CSCEC Bahamas Ltd. (CSCECB), CCA Bahamas Ltd. (CCAB), and CCA Construction, Inc. (CCA) have initiated an appeal against the $1.6 billion judgment awarded to Sarkis Izmirlian, the original developer of the Baha Mar resort. The defendants argue the trial court made significant legal mistakes and overlooked key evidence, asserting the verdict should be overturned.
The appeal, which was initially announced in October 2024, focuses on the claim that the resort’s downfall was not caused by the defendant’s actions but rather by the gross mismanagement of BML Properties (BML). The defendants allege BML’s reckless financial practices, poor decision-making, and eventual bankruptcy filing led to unpaid debts owed to both the Bahamian government and local subcontractors. These factors, they argue, culminated in the liquidation of BML by the Bahamian Supreme Court.
“As our appeal makes clear, the trial court disregarded black-letter New York law and ignored indisputable evidence that BMLP’s gross mismanagement, hundreds of millions of dollars in overspending and disastrous unilateral decision to put BML in bankruptcy drove the Baha Mar project into the ground,” stated a spokesperson for the defendants, cited by Eye Witness News. The spokesperson emphasized that CCAB’s efforts to complete 97% of the project by the agreed deadline highlighted the company’s good faith. “The judgment suffers from numerous, significant legal errors and should be reversed in its entirety, as we believe it will be,” they added.
Claims of Oversight in Court Ruling
The defendants argue that even if CCAB had achieved full project completion, BML’s shortcomings would have delayed the resort’s opening. They contend BML’s leadership, entirely under the plaintiff’s control, failed to meet its responsibilities, including delivering critical amenities such as restaurants, a nightclub, and a spa. Internal emails from BML President Tom Dunlap reportedly acknowledged these lapses. The appeal further asserts that even an on-time opening would have resulted in years of financial losses for the resort.
Additional criticisms were directed at the trial court’s handling of contractual obligations. The defendants claim the court improperly modified the original Investors Agreement, assigning new responsibilities to CCAB that were not part of the initial contract. They also highlighted their commitment to workforce expansion, with over 6,000 workers employed at the project’s peak in February 2015.
Financial Misconduct Allegations and Impact
The original ruling accused CCA of fraud and breach of contract, holding it responsible for BML’s financial collapse. Key points of contention included a $54 million purchase of the British Colonial resort by CCA, which the court argued exacerbated liquidity issues by diverting funds away from Baha Mar’s subcontractors. Additionally, the court criticized a $2.3 million payment to Notarc Management Group, suggesting it was made to gain favor with the Bahamian government.
In their defense, CCA sought an emergency stay to delay the judgment’s enforcement. The company warned that complying with the judgment could lead to insolvency, jeopardizing two other resorts it owns—British Colonial and Margaritaville—along with hundreds of Bahamian jobs.
The legal battle stems from allegations made by Izmirlian, who filed the original lawsuit in 2017 accusing CCA of engaging in “massive fraud” that contributed to the project’s collapse in 2015. Following the collapse, the Baha Mar resort was sold to Hong Kong-based conglomerate Chow Tai Fook, a key investor in The Star Entertainment.
