SFNO/Jazzland Discussion Thread

[spaceace12]

My insurance guy had a saying, "you can't get blood from a turn up". Six Flags is deep in trouble. The city was going to gain land, they sue Six Flags, they could end up getting nothing. The city should have accpeted the offer back in 2006.

[AllenA07]

Yeah I mean that is something to consider. You don't want to sue a homeless man because they're not going to have anything to give you. However I don't really think this is the same situation, Six Flags isn't a turnip, they still have money and can still pay settlements. The problem here is that we have no real idea what the city is suing for. They could be suing for money, specific performance, or to be released from the lease. My best guess is that the city is suing to be released from the contract with damages for the past few years the park has been closed, but nobody really know.

 

Also it's going to be important what the claim is. If the city claims that Six Flags is acting in bad faith (a willful breach), a settlement may be bankruptcy proof.

[Rocket Rodder]

Probably the biggest case of "... I kick myself" ever. What everyone says about the company wanting out is pretty on par IMO. NO is a great city. I've a feeling that iif they sue SF, that might damage their reputation.

[larrygator]

I don't undersatnd why so many people posting in this thread are confused about the lawsuit.

 

FACT: Six Flags signed a contract to lease the land where SFNO sits and run a amusement park for a set numbers of years.

 

FACT: Six Flags is not fulfilling their end of the contract.

 

FUZZY FACT: City of New Orleans wants Six Flags to re-open the park and/or pay a penalty (assumed to be a subtantial cash penalty) for breach of contract.

 

Now it is up to the courts and lawyers to determine if the conditions created in the marketplace with Katrina's aftermath absolve Six Flags of their contract. I'm not a lawyer nor privy to the contract signed, but as with most legal cases involving business contracts nothing is cut and dry.

[AllenA07]

Larry my confusion is more so in what the specific thing being requested by the city is. I'm pretty sure that this is a breach case, but depending on what the city is going to allege is going to change the circumstances of the suit. There are many ways that you can breach a contract.

 

Also a key thing that was hit on is that none of us are privy to the contract. Just my guess is that whomever drafted the lease agreement filled it with all sorts of provisions for these kinds of situations. Nobody here has any idea what those provisions say but those are what is going to determine how this turns out.

 

Finally I do want to make clear that contracts/property are really not my thing. Everything I have mentioned here comes from just my basic knowledge I've gotten in a basic contracts course. So I don't want to come off wrong, I'm far from an expert on this subject.

[paintballer]

Thank you New Orleans for not taking mercy on Six Flags soul.

 

Huh?

Somone said they arent suing them...Is that right or not?

[larrygator]

^^Your law student status certainly trumps my single class in the Law of Mass Communications.

 

When it comes to the City of New Orleans, they could be asking for anything. However, due to the long standing financial strain on the commumity I'm sure they are asking for lots of money to break the contract.

 

Otherwise I'm think this would have been settled by now. I remember shortly after Hurricane Katrina hearing a story that Six Flags was willing to return the land and let New Orleans keep the rides along with a cash settlement, but New Orleans refused to let Six Flags out of the contract.

 

Maybe someday there will be an end to this story.

[larrygator]

Article on the situation

 

This could shed some light on the current situation.

 

City wants to make a deal for Six Flags to exit its lease

by Rebecca Mowbray, The Times-Picayune

Thursday April 23, 2009, 8:05 PM

When Six Flags offered in 2006 to make a series of payments to the city in exchange for backing out of its lease in eastern New Orleans, Mayor Ray Nagin said no to the deal. Now City Hall has asked the amusement park company if it would consider reviving the offer.

 

Six Flags Chief Executive Mark Shapiro told the Associated Press on Thursday that the city suddenly wants his company to put that deal back on the table in spite of its well-publicized financial problems. Six Flags is considering filing for bankruptcy protection as it struggles under the weight of $2.4 billion in debt.

 

"Now, the city is asking us to re-make the same offer, but we're no longer in a position to be able to do that," Shapiro said.

