I followed this topic with great interest when it first came up... then, due to other commitments, I didn't check in here nearly as much and lost track of all that was going on with the federal case.
Here's my legal two cents (for what its worth). I haven't practiced in an admiralty court in several years and I'm not about to go and update all of my law-school memories for this discussion

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First, several posters mentioned both the 1713 Treaty of Utrecht, and then the 1982 UN "Law of the Sea". Legally, the adoption of a modification, or the changing of a law by a later law does not negate the initial law. In 82' territorial waters were established, which were not considered in 1713.
Just because there are now 3 miles (later 12), of territorial waters, does not negate the initial transfer.
It merely modified a specific portion of the "waters" at issue.
Second... as for the actual federal court case regarding the wreck, its site, heirs, assigns and the like...
A. Unless you have, and have read, all of the documents filed in the court, and are familiar with ALL of the treaties, laws and conventions, you cannot speak intelligently about who is correct, incorrect, etc. (that goes for me as well- so i'll try to speak generally)
B. Even if you have done all of "A", you are still not privy to the phone calls, conferences, conversations with the judges, etc, that always take place outside of the "file" or "transcripted" court proceedings.
C. Taking one objection, from a file, that I would surmise is several inches thick, is taking something completely out of context, and that one document cannot be relied on as the basis of an argument
D. A great deal of ANY legal case is legal posturing. Having a valid argument doesn't mean you're necessarily going to win, and having an "iffy" argument doesn't mean you're going to lose. Here, Spain, and the other "defendants" have a valid argument (whether you agree or not), and they would be foolish, not to attempt to use that claim to pressure some kind of settlement or favorable outcome for themselves. With nearly 600 thousand coins at stake, with an immense value, of course they're going to try for a slice of the pie, whether they are actually entitled to it or not. If you found out tomorrow that you were a long lost heir of the shipping company, wouldn't you throw your hat into the ring? I sure would.
E. I read the "objection to the report"... without reading ALL of the filed documents, you have to consider what it is. In a general sense, a Judge made a decision. someone didn't like the decision, and then "objected" and asked the judge to reconsider. That objection is, of course, a one sided-argument from one of the aggreived parties, and should be taken for what it's worth - an objection by an aggreived party.
steve (actual attorney at law)