Lawyers representing the owners of The Greenbrier Hotel have filed for a preliminary injunction to halt the forced auction of the historic resort.
The motion was filed today in Greenbrier County court on behalf of The Greenbrier Hotel Corporation, which has a majority stake by Jay and Jill Justice, the son and daughter of Gov. Jim Justice.
The Greenbrier Hotel has been announced for auction on the courthouse steps at 2 p.m. August 27 — next Tuesday — because of default on the terms of a longstanding loan through the financial giant JPMorgan Chase. A few weeks ago, JPMorgan sold loan documents including the deed of trust to a credit collection company, McCormick 101.
The filing for the Greenbrier ownership group contends the auction would be invalid for several reasons: that the legal notice that ran in a local newspaper was deficient; that a 2014 deed of trust isn’t valid because it was approved by Jim Justice and not by the current majority of the Greenbrier Hotel Corporation, his son and daughter; and that the forced sale violates assurances offered verbally between representatives of JPMorgan and Jay Justice.
More broadly, lawyers for the Justice family contend that the auction should be halted because it would result in a piecemeal sale of the hotel property, drive down the value of the resort, imperil jobs and throw the region’s economy into turmoil.
“Defendants seek a hastily arranged sale of a unique piece of real property that is owned by Plaintiffs and contributes significantly to the economy of Greenbrier County. Defendants attempt foreclosure on the Deed of Trust notwithstanding that they lack the legal authority to do so,” wrote the lawyers for the Justice family.
“The threatened sale would irreparably harm Plaintiffs. The Greenbrier’s reputation and business will suffer. Local jobs will be lost. And the foundation of Greenbrier County’s economy will suffer damage that will be difficult or impossible to repair.”
The lawyers for the Greenbrier ownership group, led by Charleston attorney Steve Ruby, wrote that the public interest weighs heavily in favor of an injunction.
“The Greenbrier and its affiliated entities employ nearly 2000 people during peak season and indirectly support hundreds or thousands more jobs, contributing mightily to the local economy. If the threatened sale is allowed to proceed despite its legal infirmities, the jobs of those employees will be at immediate risk. Hotel patronage will drop precipitously, with the inevitable effect that spending at local businesses will fall drastically,” wrote lawyers for the Justice family.
Jim Justice gained goodwill and steps toward statewide name recognition when he bought The Greenbrier out of bankruptcy in spring of 2009. Justice, a two-term governor, is now a Republican nominee for U.S. Senate and is considered the frontrunner because of his broad name identification and West Virginia’s recent voting trends.
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Justice in several recent public statements has contended the forced sale of The Greenbrier has been politically motivated, saying his election on Nov. 5 could tip the majority of the U.S. Senate.
A complaint that accompanies the motion for preliminary injunction in Greenbrier Circuit Court does not make that as a legal argument, but it does mention Justice’s candidacy as part of the overarching context and describes just a few weeks passing between his official nomination and the announcement of the auction:
“On May 14, 2024, however, Justice II became the Republican nominee for one of West Virginia’s United States Senate seats. The Senate seat for which he was nominated is regarded as the one most likely to change parties from Democrat to Republican. Less than seven weeks after his nomination, and after 14 years of doing business with Justice II, JPMC, with no notice or warning, sold Justice II’s loan to McCormick, which JPMC knew or should have known was a cutthroat debt collector that likely would launch an immediate legal attack on Justice II.”
Jim Justice was the primary signatory for the original $142 million loan agreement with JPMorgan Chase. That loan continued for years, with several rounds of revised terms.
A statement included in the overall filing by Jay Justice, the governor’s son, notes that when the original loan terms were reached in 2014, the board of directors of Greenbrier Hotel Corporation included Jim and Jay Justice. At the time, the president of Greenbrier Hotel Corporation was Jim Justice.
The statement indicates Jay Justice owns 30% of Justice Family Group, and Jill Justice owns 21% — giving them the combined majority of the entity that owns the full value of Greenbrier Hotel Corporation.
Jay Justice’s statement contends neither he nor Jill Justice consented to the 2014 deed of trust with JPMorgan Chase.
From 2014 to July 1 of this year, Jay Justice’s statement says JPMorgan Chase communicated regularly with the family-owned Greenbrier Hotel Corporation about the loan.
Starting in 2022, according to Jay Justice’s statement, the family-owned group started selling cottages that are part of The Greenbrier complex to private buyers. Jay Justice stated that JPMorgan representatives told him that if the lender received payments associated with those sales and if the family ownership group sold or refinanced Glade Springs Resort in Raleigh County by this September then JP Morgan would take no action against the family owners.
The filing describes this agreement as an “oral forbearance.”
Jay Justice stated that in the last week of June he informed JPMorgan Chase about an agreement to sell a piece of real property at Glade Springs Resort and turn over the proceeds to the lender.
“JPMC did not attempt to revoke the oral forbearance even during this discussion in the last week of June, 2024,” Jay Justice stated.
But Jay Justice stated that about July 1 he learned that JPMorgan Chase, “without warning or advance notice” had assigned the deed of trust and the associated loan agreements to McCormick 101.
Jay Justice’s statement notes that the auction is only for the main hotel building and some of the freestanding cottages but not most of the grounds surrounding the main hotel, such as the golf courses, most of the cottages, the parking lots, areas with resort amenities such as fishing or carriage rides or the tanks that supply water to the resort.
“The threatened sale therefore would separate The Greenbrier resort in a manner that would be catastrophic to The Greenbrier’s business,” he stated.