any part of Windjammer cruises, nor would the money be returned. Susan alluded to me that the family had "trusted the wrong people to bail them out financially," so presumably, something was found to be wrong with Jerry Cedar and so while his money has good enough for the original agreement, he apparently did not get what he was promised in return for it.
Once again, a well-meaning friend caught up in the magic and romance of Windjammer receives a promise via an oral agreement and takes action in good faith only to be subsequently told that the agreement was invalid and hence not in force, but (by the way) the money is not scheduled to be returned. Cedar, who has still received nothing for his reported $373,000 investment has filed a lawsuit in Miami court seeking repayment of his money plus damages.
This is yet another incident where everything that has been said is public record, however no better or more logical counter explanation (read "no comment") for Cedar's lawsuit has been presented by the Burkes.