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New future awaits former Winery at Elk Manor

ELK NECK — Nearly one year after it abruptly closed its doors, leaving couples scrambling to find a new wedding venue at the height of marriage season, the former Winery at Elk Manor awaits a new future after a federal court approved its sale.

The former event venue and never-fully-operational winery, owned first by former Google executive Simon Tusha, of Forest Hill, and later by his wife, Gretchen, closed abruptly in the first days of August 2016 without notice, sending ripples across the region as media swarmed the bucolic venue at 88 Rivers Edge Road to find a closed sign on the gate and alternative vendors reached out to affected couples offering their help.

The operation at Elk Manor was impacted by Tusha’s guilty plea in a federal tax fraud case. On May 20, 2016, he pleaded guilty to conspiracy to obstruct and impede the IRS, defrauding the government of nearly $1 million in tax returns.

Tusha admitted in federal court that he received some $3.2 million in kickbacks from companies in the United Kingdom and the Netherlands that were negotiating contracts for data centers with Google and then hid the money from his employer and the IRS through a series of shell companies he and his co-conspirators created, according to U.S. District Court records.

While he tried to reassure worried couples that his plea would have no impact on the venue, it actually would have dramatic consequences. The circumstances of his legal case pushed a nearly $5 million business loan from BBT Bank into default and ultimately the Tushas agreed to a judgment against their business.

Since then, the property has been winding its way through the bankruptcy process over the past nine months, beginning first as Chapter 11 to reorganize its debt, but entering into Chapter 7 liquidation this spring due to “gross mismanagement of the estate and failure to file a plan and disclosure statement,” according to federal court records.

On July 6, the U.S. Bankruptcy Court for the District of Maryland approved the sale of the 150-acre property along with its winery, four residential buildings, two offices, two event halls and two barns to 88 Rivers Edge Road LLC for $3.35 million.

The limited liability corporation was formed by Michael Novak, president of a Baltimore building restoration company, earlier this year as he negotiated to buy the former winery’s note from BBT Bank. While the Tushas had marketed the property at $9.9 million before entering bankruptcy, a recent appraisal placed it at about a third of that value, which Novak agreed to. According to court filings, he has no connection to the Tushas.

On Friday, Novak confirmed that he was Elk Manor’s buyer, but declined to elaborate on his plans for its future, including whether it would become a private residence or continue in commercial operations, explaining that it was too preliminary to discuss.

The sale was brokered outside of a public auction, which creditors twice tried to hold only to be stymied by bankruptcy filings, but in doing so allowed the property to avoid foreclosure, in which creditors outside of the primary lienholder would have received nothing.

In settling the estate’s debts, Novak also agreed to pay smaller creditors. While the Maryland Casino Business Investment Fund held a $490,000 judgment against the Elk Manor for defaulting on a 10-year note, it will recoup only $20,000 through the sale, according to records.

While the former venue’s future is on the way up, its one-time owner is still dealing with the repercussions of several criminal cases.

In November, he was found guilty of second-degree assault related to a September 2016 spousal abuse incident and was later sentenced to three years in prison, with seven years suspended. Now in Dorsey Run Correctional Facility, he is appealing that case along with five counts of violating a protection order, and will be back in court in August.

Meanwhile, Tusha still awaits sentencing on his federal charge of conspiracy to obstruct and impede the IRS, in which he faces up to five years in prison or a fine of up to $250,000, or both.

His sentencing date in that case, now scheduled for Oct. 10, as been delayed five times, according to federal court records. According to federal court records, the postponements are due to Tusha’s planned cooperation and testimony in the Netherlands connected with the larger bribery case.

In late 2016, Dutch prosecutors capitalized on the American investigation to charge Rudy Stroink and his wife with money laundering, fraud, forgery and membership in a criminal organization. Stroink, who is one of the Netherlands’ richest men, a major developer and a media personality, and his wife are accused of paying 1.7 million euros — about $1.8 million — in bribes to Tusha for favorable conditions related to a Google contract for a data center in Eemshaven, Netherlands, a North Sea port city near Germany.

Asserting Stroink’s innocence, his legal team has already begun a public campaign to attack Tusha’s reputation ahead of any planned testimony in the case.

Article source: http://www.cecildaily.com/business/article_665743d7-ec99-5b9c-9736-b9ec320c82b9.html

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