Settlement approved in Turnberry’s Fontainebleau Las Vegas bankruptcy

Miami /
Jan.January 23, 2015 05:47 PM

A Miami bankruptcy judge has approved a settlement in the litigation against former officers and directors of the Fontainebleau Las Vegas, topping off years of legal wrangling related to the failed project spearheaded by Aventura-based Turnberry Associates’ CEO Jeffrey Soffer.

According to the settlement, approved by U.S. Bankruptcy Court Chief Judge Emeritus A. Jay Cristol, $27.5 million will be paid to the bankruptcy trustee to be distributed to creditors. Of that, $25 million will be paid by the directors’ and officers’ insurance providers and $2.5 million by “or on behalf” of  Soffer.

The deal effectively halts $675 million in claims against the estates by parties related to Soffer, the order says. It also caps the distribution of settlement proceeds to the project’s lenders at $2 million.

“The settlement agreement is the result of extensive arm’s length negotiations between the trustee, the defendants, the insurers and the term lenders over the course of more than two years,” Cristol wrote in his order, citing the settlement as “fair and reasonable.”

In separate litigation, lenders in Nevada, also creditors of the estate, will receive $98 million to resolve their lawsuits.

“We are pleased that all the creditors supported this deal, and that we were able to convince the insurance carriers to pay all of their remaining policy limits to effectuate this global resolution,” said Jason Mazer, a shareholder with Ver Ploeg & Lumpkin and special insurance counsel for the trustee.

The Fontainebleau Las Vegas filed for bankruptcy protection in 2009.  Soffer has blamed the bankruptcy on Lehman Brothers’ collapse, and the banking industry’s woes, which led creditors to stop funding construction. In late 2013, a $178 million settlement agreement with creditors for the Fontainebleau Las Vegas was approved by the bankruptcy court in Miami, which gave contractors about $85 million, and construction lenders most of the remaining balance.


Related Articles

arrow_forward_ios
Jeffrey Soffer and Turnberry Ocean Club (Getty, iStock)
Argentine politico drops $12M on two units at Turnberry Ocean Club
Argentine politico drops $12M on two units at Turnberry Ocean Club
Jeffrey Soffer and Turnberry Isle Yacht and Racquet Club
Turnberry Isle condo association sues Jeffrey Soffer affiliate over lobby repairs
Turnberry Isle condo association sues Jeffrey Soffer affiliate over lobby repairs
26 Indian Creek Island Road with Jeffrey and Jackie Soffer (Realtor, Getty, iStock)
All in the family: Jackie Soffer sells Indian Creek home to Jeffrey Soffer
All in the family: Jackie Soffer sells Indian Creek home to Jeffrey Soffer
Turnberry Ocean Club and Jeffrey Soffer (Getty)
Closings begin at newly completed Turnberry Ocean Club in Sunny Isles
Closings begin at newly completed Turnberry Ocean Club in Sunny Isles
Jeffrey Soffer and Fontainebleau Miami Beach (Getty)
Fontainebleau Miami Beach’s $1B loan exits special servicing
Fontainebleau Miami Beach’s $1B loan exits special servicing
1616 West 28th Street, Sunset Islands and Marsha Soffer (Realtor, World Red Eye, iStock)
Marsha Soffer sells Sunset Islands mansion for $11M
Marsha Soffer sells Sunset Islands mansion for $11M
Jeffrey Soffer, Brett Mufson, David and Simon Reuben
British billionaires invest in Jeffrey Soffer’s Turnberry resort in Aventura
British billionaires invest in Jeffrey Soffer’s Turnberry resort in Aventura
Jeffrey Soffer with the Fontainebleau and Michael Dell with the Boca Raton Resort & Club
Soffer’s Fontainebleau Miami Beach and Dell’s Boca Resort lay off thousands
Soffer’s Fontainebleau Miami Beach and Dell’s Boca Resort lay off thousands
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...