19843005

Alan L. Sullivan (3152)

Amber M. Mettler (11460)
Snell & Wilmer L.L.P.
15 West South Temple, Suite 1200
Gateway Tower West
Salt Lake City, Utah 84101-1004
Telephone: (801) 257-1900
asullivan@swlaw.com
amettler@swlaw.com

Michael D. Zimmerman (3604)
Troy L. Booher (9419)
Zimmerman J ones Booher LLC
Kearns Building, Suite 721
136 South Main Street
Salt Lake City, Utah 84101
Telephone: (801) 924-0200
mzimmerman@zjbappeals.com
tbooher@zjbappeals.com

Attorneys for Plaintiffs/Counterclaim Defendants
Greater Park City Company and Greater Properties,
Inc.
J ames W. Quinn (pro hac vice)
Bruce S. Meyer (pro hac vice)
Weil Gotshal & Manges, LLP
767 Fifth Avenue
New York, New York 10153
Telephone: (212) 310-8385
james.quinn@weil.com
bruce.meyer@weil.com
IN THE THIRD JUDICIAL DISTRICT COURT IN AND FOR
SUMMIT COUNTY, STATE OF UTAH
GREATER PARK CITY COMPANY, a Utah
corporation, and GREATER PROPERTIES,
INC., a Delaware corporation,
Plaintiffs,
vs.
UNITED PARK CITY MINES
COMPANY, a Delaware corporation, and
TALISKER LAND HOLDINGS, LLC, a
Delaware limited liability company,
TALISKER LAND RESOLUTION LLC, a
Delaware limited liability company, VR
CPC HOLDINGS, INC., a Delaware
Corporation, FLERA, LLC, a Delaware
limited liability company, TALISKER
CANYONS LEASECO LLC, a Delaware
limited liability company, TALISKER


PLAINTIFFS MEMORANDUM
REGARDING SECURITY FOR A STAY
PENDING THE CONCLUSION OF
LITIGATION BEFORE THE TRIAL
COURT

**REDACTED**


Case No. 120500157
J udge Ryan Harris

19843005




CANYONS FINANCE CO LLC, a
Delaware limited liability company, and
J OHN DOE CORPORATIONS 1
THROUGH 10,
Defendants.
UNITED PARK CITY MINES COMPANY,
a Delaware corporation, and TALISKER
LAND HOLDINGS, LLC, a Delaware limited
liability company,

Counterclaim Plaintiffs,

vs.

GREATER PARK CITY COMPANY, a Utah
corporation, and GREATER PROPERTIES,
INC., a Delaware corporation,

Counterclaim Defendants.

Pursuant to the Stipulated Scheduling Order signed by the Court on J uly 1, 2014, and the
Revised Stipulated Scheduling Order signed by the Court on August 12, 2014,
Plaintiffs/Counterclaim Defendants Greater Park City Company and Greater Properties, Inc.
(collectively, Plaintiffs), by and through their counsel of record, respectfully submit this
Memorandum Regarding Security for a Stay Pending the Conclusion of Litigation Before the
Trial Court.
TABLE OF CONTENTS

Page

-i-

I. SUMMARY ....................................................................................................................... 1
Period Covered by the Bond .............................................................................................. 1
The Appropriate Amount of the Bond ............................................................................... 2
Fair Rental Value ............................................................................................................... 2
Items That Should Not Be Included in the Bond ............................................................... 3
II. BACKGROUND ............................................................................................................... 3
A. The Leases ............................................................................................................. 3
B. Vail Transaction ..................................................................................................... 4
C. Taliskers Unlawful Detainer Counterclaim .......................................................... 5
D. Taliskers Damages Claims ................................................................................... 6
III. GENERAL LEGAL STANDARDS FOR STAYS PENDING FURTHER
ADJ UDICATION AND FOR THE DETERMINATION OF SECURITY ...................... 8
A. Utahs Unlawful Detainer Statute .......................................................................... 8
B. Utah Rule of Civil Procedure 62 ............................................................................ 9
IV. ARGUMENT ................................................................................................................... 10
A. The Period for Which Plaintiffs Seek a Stay ....................................................... 10
B. Taliskers Claims for Rent and Damages ............................................................ 10
1. The Value of All Taliskers Claims for Monetary Relief Are Based
on the Fair Rental Value of the Leased Premises .................................... 10
2. The Fair Rental Value of the Leased Premises is No More Than
$1,000,000 Per Year ................................................................................ 12
a. Fair Market Value ........................................................................ 12
b. Investment or Use Value .............................................................. 15
c. Vails Valuation of the Leased Premises ..................................... 16
3. Summary Rental Value Calculations ....................................................... 18
4. Amounts to Which Talisker is Not Entitled Under its Damages
Claims ...................................................................................................... 18
a. Taliskers Alleged Lost Profits .................................................... 18
b. Plaintiffs Profits .......................................................................... 20
c. Double Recovery of Rent From Both Vail and Plaintiffs ............ 22
d. Prejudgment Interest .................................................................... 25
TABLE OF CONTENTS
(continued)
Page

-ii-

e. Limited Reasonable Attorneys Fees ........................................... 27
C. Principles for the Computation of the Amount of Security ................................. 29
1. The Amount Secured Should Equal No More Than the Fair Rental
Value of the Leased Premises from May 1, 2011, to May 29, 2013,
Plus Taliskers Reasonable Attorneys Fees Incurred in Connection
with the Unlawful Detainer Counterclaim Since October 28, 2013 ........ 29
2. Trebled Damages Should Not Be Included in the Amount Secured ....... 29
3. Prejudgment Interest Should Not be Included in the Amount
Secured ..................................................................................................... 30
V. CONCLUSION ................................................................................................................ 31





TABLE OF AUTHORITIES
Page
-iii-

FEDERAL CASES
650 Park Ave. Corp. v. McRae,
665 F. Supp. 228, 237 (S.D.N.Y. 1987)................................................................................. 22
Alexander v. Chesapeake, Potomac, and Tidewater Books, Inc.,
190 F.R.D. 190 (E.D. Va. 1999) .............................................................................................. 1
Bowes v. Saks & Co.,
397 F.2d 113 (7th Cir. 1968) ................................................................................................. 17
ClearOne Commcns, Inc. v. Chiang,
432 Fed. Appx. 770 (10th Cir. 2011) ..................................................................................... 26
E.E.O.C. v. Waffle House, Inc.,
534 U.S. 279 (2002) ............................................................................................................... 23
In re Network Associates, Inc., Sec. Litig.,
C 99-01729WHA, 2000 WL 33376577 (N.D. Cal. Sept. 5, 2000) ........................................ 15
Kelly v. Kruse, Landa, Zimmerman & Maycock, Civil No. C-85-1057W,
1998 U.S. Dist. LEXIS 18657 (D. Utah Dec. 9, 1988) .......................................................... 30
Lenci v. Owner,
638 P.2d 598, 803-04 (Wash. Ct. App. 1981)........................................................................ 11
Murphy v. Texaco, Inc.,
567 F. Supp. 910 (N.D. Ill. 1983) .......................................................................................... 13
Shepherd v. C.I.R.,
115 T.C. 376 (2000) ............................................................................................................... 15
United States v. Miller,
317 U.S. 369 (1942) ............................................................................................................... 12
STATE CASES
438 W. 19th St. Operating Corp. v. Metro. Oldsmobile, Inc.,
142 Misc. 2d 170 (N.Y. Civ. Ct. 1989).................................................................................. 13
Anesthesiologists Assocs. of Ogden v. St Benedicts Hosp.,
852 P.2d 1030 (Utah Ct. App. 1993) ..................................................................................... 26
Aris Vision Institute, Inc. v. Wasatch Prop. Management, Inc.,
2006 UT 45, 143 P.3d 278 .............................................................................................. passim
Bennett v. Huish,
2007 UT App 19, 155 P. 3d 917 ............................................................................................ 27
Bjork v. April Indus., Inc.,
560 P.2d 315 (Utah 1977) ...................................................................................................... 26
Brooks v. Networks of Chattanooga, Inc.,
946 S.W.2d 321 (Tenn. Ct. App. 1996) ................................................................................. 13
Canyon Country Store v. Bracey,
781 P.2d 414 (Utah 1989) ...................................................................................................... 26
Charles Downey Family Ltd. Pship v. S & V Liquor, Inc.,
880 N.E.2d 322 (Ind. Ct. App. 2008)..................................................................................... 13
Christopherson, Farris, White & Utley, P.C. v. Pugh,
2006 UT App 68, 2006 WL 448677 (Utah Ct. App. Feb. 24, 2006) ..................................... 28
19843005




