An affiliate of the Omni Hotels & Resorts chain and the longtime banker for the owners of The Greenbrier continue to say claims filed on behalf of Senator Jim Justice and his family business should be knocked out of state court.
“Plaintiffs again face a debt they cannot pay. They again ask (yet another) court to buy their tale and save their bacon,” wrote lawyers for White Sulphur Springs Holdings, a corporate affiliate of Omni.
“Enough is enough. Plaintiffs’ decades-long manipulation of the legal system to avoid their obligations must end.”
A battle over control of The Greenbrier Hotel is proceeding on two fronts. White Sulphur Springs Holdings, which bought rights to about $300 million in first-lien debt on The Greenbrier and associated properties, filed a federal lawsuit to have a receiver named to oversee the historic hotel and to push the Justices out.
The federal lawsuit is largely on hold while the Justices pursue a financing deal of up to $500 million with Kennedy Lewis Investment Group, a New York-based alternative asset management firm focused on opportunistic and private credit.
Meanwhile, the Justices sued White Sulphur Springs Holdings and longtime lender Carter Bank & Trust in Greenbrier County, contending the two parties engaged in fraudulent practices and broke confidentiality agreements to make the debt transfer.
The Justices are seeking legal rescission of the loan sale and at least $500 million in damages for fraud and antitrust violations.
White Sulphur Springs Holdings was formed this year as a subsidiary of TRT Holdings, which is owned by Texas billionaires Robert and Blake Rowling. They own the Omni Hotels & Resorts chain. The Justices sued all of them, plus Carter Bank.
In the Greenbrier Circuit case, both White Sulphur Springs Holdings and Carter Bank entered filings this week to argue for dismissal. One of their main arguments is that the case was filed in the wrong jurisdiction because the Justices repeatedly signed contracts designating Martinsville, Virginia, as the proper forum.
“Plaintiffs voluntarily entered into the contracts they now seek to avoid,” wrote the lawyers for the holding company.
The spicier of the two is the 38-page filing by White Sulphur Springs Holdings, which pushes for dismissal without prejudice, maintaining that the plaintiffs have failed to state any valid claims for fraud or antitrust violations.
The filings characterize the Justice claims as a fictional narrative designed to stall the enforcement of millions of dollars in debt obligations.
“Plaintiffs ask the Court to endorse a fabricated tale rich with conspiracy and coercion, good and evil. And they must — the truth is too simple and too fatal to their claims. But accepting Plaintiffs’ narrative would require the Court to ignore the undisputed facts driving this judgment creditor vs. judgment-debtor dispute,” wrote the lawyers for White Sulphur Springs Holdings.
The filing contends the Justices and their legal team are too savvy to have fallen for a trap.
“Plaintiffs tell the Court that the TRT Defendants and CBT somehow tricked them into executing the years’ worth of agreements at hand. Everyone — the participants in this litigation and all those watching — knows this is preposterous. Plaintiffs are a United States Senator, his family, and their entities. Together they have operated a vast business network for decades. All the while advised by formidable legal counsel.
“Senator Justice is a seasoned businessman. The press has alternately described him as the ‘richest senator in the United States’ with an estimated net worth of $664.2 million at one point or, conversely, one with a debt burden exceeding $1 billion. Either way, Plaintiffs are no strangers to complex contracts, loan arrangements, and multi-party financing transactions.”
White Sulphur Springs Holdings maintains it is in control of a forbearance agreement, which represents a contract between a lender and a borrower in default, where the lender temporarily pauses or reduces payments and delays legal action like foreclosure or repossession to allow the borrower to resolve financial hardship.
Signing such an agreement allows a grace period but essentially hands the keys to the creditor by admitting full liability and waiving almost all rights to contest a future judgment. It’s a high-risk legal document.
The Justices had signed a 14th forbearance agreement with Carter, effective this past Feb. 28. Carter then transferred it to White Sulphur Springs Holdings, which is seeking to assert its authority.
“The time has come for Plaintiffs to face their obligations,” wrote the lawyers for White Sulphur Springs Holdings. “They owe well over $370 million in judgment obligations to WSSH, which is secured in part by The Greenbrier.”