Free at last? Govt-owned bank wins control of Landmark hotel

cover-halseyminor-leedanielsonMinor and Danielson at the 2008 groundbreaking. FILE PHOTO BY JAY KUHLMANN

Three years after ground was broken and two years after lawsuits began flying, the towering skeleton of the planned Landmark hotel crept one inch closer to completion Wednesday, January 19, when a Georgia judge ruled against Halsey Minor on all counts in litigation between him and his lender.

"It was game, set, and match in favor of the bank," says Connor Crook, attorney for another party in the morass, a company controlled by Lee Danielson, developer of the 101-room luxury lodging. "All claims are now resolved between those parties, pending any appeal."

Appeal indeed, says Halsey Minor, a tech industry titan with a knack for waging litigation long after the first gavel has fallen.

"The decision was a travesty of justice," Minor says in an email, "and will be reversed."

The bank–- Atlanta-based Specialty Finance Group–- was suing Minor to recover the $10.5 million it fronted the project as part of a loan package that was to have eventually reached $23.6 million. The bank–- now owned by the Federal Deposit Insurance Corporation–- claimed that Minor defaulted; Minor counter-claimed that the bank and developer colluded against him.

Last June, Minor won a measure of support for that claim when an arbitrator, ruling against Danielson's company, ordered it to pay Minor $6.4 million on similar claims. Both Danielson and Minor hinted that it was a paper victory, coming against a disposable company, not an individual.

In September, Minor, having filed for federal bankruptcy protection for his hotel-creating company, tried to push the bank litigation into his bankruptcy case. However, an October 1 order by bankruptcy judge Norman K. Moon remanded the case to the bank's turf in Georgia. Minor doesn't like that.

"The FDIC spent a million dollars to switch this case to an Atlanta courtroom 500 miles from Charlottesville," says Minor via email. "It got what it paid for."

Oral arguments began on December 14 and 15 before the skies opened up with snowfall that paralyzed the oft-sunny Atlanta area. Fulton County Judge Susan B. Forsling took advantage of her snow days to pore through thousands of pages of documents, according to Crook.

So when the arguments resumed on January 18 and 19, instead of keeping the parties in further suspense, she was ready to rule, says Crook, noting that the bank prevailed on all its summary judgment motions and cross-motions and that all of Minor's were rejected.

Crook predicts that once the order is entered in Georgia, it will be sent to Charlottesville Circuit Court where it will halt the remnants of similar litigation that had been pending before Judge Edward Hogshire (halted under the concept of res judicata, which springs from the U.S. Constitution's demand for "full faith and credit.")

This can't be good news for Halsey Minor's lawyer. Having already carried her Los Angeles-based firm, DLA Piper, into litigation that caused Minor to ring up a $3 million legal fee by last September's bankruptcy filing, attorney Betty Shumener recently began representing Minor in another of Minor's cases, an appeal of a judgment won by Sotheby's. Shumener jobbed on even after Minor's previous lawyer told the court he had to quit because communications were “rendered impossible" and that relations had “broken down irreparably.”

In that case, Minor paid Sotheby's an award of $6.6 million after the auction house prevailed on its claim that he reneged on buying three works including "Diamond Dust Shoes" by Andy Warhol. In November, New York federal court Judge Barbara S. Jones–- asserting that Minor violated a restraining notice by transferring funds elsewhere than to deserving lawyers–- cranked up the punishment by ordering him to pay Sotheby's $2.3 million in legal fees. Shumener did not immediately return a reporter's call.

Back at the Landmark, the Tyvek wrappings still flap in the winter breeze, and exposed metal studs still channel rainwater into a cacophony of flood-like sounds during showers.

Across the continent, the now Los Angeles-based man who transformed the Downtown Mall in the mid-1990s with a six-screen Regal cinema and what was originally called the Charlottesville Ice Park, expresses happiness when asked about the Georgia ruling.

"Well, justice prevailed," remarks Lee Danielson. "I believe that the project now can be completed as originally intended."

How soon the citizens of Charlottesville can expect to see action at the towering hulk is another story. Poised to take control of the project but facing the vow of an appeal from Minor, the FDIC did not immediately offer comment on what happened in the courtroom.


As ld time charlie said up top, it the dems fault.

to knowsbetter and Judge's Ruling: I doubt that Crook will be crowing to prospective clients about his results of his advocacy in the arbitration hearing. Maybe he just had a bad set of facts to work with (i.e., could it be that Halsey was right when he claimed that key facts were withheld by his business partner?). Hope Mr. Crook had a retainer in place prior to that arbitration.