TABLE OF AUTHORITIES
(continued)
Page

iv

Coinmach Corp. v. Aspenwood Apartment Corp.,
417 S.W.3d 909 (Tex. 2013) .................................................................................................. 20
Coleman v. Thomas,
2000 UT 53, 4 P.3d 783 ......................................................................................................... 11
Colt Investments, L.L.C. v. Boyd,
419 S.W.3d 194 (Mo. Ct. of App. 2013) ............................................................................... 13
Dejavue, Inc. v. U.S. Energy Corp.,
1999 UT App 355, 993 P.2d 222 ........................................................................................... 25
Diversified Holdings, L.C. v. Turner,
2002 UT 129, 63 P.3d 686 ..................................................................................................... 29
First Sec. Bank of Utah, N.A. v. J .B.J . Feedyards, Inc.,
653 P.2d 591 (Utah 1982) ...................................................................................................... 26
Forrester v. Cook,
292 P. 206 (Utah 1930) .............................................................................................. 11, 18, 21
Golden Meadows Properties, LC v. Strand,
2010 UT App 257, 241 P.3d 375 ........................................................................................... 27
Hall v. Feigenbaum,
319 P.3d 61 (Wash. Ct. App. 2014) ....................................................................................... 22
Keith J orgensens, Inc. v. Ogden City Mall Co.,
2001 UT App 128, 26 P.3d 872 ............................................................................................. 28
McGuire v. City of J ersey City,
593 A.2d 309 (N.J . 1991)....................................................................................................... 17
Monroc, Inc. v. Sidwell,
770 P.2d 1022 (Utah Ct. App. 1989) ..................................................................................... 11
Nielsen v. OReilly,
848 P.2d 664 (Utah 1992) ...................................................................................................... 30
Olympus Hills Shopping Center, Ltd. v. Landes,
821 P.2d 451 (Utah 1991) ...................................................................................................... 23
Reid v. Mutual of Omaha Ins. Co.,
776 P.2d 896 at 906 (Utah 1989) ..................................................................................... 11, 23
Rische Const. Co. v. May,
112 N.W.2d 165 (Wis. 1961) ................................................................................................. 22
Simmons v. OCharley's, Inc.,
914 S.W.2d 895 (Tenn. Ct. App. 1995) ................................................................................. 20
Sprincin King St. Partners v. Sound Conditioning Club, Inc.,
925 P.2d 217 (Wash. 1996).................................................................................................... 30
Superior Motels, Inc. v. Rinn Motor Hotels, Inc.,
241 Cal. Rptr. 487 (Cal. Ct. App. 1987) .................................................................... 21, 22, 26
Taylor Nat'l, Inc. v. J ensen Bros. Constr. Co.,
641 P.2d 150 (Utah 1982) ........................................................................................................ 8
T-Mobile USA, Inc. v. Utah State Tax Commn,
2011 UT 28, 254 P.3d 752 ..................................................................................................... 16
19843005




TABLE OF AUTHORITIES
(continued)
Page

v

Valley Lane Corp. v. Bowen,
592 P.2d 589 (Utah 1979) ...................................................................................................... 13
Westport Taxi Serv., Inc. v. Westport Transit Dist.,
664 A.2d 719 (Conn. 1995) ................................................................................................... 26
Wright v. Vickaryous,
598 P.2d 490 (Alaska 1979)................................................................................................... 23
STATE STATUTES
N.M. Stat. Ann. 47-8-3 ............................................................................................................. 13
Utah Code Ann. 15-1-1(2) ........................................................................................................ 30
Utah Code Ann. 59-2-102(12) .................................................................................................. 12
Utah Code Ann. 78B-6 .................................................................................................... passim
STATE RULES
Utah R. Civ. P. 4 ............................................................................................................................ 8
Utah R. Civ. P. 54(b) ................................................................................................................. 8, 9
Utah R. Civ. P. 62 ................................................................................................................. passim
FEDERAL REGULATIONS
26 C.F.R. 1.170A-1(c)(2) .......................................................................................................... 12
OTHER AUTHORITIES
9 A.L.R. 5th 63 (Originally published in 1993) ........................................................................... 27
32 A.L.R. 2d 582.......................................................................................................................... 13
Accounting Standards Codification 840 ...................................................................................... 17
Accounting Standards Codification 840-10-25. .......................................................................... 17
Restatement (Second) of Property, Land. & Ten. 14.5 ............................................................. 25
The Appraisal of Real Estate at 22 (12
th
ed. 2003) ................................................................ 12, 15


-1-

I. SUMMARY
The issues before the Court concern (1) the methodology the Court should follow in
setting the amount of the bond that will secure a stay of the Order of Restitution entered on J uly
1, 2014, and (2) the appropriate amount of the bond.
1
In a motion filed on J une 12, 2014,
Plaintiffs asked the Court, among other things, to stay any order of restitution pending the
conclusion of this case at the trial level. The Court has since directed the parties to file
simultaneous memoranda on the methodology the Court should follow in calculating the amount
of the bond and for the parties positions on what the amount of the bond should be. This
memorandum complies with that direction.
Period Covered by the Bond
The bond that is the subject of the present proceeding is interim in nature. The period of
time for which a stay is sought will conclude with this Courts entry of final judgment following
the adjudication of the remaining claims of the parties. Based on the Courts Stipulated Order
Regarding Schedule (J uly 1, 2014), the parties anticipate that the remaining issues will be tried
late this year or early in 2015. When final judgment is entered by this Court, Plaintiffs expect to
apply for a stay pending appeal to the Utah Supreme Court under Rule 62(d), Utah Rules of Civil

1
Throughout this memorandum and for convenience, Plaintiffs refer to the proposed security as
a bond. However, both Rule 62 and the unlawful detainer statute contemplate the possibility
of security other than a corporate bond, including, for example, a personal bond having one or
more sureties who are residents of Utah with a collective net worth of at least twice the amount
of the bond, or a deposit of money in court or security in lieu of a bond. See Utah Code Ann.
78B-6-808(4)(b)(i)-(ii); Utah R. Civ. P. 62(i)(1)-(2); see also Alexander v. Chesapeake,
Potomac, and Tidewater Books, Inc., 190 F.R.D. 190, 193-94 (E.D. Va. 1999) (defendants may
either post a bond in the amount set aside, or, if the parties agree, place the sum into an escrow,
to be released to plaintiffs if they prevail on appeal). Once the Court sets the appropriate
amount of security required to continue the stay, and if Plaintiffs elect to post such security,
Plaintiffs should be afforded the opportunity to post security in a form other than a corporate
bond, as long it is acceptable to and approved by the Court.
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2

Procedure. The bond that is the subject of the present memorandum would be replaced by a
supersedeas bond in an amount determined by the Court pursuant to Rule 62(j).
The Appropriate Amount of the Bond
The amount secured by the bond should equal no more than the fair rental value of the
Leased Premises from May 1, 2011, through May 28, 2013, plus Taliskers reasonable attorneys
fees incurred in connection with the unlawful detainer counterclaim since October 2013, and
costs. Plaintiffs experts have determined the range of values for the market rent appropriate for
the Leased Premises based on a series of assumptions. Based solely on the fair market value of
the Leased Premises which should control here the fair rental value of the property for the
period from May 1, 2011 to J anuary 31, 2015, is $226,650 per year. Assuming, however, that
the Leased Premises may be leased as part of an operating ski resort, the reasonable rental value
is no more than $1,000,000 per year. Vails own estimate of the fair market value of the Leased
Premises together with unspecified improvements implies an annual rental value for the property
is no more than $2,890,000 per year. Using these figures to provide a range of possible values,
the total amount of the security required to stay the execution of the Order of Restitution until
entry of final judgment before this Court should be between $1,021,308 and $6,559,616.
Fair Rental Value
The Courts determination of the amount of an interim bond must be based on a
preliminary estimate of the total net amount of rent and damages that will be awarded to
Defendant Talisker Land Holdings, LLC (Talisker). Those damages will be based on the fair
rental value of the Leased Premises for the period in question, which began on May 1, 2011, and
will end when final judgment is entered by this Court. The Court should base its estimate of the
fair rental value on the fair market value the leasehold. As shown below, since both rent and
damages must be based on fair rental value, Talisker would not be entitled to recover for either
its own alleged lost profits or Plaintiffs profits for the period of occupancy.
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3

Items That Should Not Be Included in the Bond
Talisker should not be permitted to recover and the amount of the bond should not
include rent for the period for which Talisker has already been paid rent by Defendant VR CPC
Holdings, Inc. (Vail). Nor should the bond include prejudgment interest primarily because
the fair rental value is not a liquidated sum to which prejudgment interest should be applied.
Trebled damages should be excluded from the amount secured because the law is clear that all
such punitive damages must be excluded from the amount secured by the bond under both the
unlawful detainer statute and Rule 62. Finally on this score, although the estimated amount of
Taliskers unlawful detainer attorneys fees may be included in the amount secured by the bond,
those attorneys fees began to accrue in about October 2013, when Taliskers unlawful detainer
counterclaim was filed.
II. BACKGROUND
A. The Leases
1. Plaintiffs own and operate the Park City Mountain Resort (the Resort or
PCMR). A significant portion of the Resorts skiable terrain is operated on land leased
through two lease agreements (the Resort Area Lease and the Crescent Ridge Lease,
collectively referred to as Leases). The Leases cover approximately 3,000 acres of land (the
Leased Premises).
2. The Leases initial term ran until 1991, with the option to extend the term for
three additional terms of twenty years (for a total of sixty years or until 2051). Prior to the end
of the initial term in 1991, both Leases were extended for an additional twenty-year term until
April 30, 2011.
3. On May 2, 2011, Plaintiffs gave written confirmation to UPCM and Defendant
Talisker Land Holdings, LLC (collectively, Talisker) that the Leases had been extended for an
additional 20-year term.
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4

