Justice asks court to delay Sporting Club sale 

By Stephen Baldwin, RealWV

On Valentine’s Day, lawyers for the Justice Companies filed a motion for preliminary injunction seeking to stop a planned sale of The Greenbrier Sporting Club properties. Citing “this community’s economic well-being,” the legal filing argues that Carter Bank & Trust is racing too quickly and would injure the residents of the Greenbrier Valley by going through with an advertised sale. 

As previously reported by Brad McElhinny and other outlets last year, loans totaling more than $300 million came due to Carter by the Justice Companies on April 15, 2023. Since then, Carter has been working towards acquiring Justice assets to offset that debt. In an SEC filing to their shareholders last month, Carter said it planned to “pursue aggressively all remedies afforded it to collect all amounts due and owing by the Justice Entities.”

Then last week, Carter placed a legal ad providing notice of large portions of the Greenbrier Sporting Club on the courthouse steps in March. The planned sale includes the golf course, lodge, and more common areas in the private club. 

Photo by RealWV

In yesterday’s legal filing, lawyers for the Justice Companies argue that the planned sale is illegal, as it seeks $250 million in assets while they owe more than $300 million. Additionally, they say they may not owe that amount due to a federal court action they took last year seeking $1 billion in damages against Carter. 

“The attempted sale is nothing more than a race to strip Plaintiffs of their assets (in a hastily scheduled auction on the courthouse steps that likely would bring pennies on the dollar) before their claims against the bank can be adjudicated,” says the filing in Greenbrier County Circuit Court, assigned to Judge Jennifer Dent. 

Golf course, lodges, & restaurants

As previously reported, the crux of the legal battle seems to be over certain “shared facilities” on the grounds of the Sporting Club including the golf course, main lodge, and mountaintop lodge. Both lodges also include restaurants. 

Carter’s planned sale includes those shared entities or common properties. Sporting Club members argue that they own those as part of their equity membership, not Justice Companies. Carter contends the assets were pledged as collateral in loans by Justice Companies. 

Yesterday’s filing does not appear to dispute that the shared entities were pledge as collateral, but it does say the Justice Companies and surrounding community would be “irreparably harmed” by their sale. 

“The threatened sale of the Shared Facilities would badly damage the Sporting Club. The Shared Facilities are the principal amenities available to Sporting Club members, and if they become unavailable as the result of a sale, the value of members’ residences would plummet immediately.”

It goes on to say, “The effect would not be limited to the Sporting Club. The Greenbrier itself would be seriously damaged…Local jobs will be lost. And the foundation of Greenbrier County’s economy will suffer damage that will be difficult or impossible to repair.”

Club members react

Speaking on the condition of anonymity for fear of retribution by ownership, Sporting Club members are exploring their options. 

They conveyed “lots of grumbling” last 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.

Ultimately, they would like to gain control of the property themselves, which they believe would provide for a fairer dues structure. Meanwhile, the Justice Companies filing contends that if a sale does proceed then a fire sale would occur among members for “pennies on the dollar.” 

Stay tuned to RealWV for updates on this story. 

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