In the fall of 1986, a number of involuntary bankruptcy petitions were filed in the United States Bankruptcy Court for the Southern District of New York against certain debtor companies that owned and operated 40% to 60% (depending on what was being measured) of the island of Hilton Head, South Carolina. In response, debtors’ counsel filed voluntary petitions in South Carolina, and venue was changed to South Carolina. There were 14 petitions filed involving many planned developments, the original was called The Sea Pines Company, and the group of bankruptcy cases were referred to as Sea Pines.
Shortly thereafter, the Chief Judge of the United States District Court for the District of South Carolina, the Honorable Sol Blatt Jr., withdrew the reference to the United States Bankruptcy Court for South Carolina, but directed the Clerk of Court for the Bankruptcy Court to maintain the file, accept all pleadings for filing, handling notices, etc. At the time the bankruptcy case began, Judge Blatt was presiding over about 10 District Court cases involving the debtors. Approximately another 20 suits were pending in other courts involving these debtors.
Judge Blatt was a wonderful person and very interesting. While he was presiding over Sea Pines, he was 64 years old and he had his own District Court caseload. He would mediate his own cases and meet with parties separately in that mediator role. As Chief Judge he stayed on top of General Services Administration (GSA) in the construction of the new District Court in downtown Charleston. Because the Federal Court was located at the four corners of law (Broad and Meeting streets), history advocacy groups took a keen interest in the renovations and new additions. Judge Blatt would mediate between competing interests involved in the design and construction of the courthouse facilities. At one-point GSA threatened to make this the three corners of law (God’s law, a church; Charleston Municipal Court and the Charleston County courthouse) by building a new facility in North Charleston, where it was rumored that there were no zoning laws. Judge Blatt prevailed and the fourth corner, federal law, was preserved.
Some of the unusual aspects of the Sea Pines cases:
Without a doubt, other bankruptcy or district court judges could have successfully presided over these cases. But it is unlikely that another judge would have managed these cases this quickly or devoted so much bench time. Judge Blatt paid a price for his actions, but South Carolina and the Island of Hilton Head were the beneficiaries of his actions.