Swiftships, LLC, an 84-year-old military shipbuilder based in Morgan City, Louisiana, filed a voluntary chapter 11 petition on March 18, 2026, in the U.S. Bankruptcy Court for the Western District of Louisiana (Case No. 26-50237). The filing followed the U.S. Navy's termination of the company's Landing Craft Utility (LCU) 1700 program — Swiftships' primary revenue source — in February 2024, and a December 2025 receivership that preceded the transition to federal bankruptcy protection. The petition lists estimated assets and liabilities each in the range of $10 million to $50 million and indicates that funds will be available for distribution to unsecured creditors.
Swiftships entered chapter 11 as a freefall filing with no pre-arranged plan, no stalking horse bidder, and no disclosed DIP lender. The company filed a motion for use of cash collateral alongside the petition. The case is in its earliest stage: schedules and the statement of financial affairs are due April 1, 2026, and the section 341 creditors' meeting is scheduled for April 8, 2026.
U.S. Bankruptcy Court, Western District of Louisiana
Case Number
26-50237
Petition Date
March 18, 2026
Estimated Assets
$10 million – $50 million
Estimated Liabilities
$10 million – $50 million
Case Snapshot
Vietnam-Era Swift Boats to Navy Shipbuilder
Swiftships traces its origins to 1942, when Fred Sewart founded Sewart Machine Works in Berwick, Louisiana. The business was renamed Sewart Seacraft in 1946 and relocated to Morgan City. The company built water taxis for Gulf of Mexico oil rig operators — a form factor that attracted U.S. Navy attention during the Vietnam War. Sewart Seacraft delivered 193 Fast Patrol Craft — known as "Swift Boats" — to the Navy throughout the Vietnam conflict. The company was renamed Swiftships in 1969.
Swiftships expanded internationally beginning in 1979 and has operated shipyards across six international locations. In 2008, the company signed a co-production agreement with the Egyptian Navy. The company's client base has extended to navies and maritime customers from over 52 countries, and Swiftships has delivered more than 600 naval vessels and commercial platforms since its founding. Shehraze Shah serves as President and CEO. The company is classified as a minority-owned small business (Subcontinent Asian American-owned), and Swiftships Group, Inc. holds 100% equity interest in the debtor.
Navy LCU 1700 Contract and Termination
Contract awards. Naval Sea Systems Command (NAVSEA) awarded Swiftships an $18 million contract in March 2018 for detail design and construction of the first LCU 1700 craft. A follow-on contract worth $26.7 million for two additional craft (LCUs 1701–1702) followed in 2019, and an additional $50.1 million contract for four more craft (LCUs 1703–1706) was awarded in 2020. In May 2021, NAVSEA exercised a further option worth $59.3 million for five additional craft (LCUs 1707–1711), bringing total obligations under the contract to approximately $152.5 million across seven vessels. Total contract options provided for up to 32 LCU 1700 vessels to replace the Navy's aging Vietnam-era LCU fleet.
Program delays. The LCU 1700 program encountered schedule and design problems. The first three craft were supposed to be delivered by June, September, and December 2023 but remained incomplete. Two years elapsed before the design was finalized. A third-party design agent, Genoa Design International (retained with VARD Marine), made ongoing modifications that at one point required reinstallation of the engine-cooling system and piping. Four program manager transitions occurred on the Navy side, delayed vendor payments created supply chain disruptions, and Swiftships needed nearly a year to settle a request for equitable adjustment.
Stop-work and termination. NAVSEA suggested terminating the program in September 2023, citing lack of production progress. NAVSEA formally recommended termination on November 9, 2023. The Navy issued a stop-work order to Swiftships on January 24, 2024, and formally notified the company of contract termination on February 20, 2024. Federal contracting records reflect the termination as a termination for default; Swiftships disputed the basis and filed suit alleging bad-faith termination. The Navy's fiscal year 2026 budget documents confirm it does not plan to take delivery of any Swiftships-built LCUs. Following the termination, Swiftships laid off nearly 100 workers.
Competing LCU contract. In September 2023, Austal USA (based in Mobile, Alabama) was awarded a competing LCU contract worth $91.5 million for three vessels, with options for up to 12 craft and a total contract value of up to $379.7 million. Austal's first LCU (hull 1710) began sea trials in February 2026, following a launch in August 2025. The Navy is also seeking a second shipbuilder through a new competition with $295 million in allocated funds.
Federal Claims Litigation Against the Navy
In March 2024, Swiftships filed suit against the United States in the U.S. Court of Federal Claims (Case No. 1:24-cv-00361, filed March 6, 2024, Judge Richard A. Hertling). Swiftships alleged that the Navy's termination was made in bad faith and that the government obstructed the company's ability to succeed on the LCU program. The complaint sought approximately $150 million in damages under the Tucker Act (28 U.S.C. § 1491). Swiftships is represented in that litigation by Faisal Mahmood Gill of the Gill Law Firm; the U.S. government was represented by Stephanie Fleming of the DOJ Civil Division.
