14

A FINAL END

In 2001, the U.S. Bankruptcy Court for the District of Rhode Island heard the case of Acropolis Enterprises Incorporated versus C.R. Amusements (also known as Rocky Point Amusement Park), James Callahan, Henry Vara, Rita Dimento and Francis Dimento. As the result of a dispute between shareholders, Acropolis had filed a complaint concerning determination of the extent, amount and priority of its lien against the debtor’s assets, which secured a loan of $8,339,518.

During the 1980s, Rocky Point Park had been owned by Captain Rocky Incorporated, Rocky Point Amusements, Kiddy Park Incorporated and other entities. Their operations were financed by the Bank of New England. When the bank began to experience financial difficulties, it called in its note. Captain Rocky and its affiliates needed to quickly secure other financing and, in September 1991, began a lending relationship with Fairway Capital Corporation. Fairway loaned Captain Rocky $5,395,000 at 15.5 percent interest per year, to be made in payments over the course of twenty years but with a balloon payment due in five years. Under the agreement, Captain Rocky was required to pay interest of approximately $900,000 per year. To be able to do that, the park would have to escrow $50,000 per week during its open season. This obligation was personally guaranteed by Callahan, Vara and the Dimentos.

In 1994, the defendants defaulted on the loan, and Moneta Capital Corporation was placed into receivership. The loan was assigned to Participation Services Corporation, created by Arnold Kilberg to service the loan. Threatened with foreclosure, Captain Rocky and its associates filed for bankruptcy. Callahan, Vara and the Dimentos owned 100 percent of the shares of Captain Rocky. Captain Rocky also owned 100 percent of the shares of the affiliated companies. Callahan reported that the goal was to emerge free of personal guarantees on the Fairway loan, retain some equity interest in the park and eliminate personal liability on unpaid sales and payroll tax obligations.

The following year, attempts to secure food and game concessionaries for the park were unsuccessful. At that time, an agreement was made between Captain Rocky, Moneta Capital and Kilberg, who was the investment advisor for both Moneta and Fairway. Under the agreement, a reorganization plan was put into place that declared that Moneta would acquire the Fairway loan and that all unpaid interest, legal fees and late charges due under the original loan would be capitalized and added to the Moneta loan. In addition, the Moneta loan would be fully due in five years, and a new limited liability company would be created in which to transfer all Rocky Point assets—free of all liens except the Moneta mortgage—prior liens of record and the property tax lien. It was also agreed that Moneta would own 51 percent of the common membership interest of the new company, with Callahan, Vara and the Dimentos owning 49 percent.

Moneta was to receive a $1.5 million nonvoting-preferred-membership interest in the new company, and while Callahan, Vara and the Dimentos’ personal guarantees would be released, they would remain jointly and severally liable to the new company for any payroll and sales tax liabilities paid by the new company on behalf of the former company.

In October of that year, the reorganization plan was accepted by the bankruptcy court in Worcester, and all the assets of Rocky Point were transferred to C.R. Amusements, which was to begin locating food, game and ride concessionaries who were willing to pay at least 20 percent of their gross revenues to C.R. Amusements.

Callahan, who had failed in this effort before, led the search. He, Vara and the Dimetos would later claim that Kilberg and Moneta made the task difficult by refusing to cooperate and by refusing to give them consent for certain concessionaires to be contracted. They stated that they believed Moneta never really intended to see the park in operation but secretly planned to eventually develop a large residential waterfront community on the property. Moneta’s scheme, they charged, was to financially cripple C.R. Amusements so that it would be forced to default on its loan, allowing Moneta to acquire the property at foreclosure. It would then be able to develop the property and retain all financial gains for itself. Moneta’s actions, as a 51 percent shareholder of C.R. Amusements, they claimed, was a breach of fiduciary duty.

When Callahan’s efforts to secure concessionaries failed, C.R. Amusements was left with very little money from operations. In the winter of 1996, it was decided to sell the park’s rides and equipment the following spring. Callahan, Vara and the Dimentos alleged that they had no involvement in the decision to sell the rides and that the sale was a unilateral, preplanned move by Moneta to dispose of the rides rather than operate the park so that it could develop the land instead. They further charged that Moneta insisted that, from the proceeds of the sale, $1.5 million would be paid to redeem its nonvoting preferred membership interest, five years earlier than agreed on.

