Managing Partner
October 1, 2024 – Media Mention in Forbes
In a recent Forbes article by staff reporter Kyle Khan-Mullins, the complex financial and legal implications of hotels dropping the Trump brand are examined in detail.
The piece, which features insights from Woods Lonergan PLLC’s Managing Partner Jim Woods, highlights several intricate legal issues in hotel and hospitality management, particularly regarding licensing agreements.
- Contract Termination and Buyouts: The article suggests significant payouts when hotels separated from the Trump brand, indicating complex contractual agreements with specific terms for early termination of licensing and management contracts.
- Intellectual Property Rights: The removal of Trump’s name from properties involves considerations around trademark usage, brand transition periods, and the cessation of Trump branding in hotel and hospitality contexts.
- Management Transition: Legal obligations during the handover of hotel management, including potential issues with employee contracts and the transfer of operational data in the hospitality sector.
- Financial Disclosure and Reporting: The accuracy of reported revenues and breakup fees in financial disclosures, particularly given Trump’s status as a public figure and former president, and how these relate to licensing and management agreements.
- International Legal Considerations: With properties in various countries, including the U.S., Canada, and Panama, different legal frameworks likely governed these licensing agreements and their termination.
The article raises the possibility that Trump’s legal team may have employed a strategy that effectively held hotels “hostage” to secure favorable terms for removing his name from their properties. This approach, if employed, could have significant implications for contract negotiations and terminations in the luxury hotel industry.
Jim Woods, Managing Partner of Woods Lonergan, PLLC, was quoted in the article, providing expert insight into the broader implications for the Trump hotel brand and licensing strategy. Addressing the long-term impact on Trump’s real estate ventures, Woods observed, “The luster of the Trump name seems to have worn off, certainly in this industry.”
This commentary underscores the potential long-term effects on Trump’s hotel and hospitality management business in certain markets. It also highlights the legal and financial considerations that may arise from brand devaluation in licensing agreements, including the complexities of negotiating contract terminations.
Woods’ expertise helps contextualize the challenges faced by high-profile real estate brands in a changing political and economic landscape, particularly in the realm of hotel licensing and management.
Woods Lonergan, PLLC continues to be at the forefront of commercial real estate law, offering valuable insights into high-profile property management, licensing agreements, and the complex legal landscape surrounding luxury hotel operations. Contact us online or call (212) 684-2500 today to discuss how we could be of assistance with your legal needs.
Woods Lonergan PLLC’s Real Estate Hospitality Practice focuses on serving boutique hotel owners, hotel developers and restaurant owners in New York City and in cities across the United States as they establish their brands and presence in competitive markets.
Click here to read the full article in Forbes. Access may require a subscription.