A subsidiary of Chevron is suing the Baton Rouge-based Wilbur Marvin Foundation for $10.9 million it claims it is owed in connection with its role as an investor in the Hilton Baton Rouge Capitol Center downtown.
The lawsuit has been in litigation since Chevron TCI filed its suit in U.S. Middle District Court just over a year ago, though it has largely gone unnoticed outside of legal circles.
The suit claims Chevron TCI, which helped finance the renovation of the historic property in 2005 by serving as an investor, had an option with the hotel’s operating company and the Marvin Foundation to buy back its interest in the property at a discounted price at a later date.
But when the energy giant tried to exercise that right in 2015, an attorney for the Marvin Foundation refused, the lawsuit alleges.
The Marvin Foundation is a support foundation of the Baton Rouge Area Foundation and essentially owns BRAF’s real estate company, Commercial Properties Realty Trust.
Commercial Properties was the developer of the downtown Hilton, a $70 million catalytic redevelopment project in 2006 that helped revitalize the area.
Commercial Properties sold the hotel in 2012 for $40 million.
Chevron’s suit accuses the hotel operating company and the Marvin Foundation breach of contract, a claim the defendants’ attorney, Claude Reynaud, denies in an extensive answer to the lawsuit.
In that filing, Reynaud blasts Chevron’s claims for 16 different reasons, known as affirmative defenses. Among them:
• Chevron fails to state a claim on which relief can be granted.
• Since the hotel was sold, it is no longer owned by the entity Chevron TCI is suing.
• Chevron already monetized the historic building tax credits that it used as the basis for its investment in the hotel property.
“The hotel was sold in 2012 and they agreed to the sale of the hotel at the time,” says Reynaud, an attorney with Brezeale Sachse. “Now they’re seeking money we don’t think they’re owed.”
He declined further comment, citing a confidentiality agreement in the case.
Chevron TCI attorney Kirk Patrick says he cannot comment beyond what is in the court record.
The case is moving slowly through the course system, with both sides currently seeking discovery through depositions. No trial date has been set.
(Note: This story has been corrected since its original publication to reflect the selling price of the downtown Hilton in 2012 was $40 million. Daily Report regrets the error.)