4. On December 30, 2011, Talisker advised Plaintiffs for the first time that its
position was that Plaintiffs had failed to timely renew the Leases and the Leases had, therefore,
expired on April 30, 2011.
5. Plaintiffs initiated this lawsuit on March 9, 2012, seeking, among other things, a
declaration from the Court that the Leases had been extended. (See generally Compl.)
6. Although Talisker contended that the Leases expired on April 30, 2011, by letter
dated April 12, 2012, Talisker expressly permitted Plaintiffs to remain on the Leased Premises
for the period between April 30, 2011, and April 30, 2012. (See 4/12/2012 Letter attached as
Exhibit 14 to 2/7/2014 Declaration of Michael D. Zimmerman (Zimmerman Decl.).) Among
other things, Talisker stated that if Plaintiffs did not leave the premises by April 30, 2012,
beginning May 1, 2012, rent for the Leased Premises would be $7.7 million per annum. (Id.)
7. On March 29, 2013, Talisker sent another letter to Plaintiffs again demanding rent
in the amount of $7.7 million per year and informing Plaintiffs that while Talisker had no
present intention to move for immediate possession of the Resort Lands, it may do so in the
future. (See 3/29/2013 Letter from D. Smith, attached as Exhibit 15 to Zimmerman Decl.)
8. On April 15, 2013, Talisker sent notice to Plaintiffs reiterating that Talisker had
no present intention to move for immediate possession of the Premises, but informing
Plaintiffs that if they remained on the Leased Premises after May 1, 2013, they would do so as a
tenant at will. (4/15/2013 Letter from D. Smith, attached as Exhibit 16 to Zimmerman Decl.)
B. Vail Transaction
9. On or about May 29, 2013, Talisker and Vail Resorts, Inc. (through Defendant
VR CPC Holdings, Inc.) consummated a transaction in a series of agreements, pursuant to which
VR CPC Holdings leased the Canyons Resort property for a fifty-year term, with six automatic
fifty-year renewal periods, for a total term of 350 years (the Vail Transaction). (See 5/21/2014
Mem. Decision and Order at 97.)
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5

10. As part of the Vail Transaction, the parties created a new entity, known as
Talisker Land Resolution LLC, in order to afford Vail a means to exercise control over this
litigation. (Id. at 98.) Talisker Land Resolution acquired 100% of the equity in, and is the sole
member of, TLH. (Id.)
11. As part of the Vail Transaction, the parties agreed that the Leased Premises may
be added to Vails lease if Talisker prevails in this litigation, although the amount of rent paid by
Vail to Talisker a fixed base rent of $25 million per year will not change; additional
participatory rent which is to be paid by Vail based on the resorts earnings, may change if
Vail is able to operate PCMR. (See, e.g., 4/8/2014 Decl. of J ack Bistricer at 6 (The May 2013
deal with Vail was structured so that the Talisker-affiliated entities involved in the deal would
benefit financially from the potential upside that I believed could be achieved through the
arrangement with Vail. Specifically, in addition to the $25 million per year that VR CPC
Holdings pays as fixed base rent, VR CPC Holdings is also obligated to pay participating rent
of 42% of the amount by which the EBITDA from [Canyons Resort and PCMR] exceeds a
certain threshold amount.), Ex. A.)
12. In its public securities filings, Vail represented that the fair market value of the
Leased Premises with improvements, is $57.8 million. (See September 27, 2013 Vail Resorts,
Inc. 10-K at F-18, available at
http://files.shareholder.com/downloads/MTN/2798586215x0xS812011-13-29/812011/filing.pdf,
excerpts attached as Ex. B.)
C. Taliskers Unlawful Detainer Counterclaim
13. On August 28, 2013, Talisker, by and through its sole member, Talisker Land
Resolution, served GPCC and GPI with a Five Day Notice to Quit pursuant to Utah Code Ann.
78B-6-802, et seq. (5/21/2014 Mem. Decision and Order at 84.)
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6

14. On October 28, 2013, Talisker filed counterclaims against Plaintiffs, including a
counterclaim for unlawful detainer.
15. On March 14, 2014, for the first time, Talisker took action to obtain possession of
the Leased Premises by filing a motion for partial summary judgment on the unlawful detainer
counterclaim and an order of restitution. (See Talisker Counterclaim at 66-75; 3/14/2014
Talisker Mem.)
16. On J une 12, 2014, Plaintiffs filed their Motion to Postpone or Stay the Effect and
Enforcement of Any Ruling that May be Rendered on Defendants Unlawful Detainer
Counterclaim.
17. On J uly 1, 2014, the Court entered an Order of Partial Summary J udgment and an
Order of Restitution on an unlawful detainer counterclaim in favor of Talisker. The Court ruled
that Talisker is entitled to take possession of the Leased Premises, but stayed enforcement of the
J uly 1 orders until after the August 27, 2014 hearing.
18. On J uly 25, 2014, Talisker responded to Plaintiffs motion to stay, indicating that
it would not oppose a stay of the Courts Order of Restitution on the condition that Plaintiffs
post a bond sufficient to protect Taliskers rights to collect on a judgment for [Plaintiffs]
wrongful use of Taliskers property. (7/29/2014 Letter from J . Lund.)
19. On J uly 10, 2014, Plaintiffs filed an appeal from the J uly 1 orders entered by the
Court concerning Taliskers unlawful detainer counterclaim as a precautionary measure.
Plaintiffs do not believe the J uly 1 orders finally resolve the litigation, but filed the appeal out of
an abundance of caution.
D. Taliskers Damages Claims
20. Talisker has asserted three claims for monetary relief: (1) rent for the period since
the Leases expired on April 30, 2011; (2) unlawful detainer damages; and (3) in the alternative,
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7

unjust enrichment damages.
2
(See generally Talisker Counterclaim at 61-81.) Pursuant to
the unlawful detainer statute, in addition to seeking restitution of the Leased Premises, Talisker
claims it is entitled to the reasonable value of use of the Leased Premises and the buildings,
structures, facilities, and improvements thereon, from five days after service of the Notice to
Quit to the present until the time [GPCC and GPI] vacate the premises. (See Talisker
Counterclaim at 73-74.)
21. In its written discovery responses, Talisker refused to disclose the amount of
damages it seeks. It advised Plaintiffs only that the monetary relief it claims will be the subject
of expert evidence and testimony and that it is entitled to at least $7.7 million for the 2012-
2013 period pursuant to its April 12, 2012 letter, even though this amount was not computed,
but was simply closer to what [Talisker believes it] should at least be getting for Plaintiffs use
of [Taliskers] lands. (7/9/2013 Defs Resp. to Interrogatory No. 4, attached as Ex. C;
8/23/2013 Defs Suppl Resp. to Interrogatory No. 4, attached as Ex. D.)
22. To date, Talisker has provided no additional information as to the amount of
damages to which it claims to be entitled, the alleged reasonable value of use of the Leased
Premises, or the basis for such amounts. (See, e.g., 12/16/2013 Talisker Suppl Initial Discl. at
5-6, attached as Ex. E.) J ack Bistricer, however, testified that EBITDA (earnings before interest,
taxes, depreciation, and amortization) is not relevant to real estate, only to an operating
business. (See 11/20/2013 J . Bistricer Dep. Tr. at 21:13-24, attached as Ex. F.)
23. Other than Talisker, none of the defendants has asserted a claim against Plaintiffs
for rent or damages. To be specific, Vail has not asserted a claim for damages or any other relief
in this case.

2
As the Court noted in its February 20, 2014 Memorandum Decision and Order, Talisker was
permitted to maintain its claim of unjust enrichment in the alternative, even though it was highly
unlikely that such a claim will ever be needed because Talisker likely has an adequate remedy at
law. (See 2/20/2014 Mem. Decision and Order at 20-21.)
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8

III. GENERAL LEGAL STANDARDS FOR STAYS PENDING FURTHER
ADJUDICATION AND FOR THE DETERMINATION OF SECURITY
A. Utahs Unlawful Detainer Statute
Because there is no final judgment from which Plaintiffs may appeal as a matter of right
pursuant to Utah Rule of Civil Procedure 4, and because no judgment has been certified as final
and appealable pursuant to Utah Rule of Civil Procedure 54(b) (such that Rules 62(d) and 62(h)
would apply by their terms), the appropriate standard for determining the amount of security is
the unlawful detainer statute. The unlawful detainer statute provides that [a] request for hearing
by the defendant may not stay enforcement of the restitution order unless: (i) the defendant
furnishes a corporate bond, cash bond, certified funds, or a property bond to the clerk of the court
in an amount approved by the court according to the formula set forth in Subsection 78B-6-
808(4)(b); and (ii) the court orders that the restitution order be stayed. Utah Code Ann. 78B-
6-812(2)(b) (emphasis added). The formula set forth in Subsection 78B-6-808(4)(b) is as
follows: the probable amount of costs of suit, including attorney fees and actual damages which
may result to the plaintiff if the defendant has improperly withheld possession. Utah Code Ann.
78B-6-808(4)(b)(vi) (emphasis added). Subsection 78B-6-808(4)(b) indicates that the requisite
security may take the form of a corporate bond, cash bond, certified funds, or a property bond
executed by two persons who own real property in the state and who are not parties to the action
and the form of the bond is at the [tenants] option. Id. at -808(4)(b)(i)-(ii)
To the extent there is any lack of clarity in Subsection 78B-6-808(4)(b) as to the
standards this Court should follow in setting the bond amount, the principles set forth in Rule 62
provide guidance, particularly since Rule 62 generally allows the Court to stay execution of a
judgment in its discretion. See Utah R. Civ. P. 62(a); see also Taylor Natl, Inc. v. J ensen Bros.
Constr. Co., 641 P.2d 150, 154 (Utah 1982) (court, in its discretion, may temporarily stay
execution in order to prevent injustice, but it may not negate its own judgment by indefinitely
staying execution thereon).
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9

