By: Rob Harris
Jeffrey and Judee Donner claim that Jack Nicklaus hoodwinked them into spending $1.5 million to become charter members in an anticipated golf course development that went bankrupt. Perhaps wanting to “be like Mike” (I mean Jack) or to “keep up with the Joneses” (I mean Nicklauses), Mr. and Ms. Donner allegedly bought into the development on the strength of the following statements attributed to Nicklaus in a press release and a marketing brochure:
- “When I walked Mt. Holly Club, I was so captured by its potential [that] I thought through all 18 holes. In fact, I have been so impressed with the club and its management team that I became a founding charter member.”
- “Mt. Holly Club enjoys the ideal alpine setting. I knew from my first visit there that we had been given a canvas on which to design a truly spectacular golf course. I am so impressed with the Mt. Holly Club and its management team that I became a founding charter member. I look forward to seeing you there.”
Mr. and Ms. Donner alleged that, by virtue of these statements, they reasonably believed that Jack, too, had paid $1.5 million for a charter membership.
According to the complaint, however, Jack was not $1.5 million poorer and one charter membership richer. Instead, he was the owner of an “honorary Founder Membership” for which he paid nothing.
In upholding the Donners’ right to pursue this claim of intentional misrepresentation, the three judge appellate court explained that, “[t]he golf course would be designed by legendary golfer Jack Nicklaus, who would have a house in the development and serve as a member. Mr. Nicklaus joined the developer to solicit investors, lending his name in exchange for millions of dollars.”
As the court’s opinion addressed only a preliminary motion to dismiss the claims, Mr. and Ms. Donner still must prove to a judge or jury that their claims of intentional misrepresentation are meritorious and that, but for the statements attributed to Jack, they would have opted not to invest in the Mt. Holly Club.