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Turnberry Says Exec Stole St. Regis Opportunity For Himself

By Carolina Bolado

Law360, Miami (May 11, 2015, 6:40 PM ET) — The residential arm of developer Turnberry Associates on Monday asked a Florida appeals court to reverse a decision declaring former executive Bruce Weiner did not violate a partnership agreement by inking a deal on his own with Starwood Vacation Ownership Inc. to develop the St. Regis Bal Harbour Resort.

Stephen Rosenthal of Podhurst Orseck PA told a panel of the Third District Court of Appeal that Bruce Weiner, who was president and chief operating officer of Turnberry’s residential development business, violated the terms of his partnership agreement when he made the deal with Starwood without telling the other partners in Turnberry, which had also expressed interest in working with Starwood on the project.

Rosenthal argued that the trial court erred in granting Weiner summary judgment by focusing on one provision in the contract allowing partners to pursue other side projects without looking at other parts of the contract, such as one stating that partners at all times operated under a fiduciary duty to the company.

“The trial court viewed that provision with tunnel vision,” Rosenthal said.

Rodolfo Sorondo of Holland & Knight LLP, who represented Weiner, said the contract was drawn up carefully to allow partners to engage in outside deals and noted that all of the parties involved are “titans of the real estate industry” and savvy businesspeople with vast resources.

“They decided they wanted to do business together but didn’t want to get married,” Sorondo said.

He pointed out that several other partners were involved in projects during the course of the contract.

“Nobody had a problem with the language with the other projects,” Sorondo said. “It only became pertinent when the St. Regis came in in 2008 after the economy tanked and the money became more important.”

But Rosenthal pointed out that this agreement to “see other people” did not allow the partners to do so on company time and to bill Turnberry for it, as Weiner did.

Starwood began planning the St. Regis project in Bal Harbour, just north of Miami Beach, and looking for a developer in 2005. Turnberry was interviewed as a potential developer, according to court documents, but Starwood chose to partner with the Related Group.

In 2009, Starwood fired Related and hired Bal Beach LLC, an entity formed by Weiner and Robert Vollrath, another former executive at Turnberry.

Turnberry claims that Weiner met with Starwood secretly and even had Turnberry reimburse his travel expenses to New York for a meeting with the company.

Turnberry says it was “cheated out of a $40 million business opportunity to provide sales and marketing services.”

The St. Regis Bal Harbour, located near Miami’s famous South Beach, combines a 27-story, 207-room hotel with a number of private residences and condo-hotel units, as well as a restaurant, spa, pools and indoor and outdoor function space. The resort, which opened in 2012, was sold in January 2014 by Starwood to a unit of Qatari company Al Faisal Holding Co. LLC in a $213 million deal.

Judges Frank A. Shepherd, Linda A. Wells and Vance E. Salter sat for the Third District.

Turnberry is represented by Roberto Martinez and Curtis B. Miner of Colson Hicks Eidson PA and Stephen F. Rosenthal of Podhurst Orseck PA.

Weiner and Bal Beach are represented by Richard H. Critchlow, Jeffrey T. Foreman and Michael A. Ponzoli of Kenny Nachwalter PA, and Rodolfo Sorondo Jr. and Ilene L. Pabian of Holland & Knight LLP.

The case is Turnberry Ltd. et al. v. Weiner et al., case number 3D14-391, in the Third District Court of Appeal of the State of Florida.

–Additional reporting by Daniel Wilson. Editing by Mark Lebetkin.