The case was terminated on May 30, 2024. The specific disposition — whether by settlement, dismissal, or transfer — is not confirmed in available public records. The status of the claim in the bankruptcy estate has not been disclosed.
The petition identifies between 50 and 99 creditors. Shehraze Shah, the company's CEO and manager, is listed as the authorized representative of the debtor. Ryan J. Richmond of Sternberg, Naccari & White, LLC serves as debtor's counsel.
Prepetition Capital Structure and Known Claims
The petition disclosed estimated assets and liabilities each in the $10 million to $50 million range. Specific prepetition debt instruments, secured creditors, and capital facilities have not been disclosed in available public sources as of four days after the petition date. Schedules A/B through H and the Statement of Financial Affairs are due April 1, 2026.
Genoa Design International judgment. Genoa Design International — the third-party design agent on the LCU program — obtained a default judgment against Swiftships for $524,190.41 ($408,285.00 in unpaid invoices plus $115,905.41 in interest) in the Eastern District of Virginia (Case No. 1:23-cv-00967), entered April 5, 2024.
Federal claims litigation asset. The $150 million Court of Federal Claims case against the U.S. Navy is listed as a potential estate asset; its status has not been disclosed in available public filings.
Swiftships filed a motion for use of cash collateral at or near the petition date. No DIP financing facility has been disclosed. The company also filed motions for continued utility services and for an extension of the deadline to file schedules and the statement of financial affairs. The specific terms of any cash collateral order — budget, adequate protection, and milestones — are not yet available in public sources as of March 22, 2026.
Key Timeline
Date
Event
1942
Fred Sewart founds Sewart Machine Works (predecessor to Swiftships)
1960s–1975
Delivers 193 Fast Patrol Craft ("Swift Boats") to U.S. Navy during Vietnam War
1969
Company renamed Swiftships
March 2018
NAVSEA awards $18 million LCU 1700 contract
2019
Follow-on LCU contract: $26.7 million for two craft
2020
Additional LCU contract: $50.1 million for four craft (LCUs 1703–1706)
May 2021
Fourth LCU contract: $59.3 million for five craft (LCUs 1707–1711); total obligations reach ~$152.5 million
September 2023
Austal USA awarded competing LCU contract ($91.5 million); NAVSEA suggests terminating Swiftships program
November 9, 2023
NAVSEA formally recommends LCU program termination
The filing followed the U.S. Navy's termination of the LCU 1700 contract in February 2024, which removed Swiftships' primary revenue source. The company laid off nearly 100 workers, entered receivership in December 2025, and transitioned to chapter 11 protection in March 2026.
What was the LCU 1700 program?
The LCU 1700 was a Navy program to replace Vietnam-era landing craft. NAVSEA awarded Swiftships four tranches of contracts between 2018 and 2021 totaling approximately $152.5 million in obligations, covering seven craft (LCUs 1701–1711), with options for up to 32 vessels. The Navy terminated the program in February 2024 after the first craft missed delivery deadlines, and federal contracting records reflect a termination for default. Austal USA, awarded a competing contract in September 2023, completed its first LCU and began sea trials in February 2026.
What is the status of Swiftships' $150 million lawsuit against the Navy?
Swiftships filed suit in the U.S. Court of Federal Claims in March 2024, alleging bad-faith termination. The case docket was terminated on May 30, 2024, but the specific disposition — settlement, dismissal, or transfer — is not confirmed in available public records. The status of the claim in the bankruptcy estate has not been disclosed in available filings.
What are the estimated assets and liabilities?
The petition lists both estimated assets and estimated liabilities in the $10 million to $50 million range, with an indication that funds will be available for distribution to unsecured creditors.
Who is the debtor's counsel?
Ryan J. Richmond of Sternberg, Naccari & White, LLC (New Orleans/Baton Rouge) serves as debtor's counsel.
December 2025 receivership https://www.thestreet.com/retail/major-us-military-vendor-swiftships-files-unexpected-chapter-11-bankruptcy
$10 million to $50 million https://www.alabamagazette.com/story/2026/03/15/news/swiftships-files-for-chapter-11-bankruptcy-after-loss-of-key-navy-contract/10475.html
delivered 193 Fast Patrol Craft https://www.defensenews.com/naval/2024/02/23/us-navy-orders-swiftships-to-stop-work-on-its-landing-craft-program/
$59.3 million for five additional craft https://seapowermagazine.org/navy-orders-five-new-utility-landing-craft/
does not plan to take delivery https://www.workboat.com/first-austal-built-lcu-starts-sea-trials
$91.5 million for three vessels https://breakingdefense.com/2025/07/navy-plans-to-find-second-shipbuilder-for-its-landing-craft-program-again/
This article was researched and written with AI assistance, using court filings, public records, and news sources. AI-generated content can contain errors. Verify all information against primary sources before relying on it. This is not legal or financial advice. See the disclaimer.