Tepper company blasts Rock Hill and York County, says it owes them nothing in bankruptcy
The real estate company created by Carolina Panthers owner David Tepper to build the failed team headquarters in South Carolina -- and now in bankruptcy -- has blasted the city of Rock Hill and York County in its latest bankruptcy plan, which would pay contractors first.
The most recent move came after Rock Hill and York County in South Carolina filed lawsuits against GT Real Estate over claims that the Tepper company committed fraud and conspiracy in the project, which was abruptly halted before it was finished.
The lawsuits allege Tepper companies misused millions of taxpayer dollars for the project. Tepper companies deny the allegations in court documents.
GT Real Estate was created by Tepper to build the team practice site and headquarters. Earlier this year GT Real Estate stopped construction and filed bankruptcy in a dispute over money for the project.
York County’s lawyers late Wednesday described the Tepper company’s move as the latest “broken promises” that Tepper’s company has made to taxpayers. The company has left taxpayers in a “wake” of alleged financial misdeeds after initial promises to repay millions spent on the botched headquarters, York County’s lawyers said.
The new Tepper company plan, if approved by a federal judge in Delaware bankruptcy court, would pay private contractors before York County and Rock Hill can possibly get back the $100 million of taxpayer money the county and city claim is owed.
Documents in the case filed by GT Real Estate in a disclosure statement say GT Real Estate owes York County and Rock Hill nothing, and relegates the city and county to a part of the bankruptcy claim where creditor claims are disputed, documents show.
A previous plan in August would have paid York County $21 million plus interest, and paid the city after the property eventually sold.
“The Debtor (GT) believes that the County does not have any claim against or interest in the Debtor or its property,” the disclosure statement says on page 13. “Similarly, the Debtor believes that the City does not have any claim against or interest in the Debtor or its property.”
The GT disclosure document further states:
“In short, the Debtor hoped, and in fact expected, that the treatment included in the August 11 Plan, which provided clear paths to recoveries for the City and the County (totaling over $40 million in cash and future property proceeds) despite each holding Disputed Claims, would be met with receptiveness or at least a willingness to negotiate further regarding a fair and reasonable resolution to the failed Project. The Plan Sponsor was putting forth significant value and making significant concessions that would benefit the County and the City. But this attempt by the Debtor and the Plan Sponsor to lead all parties to a near-term, consensual outcome was instead followed by exorbitant counter-demands and unreasonable conduct from both the County and the City.”
The latest plan
In August GT filed a bankruptcy plan that would pay the county $21 million, the city $20 million after the property sold, and contractors another $60 million.
But the city of Rock Hill, York County, and the federal bankruptcy trustee assigned to the case said in court documents this week the August plan was flawed and should not be approved.
Just a day later, on Tuesday, GT filed its amended bankruptcy plan.
York County wants $80 million in bankruptcy from road dollars and interest and loss of expected tax dollars, and Rock Hill wants $20 million, GT documents state.
GT’s amended plan would first pay contractors around $60 million.
GT claims York County has no claim to the money that was properly used by GT, and that Rock Hill failed to issue bonds for the project that caused the project to fail.
In a news statement issued Wednesday, GT said it filed the plan Tuesday because Rock Hill and York County have filed lawsuits against GT and other Tepper companies that have harmed the bankruptcy case where creditors might get money back.
The full GT statement said:
“GTRE filed an amended Plan of Reorganization today to address the reactions of stakeholders to the original plan filed in August. GTRE’s original Plan of Reorganization would have paved the way for all creditors, including the City and County, to receive generous payouts on an expedited basis. Trade creditors have engaged constructively with GTRE, and their treatment under the amended Plan of Reorganization remains unchanged. Unfortunately, the City and County have instead chosen to pursue a flawed litigation strategy, making exorbitant and unreasonable demands well in excess of their entitlements. Under the amended Plan of Reorganization, the City and the County are treated similarly in accordance with their rights under the Bankruptcy Code and without the concessions that had been provided previously. These modifications are intended to prevent the City and County from causing further harm to the confirmation process and delaying payment of the $60.5 million that has been reserved to pay trade creditors.”
York County calls Tepper’s plan “broken promises”
Neither the city of Rock Hill, nor York County, have yet filed responses to the new plan in bankruptcy court.
York County’s lawyers said in a statement Wednesday the county will continue to seek money it believes the public is owed from GT Real Estate. The county’s claims are reasonable, the statement said.
The statement from York County’s lawyers said:
“Late Tuesday, September 13th, GT Real Estate LLC filed a modified Plan of Reorganization in the Delaware Bankruptcy Court. The County is still reviewing the modified plan. However, it is self-evident the modified plan is yet another example of broken promises from these Tepper entities. To date, the Debtor in its public pleadings, and others have made repeated assurances that the misappropriated $21 million of York County taxpayer money would be repaid. York County is disappointed these parties again appear to be going back on their word. To be clear, the County has not engaged in any unreasonable conduct in regard to the Debtor. Rather, the County has only sought reasonable compensation for its real and legitimate claims and the damages GT Real Estate and the other Tepper entities have left in their wake. The County will continue to pursue its claims and aggressively protect its interests and the interests of its citizens and taxpayers.”
City officials said Wednesday the city looks forward to its day in court when its version of the facts will come out.
“The City has no comment on these legal matters except to note generally that the City Council is looking forward eagerly to the day judgment is rendered on the facts that will be presented in court,” a Rock Hill city statement said.
Check back for updates on this story.
This story was originally published September 14, 2022 at 3:27 PM with the headline "Tepper company blasts Rock Hill and York County, says it owes them nothing in bankruptcy."
