Court sorts out damages due Isis Theater owners
April 30, 2003
A district court judge has ruled that a Swedish company owes the owners of the Isis Theater $2.5 million, but that figure will likely rise as other damages for which the company is liable have yet to be determined.
Judge T. Peter Craven has asked for a recalculation of the amount of rent the Isis owners could have reasonably expected, had Resort Theaters of America not broken its lease for the Aspen cinema, from the time RTA pulled out until the case went to trial. He has also asked for a recalculation of the owners’ out-of-pocket expenses associated with the folding of the theater operation.
Craven’s ruling last week set a firm number on damages only for future, or post-trial, lost rent due to the owners. That sum, discounted income through the end of the RTA lease on Dec. 31, 2019, is the $2.5 million.
“Not all of the amounts are decided in final dollars and cents,” said attorney Jack Smith of Holland and Hart in Denver, representing the Isis.
Supplemental calculations from the Isis representatives, based on the direction provided by Craven in his ruling, should be submitted shortly, Smith said.
“It’s fairly complicated calculation of lost rent, expenses, things like that,” he said.
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After the additional information is provided to the court, Smith said he anticipates a final ruling from Craven that will establish the total damages to be awarded to the Isis owners.
The seven-member Isis LLC sued Svensk Filmindustri, based in Stockholm, in December 2000, after RTA filed for bankruptcy and subsequently pulled its operation out of the Isis. Svensk had provided a guaranty for the RTA lease.
After a trial last year, Craven ruled that Svensk was liable for unpaid rents and other costs. The actual damages were the focus of a subsequent trial, held over two days last month.
In his ruling, following last month’s testimony, Craven rejected the Isis owners’ claim for $2.1 million in pretrial economic damages and $6.2 million or $6.4 million in post-trial damages, depending on the method used in calculating the sum.
The Isis partnership also sought $1.1 million in out-of-pocket expenses.
Craven concluded the Isis partners are owed damages dating back to Oct. 21, 2000, but found fault with the estimates offered by the owners’ expert witnesses.
“The court has rejected much of the [accountant’s] report because of inherent defects, including unsupported speculation on some elements of damage,” the judge wrote. “The court is left with the task of using common sense in quantifying the elements of damages.”
He ordered the Isis representatives to recalculate the amount of pretrial damages for lost rent and some of the claims for out-of-pocket expenses.
The Isis owners leased the Hopkins Avenue cinema to RTA after redeveloping the funky, old theater into a state-of-the-art, five-screen facility. The rebuilt Isis debuted in December 1999 and closed a year later, when RTA folded its Aspen operation.
The Isis sat vacant until June 2002, when Idaho-based Rocky Mountain Resort Cinemas reopened the theater after negotiating a lease with the owners.
The Isis owners put the theater on the market in May 2001 for $13.3 million. It remains for sale with a current price of $7.9 million.
Janet Urquhart’s e-mail address is firstname.lastname@example.org