CHARLESTON – West Virginia tax officials say their interests need to be represented in a federal lawsuit brought by the new loan holders for the Greenbrier Resort and its owner, U.S. Sen. Jim Justice.

The State Tax Division filed a consolidated reply Tuesday in support of a motion to intervene filed last month in the federal lawsuit brought by White Sulphur Springs Holdings LLC (WSSH) against Sen. Justice, former first lady Cathy Justice, son Jay Justice, and several Justice-owned entities connected to the Greenbrier.

The state agency seeks to intervene as a defendant because it holds more than $4.4 million in tax liens against the properties being litigated. While both the attorneys for WSSH, a subsidiary of Texas-based TRT Holdings, and attorneys for the Justice family agree that the tax debts exist, they oppose the state’s involvement on various procedural grounds.

“Despite acknowledging that the Tax Division holds valid tax liens against property implicated by this action and that the Tax Division possesses statutory rights entitled to priority protection, Plaintiff and Defendants oppose the Tax Division’s intervention on procedural grounds,” wrote Deputy Attorney General Cassandra L. Means-Moore. “Those objections lack merit.”

WSSH and TRT Holdings, the parent company of Omni Hotels and Resort, purchased the remaining loan debt on the Greenbrier previously owned by Virginia-based Carter Bank and Trust. On March 25, Carter Bank announced the sale of Justice’s Greenbrier loans to WSSH, now more than $370 million, according to the 14th amended and restated forbearance agreement.

A deal between the Justice family and WSSH that would have seen TRT Holdings take a 50% stake in the Greenbrier failed at the beginning in April, according to court documents. WSSH later filed suit in the U.S. District Court for the Southern District of West Virginia asking the court to appoint a receivership for the Greenbrier and issue an injunction to prevent the Justice family from interfering in Greenbrier operations.

Deadlines in the federal lawsuit have been delayed while the Justice family works to close on a deal with a new loan provider to pay off the White Sulphur Springs Holdings debt. According to a redacted term sheet provided by the Justice family, New York-based Kennedy Lewis Investment Management could provide the Justice family up to $500 million to refinance existing debt and fund capital improvements at The Greenbrier.

In its Tuesday filing, the State Tax Division argues that its unique interests as a creditor are not represented by the current parties in the federal lawsuit and could be harmed by a court-ordered receivership. The agency maintains that legal intervention is necessary to ensure its statutory priority and collection rights are maintained throughout the proceedings.

According to the State Tax Division, the Justice family owes more than $3.9 million through nine liens for consumer sales and use taxes, and one lien for personal income tax withholding for $455,070.

“…The Tax Division’s interests are not adequately represented by any existing party,” Means-Moore wrote. “The Tax Division must be afforded an opportunity to ensure that all of its interests are accurately identified, recognized, and protected before orders affecting encumbered property are entered. Intervention is intended to prevent such oversights from affecting legally protected interests, not merely to remedy them after the fact.”