B. Utah Rule of Civil Procedure 62
Rule 62 allows the Court to stay execution of a judgment in its discretion, Utah R. Civ. P.
62(a), when an appeal is taken, Utah R. Civ. P. 62(d), or when a court has ordered a final
judgment on some but not all of the claims presented in the action under the conditions stated in
Rule 54(b), Utah R. Civ. P. 62(h). Subsection (h) allows the court to stay enforcement under
such conditions as are necessary to secure the benefit thereof to the party in whose favor the
judgment is entered. Subsection (d) conditions a stay on the posting of a supersedeas bond.
Rule 62(j) directs the Court to set the supersedeas bond in an amount that adequately protects
the judgment creditor against loss or damage occasioned by the appeal and assures payment in
the event the judgment is affirmed. Utah R. Civ. P. 62(j). [T]he presumptive amount of a
bond for compensatory damages is the amount of the compensatory damage plus costs and
attorney fees, as applicable, plus 3 years of interest at the applicable rate. Utah R. Civ. P.
62(j)(2)(A) (emphasis added).
3
In setting the amount of the bond, the Court may consider any
relevant factors, including the judgment debtors ability to pay the judgment and the
respective harm to the parties from setting a higher or lower amount. Utah R. Civ. P. 62(j)(1).
The Advisory Committee Note to the rule states: In considering conditions for setting a bond of
less than the presumed amount under paragraph (j)(1), the judges objective is to protect both a
judgment creditors interest in collecting a judgment affirmed on appeal and to afford a judgment
debtor a reasonable opportunity to prosecute an appeal without unduly and unnecessarily
affecting the judgment debtors operations. No bond is required for punitive damages. Id. at
62(j)(2)(C). Further, a supersedeas bond may be either a commercial bond or a personal bond
having one or more sureties who are residents of Utah having a collective net worth of at least
twice the amount of the bond, exclusive of property exempt from execution. Id. at 62(i)(1).

3
The post judgment interest rate for calendar year 2014 is 2.13%. See
https://www.utcourts.gov/resources/intrates/interestrates.htm.
19843005




10

IV. ARGUMENT
A. The Period for Which Plaintiffs Seek a Stay.
Plaintiffs seek a stay of enforcement of the Order of Restitution through the conclusion of
the proceedings before this Court. Based on the Stipulated Scheduling Order entered by the
Court on J uly 1, 2014, the parties anticipate a trial occurring at the end of this year or the early
part of 2015. Once the remaining issues have been resolved and final judgment is entered,
Plaintiffs will seek a stay during the pendency of their appeal pursuant to Rule 62; the Courts
order of stay pursuant to Rule 62(d) will be conditional on a bond or other security in compliance
with Rule 62(j). That bond will, in effect, replace the bond or other security that is the subject of
this memorandum. For present purposes, the relevant period for the calculation of the amount to
be secured is from May 1, 2011 through J anuary 31, 2015, the approximate date of trial.
B. Taliskers Claims for Rent and Damages.
1. The Value of All Taliskers Claims for Monetary Relief Are Based on the
Fair Rental Value of the Leased Premises.
The starting point for the Court should be its preliminary determination of the market rent
for the Leased Premises. Talisker has asserted three overlapping claims for monetary relief: (1)
rent; (2) unlawful detainer damages; and (3) in the alternative, unjust enrichment damages. No
other defendant including Vail has asserted any claim for damages. The damages sought by
Talisker under the unlawful detainer statute are inclusive of all other damages it seeks. This is
because the unlawful detainer statute provides [t]he judgment shall be entered against the
defendant for [1] the rent, [2] for three times the amount of the damages assessed resulting to
the plaintiff from, in relevant part, unlawful detainer and/or waste, and [3] for reasonable
attorney fees.
4
Utah Code Ann. 78B-6-811(3). Damages incurred during the period of

4
Although Talisker has alleged damages for waste of the premises, it has never identified
because it cannot what waste Plaintiffs allegedly committed. (See, e.g., 12/16/2013 Talisker
Suppl Discl. at p. 5 (waste is currently unknown but will be the subject of future discovery)
Ex. E.)
19843005




11

unlawful detainer in other words, damages incurred after the fifth day following service of the
notice to quit are subject to trebling. Id.; see also Monroc, Inc. v. Sidwell, 770 P.2d 1022,
1025 (Utah Ct. App. 1989) (only damages incurred after the tenancy has been terminated by the
notice to quit may be trebled).
Thus, for the period May 1, 2011, through September 2, 2013 (the date on which the
tenancy terminated as a result of the Notice to Quit served on August 28, 2013), Talisker may be
entitled to rents, which amounts are not subject to trebling. See, e.g., Monroc, Inc., 770 P.2d at
1025. For the period after termination of the tenancy (on September 2, 2013) through entry of
final judgment, Talisker may be entitled to damages resulting from Plaintiffs unlawful
detainer of the Leased Premises, which damages are measured by the rental value or the
reasonable value of the use and occupancy of the premises
5
and are subject to trebling.
Forrester v. Cook, 292 P. 206, 211 (Utah 1930); see also Monroc, Inc., 770 P.2d at 1025-26
(noting that damages for unlawful detainer were the propertys fair rental value for the period
the tenant remained on the premises after receiving the notice of unlawful detainer); Lenci v.
Owner, 638 P.2d 598, 803-04 (Wash. Ct. App. 1981) (The amount of damages occasioned by
an unlawful detainer and holding over is based upon the fair value of the use of the premises
rather than the amount of rent agreed upon by the parties under a lease no longer in effect.).

5
For the reasons argued in detail at pages 22 to 25 of this memorandum, Talisker cannot
lawfully claim any such damages. However, if such damages were to be assessed, these
damages would continue to accrue until Plaintiffs returned possession of the Leased Premises to
Talisker, which assuming the stay is continued would presumably only occur if, and not
until, Plaintiffs do not prevail on their appeal. See, e.g., Coleman v. Thomas, 2000 UT 53, 6, 4
P.3d 783. As such, any damages that accrue after entry of judgment may either be paid into
escrow or may be added to the supersedeas bond that replaces the security required for the
interim stay requested by Plaintiff. Cf. Reid v. Mutual of Omaha Ins. Co., 776 P.2d 896, 906
(Utah 1989) (To recover for later accruing rents, the landlord must bring a supplemental
proceeding or proceedings in which it can prove that additional rents have accrued and that
reasonable efforts to mitigate those losses have been taken.).
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12

2. The Fair Rental Value of the Leased Premises is No More Than
$1,000,000 Per Year.
The Court may potentially follow one of two different approaches to determine the value
of the Leased Premises: (1) a fair market value analysis or (2) an investment or use value
analysis. Both can be determined by analyzing the price paid for comparable properties or by
performing an income capitalization analysis (calculating the present value of the future benefits
of the Leased Premises). (See, e.g., Declaration of Lance Dor (Dor Decl.) at 12-14, 20,
33, Ex. G.) Using both of these methods, Plaintiffs conclude that an appropriate rental value of
the Leased Premises is $226,650 per year, but in no event more than $1,000,000 per year. As
shown below (at pages 16 to 18), a valuation in this range of magnitudes is confirmed by the fair
market value ($57.8 million) attributed to the Leased Premises in Vails public securities filings.
a. Fair Market Value
Fair market value means the amount at which property would change hands between a
willing buyer and a willing seller, neither being under any compulsion to buy or sell and both
having reasonable knowledge of the relevant facts. Utah Code Ann. 59-2-102(12); see also
United States v. Miller, 317 U.S. 369, 374 (1942) (market value is what a willing buyer would
pay in cash to a willing seller); 26 C.F.R. 1.170A-1(c)(2) (The fair market value is the price
at which the property would change hands between a willing buyer and a willing seller, neither
being under any compulsion to buy or sell and both having reasonable knowledge of relevant
facts.); The Appraisal of Real Estate at 22 (12th ed. 2003) (market value is [t]he most probable
price, as of a specific date, in cash, or in terms equivalent to cash, or in other precisely revealed
terms, for which the specified property rights should sell after reasonable exposure in a
competitive market under all conditions requisite to a fair sale, with the buyer and seller each
acting prudently, knowledgeable, and for self-interest, and assuming that neither is under undue
duress.). Plaintiffs have found no authority permitting the use of any method other than a fair
19843005




13

market value analysis to arrive at the rent and damages due in an unlawful detainer action.
6

As set forth in the Declaration of Lance Dor, attached hereto as Exhibit F, the fair
market rental value of the Leased Premises is $226,650 per year. (Dor Decl. at 16-30.) This
figure was calculated by determining the annual rental income of the fair market value of the
property using a 5% overall rate of return, which is appropriate for the risk profile of the Leased
Premises. This method based on the sales of comparable properties assumes that a buyer (or
in this case a lessee) would pay no more for a specific property than the cost of acquiring (or
renting) a property with the same quality, utility, and perceived benefits of ownership (or

