Courtesy of The Palm Beach Post
Published November 16, 2015
Donald Trump is demanding as much as $75 million from
hundreds of condo owners in Panama City's Trump Ocean Club, alleging that
its directors wrongfully fired his company as administrator managing the
luxury building that is the tallest in Central America.
The Republican presidential candidate and celebrity businessman filed his
claim confidentially with the Paris-based International Chamber of Commerce
court of arbitration, The Associated Press has learned. The court organizes
arbitration over complex civil settlements, often involving business deals
that cross continents.
|Fired by Panama condo owners, Trump
demands $75 million photo
Trump's claim alleged a criminal conspiracy to remove his
management company from its unpaid position as building
administrator for the luxury property in Panama City. As the
AP reported last month, the owners' board of directors had
accused Trump's managers of repeatedly exceeding budgets,
paying themselves bonuses without permission and improperly
passing costs from the building's Trump-controlled hotel.
At a key vote in May, building investors and residents
overwhelmingly rejected a Trump-backed proposal to recoup
more than $2 million of building administration debt through
a special assessment on the owners. Following the vote,
Trump's top Panamanian employee resigned — paving the way to
overthrow Trump's management company.
Eric Trump, who controls the management company along with
Ivanka Trump and his father, disputed the investor and owner
claims in an AP interview. He said at the time that the
Trump Organization had no plans to sue the hundreds of
American and foreign condo investors who comprise the
owner's association — including owners of hotel condominium
units that remain under Trump's control.
Trump Organization general counsel Alan Garten said Trump
has no beef with the owners at-large but had to pursue its
claim against them, anyway.
"Unfortunately, the only way for Trump to exercise its
rights was to take the action that it did," Garten said. He
said the arbitration action was supposed to remain
confidential, and whoever informed the AP would be liable
"for substantial damages over and above what is claimed in
the statement of claim." Garten confirmed the legal filing
and answered the AP's questions about it.
This July 4, 2011, file photo, shows the main
entrance to the Trump Ocean Club International Hotel and Tower in
Panama City, Panama. Trump wants as much as $75 million from
hundreds of condo owners in Panama City’s Trump Ocean Club. The
Republican presidential candidate is alleging that they wrongfully
fired his company managing the luxury building that is the tallest
in Central America.
Trump's claim accused owners led by businessman Gary Lundgren of wrongfully
firing Trump's management company in violation of Panamanian law. The filing
called Lundgren — the largest single owner of units in the building — a
"soulless vulture." The claim also raised numerous allegations of illegal
behavior by Lundgren before conceding that "none of these allegations could
At the heart of Trump's claim is that Lundgren — an Alaska-born investor in
Panama City real estate developments — stands to gain by removing Trump's
administrators. Garten said Lundgren told Trump that he intended to request
that payments be made to a management firm run by his wife.
Lundgren told residents and the AP that his wife's firm has not and will not
request compensation for its work. In an email to the AP, Lundgren said it
was hard to believe that "a man who claims that his net worth is $10 billion
finds it necessary to sue a non-profit owners association, which he
mismanaged into insolvency."
Trump's claim also takes aim at Sun International, the South African
operator of a casino within the Trump Ocean Club, in addition to the
at-large owners. Trump said Sun failed to meet contractual requirements that
it would support Trump's management company.
Representatives of Sun did not respond to emails or phone calls from the AP.
The claim comes at an awkward time for the building's developer, Newland
International. The company is still attempting to sell more than 200 hotel
units under Trump's control. Rosella Violi, a sales agent for Newland, said
the company supports Trump and hopes for a quick and amicable resolution.
Trump's claim came as unwelcome news to owners of condos in the building,
setting off a sometimes heated debate in an owner's forum over whether to
fight back — or try to avoid further antagonizing Trump.
"I never thought this would happen," said Al Monstavicius, a retired Nevada
doctor who bought a hotel unit in the Trump Ocean Club in part because it
would be under Trump's control. "I thought it was pretty safe, because we
had Trump involved."