By: Kyler Roush
On March 9th, 2012, the owners of Park City Mountain Resort (PCMR) filed a lawsuit against Talisker Land Holdings. The lawsuit claims that PCMR on April 30th, 2011 gave written confirmation to Talisker of their intent to extend their lease by another 40 years, through 2051. Since the lawsuit was filed, Talisker has claimed that PCMR failed to meet the deadline of March 1st, 2011 for their lease extension.
In the 14 page complaint filed by PCMR in the Third Judicial District Court for Summit County, PCMR claims that they had met with Talisker on many occasions in 2009, 2010, and 2011 to discuss resort improvements and their intents to continue their lease through 2051.
The lease agreement that PCMR has operated on for 40 years allows the use of 3,700 acres of land. Much of the land that PCMR operates on is included in the 3,700 acre’s, including: much of the ski terrain, parking lots, base facilities. However, PCMR owns in full the rights to the water, snowmaking, sewer infrastructure, buildings and lifts.
Out of the Lawsuit, PCMR asks that the courts uphold the extension of the lease through 2051. They also demand compensatory and punitive damages be paid by Talisker to an amount no lower than $7,000,000 and the highest lawful interest rate. In addition, they also demand that Talisker pay PCMR’s attorney fees, court costs, and any other fee’s the court finds just.
After reading the court papers, the one thing that stood out the most to me was,
“The threatened injury to GPCC and GPI (Park City Mountain Resort) far outweighs any possible damage the proposed injunction could cause UPCM or Talisker. Indeed, if an injunction is issued in this case, defendants will suffer no loss whatsoever. On the other hand, if an injunction is not issued and the Resort is shut down, defendants will, in fact be deprived of GPCC’s ongoing lease payments which total approximately $155,000 per year.”
To me, this statement says ALOT.
It seems as if PCMR is trying to continue their lease at what would be far below market value of the land at $155,000 per year, by saying Talisker will be harmed if they don’t continue at the current rate. I also feel as if Talisker is upset that in their original lease they allowed the lease to be continued at the seemingly low rate of $155,000, and because of that are saying the lease extension wasn’t filed in time.
Both parties have a trump card in this case, Talisker owns the land and PCMR owns everything on the land and if the courts don’t back up PCMR’s lease claims, things will get very interesting very quickly. Not only does Talisker own much of the land that PCMR operates on, they own entirely the neighboring resort, Canyons, which is PCMR’s competitor. In the last several years there have been ongoing discussions to link the two resorts via a chairlift to create what would be one of the largest resorts in the nation. It would be unlikely that PCMR would be very interested in selling all the infrastructure to Talisker in the event of a loss. If PCMR wins the lawsuit, the lease extension come 2051 may also get interesting. Imagine suing your landlord and expecting to come back to the same place the next season.
I do hope that the dispute is settled soon as the 2012-2013 season is on the line, as well as 1,200 jobs and 10’s of millions of dollars in the local economy is in jeopardy.
What do you think of Talisker’s crafty business move and PCMR’s big mistake of not renewing their lease?