Was Wolf Mountain required to sell resort?
July 25, 2007
A Park City man has sued Wolf Mountain Resorts Managing Partner Kenny Griswold claiming Griswold agreed to sell property he owns at The Canyons for $115 million, according to a spokesman for the plaintiff in the case.
The lawsuit, filed against Griswold and Wolf Mountain Resorts, which leases ski terrain at The Canyons to ASC, comes on the heels of an announcement from American Skiing Co. of a pending sale of The Canyons to Talisker Corp., a development firm based in Toronto.
But the plaintiff in the case, Peninsula Advisors principal Mark Robbins, of Park City, reached his agreement to purchase Griswold’s land and take over Wolf Mountain’s lease with American Skiing Co. long before the Talisker deal was announced, said
a spokesman for Peninsula Advisors, who insisted that Robbins hasn’t worked with Talisker during the negotiations.
"The main purpose of the lawsuit is to enforce the contract and have the court direct that Mr. Griswold is to live by the terms of the lawsuit," Peninsula Advisors spokesman Josh Ewing said. "We’re saying, enforce the contract and ensure that that closing does occur."
Meanwhile, attorneys for Wolf Mountain Resorts filed a lawsuit on Tuesday in Los Angeles Superior Court against Robbins and other parties associated with Peninsula Advisors, including a realtor in Park City, according to a prepared statement from Wolf Mountain Resorts.
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"The suit alleges claims for breach of contract, fraud and concealment. Particularly, the suit alleges that the defendants made many misrepresentations and fraudulently induced Wolf Mountain to enter into an agreement based on financial misrepresentations," according to the statement from Wolf Mountain.
If Robbins prevails in his lawsuit, he expects to lease the land to Talisker Corp., should the sale of the resort close, Ewing said.
Before ASC can close the sale of The Canyons, however, Griswold must give his consent.
"[Peninsula] would step into Wolf’s shoes," Ewing explained.
Peninsula Advisors agreed to purchase about 2,000 acres Griswold owns at The Canyons, the 12-page complaint filed Monday in 3rd District Court states.
The lawsuit seeks $16 million in damages from Griswold.
Griswold owns ski terrain at The Canyons that is leased to American Skiing Company, parent company to The Canyons. Once the largest owner of alpine ski resorts in the country, last week American Skiing, which is in the process of dissolution, announced the pending sale of The Canyons to Talisker.
Ewing claims Griswold signed a contract with Peninsula Advisors agreeing to sell the property and take a 20-percent minority interest in a new firm called The Canyons Real Estate, LLC.
But by failing to sell and convey their land on time, Wolf Mountain officials breached their obligations to Peninsula, Ewing said.
Griswold and Wolf Mountain Resorts had not been served with the lawsuit and did not respond to the complaint on Tuesday.
In the negotiations, Griswold misrepresented to Peninsula Advisors that Wolf Mountain was entitled to 4.3 million square feet of development on the property, "when Griswold knew that the amount of entitled density was substantially less than and not more than 3,700,000 square feet," the lawsuit states.
On Oct. 31, 2006, Wolf Mountain and Peninsula entered a transfer agreement to form the new company to allow Peninsula to acquire the property at the resort, the complaint filed against Wolf Mountain states.
Griswold began leasing land to American Skiing Company when the publicly traded firm formed The Canyons in the late 1990s.
According to Ewing, Griswold’s contract with Peninsula includes "2,000 acres of land underneath The Canyons resort and other rights, including Wolf Mountain’s interest as the landlord under a ground lease with [American Skiing Company.]"
Officials at Peninsula Advisors told Griswold they were prepared to begin closing the transaction on June 27, the lawsuit states.
But Griswold failed to attend a meeting to close the deal on July 2 when Peninsula was prepared to pay him $115 million, Ewing said.
Wolf Mountain was sued because Griswold failed to file the proper notices to transfer the property and misrepresented his development entitlements, according to the lawsuit.
"To date, Wolf has not cured any of the above-described defaults," according to the lawsuit.