Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 1 of 14

UNITED STATES DISTRICT COURT

DISTRICT OF MINNESOTA

VERSACOLD USA, Inc., a Minnesota Court File No. 09-CV-______ (___/___)

corporation,

Plaintiff,
COMPLAINT
v.

INLAND AMERICAN BROOKLYN

PARK ATLAS, L.L.C., a Delaware limited
liability company; INLAND AMERICAN
ST. PAUL ATLAS, L.L.C., a Delaware
limited liability company; INLAND
AMERICAN ZUMBROTA ATLAS,
L.L.C., a Delaware limited liability
company; INLAND AMERICAN NEW
ULM ATLAS, L.L.C., a Delaware limited
liability company; INLAND AMERICAN
DOUGLAS ATLAS, L.L.C., a Delaware
limited liability company; INLAND
AMERICAN GAINESVILLE ATLAS,
L.L.C., a Delaware limited liability
company; INLAND AMERICAN
PENDERGRASS ATLAS, L.L.C., a
Delaware limited liability company;
INLAND AMERICAN CARTERSVILLE
ATLAS, L.L.C., a Delaware limited
liability company; INLAND AMERICAN
BELVIDERE ATLAS, L.L.C., a Delaware
limited liability company; INLAND
AMERICAN PIEDMONT ATLAS,
L.L.C., a Delaware limited liability
company; and INLAND AMERICAN
GAFFNEY ATLAS, L.L.C., a Delaware
limited liability company,

Defendants.

Plaintiffs Versacold USA, Inc. (“Versacold”) for its causes of action against

Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 2 of 14

INLAND AMERICAN BROOKLYN PARK ATLAS, L.L.C., a Delaware limited

liability company; INLAND AMERICAN ST. PAUL ATLAS, L.L.C., a Delaware

limited liability company; INLAND AMERICAN ZUMBROTA ATLAS, L.L.C., a

Delaware limited liability company; INLAND AMERICAN NEW ULM ATLAS,

L.L.C., a Delaware limited liability company; INLAND AMERICAN DOUGLAS

ATLAS, L.L.C., a Delaware limited liability company; INLAND AMERICAN

GAINESVILLE ATLAS, L.L.C., a Delaware limited liability company; INLAND

AMERICAN PENDERGRASS ATLAS, L.L.C., a Delaware limited liability company;

INLAND AMERICAN CARTERSVILLE ATLAS, L.L.C., a Delaware limited liability

company; INLAND AMERICAN BELVIDERE ATLAS, L.L.C., a Delaware limited

liability company; INLAND AMERICAN PIEDMONT ATLAS, L.L.C., a Delaware

limited liability company; and INLAND AMERICAN GAFFNEY ATLAS, L.L.C., a

Delaware limited liability company (together, “Defendants”), states and alleges as

follows:

PARTIES, VENUE, AND JURISDICTION

1. Versacold is a Minnesota corporation with a principal place of business

in Vancouver, British Columbia.

2. Versacold is in the business of providing refrigerated and dry

warehousing, transportation and logistical services for food and other products owned by

third parties.

3. Versacold is the successor-by-name-change to Atlas Cold Storage USA

Inc. and the successor-by-merger to Atlas Cold Storage America LLC.

2
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 3 of 14

4. Versacold’s predecessors-in-interest entered into written lease

agreements with each of the Defendants as set forth in more detail below.

5. Defendant Inland American Brooklyn Park Atlas, L.L.C. (“Inland

Brooklyn Park”), is a Delaware limited liability company whose sole member is Inland

American.

6. Defendant Inland American St. Paul Atlas, L.L.C. (“Inland St. Paul”), is

a Delaware limited liability company whose sole member is Inland American.

7. Defendant Inland American Zumbrota Atlas, L.L.C. (“Inland

Zumbrota”), is a Delaware limited liability company whose sole member is Inland

American.

8. Defendant Inland American New Ulm Atlas, L.L.C. (“Inland New

Ulm”), is a Delaware limited liability company whose sole member is Inland American.

9. Defendant Inland American Douglas Atlas, L.L.C. (“Inland Douglas”), is

a Delaware limited liability company whose sole member is Inland American Real Estate

Trust, Inc., a Maryland corporation (“Inland American”).

10. Defendant Inland American Gainesville Atlas, L.L.C. (“Inland

Gainesville”), is a Delaware limited liability company whose sole member is Inland

American.

11. Defendant Inland American Pendergrass Atlas, L.L.C. (“Inland

Pendergrass”), is a Delaware limited liability company whose sole member is Inland

American.

12. Defendant Inland American Cartersville Atlas, L.L.C. (“Inland

3
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 4 of 14

Cartersville”), is a Delaware limited liability company whose sole member is Inland

American.

