Harcourt Moves to Dismiss $1B Sullivan Square Suit

LAS VEGAS-Harcourt Developments of Dublin, Ireland has filed a motion to dismiss a lawsuit filed against it over Sullivan Square–a failed 1,300-unit luxury residential-over-retail project at Durango Drive and Interstate 215. Sullivan Square Harcourt LLC, an entity of locally based Glen, Smith & Glen Development, sued Harcourt’s local entity, Harcourt Nevada LLC, claiming Harcourt failed to perform under a contractual agreement to finance up to $800 million for the project.

The lawsuit alleges that Harcourt and Doherty repeatedly promised to meet its funding requirements but never came through. The lawsuit claims the plaintiffs “never had any intention of performing” under the agreement and, as far back as June 2007, “conspired to, intended to, and, in fact, did exploit [Glen, Smith & Glen], obtaining value for the project through the Plaintiffs efforts, all with the eventually intended result of bankrupting or seriously damaging the Plaintiffs so that the Defendants could assume control of the project for their sole benefit.”

In its motion to dismiss, Harcourt Nevada claims the funding requirement was subject to conditions in the operating agreement that were never met. Specifically, Harcourt says the operating agreement specifies that it would be “solely responsible for providing or arranging all of the financing for any and all projects costs” provided that (1) “funding is available on a reasonable terms in the reasonable opinion of [the members of the LLC]” and (2) “ the terms and conditions of loans to the company and its subsidiaries shall be subject to the unanimous approval of the members.” Those conditions were never met, Harcourt claims.