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Camden inn sues SBA to get emergency loan

By Stephen Betts | Jun 18, 2020
Camden Harbour Inn

Camden — The owner of the Camden Harbour Inn is asking a federal court to order the Small Business Administration to grant it a loan offered to help companies during the pandemic.

But the federal agency is claiming that there is no legal entitlement for Breda, LLC to get money through the Coronavirus Aid Relief and Economic Security (CARES) Act.

The lawsuit was filed by Breda on May 4 in the U.S. Bankruptcy Court in Bangor. The SBA filed a motion to dismiss June 10 and attorneys for Breda filed a motion in opposition to dismissing June 17.

The Camden Harbor Inn is a 20-room, luxury boutique inn with the award-winning 65-seat restaurant Natalie's.

The SBA rejected the loan application because the company had filed for bankruptcy. Breda filed for bankruptcy protection in March 2018 but the court has approved an exit plan from bankruptcy and co-owner Raymond Brunyanszki said the company should be out of that status in a couple weeks. The company had filed bankruptcy to stave off an effort by its bank to demand a foreclosure auction of the property. Brunyanszki said the Camden Harbour Inn has always been profitable but it was the Danforth Inn in Portland, which has since been sold, that was the issue.

He said the lawsuit was filed to protect its rights to money upon the exit from bankruptcy. He said Breda will apply again on Monday for the loan under the CARES Act.

The three-story Camden Harbour Inn has operated — with a view of Camden Harbor and the Camden Hills — since the late 1800s.

Brunyanszki and Oscar Verest purchased the Camden Harbour Inn in 2007 for $2 million. The inn underwent a $2 million renovation and expansion of Natalie's restaurant in 2007. The inn operates the limited liability company Breda, LLC.

The lawsuit claims that it is discriminatory to deny a loan based on the company being in bankruptcy.

In the lawsuit, Breda points out that the mandated closing of lodging businesses by order of the state has significantly impacted the inn. There have been a significant number of cancellations of reservations.

The inn employs 17 to 40 people, depending on the season.

The company said it needs the loan to weather the storm and without the aid will have to close and layoff the workers.

The SBA maintains that there would be an unacceptably high risk of the loan not being used for the stated purpose or not repaid if granted to businesses that has filed bankruptcy.

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Comments (1)
Posted by: Laurel E Taylor | Jun 18, 2020 10:17

Humm, Pending bankruptcy



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