13. Defendant Inland American Belvidere Atlas, L.L.C. (“Inland

Belvidere”), is a Delaware limited liability company whose sole member is Inland

American.

14. Defendant Inland American Piedmont Atlas, L.L.C. (“Inland Piedmont”),

is a Delaware limited liability company whose sole member is Inland American.

15. Defendant Inland American Gaffney Atlas, L.L.C. (“Inland Gaffney”), is

a Delaware limited liability company whose sole member is Inland American.

16. The Court has jurisdiction over this action under 28 U.S.C. § 1332

(diversity of citizenship) based on the fact that plaintiff and defendants are citizens of

different States with the amount in controversy exceeding $75,000, exclusive of interest

and costs.

17. The Court further has jurisdiction under the Declaratory Judgment Act,

28 U.S.C. § 2201.

18. Venue is proper in this district pursuant to 28 U.S.C. § 1391 because

Defendants’ coordinated threatened actions have a significant effect in the State of

Minnesota and because a substantial number of affected properties are located in the

State of Minnesota, including without limitation the fact that four of the warehouses

leased by plaintiff are located within this jurisdiction.

LANDLORD-TENANT RELATIONSHIPS

19. Versacold entered into a lease agreement with Inland Brooklyn Park on

4
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 5 of 14

September 28, 2007 (the “Brooklyn Park Lease”). A copy of the relevant portions of the

Brooklyn Park Lease and a guarantee thereof are attached hereto as Exhibit 1.

20. The Brooklyn Park Lease is controlled by Minnesota law.

21. The annual lease payments due under the Brooklyn Park Lease exceed

$897,925.

22. Versacold entered into a lease agreement with Inland St. Paul on

September 28, 2007 (the “St. Paul Lease”). A copy of the relevant portions of the St.

Paul Lease and a guarantee thereof are attached hereto as Exhibit 2.

23. The St. Paul Lease is controlled by Minnesota law.

24. The annual lease payments due under the St. Paul Lease exceed

$1,098,320.

25. Versacold entered into a lease agreement with Inland Zumbrota on

September 28, 2007 (the “Zumbrota Lease”). A copy of the relevant portions of the

Zumbrota Lease and a guarantee thereof are attached hereto as Exhibit 3.

26. The Zumbrota Lease is controlled by Minnesota law.

27. The annual lease payments due under the Zumbrota Lease exceed

$1,364,176.

28. Versacold entered into a lease agreement with Inland New Ulm on

September 28, 2007 (the “New Ulm Lease”). A copy of the relevant portions of the New

Ulm Lease and a guarantee thereof are attached hereto as Exhibit 4.

29. The New Ulm Lease is controlled by Minnesota law.

30. The annual lease payments due under the New Ulm Lease exceed

5
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 6 of 14

$809,955.

31. Versacold entered into a lease agreement with Inland Douglas on

September 28, 2007 (the “Douglas Lease”). A copy of the relevant portions of the

Douglas Lease and a guarantee thereof are attached hereto as Exhibit 5.

32. The Douglas Lease is controlled by Georgia law.

33. The annual lease payments due under the Douglas Lease exceed

$520,392.

34. Versacold entered into a lease agreement with Inland Gainesville on

September 28, 2007 (the “Gainesville Lease”). A copy of the relevant portions of the

Gainesville Lease and a guarantee thereof are attached hereto as Exhibit 6.

35. The Gainesville Lease is controlled by Georgia law.

36. The annual lease payments due under the Gainesville Lease exceed

$1,021,056.

37. Versacold entered into a lease agreement with Inland Pendergrass on

September 28, 2007 (the “Pendergrass Lease”). A copy of the relevant portions of the

Douglas Lease and a guarantee thereof are attached hereto as Exhibit 7.

38. The Pendergrass Lease is controlled by Georgia law.

39. The annual lease payments due under the Pendergrass Lease exceed

$1,945,864.

40. Versacold entered into a lease agreement with Inland Cartersville on

September 28, 2007 (the “Cartersville Lease”). A copy of the relevant portions of the

Cartersville Lease and a guarantee thereof are attached hereto as Exhibit 8.

6
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 7 of 14

41. The Cartersville Lease is controlled by Georgia law.

42. The annual lease payments due under the Cartersville Lease exceed

$1,075,440.

43. Versacold entered into a lease agreement with Inland Belvidere on

September 28, 2007 (the “Belvidere Lease”). A copy of the relevant portions of the

Belvidere Lease and a guarantee thereof are attached hereto as Exhibit 9.

44. The Belvidere Lease is controlled by Illinois law.

45. The annual lease payments due under the Belvidere Lease exceed

$1,323,364.

46. Versacold entered into a lease agreement with Inland Piedmont on

September 28, 2007 (the “Piedmont Lease”). A copy of the relevant portions of the

Douglas Lease and a guarantee thereof are attached hereto as Exhibit 10.

