JV Partner Sues Simon

A joint venture partner of Simon Property Group, G.K. Las Vegas LP, has filed a lawsuit against the Indianapolis real estate investment trust seeking more than $1 billion in damages.The California limited partnership's lawsuit, filed in the U.S. District Court for the District of Nevada, alleges that SPG and its affiliates "violated Federal and Nevada racketeering statutes, violated Nevada securities laws and breached its contractual and statutory fiduciary duties under a joint venture agreement with GKLV." The lawsuit involves the Forum Shops retail mall in Las Vegas, which until March 2003 was owned and operated under a joint venture agreement between GKLV and Simon, according to GKLV. In a news release, GKLV said Simon "systematically abused its position as managing general partner and exploited The Forum Shops for the benefit of other Simon wholly owned malls by skimming the joint venture's profits, converting the joint venture's property and opportunities, and coercing GKLV to forgo legitimate business interests." Commenting on the lawsuit, SPG referred to Sheldon Gordon, a principal of Gordon Group, Greenwich, Conn., the managing partner of GKLV. "Any allegation by Mr. Gordon that Simon Property Group coerced him into selling his interest in the Forum Shops at Caesars at below its value is baseless, as it was Mr. Gordon who initiated the process," SPG said. "Since Mr. Gordon voluntarily triggered the buy/sell provision of the partnership agreement, he controlled the timing of the transaction and the sales price of his interest."