6
See, e.g., Murphy v. Texaco, Inc., 567 F. Supp. 910, 913 (N.D. Ill. 1983) (damages include
recovery for any rental income Texaco could have obtained during the post-termination period
an amount based on the then-prevailing market rental rate); Colt Investments, L.L.C. v. Boyd,
419 S.W.3d 194, 198 (Mo. Ct. of App. 2013) (evidence as to fair rental value of the property
based on testimony of local real estate broker); Charles Downey Family Ltd. Pship v. S & V
Liquor, Inc., 880 N.E.2d 322, 327 (Ind. Ct. App. 2008) (as numerous cases have held, that
measure is the fair market rental value of the premises after the expiration of the lease); Brooks
v. Networks of Chattanooga, Inc., 946 S.W.2d 321, 325 (Tenn. Ct. App. 1996) (the tenant
becomes liable for the fair market rental value for the period that it occupies the premises beyond
the term of the lease (quotation omitted)); 438 W. 19th St. Operating Corp. v. Metro.
Oldsmobile, Inc., 142 Misc. 2d 170, 173 (N.Y. Civ. Ct. 1989) (In making a determination as to
value the Court has the obligation to appraise the actual value of the property taking into
consideration whatever restrictions apply because of agreements between the parties, or to
governmental decrees, or other factors (citations omitted)); Valley Lane Corp. v. Bowen, 592
P.2d 589, 592 (Utah 1979) (Defendants evidence through an expert witness was that a
reasonable monthly rental value of the property for the ten months they were in possession after
expiration of the old lease would be $1,800. As opposed to this, the plaintiffs expert testified
that with only minor repairs and upkeep, the rental value would be $3,800 per month; and that
with more extensive renovation, i.e., if new pin setters and carpeting was installed and the
interior of the building was painted, a fair market value on a ten year lease commencing
September 1, 1976 would be $5,700 per month.); see also N.M. Stat. Ann. 47-8-3 (New
Mexicos Uniform Owner-Resident Relations Act defines fair rental value to mean that value
that is comparable to the value established in the market place); 32 A.L.R. 2d 582 at 2
(Rental value apparently has reference to what the premises are worth for lease purposes on the
open market . . . .).
19843005




14

tenancy).
7
(Dor Decl. at 10-12, Ex. G.) Accordingly, Mr. Dor selected comparable
properties based on whether they were similar to the highest and best use of the Leased
Premises. (Id. at 12, 21.) Highest and best use is defined as [t]he reasonably probable and
legal use of vacant land or an improved property that is physically possible, appropriately
supported, financially feasible, and that results in the highest value. (Dor Decl. at 7
(quotation omitted).) Here, the highest and best use of the Leased Premises is use as recreation
or ranch land. The legal, physical, and financially feasible uses of the property are very limited
because the property is isolated vacant land with little or no infrastructure (no tie to a public
sewer system, no snow-making water or infrastructure, and no public access). It is zoned for
open space, and 2,500 acres of the 3,022 acres comprising the Leased Premises have no
development rights. (Id. at 17-19.)
After comparing each of the comparable properties to the Leased Premises (on the basis
of land use potential or limitations; regional and direct accessibility and proximity of goods,
services and amenities; size; view/setting and overall aesthetic appeal; topography/utility; and
recreational use potential) to determine what adjustments should be made, the properties were
analyzed on a price per acre basis because this is the most appropriate unit-of-comparison for the
Leased Premises, reflecting recreational/ranch uses. (See Dor Decl. at 22-23, Ex. G.) The
nine comparable properties Mr. Dor analyzed had an unadjusted unit price range between $932
and $3,600 per acre. (Id. at 23.) The adjusted unit price range was between $1,100 and $2,000
per acre. The unit value that appropriately reflects the approximate midpoint within this range is
$1,500 per acre. (Id. at 23.)
The fair market value of the Leased Premises is calculated by multiplying the $1,500 per

7
The two other approaches to valuation the cost approach and the income approach are not
applicable here. (See Dor Decl. at 20, Ex. G.) The cost approach does is not relevant to the
Leased Premises, because the property is vacant land. (Id.) The income approach is not relevant
because the values of ranch/residential land, like the Leased Premises, is not typically based on
income potential. (Id.)
19843005




15

acre amount by the number of acres comprising the property (3,022). (Id.) The resulting figure
($4,533,000) is the fair market value of the Leased Premises. To arrive at an annual rental rate,
the fair market value ($4,533,000) is multiplied by the annual rate of return appropriate for land
with the risk profile of the Leased Premises (5%), which is sometimes called a capitalization
rate or CAP rate. (Id. at 24-20; see also Declaration of Matthew H. Connors (Connors
Decl. at 17, Ex. H.) The resulting amount represents the ground rental rate that provides a
lessor with the desired overall rate of return appropriate for the market.
Accordingly, based on the fair market value of the Leased Premises and a 5% rate of
return or capitalization rate, the fair rental value is $226,650 per year.
8

b. Investment or Use Value
Investment or use value is the value of an asset or business to a specific investor or user.
Investment or use value is different from fair market value because it is not the exchange price
between a willing buyer and seller, but the value of the asset to a particular buyer or user. In re
Network Associates, Inc., Sec. Litig., C 99-01729WHA, 2000 WL 33376577, at *2 (N.D. Cal.
Sept. 5, 2000) (unpublished; quotation omitted); see also Shepherd v. C.I.R., 115 T.C. 376, 394
(2000) affd, 283 F.3d 1258 (11th Cir. 2002) (Investment value is more subjective because it is
predicated on the investment preferences of the individual investor. (quotation omitted)).
9

Using the investment or use value approach, the appraiser focuses on the value the real estate
contributes to the enterprise of which it is a part, without regard to the highest and best use of the
property or the monetary amount that might be realized from its sale. Use value may vary
depending on the management of the property and external conditions such as changes in
business operations. The Appraisal of Real Estate at 24 (12th ed. 2003).
Because investment or use value is not equivalent to fair market value, it is not an

8
$226,650 =$1,500 per acre x 3,022 acres x 5%. (See Dor Decl. at 29-30, Ex. G.)
9
Copies of all unpublished cases cited herein are attached as Exhibit I.
19843005




16

appropriate measure of the fair rental value of the Leased Premises.
10
In other words, the
resulting value is necessarily different from what a willing lessor and willing lessee would accept
for the Leased Premises; rather, it equates to the amount a particular investor or user would pay
to lease the Leased Premises for the purpose of operating a ski resort on the property, and it
assumes that such a use is possible.
Even though the investment or use value of the Leased Premises is not directly relevant
to the determination of fair rental value, Plaintiffs asked their expert real estate appraiser to
determine the propertys investment or use value as a point of reference. As set forth in Mr.
Dors declaration, the rental value based on an investment or use value of the Leased Premises
is approximately $829,000 to $1,000,000 per year. (See Dor Decl. at 31-36, Ex. G.) These
amounts are based on land rents currently being paid for similar facilities, using the formula
adopted by the U.S. Forest Service, the lessor of the majority of ski resort lands in the United
States, and land rent rates generally paid in the ski industry. This valuation necessarily assumes
that the Leased Premises could be leased for the purpose of operating a ski resort on the property.
Plaintiffs believe that this assumption is unreasonable unless the owner of the property also
acquires ownership or control of base facilities and infrastructure. Because of these limitations,
Plaintiffs do not believe these values reflect a fair rental value for the property.
c. Vails Valuation of the Leased Premises
In its public securities filings, Vail estimated fair market value of the land and
associated improvements on the Leased Premises as $57.8 million. (See September 27, 2013

10
Investment or use value may also include both tangible and intangible assets associated with
the property. Here, since the issue is the fair rental value of the Leased Premises (i.e., property),
only tangible assets (the land) should be considered. Intangible assets such as synergy value
and customer base are associated with the business being conducted on the property; they are
not directly attributable to tangible property. T-Mobile USA, Inc. v. Utah State Tax Commn,
2011 UT 28, 39, 254 P.3d 752. As a consequence, any measure of the fair rental value of
Leased Premises that includes intangible assets, would improperly be assessing damages against
Plaintiffs for assets to which Talisker is not entitled and which Talsisker does not own or control.
19843005




17

Vail Resorts, Inc. 10-K at F-18 & F-19, available at
http://files.shareholder.com/downloads/MTN/2798586215x0xS812011-13-29/812011/filing.pdf.)
Vails disclosure is relevant here for two reasons.
First, it is apparent from these filings that the Vail Transaction even though structured
as a lease transaction was in fact an acquisition by Vail of the Canyons Resort as well as the
Leased Premises.
11
(See Connors Decl. at 9-12, Ex. H.) As demonstrated below, this
confirms that Talisker could assert no damages arising from Plaintiffs occupancy of the Leased
Premises once those lands were sold to Vail. See, e.g., Bowes v. Saks & Co., 397 F.2d 113, 116-
17 (7th Cir. 1968) (holding, in relevant part, that landlords suffered no damages as a result of
commercial tenants failure to restore premises that had been sold by landlords); McGuire v. City
of J ersey City, 593 A.2d 309, 315 (N.J . 1991) (we think it is more appropriate to consider the
landlords sale of the premises as a mitigation, and the sale ended the right to damages for lost
future rent because sale price . . . compensate[d] for the value of the future rental income).
Second, Vails disclosure suggests a fair rental value of less than $3 million per year.
Based on Vails estimate of the fair market value of the Leased Premises at $57.8 million (which
is generous since Vail acknowledges this amount includes the value of improvements that may

11
GAAP guidance set forth in Accounting Standards Codification (ASC) 840: Leases
establishes a four-part test to determine whether the economics of a transaction indicate that it is
an operating lease (true lease) or a capital lease (constructive sale). If a lease satisfies any of the
four tests, it must be accounted for as a capital lease, meaning it will be treated as a sale. In other
words, the accounting is meant to recognize the true economics of the transaction. The four tests
are generally described as: (1) whether the lease transfers title of the asset to the lessee; (2)
whether a bargain-purchase option exists such that the lessee can purchase the asset at a price
significantly below the expected fair value at the date the option becomes exercisable; (3)
whether the lease period equals or exceeds 75% of the assets economic life; or (4) whether the
present value of the minimum lease payments equals or exceeds 90% of the fair market value of
the assets subject to the lease. See also ASC 840-10-25.
19843005




