Tim Logan, who covers economic development for the St. Louis Post-Dispatch, said rumors were flying about a pending federal indictment against local real estate developer John Steffen, so the press release announcing it wasn’t a big surprise. However, a closer look at the filing did provide something he wasn’t expecting. His story says the city stepped in to pay half a million dollars to help settle a lawsuit against the developer brought by his lenders:
“Revealed in Friday’s charges against Steffen is the fact that most of that $775,000 settlement with the Business Bank was paid by the city-run Land Clearance for Redevelopment Authority. It kicked in $500,000. Environmental Operations, which Pyramid had hired to clean up the building, paid $200,000. Steffen himself paid $50,000.
Barbara Geisman, St. Louis’ deputy mayor for development, said the city paid to avoid a long, drawn-out lawsuit between the Business Bank and the state Department of Economic Development, which issues brown-fields credits and other incentives that are key to the city’s revitalization. The fear was that messy litigation could slow the flow of tax credits to other city developments.”
Today’s Tip: Watch for secondary stories in filings, Tim says.
“The criminal filing was the first time that was made public,” he says.
Just as you do with SEC documents, familiarize yourself with court records. Determine where your companies are incorporated to keep an eye on the dockets there, too. For instance, during the corporate bankruptcy boom, many companies opted to file in Delaware because that’s where they were incorporated. Here’s a Reynolds Center tutorial on covering bankruptcy court. You can find some out-of-state court records through this public records portal operated by BRB Publications.
Read dockets carefully instead of just skimming them to be sure you find any secondary stories. Legal filings can sometimes be redundant, but new information may be introduced on subsequent references.
As this Chicago blog notes, sometimes the stories you find can point to a pattern.