NASSAU, BAHAMAS — CSCEC Bahamas Ltd. (CSCECB), CCA Bahamas Ltd. (CCAB), and CCA Construction, Inc. (CCA) have filed an opening brief for an appeal challenging the $1.6 billion judgment awarded to Sarkis Izmirlian, Baha Mar’s original developer, contending that the trial court’s decision was fundamentally flawed, citing numerous legal errors and arguing that the judgment should be overturned.
The appeal asserts that the trial court ignored key evidence showing that the collapse of the Baha Mar resort was not due to the defendant’s actions but was a direct result of BML Properties’ (BML) gross mismanagement. According to the defendants, BML’s reckless overspending, poor decision-making, and its eventual bankruptcy filing caused millions of dollars in unpaid debts to the Bahamian government and local subcontractors. They argue that the liquidation of BML by the Bahamian Supreme Court was the inevitable outcome of these missteps.
“As our appeal makes clear, the trial court disregarded black-letter New York law and ignored indisputable evidence that BMLP’s gross mismanagement, hundreds of millions of dollars in overspending and disastrous unilateral decision to put BML in bankruptcy drove the Baha Mar project into the ground, leaving a rash of unpaid debts to local subcontractors, vendors and the Bahamian government and ultimately resulting in BML’s liquidation by the Bahamian Supreme Court. The fact that CCA Bahamas completed 97% of the project by the agreed deadline evidenced its good faith. The judgment suffers from numerous, significant legal errors and should be reversed in its entirety, as we believe it will be,” a spokesman for the defendants noted.
The defendants focus on several key points in their appeal. They highlight that the plaintiff conceded during trial that CCAB was very close to meeting the March 27, 2015 deadline, completing at least 97% of the resort. They argue that even if CCAB had completed 100% of its work, BML’s failures would have still prevented the resort from opening on time. BML, which was entirely under the plaintiff’s control, admitted to “bombing” its own deliverables, and the defendants contend that even had the resort opened as scheduled, it would have operated at a loss for years. The defendants also argue that the trial court improperly rewrote the Investors Agreement, making CCAB a party and imposing new obligations that were not part of the original deal.
Further, the defendants assert that CCAB fulfilled its commitment to expand the workforce, adding more than 1,000 workers and peaking at over 6,000 by February 2015. In contrast, BML’s leadership, including President Tom Dunlap, acknowledged in an April 2015 email that BML had failed to complete key amenities like the nightclub, restaurants, and spa, which were essential for the resort’s opening.
The trial court’s $1.6 billion judgment against CCA found the company liable for fraud and breach of contract, accusing it of contributing to BML’s financial collapse. The court pointed to CCA’s $54 million purchase of the British Colonial resort instead of using the funds to pay Baha Mar’s subcontractors, which allegedly triggered a liquidity crisis. Additionally, the court criticized a $2.3 million payment to Notarc Management Group, suggesting it was an attempt to “curry favor” with the Bahamian government.
In response to the judgment, CCA sought an emergency stay to delay enforcement and avoid the potential liquidation of two other resorts it owns—British Colonial and Margaritaville. CCA argued that enforcing the judgment would lead to insolvency, jeopardizing the company’s operations and the jobs of hundreds of Bahamians employed at these resorts.
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