It involved the American privateer Jack and the 14-gun Royal Naval brig HMS Observer off Halifax, Nova Scotia.

[14] On the 7th of July, 1777, off the coast of Halifax, Sir George Collier, in command of HMS Rainbow, with a force of two British frigates and a brig, opened fire on and captured John Manley, the second in command of the Continental Navy, and the 13-gun frigate Hancock (229 men) off the coast of Nova Scotia.

After a running battle lasting 39 hours, the British succeeded in capturing both Hancock and Boston, and retaking Fox (60 men).

Observer was herself a former Massachusetts privateer, originally built as merchantman Amsterdam, which HMS Amphitrite captured on 19 October 1781.

The British ship Observer was returning to Halifax, having rescued ten crew members of HMS Blonde stranded on Seal Island.

The British immediately killed the American captain David Ropes as a result of the cannon fire.