The defendants in the $1.6 billion alleged fraud case linked to the Baha Mar casino, in the Bahamas, have requested a stay of enforcement on the court’s ruling noting that the companies in question ‘will be forced into insolvency’.
According to a reply affirmation filed with the Supreme Court of the State of New York Appellate Division, CCA Construction Inc, CSCEC Bahamas Ltd and CCA Bahamas Ltd requested the stay. The plaintiff is BML Properties Ltd.
In a copy viewed by AGB, the defendants claim ‘the trial court piled error on error in awarding the real estate developer Plaintiff $1.6 billion in damages […] including one {CCA} that had no contractual relationship to or role in the construction project at issue’.
The request furthers ‘the trial court ignored swaths of unrebutted testimony and entire defense witnesses, mixed and matched contractual obligations without importing limitations on liability, and misapplied the same bedrock damages principle that this Court corrected the trial judge on in this same case at summary judgment less than a year ago’.
The defendants have agreed to secure the stay on the condition of pledging 100 percent of CCAB’s ownership interest in its subsidiaries that own two hotels in Nassau, Bahamas, valued at between $232.7 million and $355.1 million.
‘This offer of security encompasses nearly all of the total combined value of the three Defendants’.
The group further notes that ‘because Defendants are worth collectively a fraction of the judgment, they were unable to secure a bond, […] if Plaintiff is allowed to begin enforcement proceedings immediately, Defendants will be forced into insolvency […] it is effectively certain, and it will inflict irreparable harm by the time a full panel of this Court decides Defendants’ appeal’.
The defense further argues that ‘the appeal raises dispositive legal issues, and Defendants are highly likely to prevail’.
This would ‘either reduce damages drastically and/or release one or more defendants from liability altogether’.
A spokesperson for the defendants added that “BML Properties brought about its own failures through its gross mismanagement of the Baha Mar project and the trial court piled error on error in finding otherwise. The actions we have now taken are in the best interests of all our stakeholders and, importantly, will have no impact on our operations as we pursue our appeal or on the operation of the British Colonial and Margaritaville Beach Resort hotels and their guests, employees and vendors.”
BLM Properties has made claims of $845 million, with the judge ruling to also include interest on the figure dating to May of 2014.
The company is led by businessman Sarkis Izmirlian, who issued a suit against the CCA in 2017 claiming “massive fraud” which led to the collapse of the project in 2015.
The project was later sold to Hong Kong-based conglomerate Chow Tai Fook – a major investor in The Star Entertainment and particularly in Queen’s Wharf Brisbane.
