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The financially plagued operator of the luxury resort in Whistler, Canada, where the downhill skiing competitions are taking place during the Vancouver 2010 Winter Olympics is being forced to sell off its assets. But that’s not Intrawest ULC‘s only problem. Its travel company, Abercrombie & Kent, faces a $220 million lawsuit in Los Angeles. Intrawest, the Vancouver-based operator of the Whistler Blackcomb resort, which is the alpine skiing venue for the Olympics, has been struggling to refinance its debts. It has defaulted on loan payments and sold many of its resorts. Intrawest’s corporate parent, Fortress Investment Group, a New York private equity firm, has scheduled an auction of its assets on Friday. Waiting in the wings are 540 members of a destination club that went by various names, most of them including the moniker Abercrombie & Kent. That luxury travel company, in which Intrawest is majority owner, offers African safari tours, private jets, European villas — even traveling bell hops. In their suit, filed in Los Angeles County, Calif., Superior Court, the plaintiffs allege that the club was a ruse because Abercrombie & Kent didn’t operate the business, just licensed its name. Now, they allege, their memberships are worthless. “Intrawest has been crying poverty, saying they don’t have the money, have huge debt,” said Brian Kabateck, managing partner at Kabateck Brown Kellner in Los Angeles, who filed suit in 2007 on behalf of the club members. “They may not be completely liquid, but we also know that the Canadian government has substantially worked with them in setting up the Olympics. They have an entire Olympic Village in Whistler and in Vancouver they’re operating. They are hugely benefiting from the Olympics.” Kabateck said that each plaintiff seeks the return of an up-front fee of between $250,000 and $500,000. Additionally, each plaintiff paid $10,000 in annual dues to join the club. The club failed in 2006, six months after Abercrombie & Kent dropped its name from the club’s marketing materials. “Unbeknownst to my clients, to the members, the club stopped paying the royalty fees to Abercrombie & Kent,” Kabateck said. His clients have sued Abercrombie & Kent and Intrawest, among other defendants, he said. Trial is scheduled for June 1. Calls to an Intrawest spokesman and to Lisa Demsky, a partner at Munger, Tolles & Olson in Los Angeles who represents Intrawest in the suit, were not returned.

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