 

His comments came one day after City Attorney Penya Moses-Field vowed to file suit against the company for failing to re-open its New Orleans theme park, which has sat idle since Hurricane Katrina. Moses-Fields said the mangled, rusting park is impeding the redevelopment of eastern New Orleans and denying sales tax revenue to the city and employment opportunities to its residents.

 

Moses-Fields traveled to New York this week with Nagin and City Council members Arnie Fielkow and Cynthia Willard-Lewis to negotiate a resolution with Six Flags. Moses-Fields said the trip was not motivated by the bankruptcy rumors.

 

In 2006, Six Flags offered to pay the city $10 million, donate 86 acres of land it owns in eastern New Orleans and share with the city any future insurance proceeds it collected on the park in excess of $75 million if the mayor's office would terminate its long-term lease. Six Flags valued the deal at about $14 million.

 

Moses-Fields defended the city's original rejection of the offer, arguing that it would not have satisfied the city's obligations on a loan from the U.S. Department of Housing and Urban Development, which stands at about $17 million. The loan, originally $25.3 million, was used to fill gaps between private investment and public resources when the park was being developed in the late 1990s. The city is required to pay it back even though the park is closed.

 

When the offer was made, she said it was not clear how much the city might receive on insurance from Six Flags, and the city wanted assurances that there were no environmental problems with the property.

 

"That offer was not in the best interest of the city at the time," Moses-Fields said.

 

She said the city now wants closure. "It's necessary for us to move forward in developing New Orleans East," she said. "We cannot allow a corporation to remain dormant."

 

But Dennis Speigel, president of the Cincinnati consulting firm International Theme Park Services, said that the city should have done its homework about Six Flags before rejecting the company's $14 million offer to terminate its lease.

 

Speigel has followed the saga of the New Orleans theme park since its early days as Jazzland. He said many people in the theme park industry were sounding alarms about Six Flags' financial position long before Hurricane Katrina because the company was laden with debt and its revenues were dropping.

 

The city should have considered the long-term risks with Six Flags before rejecting the deal, he said.

 

"It's too late for dessert," Speigel said. "They had a deal on the table (three) years ago. They should have taken it. This company is teetering on bankruptcy or restructuring."

 

While New Orleans officials were sparring with the company in New York, Six Flags got some bad news from the Fifth U.S. Circuit Court of Appeals in New Orleansabout its efforts to collect more money on the Hurricane Katrina insurance claim.

 

Six Flags New Orleans suffered $150 million in losses during Katrina but was unable to collect on all layers of its commercial insurance policy. The company got $25 million on its first layer of insurance but collected only $2.5 million on the next layer, plus some additional compensation for wind damage.

 

In April 2008, the U.S. District Court in New Orleans sided with the amusement park's insurance company when Six Flags sued to collect additional compensation. This week, the federal appeals court affirmed that decision for six of the amusement park's seven insurers.

Edited December 2, 2011 by larrygator

[Wes]

My insurance guy had a saying, "you can't get blood from a turn up".

 

I would get a new insurance guy that knows it's "turnip" and not "turn up".

[OldJJman]

I'm staying out of this for now (I'm on vacation DAMMIT!!).

 

People, get a F'n clue!!

 

Arnie said way back when, they could NOT and WILL NOT support ANY VENTURE where the city of N.O. would contribute more than a dime!

 

Do your homework!!

 

And, if the "lawsuit" claims breach of contract for NOT operating the park, it may be a moot point, as there will be NO FINANCIAL gain to N.O. "IF" they win said "lawsuit".

 

Of course, it remains to be seen that the contract actually stipulates that SFI MUST operate the park. As the video showed, SFI is still making the lease payments on the land.

 

And, if that is what they're suing over, then they will lose in a very embarassing manner.

 

Deal with it.

 

JJ

 

(Yes, that's my version of staying out of it. But, when I get home, you'll be sorry, because, as I have done before, I will dig out the facts (i.e. Danny Rodgers is misguided, SFNO will NEVER open again, etc...) and get to say "I TOLD YOU SO" once again!!!)

