2 Owners Of Schweitzer Lash Out At Bank Pair Accuse Lender Of Mismanagement In Handling Loans For Family’s Ski Hill
Two family members who are trying to stop the sale of Schweitzer Mountain Resort have filed a complaint against the bank that loaned them millions to operate and develop the ski hill.
Bobbie Huguenin and Jean Brown protested the sale of their family-owned resort last week, even though they signed an $18 million sale agreement.
Huguenin and her mother have now accused U.S. Bank of mismanagement, improper banking practices and scheming to sell the resort and leave the Brown family penniless.
“The proposed imminent sale of Schweitzer Mountain Resort will be the culmination of the bank’s wrongful conduct and will result … in the financial ruin … of the Brown family,” the complaint said.
The family members filed the complaint in Superior Court in King County, Wash. They want a jury to hear the case.
U.S. Bank officials could not be reached late Tuesday. Ford Elsaesser, a Sandpoint attorney appointed by the family and bank to sell the resort and stall foreclosure, had not seen the complaint.
But he said the bank has cooperated in every way with the Browns.
“The bank has never adopted a fire sale or foreclosure mentality to the mountain even though they may have well been legally entitled to do so,” he said. “The bank has been supportive of selling it as a going concern.”
Elsaesser said the recent action by some Brown family members could prevent Schweitzer from opening this fall. It could also prompt the bank to foreclose on the ski hill to recoup some of the $21 million it loaned the Brown family.
If the resort doesn’t open this year, it would leave about 500 people without jobs and devastate Sandpoint’s winter tourism economy.
The resort is about $28 million in debt. Since 1989 the Brown family has continually borrowed money from U.S. Bank to develop the mountain and keep it operating. Much of the family’s personal property as well as the mountain was put up as collateral.
In their complaint, Huguenin and Brown say the bank forced them to accept Elsaesser as trustee to oversee the mountain. Earlier the family said they specifically requested Elsaesser be in charge.
The pair also now alleges they were not informed how to protect their property by declaring bankruptcy rather than appointing a trustee.
“U.S. Bank succeeded in a deliberate scheme of keeping the members of the Brown family under constant … threat of seizure of all their assets …” the complaint said.
The bank agreed, however, not to foreclose on the resort several times. Instead a payment plan was arranged to help the family. And nearly $1 million was loaned to the resort last year so a new ski lift could be repaired.
But family members who filed the complaint blame the bank for their financial woes and huge debt.
“The sale of assets … and the general dismantling and destruction of the Brown family businesses - all directed and controlled by U.S. Bank - have caused (the family) serious loss and damage,” the complaint said.
The resort was set to be sold to Harbor Properties Inc., a Seattle-based company that owns Stevens Pass ski area near Snoqualmie, Wash.
The company offered $18 million for Schweitzer with about $14 million going to pay off the debt to U.S. Bank. The family would also retain a 10 percent ownership in Schweitzer. The sale was supposed to be approved by a judge next month.
Since Huguenin and Brown have protested, the sale is in question. The family members claim the resort is worth $60 million and said they were forced into selling cheap by the bank.
“U.S. Bank succeeded in persuading some members of the Brown family … that they would only preserve their homes and other personal assets if they continued to consent to all of U.S. Bank’s collection efforts,” the complaint said.
, DataTimes