County to try to recover $350,000 from failed Sanborn Studios agreement as it proceeds with legal case

Dissolution of the company has not stopped a deputy county attorney from his efforts to make Sanborn’s CEO show up for a deposition

Ken Sanborn. Image from
Ken Sanborn. Image from

One might see it as the script for a Hollywood tale all its own: A movie studio boss tells the Sarasota County Commission that with $650,000 in a grant upfront, he will be able to put the klieg lights on the community. Imagine it, he might have whispered: “Film and TV production work will make the West Coast of Florida a far bigger star than any incarnation of the Sarasota Film Festival ever has.”

With an economic development incentives account at hand, the County Commission agreed. It offered Sanborn Studios the money in return for the promise that it would relocate to the county, add 117 new jobs between Sept. 2, 2010 and Sept. 2, 2013 and bolster the economy with an extra $164 million — give or take a few thousand dollars — over that same period.

Those jobs would be high-paying ones, too, the company vowed: an average wage of $72,029.

Part of the county grant — $350,000 — would enable the company to purchase the technical equipment it needed for its Lakewood Ranch facility. The firm signed a two-year lease, with an option to purchase more county property, prior to the commission’s vote on the incentive funds.

A couple of catches were written into the agreement, however. For example, Sanborn had to repay the county $2,992 for each of those 117 jobs it had not created during the three-year period; that money was due within 60 days after Sept. 2, 2013.

Furthermore, if Sanborn ceased operations in Sarasota County within five years of the agreement, it would reimburse the county a prorated portion of the grant, less any reimbursement it already had provided for jobs it had not produced.

Kenneth Sanborn signed the agreement on Oct. 11, 2010. As chair of the County Commission, Joe Barbetta added his name on Oct. 14, 2010.

Flash forward to July 28, 2014: In a filing with the 12th Judicial Circuit Court in Sarasota, Sarasota County brought suit against Sanborn Studios. The reason: “breach of a Financial Incentive Agreement with Sarasota County.”

None of the 117 jobs had materialized, the suit said.

Sanborn not only disputed terms of that agreement, it also countersued.

Slightly more than two years later though — on Aug. 5 — Sanborn filed a Confession of Judgment, acknowledging its debt of $350,064 to Sarasota County. In an Aug. 9 order approved by Judge Rochelle T. Curley, the county accepted that action and stated that it would seek to recover the money from Sanborn Studios.

Judge Rochelle Curley. Image from the 12th Judicial Circuit website
Judge Rochelle Curley. Image from the 12th Judicial Circuit website

On Aug. 26, county spokesman Jason Bartolone told The Sarasota News Leader in an email, “The county plans to institute collection proceedings to recoup the money.” If any funds are collected, they will go back into the Economic Incentive Fund.

In the meantime, as Commissioner Christine Robinson has pointed out during recent board meetings, she worked with a number of organizations representing county businesses to revise the county ordinance governing the Economic Incentive Fund. One primary goal of that 2012 undertaking was to prevent another Sanborn Studios scenario.

This is not how the Sanborn Studios storyline ends, however.

Case remains open

On Aug. 9, Judge Curley approved an order entered by a magistrate in the case on July 20. It calls for the CEO or a corporate representative of Sanborn to be deposed by a county attorney. (Deputy County Attorney Rick Elbrecht has been handling the case, court records show.)

Magistrate Deborah Bailey wrote in her July 20 order that the county “has been attempting since August of 2015 to schedule [such a] deposition … Dates were provided in December 2015 and by agreement the deposition of Ken Sanborn was scheduled for December 14. On December 10, 2015,” she continued, “[Sanborn Studios’] counsel indicated Mr. Sanborn had medical issues and would not appear on December 14.”

The deposition then was rescheduled for April 29, Bailey wrote. But on April 27, Sanborn Studios filed a notice that the company was being dissolved, she noted. “In an email dated April 28, 2016,” Bailey wrote, “Defendant’s counsel advised that Defendant was going to wind up its business in accordance with the provisions of Chapter 605, Florida Statutes, and ‘there will be no depositions in any court proceedings involving Sanborn Studios, LLC,’ there would be no deposition of Mr. Sanborn, and he no longer had a client in the case. Counsel then filed a motion to withdraw, which has not been set for hearing.” Bailey added, “Neither Mr. Sanborn nor counsel appeared at the deposition on April 29, 2016.”

David Boggs. Image from the Macfarlane Ferguson & McMullen website
David Boggs. Image from the Macfarlane Ferguson & McMullen website

Bailey also disagreed with Sanborn Studios’ attorney’s interpretation of the Florida law governing the dissolution of a limited liability company. She pointed to the section of the statute — 605.0707 — that says after it has filed the articles of dissolution, a company “shall cease conducting its business and shall continue solely for the purpose of winding up its proceedings … except for the purpose [Bailey’s emphasis] of lawsuits, other proceedings, and appropriate action as provided in [the statute].”

Therefore, Bailey concluded, Sanborn “shall cooperate in the scheduling of this deposition …” She also awarded costs and attorneys’ fees to the county, finding that appropriate, she noted, given the necessity of the county’s having to file its motion seeking to compel the deposition.

The Sarasota News Leader was unable to reach the attorney listed in court records as counsel for Sanborn Studios. He is David M. Boggs of the Macfarlane Ferguson & McMullen firm in Tampa.

A Google search for the website of Sanborn Studios LLC in Lakewood Ranch, conducted by the News Leader this week, resulted with the warning, “This site may harm your computer.”