Isis owners awaiting ruling on unpaid bills
July 5, 2002
Owners of the Isis Theater are awaiting a court ruling on whether a Swedish company is liable for bills that went unpaid when Resort Theaters of America ran into financial trouble and broke its lease for the Aspen cinema.
The 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.
According to the suit, which was the subject of a 4 1/2-day court trial in Aspen last week, Svensk provided a guaranty for the RTA lease, meaning it would satisfy the monthly rent of the Hopkins Avenue theater if RTA did not.
“Svensk has been disputing the guaranty ever since,” said attorney Jack Smith of Holland and Hart in Denver, one of three attorneys representing the Isis owners.
Svensk was to cover RTA’s rent for the first five years of its lease for the theater if RTA failed to make the payments, according to the lawsuit, which claimed the company owed The Isis LLC $181,551 at the time the suit was filed. That sum included $59,300 in rent for the months of October, November and December 2000, plus monthly management fees.
Smith declined to comment on the amount the Isis partners are now seeking in compensation. The theater sat vacant for about 18 months after RTA closed the Isis doors on Dec. 7, 2000.
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“The calculation of damages is an issue in the litigation,” he said. “I really can’t comment on that.”
During the trial, Judge T. Peter Craven ruled he would split the proceedings into two parts, focusing first on whether Svensk is liable for the unpaid rent and fees. If he determines the company is liable, a second trial could be held to determine the amount of damages, Smith said.
Witnesses taking the stand last week included Sam Houston, managing partner for The Isis LLC, former Isis employees and a representative of Svensk, according to Smith.
Aspen attorney Hugh Wise represented the Swedish company. He declined to comment Wednesday on his client’s position.
Svensk’s main defense, according to Smith, was in claiming the individual who signed the guaranty on the company’s behalf didn’t have the authority to do so.
RTA entered into a lease with The Isis LLC to run the theater after the building’s owners undertook a massive redevelopment project to convert the Isis from a funky old one-screen venue into a state-of-the-art, five-screen cinema.
The rebuilt Isis debuted in December 1999 and closed a year later when RTA pulled out, citing mounting financial losses.
It sat vacant until last month, when Idaho-based Rocky Mountain Resort Cinemas reopened the theater after negotiating a lease with the owners.
[Janet Urquhart’s e-mail address is email@example.com.]