Shoen family fight erupts over Las Vegas hotel

Monday, July 3, 2000 | 11:41 a.m.

Three children of late U-Haul International Inc. founder Leonard Shoen are attempting to block distribution of funds from the pending sale of the World Trade Center hotel.

In a June 28 lawsuit filed in Clark County District Court, companies controlled by Samuel Shoen, Michael Shoen and Cecilia Shoen Hanlon requested a freeze on the distribution of all assets from the auction of the World Trade Center, now scheduled for Sept. 14. The plaintiffs also requested a freeze on $1.3 million they claim is held by Amerco Entrepreneurial Institute Inc., the current owner of the property. Leonard Shoen was president of AEI.

The lawsuit says Carol Shoen, Leonard Shoen's wife and sole heir, informed Samuel Shoen that the claims of Shoen's estate should take priority over any claims by the Shoen children's companies. The lawsuit also claims Carol Shoen is pressuring the estate's executor to give the estate priority claims.

The three companies loaned $8 million to AEI from April 1997 to January 1998, the lawsuit said. Previously, Leonard Shoen contributed "in excess of $10 million" to AEI. All of these funds were used for capital improvements.

However, the plaintiffs claim, Leonard Shoen entered into an agreement in May 1998 agreeing that all debts owed to Leonard Shoen by AEI would be subordinate to claims by the plaintiffs' companies. Further, the plaintiffs claim, Leonard Shoen's payments to AEI "constituted capital contributions and were not loans to AEI."

"There is a substantial risk that the cash on hand and the proceeds from the sale of the World Trade Center will not yield sufficient funds for ... AEI to discharge all of its indebtedness to the plaintiffs and the estate of Shoen," the lawsuit said.

In addition to a freeze on these funds, the plaintiffs also asked the court for a ruling on whose claims will have priority.

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