Town of Mammoth responds to MLLA lawyer

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In hours after the Mammoth Lakes Town Council voted to pursue bankruptcy protection due to the staggering $43 million MLLA debt, Sierra Wave Media contacted MLLA attorney Dan Brockett for comment. He said that the company would fight Mammoth’s bid for bankruptcy, that Mammoth is not insolvent and that the Town dealt with MLLA in repeated bad faith. Now, Town officials have responded in a statement apparently prepared by the Town Manager and Assistant Town Manager.

The Town’s statement says that “MLLA’s bad faith continues.” The statement said MLLA repeatedly refused to attend mediation before a well-respected former judge. The Town also said MLLA “once more violates its confidentiality obligations, mischaracterizes history, and defames the Town and its hard-working officials.”

MLLA attorney Brockett had said that Mammoth is not eligible for bankruptcy. “They did not negotiate in good faith,” said Brockett, “and they are not insolvent.” Brockett pointed to Mammoth’s settlement offer of $20 million six months ago which he said was made and then rescinded. The Town’s response statement says the Town did offer $23 million to MLLA last November when Town finances looked better. Mammoth officials said MLLA “rejected ‘in full’ the Town’s generous offer, instead demanding $37.5 million by April 30th.”

Brockett pointed to MLLA’s offer to the Town in March of roughly $2.7 million per year over 30 years, with payment adjustments according to the snow year. He said Mammoth never responded to that offer.

Mammoth officials said when they saw Town finances deteriorate, they withdrew their offer that MLLA had already rejected. The Town points again to the State Bankruptcy Law which requires mediation with creditors. The Town’s statement says that the law “contemplates that MLLA would sit in a room with a highly qualified mediator, the Town and all those sacrificing to maintain Town services and implement the cuts contemplated in the Plan. MLLA would not come to the mediation,” said the Town, “despite six invitations.” Brockett said “We haven’t gone to mediation because we knew it would go nowhere considering the history.” Officials have said some 16 out of 43 creditors did take part in mediation.

Mammoth officials stated that MLLA refused mediation and challenged the Town to file Chapter 9, claiming MLLA would cause the Town’s case to be dismissed and claiming both that the Town has acted in bad faith and is not insolvent. Mammoth’s statement says that the Town is plainly insolvent because it can not pay the $43 million. The statement said that amount is “more than twice the Town’s annual discretionary budget.”

Officials maintain the Town has negotiated in good faith with creditors who were willing. The statement says, “If MLLA is so certain of its position, the mediation venue would have been an ideal setting to talk with a distinguished mediator, peer creditors, and the Town.”

Hammering their point home, Mammoth officials concluded by saying, “Because MLLA steadfastly refused to participate in the mediation, the Town had no choice but to commence the Chapter 9 case, where MLLA must come and appear and articulate whatever its story is about how the Town is able to satisfy in full…” the $43 million debt.

Assistant Town Manager Marianna Marysheva-Martinez confirmed that the Town did file necessary paperwork with federal court on Tuesday to begin the bankruptcy process.

 

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9 Responses to Town of Mammoth responds to MLLA lawyer

  1. cat July 3, 2012 at 8:19 pm #

    I only live here. I have no faith in my local city council. All along we have listened but no one yells or cries out! It bewilders my why the public does not freak out. The counsel continues to do nothing but pay lawyers and hope it will go over well with a public that is none existent.

    I bet this is only the beginning of the cuts. Counsel has a perspective so does MLLA, MLLA has done a hell of a job proving our counsel wrong!

     
    • Devout Liberal July 4, 2012 at 7:03 am #

      Cat,

      Since you are so smart, feel free to step up to the plate and run for Town Council !!!!

       
  2. Trouble July 3, 2012 at 10:27 pm #

    MLLA had their chance to get a fair offer. Now the get pennies on the dollar.

     
    • SierraFan July 4, 2012 at 10:38 am #

      MLLA won the lawsuit and have bragging rights for it but now the greed they’ve won will most likely be significantly reduced! Yes, they may have been wronged by a few power (not a fan of that aspect of business but we have to be real here) wielding folks but unfortunately that’s what seems to happen in the development business. Besides, all the comments we receive from both legal camps is all PR based! We’ll look forward to the ultimate outcome and final be on a positive path.

       
  3. Bret July 3, 2012 at 11:22 pm #

    No money, the leaders of the town make some bad choices, they sided with another group of incompetent leaders that work on the Mountain. Would MLLA take some Mammoth bucks.

     
  4. Trojan Horse Hypocrisy July 5, 2012 at 8:20 am #

    And speaking of money, I see this year’s Larry Johnston annual 4th of July parade float was a Trojan Horse. A “Trojan Horse” has come to mean any trick or stratagem that causes a target to invite a foe into a securely protected bastion or space. (Could it be Larry himself crawling out of the bowels of the horse?)

    The way Larry is on a non-stop warpath re: public servant salaries, perhaps he has short term memory loss about when he and Mrs. Johnston once took the taxpayer’s money and ran while both were public servants (“making too much money”).

    Interesting metaphor Larry (Trojan Horse). Albeit a teeny, tiny, bit on the hypocritical side.

     
  5. MJA July 5, 2012 at 11:25 am #

    Give MLLA what they deserve, nothin!

    =

     
  6. JeanGenie July 6, 2012 at 12:52 pm #

    I’ve said it before and I’ll say it again, Mammoth was better before it became a town. Too bad for everyone that lives there that their elected officials are a buch of greedy fools that got burned because thay tried to burn the wrong people.
    I may not be a big believer in the justice system, but when you lose twice I think maybe its because you are in the wrong.
    By the way, even if you are bankrupt, that doesn’t mean all your debts are immediately discharged and you are free and clear.

     
  7. How it works July 10, 2012 at 5:09 am #

    Developers need to develop. They will take a town and get rich developing and developing until every square inch of land in the town is developed.
    To see how this is accomplished … merely notice that Mammoth Lakes’ new mayor is …
    you guessed it. A developer.

     

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