Westin La Paloma Ruling “Positive” for Tucson Community09/14/12
TUCSON, ARIZ. - A recent U.S. District Court ruling, which dismissed an appeal on the bankruptcy reorganization plan previously approved for the company operating the Westin La Paloma Resort, is a "positive" for the Tucson community, according to the Quarles & Brady law firm.
The decision, made in the U.S. District Court for the District of Arizona, will allow a massive, $32 million renovation project to continue at the resort.
Quarles & Brady began representing Transwest Resort Properties, operators of the La Paloma and the Westin Hilton Head resorts, in 2010, first assisting in a Chapter 11 bankruptcy filing - and then the efforts to restructure debt obligations and facilitate new investment as part of a reorganization plan.
Last December, a Chapter 11 Plan of Reorganization for the two resorts, that restructured more than $250 million of debt and included a new equity investment of $61 million by Southwest Value Partners, was approved by a U.S. Bankruptcy Court judge. Shortly thereafter, the primary debt holder, appealed the confirmation order to the U.S. District Court.
After first defeating a request for a stay pending appeal, Quarles & Brady attorneys Kasey Nye and Susan Boswell filed three separate motions to dismiss the appeal. By the time oral argument was presented on August 24, the Reorganized Debtors had made more than $4.225 million in payments to creditors, funded $12 million of reserves, entered into $19 million of contracts for goods and services with nearly 200 vendors, and paid more than $11.25 million toward renovating the resorts.
On August 30, the Court dismissed the appeal on grounds of equitable mootness, stating: "The substantial consummation of the Plan has created a 'comprehensive change of circumstances' that makes granting the relief sought (on appeal) inequitable."
"We were very gratified that the court recognized the importance of the plan and its investment," said Quarles & Brady's Nye. "This is a positive decision for the community. Preserving and enhancing a premier resort will lead to new construction jobs and involve many Arizona-based vendors."
About Quarles & Brady LLP
Quarles & Brady LLP is a full-service law firm with more than 400 attorneys practicing from offices in Phoenix and Tucson, Ariz.; Naples and Tampa, Fla.; Chicago, Ill; Madison and Milwaukee, Wis.; Washington, D.C.; and Shanghai, China. The firm provides an array of legal services to corporate and individual clients, which range from small entrepreneurial businesses to Fortune 100 companies. Additional information about the firm may be found at www.quarles.com, and on Twitter, LinkedIn and Facebook.