Tepper company asks if ‘politically motivated leaks’ risk $21M York County settlement

York County could receive more than $21 million in a bankruptcy settlement with GT Real Estate, a company created by Carolina Panthers owner David Tepper, a spokesman said Thursday.

The Tepper company revealed the settlement amount and raised questions about whether it could be affected by a new criminal investigation. GT Real Estate’s statement said news Thursday about a South Carolina State Law Enforcement Division investigation into the transfer of public money to GT Real Estate and its affiliates came at a curious time.

“It would be unfortunate if the recently announced settlement between GTRE and York County were somehow undermined by politically motivated leaks,” a GT Real Estate spokesman said in an emailed statement. “The timing of these leaks is all the more curious in light of this settlement.”

GT Real Estate said just over $21 million, plus interest, is in escrow to repay the county in full for what the county’s taxpayers spent on the team’s failed practice site. Rock Hill has already agreed to settle its claims.

GT is the company Tepper created to build a new Panther’s headquarters in Rock Hill. Construction stopped in March and GT declared bankruptcy in June.

York County lawyers and officials haven’t commented on the proposed settlement or if there will be any impact from the SLED investigation requested by York County’s sheriff, top prosecutor and the South Carolina attorney general.

A proposed settlement also hadn’t been filed Friday morning with the Delaware bankruptcy court, court files show.

But GT Real Estate said the proposed settlement would fully compensate York County and settle all claims raised during its bankruptcy case.

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The deal and the money

York County alleged in lawsuits Tepper’s company owed as much as $81 million. That includes $21 million in public Pennies for Progress road tax money, state South Carolina roads money transferred for the project and future money from projected economic development.

The GT proposal to reimburse York County its initial investment is the same amount as the initial bankruptcy plan GT offered this summer. But during months of lawsuits, GT at one time pulled the $21 million offer and claimed it owed York County nothing.

GT countered in documents that the money was used properly. GT’s statement Thursday reaffirmed that claim.

The company also claimed in its statement the bankruptcy is “a straightforward commercial matter” rather than a criminal one.

“The underlying disputes arise under contracts that were jointly negotiated by the parties and are publicly available,” GT Real Estate said. “The funds paid by the County were handled consistent with the terms of those contracts.”

All creditors are set to vote on the bankruptcy plan in mid-December. Rock Hill agreed to approve the plan. Although the county settlement with GT has not been filed, the GT statement said the deal would settle all claims between the county and GT.

“The settlement fully compensates York County and settles all its claims related to GTRE’s bankruptcy case,” GT said in its statement.

FULL STORY: SC Law Enforcement investigating money transfer

What we know about the state investigation

York County Sheriff Kevin Tolson, 16th Circuit Solicitor Kevin Brackett, and S.C. Attorney General Alan Wilson requested a state criminal probe. But in a statement Thursday, those requesting the investigation said there is no inference any wrongdoing has been committed.

The sheriff and prosecutors are interested in whether any laws were broken in the transfer of $21 million to GT Real Estate.

SLED, the sheriff and the attorney general haven’t specified which laws would be relevant.

The August civil lawsuit by York County against GT referenced South Carolina laws specific to use of York County penny sales tax money and South Carolina road tax money.

In the civil court documents, York County claimed the $21 million had to be used for road improvements on the project by law. York County alleged in its August lawsuit against GT the $21 million was not used for the roads.

“Rather than dedicating the Tax Funds to the Mt. Gallant Expanded Scope as was required, after the Debtor (GT) received the Tax Funds, they were commingled with other operating funds, misappropriated to other aspects of the Project, and converted for others’ improper use and unjust enrichment,” the civil lawsuit stated.

Miller Shealy, a Charleston School of Law professor and former prosecutor, said law enforcement does not need probable cause or any other suspicion to investigate, including interviewing people. Law enforcement officials are not required to disclose what they are investigating, Shealy said.

Why the settlement would be important

If a Delaware bankruptcy judge accepts the settlement, the deal would end lawsuits by York County, Rock Hill and Tepper’s companies that blame each other for the failed project and its aftermath — where creditors want hundreds of millions of dollars from GT Real Estate.

The city of Rock Hill agreed earlier this month to a $20 million settlement.

GT Real Estate and most contractors tentatively agreed to a $60 million settlement.

The land involved remains owned by the Tepper company but is being marketed to be sold.