A federal judge hasn’t yet made a decision about a request by lawyers for The Greenbrier for more time to work on a potential $500 million deal to pay off debt, but the judge has asked the current debtholder, an affiliate of the Omni Hotels chain, for its take.
U.S. District Judge Frank Volk entered an order today directing the Omni affiliate White Sulphur Springs Holdings to submit its written response by Monday.
White Sulphur Springs Holdings, which bought about $300 million in first-lien debt on The Greenbrier earlier this year, filed a federal receivership lawsuit against The Greenbrier’s owners, the Justice family, on April 17.
Lawyers for the holding company say their collateral is at risk, and they’ve been asking the judge to appoint a third-party receiver to oversee the hotel while pushing out the owners, Senator Jim Justice and his family business.
The Justices and their Greenbrier Hotel Corporation say they have been working on a $500 million deal with the New York firm Kennedy Lewis Investment Management to pay off White Sulphur Springs Holdings and other entities owed money while also providing enough to invest in long-needed hotel improvements.
On May 22, lawyers for the Justices requested a delay in court activity for 60 days to work toward completion of the deal.
On May 30, Volk then granted the delay “with the expectation that closing will occur on or before July 16, 2026.”
Volk had indicated that if there’s a push to delay beyond that, the court’s patience could grow thin.
“If Defendants seek further extensions for either (1) more extended negotiations with, or financing due diligence by, the financing partner, or (2) to allow additional forays with other lenders, the balance of prejudice will likely shift rather abruptly,” Volk wrote.
That date has come and gone, but with a bunch of back-and-forth.
Volk entered a show cause order on Sunday telling lawyers for The Greenbrier to put in writing why the court should not move ahead with proceedings that have been delayed more than a month.
Lawyers for The Greenbrier responded on Tuesday to say they are close to completion of the financing deal but are asking the court for more time.
The attorneys for The Greenbrier say another period up to August 7 is necessary to work through complications like the sheer size of the financial deal, regulatory oversight of the casino license and the finer details of a resulting joint venture. The lawyers for The Greenbrier also filed a motion to continue the proceedings.
Judge Volk is now asking White Sulphur Springs Holdings for response to the requests for more time.
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