47. The Piedmont Lease is controlled by South Carolina law.

48. The annual lease payments due under the Piedmont Lease exceed

$1,794,560.

49. Versacold entered into a lease agreement with Inland Gaffney on

September 28, 2007 (the “Gaffney Lease”). A copy of the relevant portions of the

Gaffney Lease and a guarantee thereof are attached hereto as Exhibit 11.

50. The Gaffney Lease is controlled by South Carolina law.

51. The annual lease payments due under the Gaffney Lease exceed

$465,280.

7
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 8 of 14

COMMON ALLEGATIONS

52. The premises subject to the leases described above (collectively “the

Leases”) are successfully operated by Versacold as part of a national, integrated, network

of refrigerated warehouses. Collectively, more than 450 Versacold employees work at

the premises at issue in this lawsuit. In addition to its own employees, Versacold’s

operations at its warehouses generate direct employment for hundreds of other workers

employed by other entities, in such fields as transportation and maintenance, and

Versacold’s warehouse operations indirectly affect the employment of thousands of

citizens working in retail food operations.

53. By providing warehouses that refrigerate fresh and frozen foods and the

logistical services to control inventory and facilitate the efficient handling and

transportation of food, Versacold’s services provide an essential link in the food supply

chain for many population centers in the United States. Tens of thousands of individual

consumers depend on Versacold’s activities at the leased warehouses as part of the

distribution chain through which their food is safely stored, handled, and transported to

market.

54. Versacold and its predecessors in interest have, at all times, fully and

timely paid all rent and additional rent obligations due under each of the Leases.

55. Defendant Landlords have threatened to terminate the Leases and to

summarily evict Versacold from the eleven warehouses, which will have the immediate

effect of interrupting the essential services Versacold provides to the public and will lead

to the elimination of hundreds of jobs.

8
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 9 of 14

56. Each of the eleven landlords (jointly “the Landlords”) is controlled,

directly or indirectly, by Inland American.

57. Upon information and belief, Inland American owns interests in

properties in 46 States, and manages assets with a value exceeding $11 billion.

58. Inland American and its affiliated Landlords are highly sophisticated in

the real estate business.

59. Each of the Leases required the execution of a guaranty by Hf.

EIMSKIPAFELAG ISLANDS (now named A1988 hf.), an Icelandic corporation with a

principal place of business in Iceland (the “Guarantor”).

60. The Guarantor timely executed each of the required guarantees.

61. At and before the time of execution of the guarantees, the Landlords were

provided with the Guarantor’s financial information and otherwise had access to the

Guarantor’s financial information.

62. The Guarantor’s tangible net worth was negative as of September 28,

2007.

63. On or about July 1, 2009, the Guarantor entered a “composition

proceeding” in Iceland. A “composition proceeding” under Icelandic law is similar in

some respects to a financial reorganization proceeding.

64. On or about July 30, 2009, Inland American, on behalf of the Landlords,

submitted a claim in the Guarantor’s composition proceeding.

65. On or about July 30, 2009, Inland American, on behalf of the Landlords,

represented as part of its claim that the Guarantor’s seeking composition constituted a

9
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 10 of 14

breach of the Leases.

66. On or about July 30, 2009, Inland American, on behalf of the Landlords,

represented that “the leases have however not been revoked.”

67. The Icelandic composition agent rejected Inland American’s July 30,

2009, claim.

68. Notwithstanding the rejection, neither Inland American nor any of the

Landlords contested the composition agent’s composition order during the appeal period

provided by Icelandic law.

69. Shortly after issuance of the composition order, the Guarantor exited

from the Icelandic composition proceedings.

70. The guarantees executed by the Guarantor have not been rejected or

terminated by the composition proceeding or by the Guarantor.

71. The Guarantor remains liable on the various guarantees attached to each

of the Leases.

72. On information and belief, the Guarantor presently has a positive tangible

net worth.

73. Versacold is a stronger lessee as a result of transactions that occurred at

or around the time of the “composition proceeding.

74. The Landlords, through Inland American, have taken the position that the

Guarantor’s entry into the composition proceedings in Iceland constitutes an “Event of

Default” under the Leases.

75. The Landlords, through Inland American, have threatened to terminate

10
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 11 of 14

each of the Leases and to bring eviction proceedings seeking possession of the premises

subject to each of the Leases, on the ground that an Event of Default has occurred by

virtue of the Guarantor’s entry into the composition proceedings in Iceland.

76. Versacold has taken the position that because the guarantees executed by

the Guarantor have not been rejected in the composition proceeding and because the

Guarantor remains liable on the various guarantees attached to each of the Leases, no

Event of Default has occurred.

