Lymphocystis? correct answer. Saltwater Ich or Velvet (Oodinium) ? wrong answer!
If the description as cotton-ball like stuff was accutate, it is most unlikely to be ectoparasites such as Oodinium or Whitespot (Ich). Lymphocystisis was described as a viral disease. Apparently, it is not leathal but was nonetheless unsightly. Some claim that it was related to the chemical composition of the seawater in the tank (depends on which brand of seasalt (if artificial seawater was used). I have success by manually scraping it off followed by a touch of antibiotic solution. Such handling 0f the fish (out of water) was extremely stressful to fish and had to be done quickly and skillfully though.