The real winners are the Cville area judges - Hogshire transferred most of the the Danielson/Halsey dispute to arbitration, and the rest is now dead due to res judicata. Moon tossed the FDIC/Halsey litigation to the Atlanta court.

Life is good until the appeals get filed.

knowsbetter wins.

Nice to see wonderful hospitality from the old timer....maybe a horse and buggy would work.

Seriously, Minor has a problem and never did learn that honey is a lot better than a hammer. Ego, ego ,ego.....and his attorney is going to have a tough time explaining their $6,000,000 legal fees that they will not collect. I doubt her partners will allow her to file an appeal.

"game, set and match for the bank" says Crook. He is an expert in evaluating humiliating legal losses (having lost his client's litigation vs. Minor in just such a fashion).

What is it about people who fall into money pits like this guy and patrica Klege did that makes them think they are someohow responsible for their wealth?

They were both in the right place at the right time and could have quietly lived like royalty until they died of old age.

The only good part about it is that these two are probably good examples of trickle down economics that makes the liberals in this town happy.

So much for the rich getting richer...

I see ya Crook! Holla!

The unfinished downtown hotel
Remains an eyesore of a shell.
Not lawyers or bankers,
The rest of the town hankers
For news that it might turn out well.

So the attorney's name is Mr. Crook?

i say tar and feather dem both and run dem rascals out of town in a barrel!

deleted by moderator

"... a tech industry titan with a knack for waging litigation ..."

A "penchant," maybe. Or even a "jones." But it doesn't take any particular skill to wage litigation. Just a lot of money.

to Knowsbetter: the arbitrators awarded $6.4 million to Halsey. That is not "splitting the baby".

Crook's client apparently can't afford to pay the arbitration award, but that doesn't mean that Halsey's team didn't win on the substantive legal issues.

Yes, you are any legal professional knows, most arbitrators try to not find the truth but how to find a happy middle where no one is happy. The judgment was against a company that was known not to have any assets (just like Minor's company). That's the way it works. Therefore the arbitrator had really no work to do other than make an award that he knew was of no substance. In the case of Minor, he seems to have problems with California ($13M), IRS ($10M), Sotheby's, Christie's, Merrill Lynch, his farms, houses, housekeepers, etc. All are involved, or have been involved, in litigation. Minor doesn't seem to want to work things out as much as he has "righteousness" on his side. Some people call that pathological.

Who really wins anything here is the larger question. I maintain as before that the time for a boutique "luxury" hotel off the mall passed right around the time they broke ground on that white elephant (if the time actually existed even then) and that the project as originally envisioned (and at its projected cost) has no chance of commercial viability.
Of course we don't really know how it all ends up, but I still say the bank ends up unloading it at an immense loss, which we taxpayers will be so charitable as to cover, and it ends up as something totally different, but absolutely not a hotel. Time will tell though.

I guess it wouldn't fly as a State Park, eh?

The Feds will unload the toxic asset at auction, it will be purchased at a deep discount, which in turn will make the project viable. I believe there will a hotel on this site, imho.

Hey why not fill it up with water? And forget about the whole dam/ city water supply thing!

Confused is even more confused. Can't speak to the retainer issue about Crook but do know that Minor hasn't paid his attorneys. He is well over $6,000,000 (about double what the Feds spent) in legal fees on this matter alone. He stiffed his prior attorney in the Sotheby and Merrill cases. He can file and appeal but I doubt that he attorney is going much further without money in the bank. Most likely his attorney will be working at a new firm soon.

The FDIC is not funded by the taxpayers. It sells required insurance to banks. We the people allow banks to operate only if they follow certain rules, like buying insurance from the FDIC. Likewise corporations have to follow the rule of the people. We should require a lot more of them. First thing would be to prohibit high-speed trading on the financial markets. It serves no public good, endangers the system, wastes resources, and is growing like a disease. So ask a Democrat to tax stock and other finncial trades.

Hmmm Carters Grove today. Now it does look bad.

so, how about demolishing it & build a free parking structure for downtown workers & tourists

The arbitration was a non-winner for both parties from what I understand. Best to stick with the courts who really have to work for the truth than some very old judge who didn't even read the evidence. I think they called it "splitting the baby" (no winners).

this is all one needs to read in response to Halsey.

I wonder how "the cult of personality", a.k.a. Saint Maurice will handle this. Perhaps he'll pull a cue from the big O and say he inherited the problem from the previous administration.

Litigation is an expensive hobby.