Powder Mountain Owner Reed Hastings Faced with $75.9M Lawsuit

Along with the most skiable acreage in the US, Reed Hastings inherited a couple lawsuits when he took over ownership of Powder Mountain, Utah.

Hastings became the majority owner of Utah ski area in 2023 with his $100M investment in the resort. Prior to the Netflix co-founder's ownership of the resort, Powder Mountain was owned by a subsidiary of the now-defunct company Powder Summit called Summit Mountain Holding Group, who purchased the mountain for $40M in 2013.

Created by media entrepreneur Elliot Bisnow and venture capitalist Greg Mauro, Powder Summit took out an EB-5 loan to transform Powder Mountain into a posh ski destination. Now, the EB-5 lender investment group is suing Hastings for $75.9M. 

The $120M loan signed by Mauro and Bisnow in 2016 granted foreign investors green card visas to the US under the EB-5 Immigrant Investor program. Perhaps more notably, the loan contained a completion guarantee, which ensures the finishing of all proposed projects, and recourse indemnity, which allows investors to pursue the borrower's personal assets if the loan is not repaid.

The program has been a popular source of financial backing for ski area development with Jay Peak in Vermont, Keystone in Colorado, and Tamarack in Idaho all having received similar EB-5 loans. Jay Peak's EB-5 loan controversy notably ended in scandal.

Court filings reported that Summit Mountain Holding's loan payments stopped in January of 2019, and when a default notice came in 2021, the international group of investors had paid just a third of the funds. Powder Summit filed suit against the EB-5 lenders, who fought off the lawsuit's claims of unfair business dealings before countering with their own lawsuit. 

This lawsuit against Powder Summit and Summit Mountain Holding stayed in the Utah Supreme Court until 2023 when Hastings stepped in with a $100M investment in Powder Mountain and Summit Mountain Holding Group, making him the resort's majority owner.

Hastings was aware of the lawsuits when he purchased Powder Mountain and said he hoped to come to an agreement with the investors. Keep reading for more on this story.

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