Businessman Cyril O'Brien was unhappy with how promoter Denis Desmond was carrying out the promotional side of the Hot Press Music Hall of Fame and that was one of the reasons Mr O'Brien sold his shares to other investors in 1999, Hot Press editor Niall Stokes told the High Court yesterday.
Mr Stokes said Mr O'Brien left the venture in September 1999 for several reasons, including that the venture was losing money. Mr O'Brien was unhappy about the promotional side of things, the losses being incurred by live shows, and believed Mr Desmond was not taking on board the concerns of the other promoters, he said.
Mr O'Brien had not said anything about forgetting or being unaware about an indemnity in relation to personal guarantees provided by Mr Stokes and his wife, Máirín Sheehy, Mr Stokes added. He was told by his counsel, Brian O'Moore, that Mr O'Brien's evidence would be that the indemnity was "overlooked".
Mr Stokes (55) was continuing his evidence in the action by himself and his wife, Máirín Sheehy, of Trinity Street, Dublin, against Denis Desmond, of Strand Road, Killiney; Moya Doherty and John McColgan; Cyril O'Brien, of Knockabbey Castle, Co Louth; and Tony Burke, of Lambourne Wood, Cabinteely, Dublin.
The action is over liability for about €1.5 million in losses for the company that ran the Hot Press Music Hall of Fame. The failure of the venture left Mr Stokes in a position where he was offered £800,000 (€1 million) for his shares in the hall of fame by Mr Desmond and Ms McColgan and Mr Doherty.
Yesterday, Mr Stokes said the hall of fame had opened at Middle Abbey Street, Dublin, in April 1999 at a cost of some £5 million, not the projected £3 million. By July 1999, trade was not at the level that had been anticipated. Efforts were then made to get Riverdance duo John McColgan and Moya Doherty on board.
Mr Desmond had agreed to get involved after he and Dominic Kelly met Mr Stokes on St Patrick's Day, 1999.
Mr Stokes said Mr Desmond was aware business expansion scheme money was being raised by Steeple Investments Ltd, the property vehicle of Mr Stokes and his wife, the issues relevant to that and the risks involved for Mr Stokes and his wife in that they had given personal guarantees.Mr Stokes detailed the financial problems incurred by the venture during 2000 and 2001 and referred to a "high degree of animosity" displayed by Mr Desmond towards Tony Burke. He said that by January 2001, he had had enough and wanted out.
A meeting was held in February 2001 to take Mr Stokes and Hot Press out of the business, he said. It was agreed that Mr Desmond would buy the shares of Mr Stokes and Mr Burke. Mr Desmond made it clear he wanted to run the building as a live music venue, club and bar. Immediately after this meeting on February 15th, Mr Desmond took charge of the building.
Mr Desmond said it was "totally wrong" to suggest the agreement reached covered indemnities in relation to Mr Stokes and his wife.
The case continues.
