Colony founder and former Chairman Dr. Murray “Murf” Klauber and the limited partners were awarded a total of almost $25 million in a US Bankruptcy Court
Klauber wins $23 million award
Editor & Publisher
Colony founder and former Chairman Dr. Murray “Murf” Klauber and the limited partners were awarded a total of almost $25 million in a US Bankruptcy Court proceeding Friday afternoon in damages to be paid by the Association of Unit Owners. The award amounts to an obligation of more than $100,000 per unit to be paid over five years.
Klauber was jubilant and at the same time troubled that it had to come to this outcome.
“I feel terrifically elated. The outcome had to soak in,” said Klauber from outside his temporary residence on Longboat Key. “This Association board caused their fellow investors to come up with more than $23 million. You think they should be pleased with them?” added Klauber.
Judge Rodney May followed the instructions of US District Court Judge Steven Merryday, May’s superior, who ruled last year that May had erred and ordered May to reverse his rulings and award Klauber and the General Partners, which Klauber controlled, extensive damages for the Association of Unit Owners failure to pay for renovations which led to the shuddering of the once-internationally renowned resort.
May was given two options by the superior court judge to consider at the hearing: award Klauber the total damages of nearly $25 million, or award Klauber about $7 million in damages and return control of the units to Klauber and the General Partner. May said he was going to decline returning control of the units to Klauber.
May said returning control of the Colony to Klauber and the General Partnership was not feasible due to several factors including that the unit owners hold warranty deeds to their properties. He also said the General Partner and Klauber are in Chapter 7 liquidation and the partnership could not comply with articles of the management agreement. He also said the trustee was not able to successfully take the General Partner into Chapter 11 was another reason.
…(portion from later in article)…Klauber said his goal is to help bring the Colony back to life.
“I am going to try and find a way to cure the ills at the Colony shortly. This brings them to their senses. All I want to do is bring it back to what should be here for people on the island and for people who should not be injured they way they have been injured. This is a financial injury. They still do not have their units — they need to be rebuilt. We have the right ingredients for this property and I am going to try and see if these people will make sense,” said Klauber.
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