The fact that the Turkey Creek lawyers at one time represented Gold Fields was one of the cornerstones of a Miller lawsuit against Turkey Creek that was first tried in 1996.
Miller claimed that because he was a joint-venture partner with Gold Fields, the Turkey Creek lawyers also represented him, forming an attorney-client relationship. In court, Miller's attorney argued that since the Turkey Creek lawyers performed work for the joint venture and because Miller reimbursed Gold Fields for attorney fees in the form of transferred interest in the Gilman property, the lawyers represented the joint venture and would therefore be violating that attorney-client relationship by buying Gold Fields' share of the land.
"Miller is the victim, there's no doubt about it," Smith says in his Virginia drawl. "When Gulf & Western found out about the Superfund decision, it scared the hell out of them, so they dumped the property on Miller. And Miller stepped in as the cowboy he is and took the personal risk. But when Miller, who took the risk, decided he wanted to develop the property, Aronstein took it in a billion-dollar plunder. Aronstein didn't take it when there was a risk; he waited until afterwards. He devastated his client."
The U.S. District Court in Eagle County didn't see it that way, and neither did the Colorado Court of Appeals. Both courts ruled that "the law firm and the lawyers were retained by Gold Fields to represent only it and not the joint venture...Miller has asserted no other facts that would demonstrate the existence of an attorney-client relationship between the lawyers and the joint venture."
Miller also claims that as part of their joint-venture agreement, Gold Fields had to clear the Turkey Creek deal with him before Gold Fields went through with it. However, the courts ruled that after the joint venture terminated in 1986, it was each partner for himself.
Collon Kennedy of Gold Fields agrees with both court decisions. "When Aronstein and Page came to us in 1993, they weren't our lawyers," says Kennedy. "At that time, we looked at it as 'Thank God, let's get out of this.' In retrospect, maybe we should've found some other lawyers, others that we hadn't dealt with previously. But when they came to us to take on our problem, we just wanted to move on. We couldn't find anyone else who would buy the property with $30 million of liens on it."
In 1993, Aronstein and Page further cemented their role in the deal by purchasing for $70,000 the deed of trust and judgment against Miller that Viacom had inherited from Paramount and Gulf & Western. Under the deal, if Turkey Creek could successfully foreclose on the property, an action it initiated in July 1994, Viacom would get the accrued judgment of approximately $23 million against Miller, and Turkey Creek would get the land, Miller's attorney contends. Presumably, under Turkey Creek's option agreement with Vail, the ski resort would get the land. (Aronstein's attorney Netzorg won't discuss details of either Turkey Creek's deal with Viacom or its deal with Vail.)
Tom Smith, meanwhile, had been sniffing around the property on behalf of American Consolidated, the New Jersey-based holding company of which he's chairman. "In 1991 I was negotiating with Paramount for their liens," says Smith, "but Aronstein got preferential treatment from the Viacom attorneys. Miller and American Consolidated got screwed."
Smith tends to rant on the subject. "This is one of the darkest days in the history of the judicial system of Colorado," he says. "I don't see why Aronstein doesn't appoint himself as a federal judge so he can rule on this case. He's got every other conflict of interest going--why not that?"
Gold Fields' Kennedy, however, has a little more distance from the subject, though he was swept into court to testify after Miller challenged Turkey Creek's foreclosure action.
"Part of the problem," says Kennedy, "is that this transaction took place over ten or eleven years. A lot can happen in that time. And as you can imagine, people will look back and wish they did things differently. By Miller's account, the part of property we owned was worth $100 million. Well, if it was worth $100 million, it's hard to understand why he didn't buy it for $130,000. We did everything we could to work out a mutual arrangement with Miller, and he couldn't come through. Now he comes back to drag us into court. We didn't make a windfall at all with our sale [to Turkey Creek]. And if you consider the legal fees, we didn't even come close."
Why did Miller drag all this into court? Miller's attorney James Hahn notes that his client is broke and says Miller has everything sunk into the Gilman Tract. Hahn says Miller has no choice but to fight.
Tom Smith, battling for his share of the action, complains that American Consolidated's stock was selling for $3 a share when the company bought a 30 percent share of Miller's action and now fetches 10 cents a share. He's full of fighting words. "We know one thing," says Smith. "If we don't get a fair judgment in Colorado, we'll come out of New Jersey and sue the whole lot of them. We'll fuck 'em all up before it's over and be glad to do it. We welcome the litigation. Ol' Aronstein'll recognize my first cousin from New Jersey, who's gonna handle the case. He's the F. Lee Bailey of New Jersey. And he won't sell me out, either."
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