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Atwell v. Westgate Resorts, Inc.

United States District Court, D. Nevada

March 31, 2018

HEATHER ATWELL; HEATHER ATWELL as TRUSTEE of Atwell Family Trust; HEATHER ATWELL as ADMINISTRATOR of the Estate of David Atwell; and RESORT PROPERTIES OF AMERICA, INC., Plaintiffs,
v.
WESTGATE RESORTS, INC.; WESTGATE RESORTS LTD.; CENTRAL FLORIDA INVESTMENTS, INC.; and WESTGATE LAS VEGAS RESORT, Defendants.

          ORDER

          RICHARD F. BOULWARE, II UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Before this Court are Defendants Westgate Resorts, Inc., Westgate Resorts Ltd., Central Florida Investments, Inc., and Westgate Las Vegas Resort (collectively, “Defendants”) Motion for Summary Judgment (ECF No. 60), and Plaintiffs Heather Atwell, Heather Atwell as Trustee of Atwell Family Trust, Heather Atwell as Administrator of the Estate of David Atwell, and Resort Properties of America, Inc. (“RPA”) (collectively, “Plaintiffs”)' Motion for Partial Summary Judgment (ECF No. 64). For the reasons stated below, these motions are denied.

         II. PROCEDURAL HISTORY

         Plaintiffs original filed the Complaint with Jury Demand in the Eighth Judicial District Court of Clark County, Nevada on October 6, 2015. (ECF No. 1-1). Defendants removed the case on November 5, 2015, on the grounds of diversity jurisdiction. (ECF No. 1). Plaintiffs made a jury demand in this Court on November 23, 2015. (ECF No. 16). The Court had a hearing on Defendants' Motion to Dismiss for Lack of Jurisdiction on September 22, 2016, where the motion was granted in part and denied in part. (ECF No. 46). During the hearing, the Court granted Plaintiffs leave to amend the Complaint.

         Plaintiffs filed an Amended Complaint with Jury Demand on November 18, 2016. (ECF No. 49). In the Amended Complaint, Plaintiffs assert the following causes of action: count I -breach of contract, on behalf of all Plaintiffs except Heather Atwell individually; count II - breach of the implied covenant of good faith and fair dealing, on behalf of all Plaintiffs except Heather Atwell individually; count III - quantum meruit, on behalf of all Plaintiffs except Heather Atwell individually; count IV - quantum meruit, on behalf of Heather Atwell individually; count V - fraud, on behalf of all Plaintiffs except Heather Atwell individually; and count VI - fraud, on behalf of Heather Atwell individually. Defendants filed Answers on December 19, 2016. (ECF Nos. 52, 53, 54, 55). On April 21, 2017, Defendants filed a Motion for Summary Judgment. (ECF No. 60). Plaintiffs also filed a Motion for Summary Judgment on April 21, 2017. (ECF No. 64). Responses were filed on May 19, 2017. (ECF Nos. 72, 73). Plaintiffs filed their Reply on June 9, 2017. (ECF No. 77). Defendants also filed a Reply on June 9, 2017. (ECF No. 78). The Court held a hearing on the motions on March 21, 2018, and took the matter under submission.

         III. UNDISPUTED FACTS

         The Court finds the following facts to be undisputed.

         A. The Parties

         Plaintiff Heather Atwell (“Ms. Atwell”) is a licensed real estate agent in the State of Nevada, and was a licensed real estate agent at certain periods relevant to the facts at issue. Ms. Atwell is also the Trustee of Plaintiff the Atwell Family Trust and the Administrator of Plaintiff the Estate of David Atwell. Ms. Atwell's father, David Atwell (“Mr. Atwell”), was a licensed Las Vegas real estate broker who specialized in hotel and casino properties in Las Vegas. Mr. Atwell operated a sole proprietorship that did business under the name “Resort Properties of America” until March 13, 2013. On June 24, 2008, Ms. Atwell began working alongside Mr. Atwell in rendering brokerage services at his sole proprietorship, by associating her real estate agent's license with Mr. Atwell's real estate broker's license, and continued to work in association with RPA until Mr. Atwell's death on November 25, 2013.

         RPA was incorporated on March 13, 2013 in the State of Nevada. RPA as a corporate entity is a Plaintiff in this suit. Ms. Atwell is the current sole officer, director, and shareholder of Plaintiff Resort Properties of America, Inc.

         Defendant Central Florida Investments, Inc. (“CFI”) is the parent company of the other Defendants in this action, Westgate Resorts, Inc., Westgate Resorts, Ltd., and Westgate Las Vegas Resorts, LLC. David Siegel (“Siegel”) is the founder, president, and sole shareholder of CFI. Due to this structure, regardless of which Westgate entity is involved, all actions allegedly taken by any Defendant are attributed to CFI.

