The motion to sell the arrested 106.1-metre Amadea has been denied by US district judge Dale Ho.
On 9 February 2024, federal prosecutors in Manhattan filed a statement urging the judge to press ahead with an auction amid "excessive" carrying costs, estimated at $743,750 a month.
The argument has now been rejected by the court.
"The court is wary of relying solely on maintenance costs to justify sale, when those costs represent a small fraction of the value of the res and do not appear to be atypical for property of this type," said Ho.
Amadea was arrested in May 2022 after its UBO (ultimate beneficiary owner) was allegedly sanctioned following the conflict between Russia and Ukraine. US authorities detained the vessel and subsequently moved it from Fiji to San Diego, where she remains.
In October 2023, the DOJ filed a civil forfeiture complaint which could allow the United States government to take ownership of Amadea. The complaint alleged that maintenance and other works were carried out in violation of US law, including allegations of money laundering.
At the time of the filing, task Force KleptoCapture co-director Michael Khoo said: "The United States brings this action today after a careful and painstaking effort to develop the necessary evidence showing [...] clear interest in the Amadea and the repeated misuse of the US financial system to support and maintain the yacht."
The filing was submitted in federal court in New York and further alleged the existence of "a chain of shell companies [designed] to conceal the identity of the true owner of the yacht" in corporate documents.
A release issued by the DOJ said: "The burden to prove forfeitability in a civil forfeiture proceeding is upon the government, and proceedings involving this property and its claimants remain ongoing. The yacht could therefore be 'subject to forfeiture to the United States'." It continued: "A civil forfeiture complaint is merely an allegation that money or property was involved in or represents the proceeds of a crime".