Monday, March 12, 2012

Enjoy skiing PCMR? Do it soon or miss out!

I would normally make a comment like this post's title because of the rapidly melting snow.  The base is low and the temperatures are quite warm.  However, this gets a lot more interesting than that.

Park City Mountain Resort is like a lot of ski resorts, where they don't actually own the property they sit on.  Many resorts lease land from the National Forest Service or some other derivative of the US government.  Park City is an old silver mining town and even though the mining has been stopped for quite some time, United Park City Mines owned a lot of the land in the mountains.  While PCMR owns the land at its base, most (or all) of the ski runs run across land that was leased from the mining company.

Now the rub....  A few years ago, a private Canadian company named Talisker decided to start investing heavily in Park City.  They have built several subdivisions, both on the mountains and outside town.  They bought the Canyons ski resort when American Ski Corp went into bankruptcy (outbidding Vail).  Now the funny part....  they also bought the land from the mining company where PCMR's ski runs are.

This week Park City sued Talisker. Apparently Talisker has told PCMR that their lease expired and that they need to negotiate a new one.  Park City seems to think that they extended the lease they had. Unfortunately, with both negotiations and a legal case both being held in secret, it's hard to tell exactly what's going on.  PCMR is screaming that the world is ending, that Talisker is cheating, and that they did everything they were supposed to.  Talisker quietly says "nope".

My completely uneducated, uniformed guess is that PCMR screwed up somehow on extending their lease.  They are going to court and immediately started a big campaign about "Talisker is trying to shut down PCMR!"  They even created a web site called Support PCMR.

Should be an interesting series of events, but of course, all the good stuff will be behind closed doors unless the court records become public.

UPDATE:  Oops.  Sure enough.  Seems PCMR forgot to mail the letter saying they wanted to extend the lease.

"Both Talisker and PCMR are sophisticated parties who obviously had copies of the leases. Both are chargeable with knowledge of the covenants contained therein," Cronheim notes. "PCMR's complaint all but concedes it failed to give the required formal written notice of its intention to extend the leases prior to their expiration. If this is the case, PCMR made a major and inexcusable mistake. Before commencing $7 million worth of infrastructure improvements, it should have been 100% certain that the Talisker tracts were still under lease. That said, PCMR has highlighted the inference that Talisker's ownership of nearby Canyons Resort led it to deal underhandedly with PCMR in an effort to damage its major competitor. The court might be sympathetic to the argument that Talisker strung PCMR along with the intention of pulling the rug out from underneath them or otherwise wreaking havoc on PCMR's operations.

ANOTHER UPDATE:  Bored, read through the actual court document.
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