February 18, 2013

Skywalk judgment threatens Hualapais

Battle Over Skywalk

$28.6 mil judgment could be devastating for Hualapais

By Dennis Wagner
The Hualapai Tribe of northern Arizona faces serious financial and political fallout from a $28.6 million judgment last week favoring a Las Vegas developer who built the Skywalk tourist attraction on reservation land overlooking the Grand Canyon.

Hualapai leaders said they are reviewing their options following the Feb. 11 decision by U.S. District Judge David Campbell.

Campbell’s ruling upheld an arbitration decision awarding David Jin, creator of the glass-bottomed Skywalk, millions of dollars in ticket revenue Jin said was owed to him under a 2003 contract with the tribe.

A lawyer for Jin warned that total damages may reach $277 million in the wake of the tribe’s move to take over the tourist attraction on the Grand Canyon’s West Rim.
The crux of the conflict:In 2003, a tribally owned company, ‘Sa’ Nyu Wa Inc., signed a contract with Jin’s enterprise, Grand Canyon Skywalk Development LLC, for development of the overlook. Jin agreed to build the project for $30 million in return for half of the revenue.

The Skywalk, about 130 miles northwest of Flagstaff, opened to international media coverage in 2007 and reportedly attracts about 370,000 visitors annually. After the first year, court records say, the tribe stopped making payments to Jin’s company and refused to disclose financial documents.

In legal filings, Hualapai leaders and attorneys alleged that Jin’s company had failed to finish the project.

Skywalk Development, supported by testimony from former tribal officials, answered that a visitors center was not completed because the tribe failed to bring in power, sewage treatment and water systems, as required by contract.

That dispute went to arbitration. The tribe participated in negotiations until last year, when council members voted to condemn the Skywalk and take ownership of it. Hualapai attorneys argued in court that tribal sovereignty makes the Indian nation exempt from arbitration even though it was agreed to in the contract with Jin.

In a 27-page ruling, Judge Campbell described the tribe’s legal arguments as “odd,” “nonsensical” and “wholly unconvincing.” He concluded that the Hualapai Tribe “clearly waived its sovereign immunity.”
Comment:  For more on the Skywalk, see Hualapai Tribe Seizes Skywalk and Skywalk Has Quadrupled Visitors.

1 comment:

Rob said...

For more on the subject, see:


Tribal Owner of Grand Canyon Skywalk Files for Bankruptcy

When Jin tried to seize the skywalk owner’s bank accounts, the entity filed for Chapter 11 bankruptcy protection. That filing halts collection efforts and lobs the dispute to Judge Brenda Moody Whinery of the U.S. Bankruptcy Court in Yuma, Ariz.

In a letter sent to tribe members about the bankruptcy, tribal Chairwoman Sherry Counts said that Jin doesn’t have access to the tribe’s budget. The tribe itself isn’t in bankruptcy, she emphasized.