PCMR and Talisker more than $100 million apart in bond numbers
August 27, 2014
The 3rd District Court judge presiding over the lawsuit between Park City Mountain Resort and Talisker Land Holdings, LLC on Wednesday afternoon delayed setting the amount of a bond PCMR will need to post to remain on the acreage underlying most of the resort’s terrain.
Judge Ryan Harris said he would set the number during a court date that he scheduled for Sept. 3. The delay was based on information presented by the two sides at the Wednesday hearing as well as the continuing mediation between PCMR and Talisker Land Holdings, LLC. The mediation is scheduled to end by 5 p.m. on Friday.
It seemed likely as the Wednesday hearing started Harris would set the bond amount at the end of the court date. Much of the discussion between Harris and the attorneys on Wednesday focused on the number. The morning session involved detailed talk about a bond. Harris indicated he would delay a decision on the amount shortly after reconvening following a lunch break.
PCMR will be required to post a bond to stay on the land as the case continues. The dollar figure attached to the bond has been of great interest to the two sides and people watching the case.
PCMR and Talisker Land Holdings, LLC were expectedly tens of millions of dollars apart in the numbers they attached to their bond request. The bond would cover damages in the case. Harris has ruled in favor of Talisker Land Holdings, LLC on the most important parts of the case and has signed a de facto eviction order against PCMR. The judge stayed the enforcement of the eviction as he ordered the mediation.
Talisker Land Holdings, LLC indicated on Wednesday it wants the judge to set the bond at $123.9 million. The PCMR side earlier indicated in a court filing the bond should be set at between $1,021,308 and $6,559,616. Talisker Land Holdings, LLC made its number public at the hearing. An earlier filing redacted the dollar figure Talisker Land Holdings, LLC sought in a bond.
The dollar figure would cover damages between May 1, 2011, the day after the lease expired, and April 30, 2015.
Harris asked the attorneys whether they wanted to cross-examine witnesses regarding the numbers on Wednesday, but neither side opted to do so.
During the hearing, Alan Sullivan, who is the PCMR side’s lead attorney, argued the value of the land disputed in the case is "extremely limited," saying that there is no access to the terrain, no parking there and it lacks development rights. He said the acreage is an island. The land encompasses most of the skiing terrain at PCMR, starting a little bit uphill from the base area, but it does not include the base area, the lower terrain and the parking lots.
"It’s an isolated piece of property," Sullivan told the judge as he spoke about the Talisker Land Holdings, LLC acreage.
But Howard Shapiro, an attorney representing Talisker Land Holdings, LLC, disagreed, saying the PCMR side values the land as if the acreage was ranchland. Shapiro said it was "absurd" to not consider the land’s location in a ski resort. He said the land is a scarce asset.
"It’s just not out there for the taking," Shapiro said.
The two sides also spent time debating an agreement between Talisker Land Holdings, LLC and Vail Resorts to operate the Talisker corporate family-owned Canyons Resort. The deal could be extended to include the disputed terrain at PCMR depending on the outcome of the case. Vail Resorts pays $25 million annually to lease and operate Canyons Resort.
Jonathan Paikin, another attorney for the Talisker Land Holdings, LLC side, described some of the dollar figures in the Vail Resorts deal, saying that $13.6 million of the annual payment is attributable to Canyons Resort while the remaining $11.4 million is linked to the terrain at PCMR.
"That’s the market. That’s what people are willing to pay," Paikin said.
Sullivan, though, countered the deal with Vail Resorts is "clearly above market."
The judge questioned the value attached to the PCMR terrain in the deal, saying there is not easy access to the acreage from the other Talisker Land Holdings, LLC ground involved in the deal.
The courtroom on Wednesday was packed with observers. PCMR President and General Manager Jenni Smith led a small delegation from the resort. Two members of the Summit County Council — Chris Robinson and Roger Armstrong — were in the audience. Tom Daley, a City Hall attorney, was also at the hearing. Others included businessman Mike Sweeney, restaurateur Hans Fuegi, Myles Rademan, who once was City Hall’s public affairs director, and former Park City Councilman Joe Kernan.