 

[ParkTrips]

Someone get the cranky old man a new set of depends

[goatdan]

I totally agree with whoever has said this is probably a timing issue -- the company is close to bankruptcy, and the city has probably realized that if they declare bankruptcy, they could lose any ability to get any money from Six Flags.

 

If the city is suing because the contract was that they must remain open and now they aren't, knowing a little about legal contracts I am guessing that Six Flags can demonstrate that their inability to re-open is a reasonable exception to that clause. If the park sustained $150 million of damage as stated and the insurance companies have only paid up $27.5 million, then there is clearly a large gap to be made up between the two, and it would not be financially viable for an about-to-go-bankrupt company to invest one hundred million or more to reopen. I'm sure the original contract didn't include a hurricane that would flood the park for as long as it did.

 

The way that I understood the original contract to be was that Six Flags bought from the city the land and the structures on the property when they came in, which would make sense that they could remove the S&S Towers (if they were leased and then bought) as well as the trains from Mega Zeph. The contract wouldn't have stated that everything on the property must remain, or they wouldn't be able to throw out *anything*.

 

I wonder if the real reason for the suit is that the city wants Six Flags to remove the rides and pay them for the rides that they remove? I'll be really interested when the suit comes out and explains this.

[AllenA07]

Again without seeing the contract nobody really knows what is going on. However a decent attorney should have been smart enough to include some provision on disaster. Furthermore, I would be willing to bet that there is a provision in the contract that states Six Flags must actually run the park. Now the question of if Six Flags could run the park is going to be the more tricky one. Could they have gotten the park back into running condition? Maybe it wouldn't have been in running condition during the 2006 season, how about 2007 or at least by 2008?

 

I think the question in court is going to be one of good faith. Did Six Flags make a good faith attempt to abide by the terms and conditions of the lease agreement? This is going to be a matter for the courts to decide, with both sides bringing in a lot of evidence.

 

Finally since everybody seems to think it matters that it wouldn't be a good idea for Six Flags to reopen the park in this economy, I want to address that. I don't really think it matters much. A lot of companies make bad decisions, it happens every single day. However just because there is a downturn in the economy and unforseen circumstances come along doesn't give anybody the right to breach an existing contract.

 

Frankly I think this may just be saber rattling, with New Orleans hoping that Six Flags will come to the table and really try to sort this out if they are threatened with a lawsuit.

[OldJJman]

I think the question in court is going to be one of good faith. Did Six Flags make a good faith attempt to abide by the terms and conditions of the lease agreement?

 

Oh please.

 

This is EXACTLY what I meant about THINKING!

 

You already stated that "WITHOUT" seeing the actual terms of the contract, WE DON'T KNOW what it contains!

 

THEN WHY SPECULATE????

 

Everybody here, especially the SFNO fanboys, right now is ready to pounce on SFI.

 

Remember, I am not a Six Flags fanboy of any kind.

 

Now...

 

Has anyone here thought about the FACT that there are 2 parties that sign a contract?

 

Have any of you even considered that SFI may file a countersuit against the city for breach of contract??

 

Afterall, the city did NOT provide land that was safe and/or stable enough to run an amusement park on. That the land they leased may be subject to flooding? That there were not adequate levy's in place to protect that land? That SFI had intended to reopen SFNO, but the city said NO, because the CITY said it was unsafe (underwater) to use the land which they leased. And so on....

 

(BTW- "Acts of God" ((i.e. natural disasters)) are generally a part of EVERY land (and/or territory)-based lease agreement, so DON'T even go there.)

 

 

When you look at it from that perspective, who breached the contract first??

 

Maybe SFI will recoup enough money from N.O. that they won't have to file bankruptcy afterall, and still keep a failure of a park from reopening. Hmmm???

 

Like I said, THINK!

 

 

JJ

[cathyJ]

I was actually thinking about this SFNO vs. New Orleans thing today.