18

or may not belong to Talisker under the Leases
12
), and based on a capitalization rate appropriate
for the Leased Premises, the implied annual rental rate is $2,890,000 ($57,800,000 x 5%).
13
(See
Connors Decl. at 20, Ex. H.)
As shown above, the annual rental rate derived from Vails valuation of the Leased
Premises exceeds the fair market rental value of the Leased Premises.
3. Summary Rental Value Calculations.
In sum, based on the fair market value of the Leased Premises, the fair rental value of the
property is $226,650 per year. Assuming the Leased Premises can be leased for use as part of an
operating a ski resort on the property, an appropriate rental value of the property is between
$829,000 and $1,000,000 per year. Based on Vails own fair market valuation of the Leased
Premises (and associated improvements), the rental value is no more than $2,890,000. Rental
values derived from an investment or use valuation or from Vails valuation of the Leased
Premises represent the outer limit of those rental values that could under any circumstances
be assessed for the Leased Premises.
4. Amounts to Which Talisker is Not Entitled under its Damages Claims.
a. Taliskers Alleged Lost Profits
Talisker is only entitled to recover those damages that are the natural and proximate
consequences of the acts complained of and nothing more. Forrester, 292 P. at 211. Since
Talisker has never been more than a landlord entitled to a reasonable rent on its land, Talisker is
not entitled to recover its alleged lost profits in excess of the fair rental value since April 30,

12
It also is unknown whether Vail accounted for the fact that a significant portion of the Park
City Mountain Resorts skiable terrain the 240 acres surrounding the base of J upiter Lift is
not owned by Talisker, is not the subject of the Leases, and, therefore, could not have been
transferred by Talisker to Vail.
13
Indeed, an estimate of the amount of Vails $57.8 million attributable to land only based on the
historical percentage land represents of total fixed assets as reflected in the financial statements
of Vail and Park City Mountain Resorts parent company, Powdr Corp., results in an implied
land rental rate of between $404,600 and $578,000 per year. (See Connors Decl. at 23, Ex. H.)
19843005




19

2011. In other words, the damages must be directly traceable to the . . . unlawful detainer . . . .
A causal connection that is too attenuated, such as unlawful detainer which allegedly results in
loss of consortium, would not justify an award for damages. There must be a common sense
relationship. Aris Vision Institute, Inc. v. Wasatch Prop. Management, Inc., 2006 UT 45, 19,
143 P.3d 278.
The only consequence to Talisker of Plaintiffs continued occupancy of the Leased
Premises has been that Talisker has been deprived of its rent. Talisker itself has never utilized
the property for any purpose other than to lease it to Plaintiffs, and it could not possibly make
any other productive use of the Leases Premises. In 2007, it successfully annexed the majority
of the Leased Premises into Park City Municipal Corporation, stripped all of the development
rights from the property, and executed a deed restriction limiting the use of the property. (See
2/7/2014 Declaration of M. Harrington (Harrington Decl.) at 19(a) (In return for the transfer
of density from PCMRs ski terrain to the Flagstaff Mountain Annexation Area, the use of the
alpine terrain would be perpetually limited to open space and ski resort uses would be governed
by the terms of the PCMR Development Agreement), (b) (No development or associated
operations would be permitted on the annexed alpine terrain other than as part of the ski-related
operations as allows and described in the PCMR Development Agreement.).) As a result, even
if Talisker had intended to make productive use of the Leased Premises following the expiration
or termination of the Leases, the only allowable economic use of the property would be as part of
a ski resort. (See id.) Talisker itself, however, could not operate such a resort on the Leased
Premises because, among other things, Talisker does not own or control the base facilities,
parking, snow-making infrastructure, or water rights necessary to operate the Resort all of
which are owned or controlled by Plaintiffs or their affiliates.
In sum, Talisker is entitled at most to rent. Because Talisker could not have made any
profits on the Leased Premises, it is not entitled to recover any profits as a result of Plaintiffs
19843005




20

continued occupancy of the Leased Premises. See, e.g., Simmons v. OCharleys, Inc., 914
S.W.2d 895, 902 (Tenn. Ct. App. 1995) (rejecting claim for lost profits in unlawful detainer case
because landlord had no building prior to the end of the unlawful detainer, thus there was no
delay that resulted in lost profits). Because Taliskers intention has always been to lease the
Leased Premises to Plaintiffs, any profits purportedly lost by Talisker would necessarily be
duplicative of (and possibly even less than) the reasonable rent to which it is entitled. This is
because a landowners profits derived from leasing its land would be included in the rent paid to
the landowner by the tenant. Payment of both rent and a portion of the Taliskers allegedly lost
profits would, therefore, be duplicative. As one court has explained,

Typically, the landlord could not recover both reasonable rent and
lost profits because recovery is limited to the amount necessary to
place the plaintiff in the position it would have been in but for the
trespass. Lost profits are measured by deducting operating
expenses from gross earnings, resulting in net profits. Reasonable
renti.e., the value of the use of the propertyis calculated as
part of the gross earnings, and thus is already included in the net
profit calculation. To allow the plaintiff to recover both reasonable
rent and lost profits would, in most cases, constitute a double
recovery. In a residential leasewhere there is no business or for-
profit endeavorlost profits would constitute the profits normally
associated with reasonable rent.
Coinmach Corp. v. Aspenwood Apartment Corp., 417 S.W.3d 909, 921 n.7 (Tex. 2013)
(quotation, citation, and alterations omitted).
b. Plaintiffs Profits
Talisker should not be permitted to claim as damages all or a portion of Plaintiffs profits
from the Resort for at least three reasons:
First, Talisker has never asserted any claim or entitlement to Plaintiffs profits
regardless of Plaintiffs unlawful detainer of the Leased Premises. See, e.g., Aris Vision
Institute, Inc., 2006 UT 45, 19 (there must be a common sense relationship between the
19843005




21

unlawful detainer and an alleged loss to justify an award of damages). Thus, the natural and
proximate consequences of Plaintiffs continued occupancy of the Leased Premises cannot
include Taliskers loss of all or a portion of Plaintiffs profits. Forrester, 292 P. at 211.
Second, Plaintiffs profits are not attributable solely, or even substantially, to the Leased
Premises. Plaintiffs profits like the profits of any business owner are a result of Plaintiffs
own investment in and management of the Resort, Plaintiffs marketing and brand name
recognition, Plaintiffs workforce, as well as Plaintiffs ownership or control of the water rights
necessary for snowmaking, the base facilities, and the parking all necessary components of the
Resort.
Finally, the Court has already held that Talisker is not entitled to Plaintiffs profits under
its alternative claim of unjust enrichment. (See 2/20/2014 Memorandum Decision and Order at
23.) On this score, Talisker has conceded two key propositions. First, its unjust enrichment
claim will be subject to dismissal if there is an adequate remedy at law. Second, in order to
obtain the remedy of disgorgement of lost profits, some showing of willful misconduct or bad
faith is necessary. (Id. at 20, 22 (quotation omitted).) The Court concluded that remaining on
the land after expiration of a lease, even after being told to leave does not constitute the sort of
fraudulent or willfully wrongful conduct envisioned by the disgorgement of profits remedy in an
unjust enrichment claim. (Id. at 22.) The same must be true with respect to Taliskers claims
for rent and unlawful detainer, for which it does not even plead entitlement to disgorgement of
profits. To hold otherwise, would ignore and render meaningless the Courts ruling dismissing
Taliskers request for disgorgement of profits and it finds no support in the law. See, e.g.,
Superior Motels, Inc. v. Rinn Motor Hotels, Inc., 241 Cal. Rptr. 487, 508 (Cal. Ct. App. 1987)
(Profits [of the tenant] are not synonymous with rental value.). In short, [n]et profits may be
an appropriate measure of damages in a breach of contract action, but they are not equivalent to
reasonable rental value the measure of damages in an unlawful detainer case, and are,
19843005




23

position it would have been in had [the tenant] vacated the [premises] as she had agreed to do).
Because Talisker has not been damaged after May 29, 2013, it can claim no damages for the
period in which Plaintiffs have been in unlawful detainer (September 3, 2013, through present).
As a result, none of Taliskers damages is subject to trebling.
Like any other type of damages, damages for unlawful detainer or rent may (and, under
certain circumstances, must) be mitigated. See, e.g., Reid, 776 P.2d at 906 (a mitigation
requirement is generally appropriate in the context of modern landlord-tenant transactions and,
therefore, a landlord who seeks to hold a breaching tenant liable for unpaid rents has an
obligation to take commercially reasonable steps to mitigate its losses, which ordinarily means
that the landlord must seek to relet the premises); see also Olympus Hills Shopping Center, Ltd.
v. Landes, 821 P.2d 451, 455 (Utah 1991) (approving of trial courts conclusion that liability
should be limited to two years of rent because using commercial reasonable efforts, the landlord
could have relet the premises within two years).
15
The corollary of the principle of mitigation is
that a landlord, like Talisker, is not entitled to double compensation. See Wright v. Vickaryous,
598 P.2d 490, 499-500 (Alaska 1979) (rejecting unlawful detainer damages award that included
rental value for the property and the award of the hay crops harvested off the property as double
compensation); see also E.E.O.C. v. Waffle House, Inc., 534 U.S. 279, 296-97 (2002) (if one
fails to mitigate his or her damages, any recovery is limited because it goes without saying that
the courts can and should preclude double recovery by an individual (quotation omitted)).
Since Vail is already paying rent to Talisker, and since Talisker is being more than fairly
compensated for use of the Leased Premises, Talisker has suffered no injury since May 2013. As
a result, it is not entitled to seek damages for Plaintiffs occupancy and/or unlawful detainer.

