Breaking down a potential Greenbrier Sporting Club sale

By Stephen Baldwin, RealWV

After Carter Bank & Trust provided legal notice of their intention to sell significant portions of The Greenbrier Sporting Club to satisfy a $300 million debt owed to them by James C. Justice Companies, the affected community in the Greenbrier Valley immediately began asking questions.

Late Wednesday, the Justice Companies filed a countersuit against Carter, in an attempt to stop the sale. They contend that while they owe Carter in excess of $300 million, Carter only seeks $250 million in return. This violates state law, they say, and makes the Greenbrier Sporting Club sale illegal. They also contend that they had other creditors lined up to pay off their debt to Carter in years past, only for Carter to “sabotage” those efforts. Judge Jennifer Dent was assigned the case. It seeks a jury trial in Greenbrier County, where Justice Companies are the county’s largest employer.

Here’s a quick breakdown based on our reporting thus far. 

Which assets are contained in the legal notice of sale? 

The legal ad lists a number of lots, approximately 50 in total, which are included in the sale. That total number of properties includes lots owned by the Greenbrier Sporting Club Development Company LLC (controlled by Justice Companies) and common areas including the golf course, the summit lodge, and the main lodge. 

Which assets are not contained in the legal notice of sale? 

No lots owned by individual sporting club members are included. Nor are an additional sum of approximately 100 lots owned by the Development Company. 

Does the bank have the authority to sell the common areas such as the golf course? 

It’s unclear. If the common properties were pledged as collateral, then the bank could try and sell them to satisfy the debt owed to them. However, club members claim they own the majority stake of the common areas and therefore they could not have been pledged by the Justice Companies. 

When will the sale occur? 

The notice says the sale will occur on the steps of the Greenbrier County Courthouse on March 5. Carter has the right to delay or cancel the sale at any time. 

Will it actually happen? 

“I don’t believe there’ll be one ounce of anything sold, period,” Governor Jim Justice said on Wednesday. However, Carter’s notice indicates their seriousness, combined with their message to shareholders in an SEC filing late last month. The matter is before Judge Carter Greer currently, who indicated in recent filings that Carter Bank stood on solid legal ground in their efforts to receive payment for debts owed them by Justice Companies. 

Gov. Justice lays the blame with the bank, calling them “bad actors” and saying, “Carter Bank has been terrible. Beyond belief terrible. We’re not gonna put up with it anymore. We’re gonna push back like you can’t imagine.” 

He continued, “We may very well owe Carter $300 million, but on another hand we feel like they owe us in excess of $1 billion.” 

Justice Companies filed suit against Carter in 2023 seeking $1 billion in damages. That separate case is still pending as it was filed in Raleigh County, West Virginia, when Carter Bank is located in Virginia. However, Judge Carter Greer cast doubt on that defense last month by saying, “The defendants offer sparse analysis as to how these defenses are either adequate or dispositive.”

What effect with the Justice countersuit, filed February 7, have?

It’s unclear, though the addition of a new countersuit will in all likelihood delay the repayment of debts owed to Carter.

Why don’t Justice Companies just pay the debt? 

On Wednesday in response to this question, Gov. Justice said, “I don’t have a drawer with $300 million you can just write a check and pay for it. There are so many other circumstances where maybe we could’ve paid for it and maybe we were blocked. You’ve just gotta wait. At the end of the day, you’re going to be stunned by the conduct.”

How do Sporting Club members feel about this?

Speaking off the record, they conveyed “lots of grumbling” this week. They are unhappy that their dues have risen sharply (more than doubling in the last 12 years, plus paying additional fees such as the Historic Preservation Fund tax on all services and goods). They think the Development Company is not paying the dues on all the properties they own, which is causing them to shoulder more of the financial burden of the community. At the same time, they are concerned about who might have a controlling stake in the future with several recognized entities being rumored to have shown interest in purchasing the community and the resort over the last two years. The executive who’s been in charge of Sporting Club real estate for more than a decade recently resigned and moved, adding further instability to the situation.

Is Carter Bank the only interest seeking to satisfy debts owed by the Justice companies? 

No. Credit Suisse and the Justice Companies are currently involved in an agreement to repay more than $300 million in debts owed. Several companies have also been competing recently for the right to the proceeds from the sale of a helicopter. Those interests include a “Russian oligarch”, as described by Justice lawyers in filings. Also, the federal government sued to collect several million in unpaid mining safety fee violations. 

Has this happened with other Sporting Club properties recently? 

As part of a debt to MVB Bank, it took out a deed of trust against five Sporting Club lots valued at over $3 million.

Is The Greenbrier Resort part of the Carter legal notice? 

No. It only lists Sporting Club properties. 

Who might bid on the Sporting Club if it does go to sale on March 5? 

It’s unclear, but the notice of sale does explicitly provide Justice Companies the right to bid in the sale. Sporting Club members could as well. 

Stay tuned to RealWV for further updates on the matter. 

*This story has been updated since it was first published.