 

Would it had made any difference to any of this say had Six Flags reopened the park after Katrina...however only running a few flats and perhaps one food stand with a very limited staff while closing off the rest of the park to the public to see what they could do next?

 

This way New Orleans would get their Six Flags back even if 80% of the park would be closed and Six Flags by having a very limited staff and running a few rides, that shouldn't be a cost problem. Six Flags could buy time this way while they ( and the city ) could decide on the future.

 

Or did this contract state that ALL of the rides and attractions must be open?

[stingrock23]

It's pointless to try to re-open the park, it just won't work. This marketplace just won't be able to support it. I just wish this entire saga would end. I'm tired of hearing about it. I would try to sell anything I could, get whatever $$ I could get, and just end it at that.

[Six Flags Enthuseast]

^I guess that's all they can do, if nobody comes back....

 

I thought it looked like a nice park, but it will never be the same, whether they reopen it or not.

[AllenA07]

So first off I'm wondering if I've now been deemed a SFNO fanboy, as it appears I have been. I think I can refute that argument by the fact that I've never been within 500 miles of the park, and even without Katrina I seriously doubt if I would have ever gone out of my way to visit SFNO. Hard to be a fanboy of a park you have never been to.

 

As far as Six Flags filing a counter claim, I would have paid that more if the thread had been about Six Flags going after the city of New Orleans, however as it stands they've filed nothing in response. Actually nobody has filed anything as far as I know at this point, I still think that there is a very strong chance that this is simply saber rattling.

 

I'm not trying to come off wrong here and I fear that I have, I'm simply trying to make my best guess at what New Orleans is asking for. I don't believe I have stated my personal opinion in this matter yet, I'm just trying to figure out what the city is asking for. In all honesty unless there is a provision in the contract that specifically states that Six Flags must keep the park operating for the duration of that lease, I think Six Flags may very well have the stronger case, especially considering that it appears that they have continued to make the lease payments on the land. It all depends on what is in the contract, a contract that none of us have seen.

 

Finally why speculate as to what is in the contract? Everything I've speculated towards are things that I think would be highly likely to have been drafted into the contract. I think it would be highly prudent in a lease like this to include a clause that Six Flags must keep the park operating over the duration of their lease. Likewise I can almost promise you that there is a provision in the agreement for how to deal with a disaster that results in the total loss of the park. A provision like that is going to be boiler plate (or at least should be) in a lease agreement like this. The question isn't if it exists, the question is what does the provision say.

 

Basic point of everything here, I know no better then anybody else what is going on, I'm merely trying to make an educated guess as to things that the contract should have in it. Again though, my hunch is telling me that this is never going to go anywhere, and it is merely an attempt by the city to get Six Flags to work out a deal with them. No matter what happens though I seriously doubt that SFNO will ever reopen.

[OldJJman]

^Trust me. I wasn't labeling you as a fanboy. The fanboys are quite apparent.

 

...... I still think that there is a very strong chance that this is simply saber rattling.

 

My thoughts exactly.

 

Again though, my hunch is telling me that this is never going to go anywhere, and it is merely an attempt by the city to get Six Flags to work out a deal with them.

 

That would seriously be my guess as well.

 

 

JJ

[BlueFloyd]

I've never gotten around to posting on here, but I wanted to see if any official word on the New Orleans park has been released recently, and from what I've seen, that would be a negative. BUT!! if you haven't heard, the name Danny Rogers is back again and he is attempting once again to gain control of the eyesore which once was an amusement park

 

This should turn out interesting because of timing. The city is suing Six Flags for not complying with the lease agreements made to run the park, and Six Flags has some debt issues. Let's just hope the city doesn't get its hands on the park because of the money hungry politicians that seem to feed off of the anger and hostility of the people. We could think of Danny's plan to be an A+ for all parties concerned. Six Flags gets a little pocket change from SSA and the city gets its park back. Not bad?

