I assume Panama looks something like the above. I was going to use Trump Hotel photos from the website, but this was probably safer.
Trump Hotels, which the President has not divested from, has engaged in a lawsuit battle over management rights of a luxury hotel in Panama. With lawsuits and accusations flying in both directions between Trump Hotels & Marriott International, tensions are high. Also, the President’s low approval ratings in the US, let alone in Central and Latin America, leads to poorer-than-expected business performance. This touches upon a murky, previously uncharted territory of how American companies deal with the special case of competitors in which the President has direct or indirect financial interest.
Ithaca Capital Partners / Owner’s Association
- Filed $15 million arbitration claim against Trump Hotels
- Accused Trump Hotels of “gross mismanagement, breaches of contract, conversion (misusing someone else’s property for one’s own gain) and breaches of fiduciary duties.”
- Fired after accusations of financial misconduct and other mismanagement
- $200 million countersuit filed and refused to turn over financial records
- Head of Trump Hotels Eric Danziger complained to Chief Executive of Marriott Arne Sorenson
- General counsel said call not intended to pressure Marriott
- Accusing Ithaca Capital of deception and illegally terminating contract
- Escorted off premises after being invited by majority owner
- In contention as new hotel management
- Did not respond to requests for comment
What does this mean?
The article notes that Marriott and other large international companies have significant interests with the government, and is affected heavily by government policy, such as tourism and immigration.
How can Marriott or any company ethically compete against a company with ties to the president? He and his staff are not above calling out or targeting groups of people or companies, whether positively or negatively. The “potential ethics concerns” of Trump not divesting himself from his businesses or putting them in a blind trust are enormous, also when he breaks his campaign promise to do just that.
Since the hotel’s completion in 2011, business struggled and owners were sinking with association and maintenance costs. Owners voted to fire Trump’s people and terminate the contract. The President’s statements and actions are poorly received by Central Americans, doing damage to his brand and thus property values. Currently the peak high season of Panama with expected high occupancy, the hotel is only about a quarter full – far below the norm.
This lawsuit will drag out, but it is such an interesting and juicy tidbit of news. Stay tuned for more updates, although a cursory search shows developments stretching back several more years.
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