The operating agreement, however, stated that Moneta had the authority to sell the rides with or without the consent of the other shareholders. It also stated that the business affairs of the company would be managed exclusively by Moneta’s board of managers and that it would direct and control company business to the best of its ability. In addition, the agreement stated that Moneta had complete and full authority, power and discretion to make any and all decisions and to do any and all things that the board of managers deemed necessary to accomplish the business objectives.

A letter of agreement, dated January 2, 1996, was produced in which both parties had agreed to a liquidation of C.R. Amusement’s assets and a payment of $1.5 million to Moneta from the proceeds of the sale. On January 30, 1996, C.R. Amusements contracted with Norton Auctioneers to schedule an auction at the park. All rides and equipment were to be sold on April 16 and 17 of that year.

Auction day was a day of despair not only for the park owners but also for all Rhode Islanders. For ten dollars, a color brochure of everything on the auction block could be had. Every ride, amusement, table and chair was sold before the deserted park’s gates were locked. With the wind slicing the air and cold rain spitting down from the clouds, it was with great sadness that the crowd watched decades’ worth of memories be cleared away. The Freefall, which had provided thousands with the scare of a lifetime, fetched $500,000 and found a new home in Ohio. The log flume was actually resold later in the day to the second-highest bidder and shipped to the Philippines. The Cyclone went to Canada. The famous Corkscrew found itself a new owner in Seattle, Washington, for the hefty price of $805,000. Immovable structures such as game stands and ride shelters were later razed or left to simply collapse.

Just prior to the start of the auction, several pieces of restaurant equipment, valued at about $300,000, were removed from the sale. Callahan, Vara and the Dimentos alleged that the equipment was removed by Kilberg without their input or approval. This action, they claimed, caused them to lose out on proceeds that they would have obtained from the sale of the equipment and cost them an auctioneer’s commission of 8 percent and a buyer’s premium of 5 percent, totaling $39,000, for equipment that was never sold. They also claimed that $693,650 worth of assets were purchased by C.R. Amusements from itself, as a man named Timothy DelGiudice, purportedly on behalf of C.R. Amusements, successfully bid on numerous items, including the flume ride, which went for $450,000.

Callahan, Vara and the Dimentos alleged that DelGiudice worked for Moneta and was being directed by Kilberg to bid on certain items. This, they stated, was flagrant misconduct by Moneta, which cost them a loss of over $307,000.

Moneta’s people argued that they had no knowledge of DelGiudice bidding on items for the benefit of C.R. Amusements and that it had been a shock to later learn that C.R. Amusements had acquired the flume for $450,000. They claimed that DelGiudice actually worked for Vara and was bidding under his direction, as Vara wanted to keep the park open. Vara had been operating the Rocky Point Family Fun Fair on the grounds.

Proceeds from the auction totaled $3,049,050. The City of Warwick was paid $600,000 for delinquent real estate taxes. Moneta received $1.5 million pursuant to the January 2, 1996 agreement letter. The alternate plan, which was that of developing Rocky Point Park into real estate, was then begun.

On May 21, 1997, after C.R. Amusements had defaulted in mortgage payments, Moneta sent the company a notice of foreclosure. The property was to be put up for sale on July 3, 1997. Callahan, Vara and the Dimentos sought a temporary restraining order from the Providence County Superior Court, which was denied. Callahan then filed an involuntary bankruptcy petition against C.R. Amusements, averting the foreclosure sale.

On August 5, 1999, Callahan, Vara and the Dimentos had filed a motion to intervene as defendants. Once the majority shareholders entered the case, they filed a counterclaim against Acropolis, asking that the claim of Acropolis be equitably subordinated to the claims of the State of Rhode Island and the Internal Revenue Service for the payroll and tax liabilities assumed by the debtor as part of a prior bankruptcy case; the claim of Callahan for his professional fees and expenses generated as a result of the debtor’s failure to pay payroll and sales tax liabilities; and the claim of Callahan, Vara and the Dimentos for up to $1.5 million representing a return on their equity equal to the amount previously paid to Moneta Capital.

