In a motion to object to Mammoth Lakes’ wish for a speedy bankrkuptcy, Mammoth Lakes Land Acquisition claims the Town lacks any emergency, failed to consider the last offer made by MLLA and failed to make a settlement offer or any payment to MLLA.
Mammoth owes MLLA $43 million, and MLLA has begun to lay out its case against the Town’s attempt to enter bankruptcy. MLLA lawyers say that the Town has ignored MLLA’s 30-year payment plan offer and is “trying to punish MLLA for winning” the first lawsuit. The court brief says, “Municipalities are not supposed to have axes to grind.” Lawyers allege that the Town is seeking retribution and that this is at the heart of the whole case.
MLLA points to the appellate court decision against Mammoth in which the judges described Town employees’ attempts to get rid of the Hot Creek project, in breach of the development agreement.
Then the attorneys described an incident last fall. They say MLLA representatives inquired if the Town could access nearly $4.4 million from the Town’s Vehicle Replacement Fund to make an initial payment to MLLA. The brief says Town staff thought the funds were restricted, found out they weren’t and then used the nearly $4.4 million to pre-fund legal fees for two law firms and a financial advisor, among other Town costs. MLLA says, “Bluntly put, the Town played ‘keep away’ from MLLA by giving large retainers to its law firms and financial advisors.”
MLLA also claims that as a result of working with Town staff to identify available money, the two sides “reached consensus that the Town had at least nearly $5 million per year in discretionary spending that could be used to pay installments on the judgment.”
Attorneys for MLLA and Mammoth will sit down in court-ordered mediation sessions scheduled for August 6 and 7 in Southern California. MLLA will file its objections to Mammoth’s bankruptcy August 24th. So far, no date has been set for Mammoth’s bankruptcy eligibility hearing.