Bankrupt Owner of Failed Park Seeks Damages From Irvine Co. : Courts: United Leisure says the O.C. developer, which has sued for back rent, tried to drive it out of business.
After seven years of legal wrangling, a dispute between the Irvine Co. and the bankrupt owner of the now-defunct Lion Country Safari wild animal park is finally going to trial.
Beginning today, an Orange County Superior Court jury will be selected to hear Irvine Co. and United Leisure Corp. accuse each other of bad-faith dealings that date back decades.
In 1969, United Leisure signed a 28-year lease with the Irvine Co. for the 300 acres near the intersection of the San Diego and Santa Ana freeways. The property was then developed into the Lion Country Safari tour, which opened that same year. Visitors drove through the park and watched wild animals roam free.
After 15 years of poor attendance, however, United Leisure closed the unprofitable attraction in 1984.
A bitter dispute began in 1986, when United Leisure filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The Irvine Co. alleged in a civil lawsuit filed the following year that United Leisure owed $2.5 million in back rent on the 300-acre parcel where the park was situated. United Leisure, the holding company for Lion Country Safari Inc., countersued to get $50 million that it said it lost because the Irvine Co. would not allow it to add recreational operations on the leased land.
Those two cases were initially included in United Leisure’s bankruptcy file. But the company, hoping to air its grievances before a jury, managed to move the cases to Orange County Superior Court in March this year.
“This has turned out to be quite a drama,” said Marylin Mansdorf, a United Leisure shareholder, who describes the dispute as a “David and Goliath” struggle against the giant Irvine-based real estate company.
“They have all the power and the money,” she said. “But I think we have a good case.”
United Leisure subsequently subleased about 100 acres of the land to the operators of Irvine Meadows Amphitheater and the popular Wild Rivers water park. The company still receives revenue from those ventures.
United Leisure attorney Brian Lysaght said his client, which arranged construction of the amphitheater in 1981 and the water park in 1986 only after winning separate lawsuits against the Irvine Co., has long hoped to add other recreational facilities on the land, including softball fields, an equestrian center and a driving range.
Lysaght said he will argue in court that, since 1974, Irvine Co. officials have thwarted United Leisure’s efforts to establish money-making operations and have done so with the intention of driving his client “to the brink of financial ruin.” The real estate company’s aim, he said, is to break the lease so it can develop the land itself as an industrial park.
The Irvine Co., Lysaght argued in court documents, “generally acted in such a way as to make it impossible to derive a profit from its lease.”
But Irvine Co. general counsel Peter Zeughauser denies that his firm has tried to oust United Leisure and redevelop the potentially lucrative land.
United Leisure’s attempt to characterize the legal battle as a David and Goliath struggle is a red herring, he said.
“Our case is pretty simple,” Zeughauser said. “We want to collect our back rent. We are not seeking to evict them. This case is not an eviction notice.”