77. Versacold has taken the position that the Landlords in any event waived

and forfeited any such alleged breach of the Leases as part of their participation in the

composition proceedings and the Landlords’ representations set forth in their

consolidated claim in the composition proceedings.

78. Versacold has further taken the position that any purported breach of the

Leases allegedly caused by the Guarantor’s entry into and exit from the composition

proceedings is not material.

79. The Landlord’s threat of eviction unlawfully interferes with Versacold’s

rights in breach of the Leases, including the tenant’s right of quiet enjoyment, breaches of

the Landlords’ express contractual duties to act reasonably, and Landlords’ implied duties

of good faith and fair dealing.

80. In the event the Landlords were to evict Versacold, notwithstanding

Versacold’s timely payment of rent and its compliance with all material provisions of the

Leases, Landlord’s conduct would threaten Versacold’s very existence and the

employment of hundreds of employees, putting at risk the safety and value of hundreds

11
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 12 of 14

of millions of dollars worth of food products and goods belonging to third parties stored

in the leased facilities, and threatening the ability of the distribution supply chain to

deliver wholesome food to consumers.

COUNT I
DECLARATORY JUDGMENT

81. Versacold realleges and incorporates by reference paragraphs 1 through

78 above as though fully set forth herein.

82. The Landlords, through Inland American, have taken the position that the

Guarantor’s entry into the composition proceedings in Iceland constitutes an Event of

Default under the Leases.

83. Versacold has taken the position that because the guarantees executed by

the Guarantor have not been rejected in the composition proceeding and because the

Guarantor remains liable on the various guarantees attached to each of the Leases, no

Event of Default has occurred.

84. Versacold further has taken the position that the Landlords in any event

waived and forfeited any such alleged breach of the Leases as part of their participation

in the composition proceedings and the Landlords’ representations set forth in their

consolidated claim in the composition proceedings.

85. Versacold has further taken the position that any purported breach of the

Leases allegedly caused by the Guarantor’s entry into and exit from the composition

proceedings is not material.

86. A judicial determination is necessary and appropriate at this time and

12
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 13 of 14

under these circumstances to resolve the disputes between and among the parties.

87. Accordingly, Versacold requests that this Court declare: (a) that the

Guarantor’s temporary entry into and prompt emergence from Icelandic composition

proceedings did not constitute a breach of the Leases, or any of them; or (b) in the

alternative, that the Landlords have waived and forfeited any such alleged breach; or (c)

in the further alternative, that any such alleged breach was not material, and (d) that the

Landlords’ conduct with reference to the Leases is inconsistent with, and in violation of

Landlords’ express contractual duty to act reasonably with regard to determinations under

the Leases and other conduct under the Leases and is in further violation of the

Landlords’ implied duties of good faith and fair dealing.

88. Versacold further requests that the Court declare that if the Landlords

attempt to evict Versacold, such attempt constitutes a material breach of each such Lease,

allowing Versacold to terminate each or any Lease, without further liability to the

respective Landlord.

WHEREFORE, Versacold respectfully requests that the Court award it the

following relief:

1. A declaratory judgment in favor of Plaintiff Versacold and against the

Defendant Landlords that (a) that the Guarantor’s temporary entry into and prompt

emergence from Icelandic composition proceedings did not constitute a breach of the

Leases, or any of them; or (b) in the alternative, that the Landlords have waived and

forfeited any such alleged breach; or (c) in the further alternative, that any such alleged

breach was not material, and (d) that the Landlords’ conduct with reference to the Leases

13
Portlnd1-2561783.1 0076722-00003
 Case 0:09-cv-02669-DSD-JJK Document 1 Filed 09/29/09 Page 14 of 14

is inconsistent with, and in violation of Landlords’ express contractual duty to act

reasonably with regard to determinations under the Leases and other conduct under the

Leases and is in further violation of the Landlords’ implied duties of good faith and fair

dealing.

2. A declaratory judgment in favor of Plaintiff Versacold and against the

Defendant Landlords that if the Landlords attempt to evict Versacold, such attempt

constitutes a material breach of each such Lease, allowing Versacold to terminate each or

any Lease, without further liability to the respective Landlord.

3. An award of appropriate equitable relief.

4. An award of costs, interest, disbursements, and attorneys’ fees.

5. Such other and further relief as the Court deems just and proper.

DATED: September 29, 2009 STOEL RIVES LLP

s/ Marc A. Al
Marc A. Al (247923)
33 South Sixth Street, Suite 4200
Minneapolis, MN 55402
(612) 373-8801 : telephone
(612) 373-8881 : facsimile
maal@stoel.com

ATTORNEYS FOR PLAINTIFF

VERSACOLD USA, INC.

14
Portlnd1-2561783.1 0076722-00003