Credit Card Lawsuit Lawsuit News

October 29, 2012

Jackie, Jeff Soffer sued personally on Las Vegas debt

Lenders are pursuing Jeff Soffer and his sister Jackie Soffer personally in a new federal lawsuit filed in South Florida federal court.

The lawsuit by Wilmington Trust, a subsidiary of M&T Bank, seeks to pierce the corporate veil for the Soffer’s Turnberry companies, and hold the Soffers personally liable for a judgment recently obtained in New York of $50 million plus.

Dennis Richard, attorney for Turnberry, said in an emailed statement, "This lawsuit has no merit. We expect it to be dismissed by the court."

The Soffers launched the proposed mega-hotel and resort called Fontainebleau Las Vegas just before the recession hit. Construction stalled after more than $1 billion was spent. Carl Icahn acquired the unfinished project for a mere $156 million.

The Soffers had pledged business assets in guaranty for the funding on the project that came from a consortium of lenders administered by Wilmington Trust, a subsidiary of M&T Bank, and Lehman Bros.

On Aug. 28, an appellate panel for the New York Supreme Court ruled that $100 million of the guaranty was due and owing to Wilmington, which was already holding $50 million of that amount.

Wilmington filed suit Sept. 9 in Miami for the remaining $50 million. The Florida complaint makes the following allegations in pursuit of the funds. According to the lawsuit, the Soffers stripped money out of one of their companies, Turnberry Residential LP (TRLP), which had been part of the guaranty.

The lawsuit says: “The Soffers systematically stripped TRLP – the Project's guarantor - taking distributions of … cash and other assets between 2008 and 2010, the vast bulk of which they paid to themselves individually. Thus, when Wilmington Trust sought to enforce payment of the Judgment, it found that TRLP was no more than a husk, with partners' capital – Consolidated Net Worth – of negative $160.4 million at the end of 2010 and therefore insolvent. The distributions were made without consideration and without disclosure to Wilmington Trust.”





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