15
Plaintiffs do not contend that Talisker had an obligation to mitigate its damages since Plaintiffs
remained in possession of the Leased Premises. Indeed, Plaintiffs concede that the fact Talisker
was able to more than mitigate its damages (i.e., find a party willing to pay in excess of fair
rental value for property to which it was and is not entitled to possess and is the subject of
ongoing and contentious litigation) is remarkable.
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Presumably, Talisker will respond by arguing that it would be unfair for Plaintiffs to
occupy the property without payment rent for the period after May 29, 2013. The immediate
question becomes, unfair to whom? Certainly not to Talisker which is already being paid
more than fair rental value for use of the property. And Vail the only party conceivably
harmed by Plaintiffs ongoing possession of the Leased Premises could not possibly complain
for at least two reasons.
First, Vail entered into the transaction with Talisker fully aware of the dispute over the
Leases. Vail knew that Plaintiffs continued to occupy the Leased Premises, even though Talisker
asserted the Leases had expired on April 30, 2011. In other words, Vail agreed to pay Talisker
$25 million per year (in total rent for both the Canyons and Park City Mountain Resort
properties) regardless whether Plaintiffs remained on the property, regardless whether Talisker
prevailed in the litigation, and regardless whether Vail ever took possession of the Leased
Premises. Presumably Vail took this risk because it saw an opportunity to take over Park City
Mountain Resort. (See, e.g., 1/31/2014 Mem. in Supp. of Motion for Partial Summary J udgment
on Violation on Sale at 18 (in Vail transaction Vail obtained an immediate long-term
leasehold interest in the Canyons Resort property, with the possibility of adding to that lease the
Talisker property upon which PCMR operates, following the resolution of this litigation). Thus,
Vails damages (if any) are a result of its own doing and not, as required by the law, directly
traceable to the . . . unlawful detainer. Aris Vision Institute, Inc., 2006 UT 45, 19.
Second, Vails deal with Talisker does not allow it to take possession until the present
litigation is over. Although Vail now controls the litigation on behalf of Talisker, the Leased
Premises have not yet been added to the Master Agreement of Lease, and Vail does not have the
right to occupy the property. As a result of its bargain with Talisker, Vail has no right of
possession and has no claim against Plaintiffs. This is critical because the right of the incoming
tenant to sue [a holdover tenant] for damages is grounded in his right to possession of the
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premises during the period of the holdover. Restatement (Second) of Property, Land. & Ten.
14.5 Rep. Note 4 (1977). Vail cannot claim to have been deprived of the right of possession
during the holdover period because its right of possession must await the conclusion of this case
or at least the addition of the Leased Premises to the Master Agreement of Lease. As Talisker
and Vail have argued repeatedly to this Court, the lease of the Park City Mountain Resort ski
terrain to Vail is contingent only. (See, e.g., 9/18/2013 Hearing Tr. (If we win, they [Vail]
become a tenant on this property, thats all.); 2/7/2014 Talisker Mem. in Supp. of Motion for
Partial Summary J udgment on Right of First Refusal at 3 (a future lease contingent on the
outcome of this litigation . . . is precisely what Vail obtained); 1/31/2014 Mem. in Supp. of
Motion for Partial Summary J udgment on Violation on Sale at 18 (in Vail transaction Vail
obtained an immediate long-term leasehold interest in the Canyons Resort property, with the
possibility of adding to that lease the Talisker property upon which PCMR operates, following
the resolution of this litigation).)
Because Vail has never had the right to possess the Leased Premises, Vail can have no
claim against Plaintiffs arising out of Plaintiffs continued occupancy of the Leased Premises.
16

d. Prejudgment Interest
Talisker is not entitled to recover prejudgment interest. The Utah Court of Appeals has
observed that [w]hile an award of prejudgment interest might well be appropriate under the
breach of contract claim, such an award is highly problematic with respect to the forcible entry,
unlawful detainer, and conversion claims. Dejavue, Inc. v. U.S. Energy Corp., 1999 UT App

16
For this same reason, Talisker cannot claim any damages arising from any lost participating
rent associated with the Resort. In other words, even assuming Vail could make productive use
of the Leased Premises without the assets owned or controlled by Plaintiffs (it cannot), unless
and until the demising amendment has been exercised, Vail has no right to possess the Leased
Premises and, therefore, Talisker is not entitled to any participating rent associated with the
Resort. (See, e.g., 1/31/2014 Talisker Mem. in Supp. of Motion for Partial Summary J udgment
on Violation on Sale at 21 (For purposes of the participating rent calculation, the PCMR
land is not included as part of the Resort unless and until it is leased to Vail.).)
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355, 25, 993 P.2d 222, 228 (emphasis added); see also Superior Motels, Inc., 241 Cal. Rptr. at
510 (rejecting prejudgment interest in unlawful detainer case). This is not a situation, for
example, in which a tenant has defaulted on a lease and owes a liquidated sum of rent that is to
be determined by reference to the lease. Instead, Talisker has shown that it is completely unable
to justify the rent it has demanded. As a result, until judgment is entered, Taliskers damages
will not be capable of calculation with the mathematical accuracy required to warrant
prejudgment interest. See Canyon Country Store v. Bracey, 781 P.2d 414, 422 (Utah 1989)
(While the basis of the formula used to determine Canyon Countrys lost profits may have
been sufficient for the jury to render a verdict in favor of Canyon Country, it is too speculative to
allow for the addition of prejudgment interest.); Anesthesiologists Assocs. of Ogden v. St
Benedicts Hosp., 852 P.2d 1030, 1042 (Utah Ct. App. 1993) (affirming denial of prejudgment
interest award on lost profits), revd on other grounds, 884 P.2d 1236 (Utah 1994).
Prejudgment interest is available only where damages can be calculated with mathematical
accuracy. . . . ClearOne Commcns, Inc. v. Chiang, 432 Fed. Appx. 770, 773-74 (10th Cir.
2011) (citing Bjork v. April Indus., Inc., 560 P.2d 315, 317 (Utah 1977)).
Even if it were appropriate to assess prejudgment interest in an unlawful detainer case,
prejudgment interest cannot lawfully be assessed on any trebled damages. Cf. Westport Taxi
Serv., Inc. v. Westport Transit Dist., 664 A.2d 719, 740 (Conn. 1995) (holding that prejudgment
interest on treble damages was improper). Although no Utah court appears to have addressed the
specific question, it is clear that prejudgment interest is not awarded on punitive damages and
that Utah courts view treble damages under the unlawful detainer statute as the equivalent of
punitive damages. See, e.g., Aris Vision Institute, Inc., 2006 UT 45, 7 (trebling of damages
under the unlawful detainer statute is highly penal in nature); First Sec. Bank of Utah, N.A. v.
J .B.J . Feedyards, Inc., 653 P.2d 591, 600 (Utah 1982) (This rule clearly precludes prejudgment
interest on the courts mental anguish and punitive damages awards, which were not fixed or
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27

ascertainable before the time of trial.); Bennett v. Huish, 2007 UT App 19, 42-45, 155 P.3d
917 (prejudgment interest awarded on actual damages only; not punitive damages award). This
is consistent with the general rule across the country. See 9 A.L.R. 5th 63 (Originally published
in 1993) (attempts to collect prejudgment interest on punitive and statutory multiple damages
are denied by the majority of the courts.).
Accordingly, Talisker is not entitled to prejudgment interest.
e. Limited Reasonable Attorneys Fees
Pursuant to the unlawful detainer statute, Talisker is entitled to recover its reasonable
attorneys fees incurred in connection with the unlawful detainer claim. See Utah Code Ann.
78B-6-811(3) (providing for reasonable attorney fees). Courts permit fee awards for all claims
including claims that do not generally permit an award of attorneys fees when all of the
claims involve a common core of facts and related legal theories. Golden Meadows
Properties, LC v. Strand, 2010 UT App 257, 35-37, 241 P.3d 375. In Golden Meadows, for
example, the plaintiff initiated an unlawful detainer action and the defendants responded with a
counterclaim for quiet title, constructive trust, and adverse possession. Id. at 1. Under those
circumstances, the court agreed that the legal work performed in responding to the counterclaim
was inextricably intertwined with the legal work associated with the initial unlawful detainer
action and, therefore, the fees for such work were appropriately awarded to the prevailing
plaintiff. Id. at 35.
In contrast to Golden Meadows, Plaintiffs initiated this litigation in March 2012, but
Talisker refrained from seeking relief under the unlawful detainer statute until August 2013.
Until that time, it expressly permitted Plaintiffs to remain on the Leased Premises. (See, e.g.,
5/21 2014 Mem. Decision and Order at 80, 82.) Talisker did not file a counterclaim under the
unlawful detainer statute until October 28, 2013. Thus, no legal work by Taliskers attorneys
was or could have been inextricably mixed with the unlawful detainer claim until such a claim
19843005




28

was filed.
17
Compare, e.g., Christopherson, Farris, White & Utley, P.C. v. Pugh, 2006 UT App
68, 2006 WL 448677, at *4 (Utah Ct. App. Feb. 24, 2006) (unpublished) (holding that legal
work performed on the complaint for breach of contract was inextricably mixed with the defense
on the counterclaims. [Counterclaim plaintiff] relied on the same factual assertions for the entire
case, based on her belief that the [counterclaim defendant] had not properly represented her in
the prior case.). Moreover, it is simply unfair to assess attorneys fees for legal work done by
Taliskers attorneys during the time period in which Talisker expressly allowed Plaintiffs to
remain on the Leased Premises and, in fact, disclaimed any intention to move for immediate
possession of the Resort Lands. (5/21/2014 Mem. Decision and Order at 82.)
Accordingly, upon entry of judgment Talisker should be required to categorize the time
and fees expended for (1) successful claims for which there may be an entitlement to attorney
fees, (2) unsuccessful claims for which there would have been an entitlement to attorney fees had
the claims been successful, and (3) claims for which there is no entitlement to attorney fees.
Keith J orgensens, Inc. v. Ogden City Mall Co., 2001 UT App 128, 26 P.3d 872, 880 (quotation
omitted). Talisker will only ever be entitled to its reasonable attorney fees incurred in
connection with its unlawful detainer counterclaim and only for the period after October 28,
2013.