 

Anyways, the Southern Star Amusement website is back up and running, and if you check the news page you'll come across a press release...which is kind of interesting, so you should take a minute and check it out.

 

we have resumed our efforts, this time partnering with another themed entertainment industry company

 

^Are there any leads as to who this could possibly be?

 

I wish the best of luck to you Danny, and I hope you succeed, and I would be happy to support your efforts.

 

http://southernstaramusement.com/ssa/index.html

[spaceace12]

Keep dreaming Danny......Why don't you buy some other park that can actually make it.

[BlueFloyd]

Money and timing

 

He could acquire a rundown amusement park and rehab/renovate/restore for dirt cheap opposed to starting from scratch elsewhere, where the national economy has bitten a bit harder...yes i said it, New Orleans isn't facing the economic troubles and hardships that other cities around the country are (Thank you oil ). With the city's recovering process gradually moving forward, a park could spark the future development of one of the hardest hit areas, NO East.

 

If the park were to open and prove successful, the East would flourish once again (bandwagon effect.)

 

Also, there are several ways to acquire funding for the park that aren't available in other areas. We have gozone funds which are for the rebuilding efforts of the harder hit areas, which could possibly lower the cost of building the park.

 

Or maybe he might not succeed, but if someone is willing to take a multi-million dollar mess and attempt to reopen it and turn that mess into something shiny and new that benifits me, I am going to be the last one to shoot down their stars. So theres no reason to knock his plan, just hope for the best, but don't give your hopes up if something takes an unexpected/expected turn.

 

 

And sorry if I come off to you as a grouch, I'm a really nice guy and all, just get defensive over my turf and park

[OldJJman]

Guess what? I'm home!! (Deal with it!)

 

BUT!! if you haven't heard, the name Danny Rogers is back again and he is attempting once again to gain control of the eyesore which once was an amusement park

 

I guess you're a little late to the party. Before making statements like that, try reading here. (Written on 5/14/08.)

 

We could think of Danny's plan to be an A+ for all parties concerned.

Not a chance. Take a look here. (Written on 8/28/08.)

 

 

Anyways, the Southern Star Amusement website is back up ....

we have resumed our efforts, this time partnering with another themed entertainment industry company

 

^Are there any leads as to who this could possibly be?

 

Nope. To make matters worse you'll never find out. It's actually easier to trace the family tree of the abominable snowman, and the Yeti ball!

 

 

If the park were to open and prove successful, the East would flourish once again (bandwagon effect).

 

It didn't before. It helped bankrupt one owner, and then failed under the almighty "Six Flags". Why in the world does ANYONE think it will succeed again, when it was a DISMAL FAILURE in the first place?

 

So theres no reason to knock his plan, .....

 

Actually, there are plenty of reasons to "knock HIS plan".

 

Just start reading here. That should pretty much clear up ANY doubts you may have.

 

And sorry if I come off to you as a grouch, I'm a really nice guy and all, just get defensive over my turf and park

 

I'm sorry if I come off as an A$$. But, I seriously believe that you're NOT 15. You can actually form coherent thoughts, complete sentences, do a spell check and post to a forum.

 

Something Mr. Danny Rogers could never have done.

 

 

JJ

[The Alex]

Actually, Floyd over here is 15. Lives in my neighborhood, in fact.

 

 

 

I'm 17, and I would NOT have thought about any of this from the business/investor point of view. I'm too naive about that.

[BlueFloyd]

Wow; only two posts on this site and I'm already being bashed

um, thanks for that...

 

The exact reason I never posted here before, and this will surely be the last

 

I am 15 by the way, class of '11. Who are you to tell me about my life, you don't know anything about me, much less my age

 

Imagine if one of those precious parks was lost to a wildfire or earthquake over in Cali, I'm pretty sure everybody would be upset and do anything they could to get it back. Same situation, both disasters are prevalent; so why can't I rant about having my park back without someone breathing down my neck and telling me just how I should have to settle for nothing when there may be something to look forward to down the road?

 

Forget this, just wasting battery time on my laptop

I'm out