Jonathan B. Cox, Staff Writer
The Castleton Group's former landlord has sued the founder of the human resources company in hopes of recovering more than $169,280.
The Summit at Lake Boone alleges that Castleton, which is liquidating in bankruptcy, triggered clauses that automatically terminated its lease.
The suit claims that Suzanne Clifton, who started Castleton more than a decade ago, has to pay because she signed a guaranty of the company's obligations.
At issue are offices that Castleton occupied at 4101 Lake Boone Trail in Raleigh. The company moved out in September to go to 3700 Glenwood North. That violated the lease, the suit alleges. What's more, it says, regulators in November deemed Castleton insolvent, which violated another condition.
"Summit is entitled to recover from Clifton the damages incurred as a result of Castleton's defaults," the suit says. In addition to the monetary award, the landlord seeks interest and payment of attorneys' fees. An attempt to reach George F. Sanderson III, who represents the landlord, was unsuccessful.
Philip Isley, who represents Clifton, said: "We're going to vigorously defend it and will be filing an answer later this spring."
The suit is the first legal action filed against Clifton personally since her company filed for bankruptcy in December. Her company managed payroll, benefits and other human resources functions for more than 100 small and midsize businesses. The bankruptcy filing came after the state Department of Insurance declined to award a necessary license and the company admitted owing as much as $11 million in federal taxes.
Castleton's demise shocked clients. Many still have questions about retirement plans and other matters. A federal grand jury is investigating Castleton's collapse, as is the State Bureau of Investigation and Insurance Department.
The issues in this real estate suit are not unusual. Executives are often asked to guarantee commercial leases, and when their companies struggle, they can wind up in court.