17
Indeed, at the very least, no attorneys fees incurred in connection with Plaintiffs seventh and
eighth causes of action should be awarded because Talisker itself argued vociferously that these
claims d[id] not belong in this case, but should be filed, if at all, as a separate action that can be
stayed until the status of the Leases has been determined. (8/12/2013 Defs Oppn to Motion
for Leave at iv; see also id. at 8-10 (arguing that Plaintiffs new claims . . . involve multiple
non-parties and legally have nothing whatever to do with the present litigation (emphasis
added)).)
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C. Principles for the Computation of the Amount of Security.
1. The Amount Secured Should Equal No More Than the Fair Rental Value
of the Leased Premises from May 1, 2011, to May 29, 2013, Plus
Taliskers Reasonable Attorneys Fees Incurred in Connection with the
Unlawful Detainer Counterclaim Since October 28, 2013.
As shown above, Talisker is entitled to recover the fair market rental value of the Leased
Premises for the period after the expiration of the Leases but before the Vail Transaction, which
equals $471,308 in damages ($226,650 per year for the period May 1, 2011, through May 28,
2013). But even using Vails own estimate of the fair market value of the Leased Premises, the
most Talisker would be entitled to is roughly $6,009,616 in damages ($2,890,000 per year for the
period May 1, 2011, through May 28, 2013) plus reasonable attorneys fees in connection with
the unlawful detainer claim and costs. These are the only amounts that should be included in any
security required to stay the eviction through entry of final judgment.
2. Trebled Damages Should Not Be Included in the Amount Secured.
Trebled damages should not be included in the amount secured for three reasons. First,
as shown above, Talisker has suffered no injury since May 29, 2013, and is, therefore, not
entitled to any damages that are subject to trebling. Second, the unlawful detainer statute limits
the bond amount to the probable amount of costs of suit, including attorney fees and actual
damages which may result to the plaintiff if the defendant has improperly withheld possession.
Utah Code Ann. 78B-6-808(4)(b)(vi) (emphasis added). Trebled damages are not actual
damages incurred by the landlord, but merely amounts included as the judgment by the Court
essentially as punishment. See id. at 78B-6-811(3) (The judgment shall be entered against the
defendant for . . . three times the amount of the damages assessed . . . .). Third, Rule
62(j)(2)(C) expressly excludes punitive damages from a bond required for a stay, and statutory
treble damages are the equivalent of punitive damages. See Avis Vision Institute, Inc., 2006 UT
45, 7 (trebling of damages under the unlawful detainer statute is highly penal in nature);
Diversified Holdings, L.C. v. Turner, 2002 UT 129, 30, 63 P.3d 686 (a statutory penalty of
19843005




30

treble damages coupled with an award of punitive damages was duplicative); Sprincin King St.
Partners v. Sound Conditioning Club, Inc., 925 P.2d 217, 222 (Wash. 1996) (recognizing that
double damages pursuant to Washingtons unlawful detainer statute is the equivalent of punitive
damages).
3. Prejudgment Interest Should Not be Included in the Amount Secured.
Finally, prejudgment interest should not be included in the amount secured by the bond
because not only does the unlawful detainer statute omit any reference to prejudgment interest in
the formula used to calculate a bond, see Utah Code Ann. 78B-6-811(3), as shown above,
Talisker is not entitled to prejudgment interest in any event.
18

* * *
In summary, the amount of the security required to stay the execution of the Order of
Restitution until entry of final judgment should be between $1,021,308 and $6,559,616.
19


Item Low High
Rent for the period May 1, 2011 through May
28, 2013
$471,308 $6,009,616
Actual damages which may result to the
plaintiff if the defendant has improperly
$0 $0

18
Even assuming Talisker is entitled to prejudgment interest (it is not), it is unclear and Talisker
has to date supplied no evidence of what interest rate should apply. The Utah Code provides a
rate for breach of contract claims. See Utah Code Ann. 15-1-1(2) (Unless parties to a lawful
contract specify a different rate of interest, the legal rate of interest for the loan or forebearance
of any money, goods, or chose in action shall be 10% per annum.). Here, however, there is no
breach of contract claim and thus the 10% rate does not apply. See, e.g., Nielsen v. OReilly,
848 P.2d 664, 670 (Utah 1992) (rejecting claim that insured was entitled to prejudgment interest
because he had a contractual relationship with the insurance company because the insured did
not pursue a breach of contract claim against [the insurer]); compare Kelly v. Kruse, Landa,
Zimmerman & Maycock, Civil No. C-85-1057W, 1998 U.S. Dist. LEXIS 18657, at *26-27 (D.
Utah Dec. 9, 1988) (unpublished) (awarding prejudgment interest on legal malpractice claim
where there was a finding that the defendants breached the express terms of the parties Retainer
Agreement and Statement of Services).
19
These amounts do not account for Plaintiffs own remaining damages claims against Talisker
which, if awarded, would offset, in whole or in part, any damages owed by Plaintiffs to Talisker.
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31

withheld possession. Utah Code Ann. 78B-
6-808(4)(b)
Estimate of reasonable attorneys fees
associated with unlawful detainer claim
$500,000 $500,000
Costs $50,000 $50,000
Total: $1,021,308 $6,559,616
Upon entry of final judgment, Plaintiffs can replace the security required for the
requested interim stay with a supersedeas bond which bond will include the actual amount of
damages awarded by the jury and three years of post-judgment interest, as required by Rule
62(j).
V. CONCLUSION
For the reasons set forth herein and for those set forth in Plaintiffs motion to stay, the
Court should continue the stay of the Order of Restitution through the remainder of the
litigation before this Court and require Plaintiffs to post security in an amount between
$1,021,308 and $6,559,616, which amounts represent an estimate of (1) Taliskers actual
damages, (2) Taliskers attorneys fees incurred in connection with the unlawful detainer
counterclaim, filed October 28, 2013, and (3) costs.
DATED this 15th day of August, 2014.
Snell & Wilmer L.L.P.
/s/ Alan L. Sullivan
Alan L. Sullivan
Amber M. Mettler
Zimmerman Jones Booher LLC
Michael D. Zimmerman
Troy L. Booher
Weil Gotshal & Manges, LLP
J ames W. Quinn
Bruce S. Meyer
Attorneys for Plaintiffs/Counterclaim
Defendants
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32

CERTIFICATE OF SERVICE
I hereby certify that on the 15th day of August, 2014, I caused the foregoing
PLAINTIFFS MEMORANDUM REGARDING SECURITY FOR A STAY PENDING
THE CONCLUSION OF LITIGATION BEFORE THE TRIAL COURT to be served via
the Courts electronic filing system and/or U.S. mail upon the following:
J ohn R. Lund
Kara L. Pettit
SNOW, CHRISTENSEN & MARTINEAU
10 Exchange Place, 11th Floor
Post Office Box 4500
Salt Lake City, Utah 84145-5000
(Via electronic filing)

Howard M. Shapiro (pro hac vice pending)
J onathan E. Paikin (pro hac vice pending)
Christopher E. Babbit (pro hac vice pending)
WILMER CUTLER PICKERING HALE and DORR LLP
1875 Pennsylvania Avenue, NW
Washington, D.C. 20006
(Via U.S. mail)

Attorneys for Defendants United Park City Mines Company;
Talisker Land Holdings, LLC; Talisker Land Resolution LLC;
and Talisker Canyons Leaseco LLC

J onathan A. Dibble
RAY QUINNEY & NEBEKER P.C.
36 South State Street, Suite 1400
Salt Lake City, UT 84111
(Via electronic filing)


19843005




33

Robert C. Blume (pro hac vice)
Ryan T. Bergsieker (pro hac vice)
GIBSON, DUNN & CRUTCHER LLP
1801 California Street
Denver, CO 80202-2642
(Via U.S. mail)

Attorneys for Defendant VR CPC Holdings, Inc.

Mark J ames
Hatch, J ames & Dodge, P.C.
10 West Broadway, Suite 400
Salt Lake City, Utah 84101
(Via electronic filing)

Attorneys for Talisker Canyons Finance Co LLC and Flera, LLC

Michael Gill
Daniel Storino
Mayer Brown LLP
71 South Wacker Drive
Chicago, Illinois 60606
(Via U.S. mail)

Of Counsel for Talisker Canyons Finance Co LLC and Flera, LLC



/s/ Patricia Haslam