It was expected that the property would be sold that year for $10 million. However, it would be awhile before it found a new owner. On December 10, Moneta transferred and assigned its loan and security documents back to Participation Services. In February of the following year, that company assigned the loan and documents to Acropolis.

Acropolis sent a new notice of foreclosure to C.R. Amusements on March 18, 2000. Callahan, Vara and the Dimentos reacted by placing C.R. Amusements into state court receivership, and a Kent County judge enjoined Acropolis from proceeding with the foreclosure. Kilberg, as manager of Moneta, filed an instant voluntary bankruptcy petition.

The court addressed the issues of Callahan, Vara and Dimento regarding Moneta’s alleged interference with their ability to obtain park concessions, Moneta’s alleged improprieties during the auction and its acceleration of the redemption of the nonvoting preferred membership interest. The court did not feel that there was evidence to support any breach of fiduciary duty and decided that the minority shareholders had not sustained their burden of proof on other charges. Their counterclaim against Acropolis was denied and dismissed. The land and chaotic mass of fallen structures on the property were sold in 2003 for $8.5 million, with the winning bid coming from the United States Small Business Administration.

In the autumn of 2004, members of the Seaconke Wampanoag Indian tribe filed a lawsuit in which it claimed that several parcels of land in Rhode Island, by rights, belonged to it. Among those parcels was thirty-four acres of land within Rocky Point Park. The tribe’s archivist, Peter Bauer, claimed that he had done a great deal of research at the Warwick Public Library and had discovered a 1661 deed, in the Nathanael Greene collection, that showed the Rocky Point land had been given to the tribe by the king of England.

The court ruled that such a claim could not be filed due to the Land Settlement Act of 1978, whereby 1,800 acres of land were conveyed to the Narragansett Indian tribe under the stipulations that no other Indian land claims could be made against the state or federal government for damages of lost use of aboriginal land unless such claims were brought forth within 180 days of the bill’s being passed. The court reminded the tribe that the deadline was long since over. Bauer argued that the title on the land was not aboriginal; it was a recognized transfer by the king. In addition, he stated, it was unconstitutional for the Wampanoags to suffer such a loss based on a deal made with the Narragansett Indians, who were part of an entirely different tribe.

The two main tribes in possession of the shore lands situated along Narragansett Bay in 1636, when Roger Williams settled in Rhode Island, were the Wampanoags and the Narragansetts. The earliest written account of their presence there was by Giovanni da Verranzano in 1524. Among the first English settlements on the bay was the area now known as Warwick, and the colonists and thousands of Indians shared use of the land. It was the Indians, in fact, who showed the English how to dig for clams at low tide and how to prepare a clambake by producing steam from hot rocks and layers of seaweed.

Neither the Wampanoags, nor any other Indian tribe, would be allotted any part of the former park property.

The silenced land of the former resort, standing there like an enchanted ghost town, was a magnet for vandals as well as a fire hazard. On October 16, 2006, a blaze destroyed the Cliff House. The two-story wood-frame executive building, standing high atop a hill, was where the park’s seasonal staff had once been housed. A boater had discovered the fire when he looked toward the park at approximately half past six o’clock in the evening and saw flames rising high into the sky.

The Rocky Point sign at the park’s entrance, taken shortly before its demolition. Photograph by Kelly Sullivan Pezza.

The demolition of the midway took place in May 2007. On June 4, during the rainy early morning hours, the main entrance gate, emblazoned with the large “Rocky Point” sign, was demolished. On September 7, documentary film producer David Bettencourt introduced the world premiere of You Must Be This Tall: The Story of Rocky Point Park at the filled-to-capacity Stadium Theater in Woonsocket.

