The companies owned by Gov. Jim Justice and his family have announced the resolution of a long-running dispute with their longtime creditor Carter Bank & Trust.
“This settlement resolves all outstanding disputes between the parties and reinforces the respective parties’ mutual commitment to moving forward constructively and amicably,” representatives of the Justices said in a statement announcing the agreement.
“Specific terms of the settlement remain confidential per mutual agreement. However, the agreement encompasses a pathway of curtailment and payoff of the loans the Justice family has outstanding with Carter Bank.”
Carter Bank of Martinsville, Va., had been moving to cash in roughly $300 million in defaulted loans, and the Justice companies had sued the bank in federal and local courts in response. A federally-filed statement from Carter Bank indicated the lawsuits would be dropped and expressed confidence that the debts are on their way to being paid down.
The statement from the bank makes reference to a pathway of curtailment. A common way of achieving that is through selling collateral. The bank earlier this year announced a planned auction of Justice’s Greenbrier Sporting Club, but that was held up as talks between the parties went on. Another Justice property with big loans from Carter is Oakhurst Club. Additional Justice properties with Carter loans include Justice Low Seam Mining, Twin Fir Estates and Wilcox Industries.
The dispute fired up last year when Carter Bank held out signed guarantees to say the Justices should pay up after loans had come due more April 15, 2023.
The debts were personally-guaranteed by Jim Justice, his wife Cathy and their son Jay, who runs the family’s coal operations. The debts applied to several branches of the family’s business network, including Greenbrier Hotel Corporation.
Earlier this year, Carter Bank filed public notice to auction the Greenbrier Sporting Club on the courthouse steps to satisfy a portion of the debt.
In response, the Justice businesses filed a lawsuit in Greenbrier County to block the sale. Hearings in that lawsuit have been on pause for weeks, presumably because of settlement talks going on in the background.
Justice, in public comments and in court filings, has contended the bank’s practices are unfair. Justice contended Carter Bank made its lending philosophy stricter — and unworkable — after a long and mutually beneficial business relationship.
Lawyers for the Justice companies filed a $1 billion lawsuit in federal court against Carter Bank.
Today, Jay Justice — the governor’s son who runs much of the family operation — stated that he’s glad to reach a resolution.
“Our family has valued our decades-long relationship with Carter Bank dating back to my dad’s long-standing personal relationship with Worth Carter, the Bank’s visionary founder, and longtime chairman. Our family is committed to satisfying our outstanding obligations to Carter Bank and fulfilling our commitments under the terms of the agreement reached with Carter Bank,” Jay Justice stated.
“We look forward to focusing our attention on these efforts and believe that this resolution will ensure that The Greenbrier remains a part of the Justice family’s holdings for generations to come.”
Carter Bank put out its own statement in the form of a filing with the federal Securities and Exchange Commission. That statement alluded to the voluntary dismissal of the $1 billion federal lawsuit against the bank “with prejudice,” which means it’s permanently dismissed no matter what. The bank’s statement said officials also anticipate dismissal with prejudice of the lawsuit in Greenbrier County.
The Carter Bank statement provided a window, broadly, into the financial terms of the settlement, saying the Justices have already paid down several million dollars of the outstanding debt and projecting confidence that more will be paid down.
In connection with the dismissal of the Federal Lawsuit and the WV Lawsuit, the Justice Entities have agreed upon a pathway of curtailment and payoff of the loans they have outstanding with Carter Bank.
“The Justice Entities have already started that process of curtailment such that as of the date of this statement, the aggregate nonperforming loan balance associated with the Justice Entities has been reduced from $301.9 million as of the end of the 1 quarter, 2024 to a balance of approximately $294.1 million as of June 20, 2024.”