Park City/Talisker-Vail Lawsuit

[Nick]

Did anyone actually follow all of that?

I think I need a chart or an image hahaha. Thanks for the detail, that was very helpful!

 

[thetrailboss]

I think I need a chart or an image hahaha. Thanks for the detail, that was very helpful!

Here you go...this kind of shows the relationships between the folks:

Park City Resort (POWDR)(Tenant) <---------> Talisker (Landlord)

^
^
^
Vail Resorts (now leasing Canyons from Talisker)

As part of the lease of the Canyons, Talisker gave Vail the right to take over the lawsuit for the land that Park City sits on....so there would be a diagonal line from Vail up to PCMR to show that relationship.

 

[First Tracks]

Here's the latest twist:
http://www.firsttracksonline.com/20...ils-in-park-city-mountain-land-lease-lawsuit/

 

[thetrailboss]

Here's the latest twist:
http://www.firsttracksonline.com/20...ils-in-park-city-mountain-land-lease-lawsuit/

A very good summary of what has happened. Major screw up by POWDR to renew so late.

 

[First Tracks]

Once again, here's the latest:
http://www.firsttracksonline.com/20...e-park-city-mountain-resort-emails-after-all/

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[First Tracks]

PCMR scores a small, but potentially significant victory. Once again here's the latest:
http://www.firsttracksonline.com/20...-amend-complaint-against-talisker-over-lease/

 

[thetrailboss]

PCMR scores a small, but potentially significant victory. Once again here's the latest:
http://www.firsttracksonline.com/20...-amend-complaint-against-talisker-over-lease/

Well......

Very small at best. The Judge is allowing them to amend their complaint to bring the right of first refusal claim. They still have to prove it of course, but it does give them leverage. It also is moot in some ways because Vail stepped into the scene long after the PCMR lease theoretically ended.

 

[snowmonster]

Since I'm on a Red Sox high now: this sounds like the ski area version of the Red Sox mailing a contract late to Carlton Fisk which allowed Pudge to become a free agent and sign with the White Sox.

Carry on, boys.

 

[drjeff]

Well......

Very small at best. The Judge is allowing them to amend their complaint to bring the right of first refusal claim. They still have to prove it of course, but it does give them leverage. It also is moot in some ways because Vail stepped into the scene long after the PCMR lease theoretically ended.

Deferring to TB's legal expertise on this, but I would presume that the more significant ruling will be when it's decided if based on the e-mail's that POWDR had to turn over about the contacts they made with Talisker around when the lease originally expired and if POWDR actually by that deadline let Talisker know they intended to renew. If POWDR backdated that notification as it it alleged then it would seem that POWDR really doesn't have a leg to stand on and it was totally within Talisker's right to enter into the operations agreement with Vail Resorts.

If the notification between POWDR and Talisker did indeed happen on time, then I would think that POWDR's claim for the right of first refusal would have some merit.

Ultimately it seems like the basic premise is can an owner (Talisker) choose who they want to enter into a business agreement with who they want to in a situation where an existing past contract may have expired and wasn't actually acted on before the expiration date

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[First Tracks]

I would presume that the more significant ruling will be when it's decided if based on the e-mail's that POWDR had to turn over about the contacts they made with Talisker around when the lease originally expired.

The emails in question were internal, not addressed to Talisker, and they're no longer in play because Judge Harris has already ruled that Talisker isn't entitled to them.

and if POWDR actually by that deadline let Talisker know they intended to renew.

That question is the key to this whole litigation. The issue is whether Powdr's other actions - e.g., notifying Talisker prior to the end of the lease that they were spending $7M in summer 2011 (after the expiration of the original lease) to improve the property (expenditures including installation of the Crescent lift), sell season passes for 2011-12, etc. - provide Talisker with sufficient indication that Powdr intended to renew the lease? If so, the court may well find that Talisker had a reasonable expectation that the lease was to be renewed even though the formal letter specifying that didn't arrive until May 2, 2011, 3 days past the April 30, 2011 deadline. Furthermore there's the argument that Talisker let them go ahead and do all of that throughout the rest of 2011, spending allof that money, and not telling Powdr that they considered the lease null and void until December 2011, such that Powdr had a reasonable expectation that the lease was in force.