It was also that year that developer Nicholas Cambio backed out of a deal to construct a residential community on the property when he and the United States Small Business Administration could not agree on a payment schedule for the $19 million land. Vanderbilt Capital also backed out of a deal when its plans to build 396 condominiums, town houses and duplexes were not met favorably by the City of Warwick. The company, which was composed of a partnership between Toll Brothers builders and developer Arnold Goodstein, had the winning bid on the property at $25 million, more than double the amount that some other developers offered. But when the city expressed its concern over the proposed sewerage plans for a project of such a great size, the deal began to fall apart at the seams. Later, when the Small Business Administration determined that the buildings left on the property were a safety hazard and needed to be razed, it felt the cost of demolition should be carried by Vanderbilt. The friction landed both parties in court with an eventual agreement that Vanderbilt would pull out of the deal and allow the Small Business Administration to retain the company’s initial $500,000 payment to finance the razing.

Later that year, the City of Warwick secured a federal grant of over $2 million, through the efforts of Senator Jack Reed, to purchase half the property. Another $2 million plus was funded by the state. The tract included wetlands and a one-mile stretch of land along the shore. The following October, nearly 2,500 people arrived one Sunday after an invitation went out for locals to come get a peek at what was soon to become a new state park.

In 2013, the remaining acreage was conveyed to the State of Rhode Island, with the Department of Environmental Management overseeing maintenance and development. The DEM went on to budget $2.5 million for a thorough cleanup of the property.

Veri/Waterman Associates was awarded the contract to develop a schematic master plan for a waterfront state park along forty-one acres of shoreline. Newport Collaborative Architects would serve as architectural consultants, and the plan was to preserve as many of the remaining park artifacts as possible with a focus on ecological, environmental and economic sustainability.

The Rocky Point Foundation, an organization of people dedicated to saving and preserving all they could of Rocky Point’s history, had lobbied for state ownership of the property in 2010 and continued its efforts by fighting to save what remained of the park’s observation tower and the aged skeletons of older rides that still stood on the land. Founded by Warwick Beacon publisher John Howell, the foundation showed great determination toward preserving the property for public use, as opposed to razing the land and constructing condominiums.

By the beginning of 2014, a major cleanup of the park was yet to be done. The bones of the shore dinners hall still stood, along with the rusted remnants of rides and the deteriorating Palladium. Graffiti and vandalism now mar the once beautiful resort, which is overgrown with weeds and bushes and strangled by vines.

People from around the country, especially those in New England, would long remember the carefree summer days they had spent at Rocky Point. Aside from the famous chowder and clam cakes, the bakes along the shore and the most thrilling rides to be found on the East Coast, the park had been the site of so many historic events and unforgettable moments.

The who’s who of park patrons had grown steadily over the years, from famous sports figures to presidents and chart-topping vocalists to military heroes. John Jacob Astor had come to show crowds that even millionaires liked to have fun; John L. Sullivan wowed the masses with his brawn; and Janis Joplin, REO Speedwagon and the Red Hot Chili Peppers got patrons rocking. Year after year, decade after decade, century after century, it was proven that Rocky Point was a magnet for all that was important or entertaining.

Rhode Islanders still ache for pieces of the past. Online auctions rack up the bids for old Rocky Point bumper stickers, napkins, cups, ride tickets and T-shirts. Some even resort to stealing as a means of getting their hands on souvenirs. In 2013, the five-foot-tall fiberglass lobster standing outside the Green Pond Fish Market in Falmouth, Massachusetts, went missing. The lobster was one of many that had once been positioned around the grounds of Rocky Point as its logo. Standing erect on its tail, holding a cane in one hand and tipping its straw hat with the other, the lobster was synonymous with summer fun.

In addition to aged souvenirs, memories and photographs are what now remain; stories recalled and written down and visual images captured on paper and film are immortal pieces of Rhode Island history. They will never let the famous park’s tale be forgotten, from its small beginnings, through its long life, to the slow, resistant move toward a final end.

At the present time, Rocky Point stands like a forgotten dream behind the wall of jagged rocks. Its gaiety and music have faded into the past. Its wharf slowly falls into the sea.

The property is simply a remnant of another time, when it was the place for thousands upon thousands of people to come and spend carefree summer days. And though it was rarely talked about, it was the place where one little girl spent her last frightening moments on this earth, surrounded by laughter and barrel organ melodies.