Rock Hill officials say they weren’t ‘required’ to issue bonds for Panthers’ failed project
Rock Hill wants a judge to dismiss the city as a defendant in a lawsuit by York County against the city and David Tepper companies. Rock Hill officials claim for the first time in legal documents that the city was not required to issue bonds to help pay for the failed NFL Carolina Panthers headquarters and practice site.
Lawyers for the city wrote in federal court documents that there is no legal basis anywhere that states the city had to issue the bonds. York County claims in a lawsuit filed last June, that the city was required to issue the bonds.
The city “may” issue bonds that were part of negotiations and agreements with Tepper’s companies, but there was no requirement, the most recent documents state.
“York County cannot point to a single provision in the Interlocal Agreement that imposes an affirmative obligation upon the City to issue the Bonds,” lawyers for the city wrote in filings in federal court.
The city has said in written statements to the media for months that it was not required to issue bonds, but the filing in federal court is the first legal document where the city said it had no obligation to secure the $100 million-plus that York County and Tepper companies say was a reason the project failed.
The city wants to be dropped as a defendant in the lawsuit York County filed in June. The county lawsuit alleges there was a conspiracy by Tepper companies, including Tepper Sports Holding, DT Sports Holding, and Appaloosa Management. Appaloosa Management is the investment company owned by Tepper. He is worth more than $16 billion, according to Forbes.
In the lawsuit, York County alleges breach of contract against the city of Rock Hill over failure to secure the bonds.
Tepper’s real estate company , GT Real Estate, was created specifically to build the 234-acre Rock Hill site. The company halted construction in March on the project, which had been predicted to be a $100 million economic development boost for the city and county. GT filed bankruptcy on June 1, prompting York County, contractors and the city to seek more than $100 million owed to creditors.
York County’s lawyers and Tepper’s lawyers have not responded to Rock Hill move to have the city dismissed from the lawsuit. South Carolina federal Judge Cameron Currie also has not yet ruled on Rock Hill’s request to have the city dismissed.
Bankruptcy also an issue
The possible removal of Rock Hill from that federal lawsuit also is intertwined with the ongoing bankruptcy case of GT Real Estate and the creditors seeking money, court documents filed by Rock Hill’s lawyers show.
Rock Hill and York County each want more than $20 million returned from the failed project.
Rock Hill’s lawyers, Chuck Gibbs and Mark White, state in the documents that the lawsuit filed by York County can’t go forward against Rock Hill because GT Real Estate is not named as a defendant. However, GT Real Estate is at the center of the bankruptcy that affects all parties, Rock Hill’s lawyers claim.
Tepper company lawyers want the York County lawsuit transferred to Delaware federal courts where the bankruptcy is ongoing, documents show.
York County’s lawyers, in court documents, say the two lawsuits are separate and the county’s lawsuit against the Tepper companies should stay in South Carolina.
“Plaintiff (York County) disputes there is any relation between this matter and the GTRE Bankruptcy matter regardless of where it is pending,” York County’s lawyers wrote in late July.
What happens next?
The lawsuits in federal courts in both South Carolina and Delaware remain pending.
Eighteen creditors, including York County, the city of Rock Hill, and construction companies alleged to be owed more than $100 million by GT Real Estate, want the bankruptcy moved to South Carolina from Delaware.
A decision remains pending on whether the bankruptcy will be moved from Delaware where GT Real Estate is incorporated, to South Carolina where the affected creditors are. A hearing on the potential change of venue in Delaware federal bankruptcy court is set for Aug. 12.
This story was originally published August 1, 2022 at 3:45 PM with the headline "Rock Hill officials say they weren’t ‘required’ to issue bonds for Panthers’ failed project."