Frankly I don't believe from what I know that this is as clear cut as everyone seems to think that it is.

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[mbedle]

What could possibly happen if the court ultimately rules in Talisker's favor? It seems to me that since PCMR owns the properties at the base of the ski operations, the resort buildings, the parking lots and the water rights, what is Talisker/Vail going to do with the land if they take over. Just a thought, but seems to pretty much be a court battle to get PCMR to pay a fair leasing fee for the next 40 years.

 

[thetrailboss]

Just a thought, but seems to pretty much be a court battle to get PCMR to pay a fair leasing fee for the next 40 years.

That is the conclusion I have come to as well when asked the question of, "what is the end game?" I think that they are upset that they only get $150k per year from PCMR and have to pay out in excess of $1 million for their lease of a portion of the Canyons. I think they are trying to get more money out of PCMR and using this as leverage. Of course if they wear our PCMR, then they get the land back, already developed into ski terrain, and can connect it to Canyons.

 

[mbedle]

Very true trailboss and I did think that if this does go in favor of Talisker, they could try to incorporate the upper parts of the Park City Resort into the Canyons. But the lifts that terminate on PCMR property are worthless at that point. Rebuilding base lift station further up the mountain would also be difficult considering the steep elevations at the base of the mountain. They also may acquire most, if not all, of the snowmaking equipment, but that turns worthless with out the water rights.

 

[thetrailboss]

Very true trailboss and I did think that if this does go in favor of Talisker, they could try to incorporate the upper parts of the Park City Resort into the Canyons. But the lifts that terminate on PCMR property are worthless at that point. Rebuilding base lift station further up the mountain would also be difficult considering the steep elevations at the base of the mountain. They also may acquire most, if not all, of the snowmaking equipment, but that turns worthless with out the water rights.

What Talisker would do then is force PCMR to lease or sell them their facilities. Hostile takeover complete.

 

[mbedle]

Interesting - I would assume that would cost talisker a little more than 3 million a year....

 

[drjeff]

What Talisker would do then is force PCMR to lease or sell them their facilities. Hostile takeover complete.

Option B would be to just build a new base area a bit North of the current PCMR base area out behind the PC Golf Course.

There's a bunch of land between the Canyons and PCMR, some of which Talisker might already have the rights too (I'm not quite sure how far East the land Talisker has at The Canyons and via the PCMR land lease goes??)

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[bigbob]

I wonder how much $$$ it will cost Talisiker/Vail to clean up the mining waste over on the PCMR terrain? Maybe that's why Powdr never bought the land when it came up for sale a few years back...

 

[thetrailboss]

I wonder how much $$$ it will cost Talisiker/Vail to clean up the mining waste over on the PCMR terrain? Maybe that's why Powdr never bought the land when it came up for sale a few years back...

I think that they have been cleaning up the waste over many years; I think that POWDR does not have the $$$ to buy the land. They could have in 2001 or so, but Talisker beat them to it.

FWIW I believe that POWDR has a similar lease arrangement for Killington. POWDR does not own the resort; it operates it and SP Lands owns the real estate.

 

[HowieT2]

I find it hard to believe, pcmr would have neglected to notify, if they actually needed to. Just because it's alleged, doesn't make it true.

 

[thetrailboss]

I find it hard to believe, pcmr would have neglected to notify, if they actually needed to. Just because it's alleged, doesn't make it true.

PCMR says that they made several inferences and informal indications of their intent; the case recently came to a head over some correspondence and Email between PCMR and its attorneys. Talisker/Vail alleged that the lease renewal was due April 30, 2011 but was not sent until a few days after. Talisker/Vail also alleges that PCMR actually postdated correspondence after realizing the error.

I've got to say that watching this all in my backyard is interesting and that PCMR doesn't come off as the innocent party that they claim they are. It looks like a pretty big mistake IMHO. In some ways it is understandable because at that time of year resorts are winding down, folks go on vacation, staff are laid off, etc. This, apparently, fell through the cracks.