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The court ruled Feb. 28 in favor of the bankruptcy settlement allowing JD Holdings to buy the properties and assets held by John Q. Hammons’ estate.
Photo provided by 417 Drone Imaging LLC/SBJ photo illustration by Wes Hamilton
The court ruled Feb. 28 in favor of the bankruptcy settlement allowing JD Holdings to buy the properties and assets held by John Q. Hammons’ estate.

Judge allows $500M claim by JD Holdings in JQH case

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The judge overseeing the John Q. Hammons bankruptcy settlement yesterday ruled a nearly $500 million claim awarded to JD Holdings LLC can move forward.

A group of financial institution creditors, collectively referred to as commercial mortgage-backed securities lenders, had filed an objection to the claim. They claimed the agreed upon plan and settlement “go beyond a settlement of the differences between (JD Holdings) and the debtors, and seek impermissibly to fundamentally alter the rights of creditors on shortened notice.”

JD Holdings on Feb. 28 first received verbal approval for the overall bankruptcy settlement — detailed in a court room minute sheet — which allows the company to buy the hotels and other assets owned by the Revocable Trust of John Q. Hammons. Yesterday, Judge Robert Berger, of the U.S. Bankruptcy Court District of Kansas at Kansas City, upheld JD Holdings’ $495.9 million claim against all associated debtors, according to court documents.

The claim arises from JD Holdings’ yearslong lawsuit against Hammons’ estate.

In 2012, JD Holdings owner Jonathan Eilian claimed a breached agreement after his company helped JQH Hotels & Resorts go private in 2005. The arrangement resulted in JD Holdings acquiring indirect ownership of 43 of Hammons’ hotels and management of 15 others, as well as securing a right-of-first-refusal agreement to purchase other assets from Hammons’ estate if an associated debtor defaulted on obligations set forth in the agreement. Hammons’ estate subsequently filed bankruptcy in 2016, halting the litigation.

Last month, Eilian agreed to stay all pending appeals and settle for the nearly $500 million claim in line with the bankruptcy settlement and asset sale agreement. Eilian is arranging $1 billion in financing for the purchase, according to SBJ reporting.

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