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Herbert Simon sues family over alleged secret changes to real estate firm
The suit, filed in Indiana state court, alleges David Simon as manager dissolved S.F.G. in a way that stripped preferred equity holders, and seeks invalidation, damages and share reinstatement.
Herbert Simon, the Simon Property Group co-founder and majority owner of the Indiana Pacers, has sued the family of his late nephew, former Simon CEO David Simon, alleging unauthorized changes to a private real estate holdings company that left equity holders with millions of dollars fewer shares.
According to the complaint filed Friday in Marion Superior Court in Indiana, Simon and other entities with preferential distribution rights in S.F.G. Company LLC, or SFG, claim David Simon, acting as SFG manager, unilaterally stripped certain equity holders of their preferential interests to dissolve the company, with actions allegedly taken in secret without notice or consent.
The filing says the restructuring was designed to benefit David Simon and his family members. It also describes SFG as being formed in 1995 by Herbert Simon and his brother, the late Melvin Simon, to hold real estate interests not included in Simon Property Group when the company went public.
Plaintiffs are asking the court to declare the purported restructuring invalid, award compensatory and punitive damages, and reinstate one of the plaintiffs preferred holdings categories, the report notes. Bisnow reports that Bank of America and attorneys involved in the dispute declined to comment on the pending litigation.