DryShips sued

The cancellation of bulker deals forged with George Economou's private interests has landed DryShips in court in the Marshall Islands.

Nasdaq-listed DryShips said in a securities filing Monday that the complaint filed against its board of directors and a former director alleges breach of "fiduciary duty of good faith" in agreeing to the cancellations of 13 ships.

The lawsuit, filed 5 March in the island nation's High Court, seeks disgorgement of all of DryShips' payments to cancel the transactions. The Athens-based bulker and drilling unit owner is incorporated in the Marshall Islands.

The filing does not identify former director named in the lawsuit. Nor does it say who is suing the owner, although sources close to DryShips say the action was filed by a single shareholder and is not a class action lawsuit.

"The company has just received the complaint and is currently studying it," DryShips says on page 112 of its 134-page annual report.

Sources say DryShips management is not worried by the Marshall Islands case.

As TradeWinds has reported, DryShips revealed in January that it would cancel the deal for nine bulkers purchased from chief executive George Economou's private interests and other parties. It also moved three newbuildings off its book. (Read the story here.)

Under the cancellation deal, DryShips was to cough up more than $116m to cancel the $1.17bn deal.

In December, DryShips forfeited a $55m deposit to cancel four panamax bulkers bought for $400m from Economou, and it paid out another $105m to secure options to buy the ships back.

News of a lawsuit came a day after Economou defended DryShips ability to navigate the bulker downturn despite auditors raising "substantial doubts about its ability to continue as a going concern". (Read the story here.)

DryShips owns 42 bulkers totalling 3.4 million dwt, as well as two drilling rigs and a pair of drillship newbuildings.