         B. Prior Relationship Between Mr. Atwell and Siegel

         Mr. Atwell had known Siegel for over 20 years prior to the events at issue in this litigation. Mr. Atwell assisted Defendants in an attempt to procure financing to prevent the foreclosure of the former Planet Hollywood Westgate Tower (“PH Tower”) in 2011. Defendants were unsuccessful in keeping the former PH Tower, which they ultimately lost to their creditors in November 2011. PH Tower was the only Westgate-affiliated property in Las Vegas until 2014.

         C. Mr. Atwell's Initial Efforts to Find a Property for Defendants

         In September 2011, Mr. Atwell spoke by phone with Adam Rosenberg (“Rosenberg”), then Global Head of Gaming at Goldman, Sachs & Co, regarding the Las Vegas Hilton (“LVH”). Mr. Atwell and Rosenberg exchanged emails regarding the discussion. Rosenberg stated that Goldman Sachs was a 70% owner of the debt attached to the LVH, and that “[if] there [was] a real buyer with real interest, [he was] the right portal to explore what can be done.” In these emails, Mr. Atwell wrote that his client was David Siegel of Westgate Resorts.

         On January 17, 2012, Mr. Atwell sent an email to Rosenberg stating: “Don't mean to be a bother, but I'm anxious to find out the disposition of the property and it's [sic] owners. We don't want to waste our time, but will come forward when sensible.” On January 23, 2012, Mr. Atwell sent Rosenberg an email stating that “[t]he client is asking some questions” about the LVH property. The same day, Rosenberg emailed Mr. Atwell stating that Rosenberg would forward Mr. Atwell's interest to a “counterpart . . . driving the process, ” but that Rosenberg and the counterpart were “not in a position to share information just yet.”

         The following day, Siegel emailed Mr. Atwell: “How is your search going? I haven't heard anything from you. . . .” Mr. Atwell sent a response stating that he was “[s]till working on finding a new location” for Defendants. Siegel sent a follow up email on February 13, 2012, stating that he hadn't heard from Mr. Atwell “in a couple weeks” and asked about “prospects for a new Westgate Resorts in Las Vegas.”

         On February 18, 2012, Siegel told Mr. Atwell to “go for it” in response to an inquiry from Mr. Atwell as to whether Defendants had ever approached the new Hard Rock tower for purchase. On or around March 15, 2012, Mr. Atwell communicated to Siegel via email that Mr. Atwell had “talked to both hard Rock and Palms” and that he was “still talking with the bank on the [LVH] and some others.” Siegel responded, “Keep trying and best wishes on your health.”

         Mr. Atwell asked Siegel via e-mail dated November 28, 2012 about a property at the Harmon Tower, owned by MGM. Siegel responded with a question about the property and stated “if you can make the deal let's do it. . . . I'm tearing at the bid [sic]. I still have my whole team out there that did $100 million a year for 5 years at the PH Tower.” Siegel confirmed in his 2017 deposition that the context for this email was that he was “very excited to get back into Las Vegas[.]”

         On December 28, 2012, Siegel emailed Mr. Atwell: “Anything new on the Harmon property, please let me know. In the meantime have a Happy New Year and good health for 2013.” Several months later, on February 22, 2013, Mr. Atwell emailed Siegel, CC'ing Ms. Atwell and writing: “Pursuant to our talk, I've contacted both the LVH situation and Starwood/Riviera and both are interested. . . . I think I can arrange a meeting soon.” (Id.). Four days later, he sent another email stating: “Starwood and LVH requested a proposal. Please get me a basic prelim outline as soon as possible.” Siegel emailed a response the same day, in which he wrote, “What does Starwood have in Vegas? I have been talking to LVH for a long time thru a California broker.” Mr. Atwell sent an email to Siegel on February 26, 2013, in which Mr. Atwell wrote: “We[']ve been working on the LVH for many months with the bank via Houlihan Lokey (exclusive agent). . . . If you[']re bound to another broker in this regard, I[']ll discontinue my efforts, although I wish you would have told me this last week when we spoke as I started this dialogue with them and told them about you many months ago.”

         D. 2012 Engagement of Another Broker to Purchase the LVH

         Although Siegel was corresponding with Mr. Atwell throughout 2012, at some point Siegel had engaged another broker, Mayur Shetty (“Shetty”), to purchase the LVH. Siegel and Shetty corresponded previously via email in August 2011, regarding refinancing for PH Towers before its closure.

         Goldman Sachs foreclosed upon the LVH property on October 10, 2012. On or about October 17, 2012, Shetty reached out to Gramercy Capital Corp., the other primary creditor for the LVH, via e-mail to inquire about the LVH, on behalf of Defendants. This was the first time Shetty had contacted any entity connected with the LVH, well over a year after Mr. Atwell's first contact with Mr. Rosenberg.

         Goldman Sachs took title on the LVH property via 3000 Paradise Road, LLC on November 1, 2012. Westgate Resorts, Ltd.'s Chief Financial Officer, Thomas Dugan, sent Shetty a letter on November 5, ...


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