Kalmia is the largest limited partner of Westin Hotels LP. Kalmia had leveled a host of charges against Starwood, Westin Hotels Limited Partnership and general partner Westin Realty. Kalmia sought damages for lost profits, disgorgement of management fees, punitive damages and the alleged lost value of the two properties that were sold. Attempts to obtain a comment from Stroock & Stroock & Lavan LLP of New York City, which represented Kalmia, were not successful at deadline.
In April 2000, Starwood purchased the 1,192-room Westin St. Francis Hotel in San Francisco for $243 million. In January 2005, after Starwood and Kalmia had battled for some time to purchase the Westin Michigan Avenue hotel, McLean, VA-based JER Partners acquired the 751-room facility for $137 million. Starwood manages that hotel, as well as the Westin St. Francis. The panel denied Kalmia's claims, stating, "Kalmia failed to carry its burden of proving, separately or in combination, misconduct violative of any contractual, fiduciary or other legal duty owed to Kalmia by those parties," Starwood officials state.
"This is an important victory for us," comments Kenneth S. Siegel, chief administrative officer and general counsel of Starwood Hotels. "This ruling is a major validation of Starwood's business practices and proves that we honored our duties to all parties involved and acted in the utmost good faith. We look forward to continuing to successfully manage the Westin St. Francis Hotel and the Westin Michigan Avenue Hotel."
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