The state of the Bob Bondurant School of High Performance Drive school – which had been generating as much as $6 million a year in revenue only a few years ago – today stands in sharp contrast to what it was in the fall of 2018.
Its plunge into a sea of red ink is documented in thousands of pages of documents in federal bankruptcy court since previous owners Bob and Patricia Bondurant filed for creditor protection in September 2018.
That bankruptcy took a bitter turn after a trio of investors who had formed a company called Stig Investments bought the school for $1.67 million at an auction before U.S. Judge Brenda K. Martin, documents show.
With her husband in an assisted living facility, Patricia Bondurant filed a two-pronged legal attack that spilled into state Superior Court with accusations and counter-accusations of theft and mismanagement involving her, creditors, Stig Investments and the Scottsdale company appointed by the court to handle the resolution of the school’s $3.5 million in debts.
For the early part of the past year, it appeared that a sorry end awaited the school that had been founded by Robert L. Bondurant, a world champion racer, in 1968 in Orange County, California, after he almost lost his life in a race when the steering arm of his McLaren MARK II CanAm snapped at 150 mph.
Before relocating to the East Valley in 1990, his students included the late actors and racing enthusiasts Jim Garner and Paul Newman – drawn partly by Bondurant’s own successful racing career.
With numerous awards and prizes for his racing prowess, Bondurant relocated the school to Chandler.
He secured contracts worth millions from military and law enforcement agencies around the world to teach chase and evasion techniques.
Hundreds of thousands of students – from military and law enforcement personnel to racing aficionados to beginner drivers – took courses at the school while corporations flocked to the school for team-building exercises and networking events built around Bondurant’s stable of high-performance cars and go-karts.
The Bondurant School accumulated lucrative partnerships and sponsors with companies like Dodge and Goodyear.
But it began losing its financial bearings after it lost the military contracts – a big source of its income.
Atop that, sponsorship payments from Dodge and Fiat became sporadic, court papers said, as those two companies wrestled with their own financial woes.
In September 2018, the school hit a brick wall.
It had fallen behind by nearly $300,000 in rent owed Valley Marine Development, the economic development arm of the Gila River Indian Community that owned the school’s site.
Valley Marine threatened to lock the school out of its premises and the Bondurants failed to secure a deal with an unnamed investor for an infusion of cash.
The bankruptcy case appeared to be heading to a resolution after Stig bought the school for $1.67 million – except for a claim filed by Patricia Bondurant.
She asserted that the sale did not include the Bondurant name or a museum on the site that housed thousands of dollars’ worth of vehicles that included seven motorcycles – one dating to 1940 – several dirt bikes, nine high-performance and other cars as well as memorabilia from Bob Bondurant’s days as an international racing star.
With the loss of the lucrative Bondurant name hanging in the balance, Stig Investments fought back. Judge Martin ruled the issue was not a matter for bankruptcy court and that fight moved into Superior Court, where it has not been resolved.
While the new owners of the school insist the Bondurant name went with the school’s sale, a lawyer for Patricia Bondurant denied that contention.
In an Oct. 30 filing, attorney Richard Oney wrote te new oners never received permission to use the Bondurant name and filed a motion for damages from the proceeds the school has earned as the result of its use.
“The name ‘Bondurant’ is a household name in the world of motor car racing and sports” and has been since 1956, Olney wrote.
Stig “intentionally, willfully and maliciously misappropriated the commercial value” of the name, Oney alleged, contending the school owners’ “false statements on a world-wide basis” hurt Bondurant’s name in order to “lure the public into thinking its business is Bob Bondurant’s business, which it is not.”
Meanwhile, more surprises occurred in the bankruptcy case itself as Patricia Bondurant filed a new claim that triggered an avalanche of charges and countercharges in bankruptcy court throughout the summer and early fall.
She claimed the school owed her and her husband $975,000 million and that that debt might even escalate to $1.7 million in unpaid loans and back wages.
She also alleged that Stig had severely damaged two dozen high-performance cars, mostly Mazda Formula race cars.
Ramon Soberanes, the school’s garage supervisor, filed a sworn statement that said, “This is false.”
“For years, I and others in the shop were instructed to bandage or ‘cannibalize’ the Mazdas to keep them operating, which meant we would strip parts off of some of the Mazdas and install them on other Mazdas so we could keep as many of them running as possible,” Sobranes’ affidavit states. “This was no secret at the school and the Bondurants were aware of it.”
But Patricia Bondurant’s allegations went well beyond the condition of the vehicles.
A new attorney representing the Bondurants in the bankruptcy proceedings alleged that her son by a previous marriage and several top officers in the school “all engaged in a scheme to force a liquidation of the company.”
“They orchestrated a dissipation of the cash resourced of the company by giving large bonuses to the various key personnel of the company, draining the school funds down to the point of telling (the Bondurants) … that they either had to pay the payroll or the rent but there was not enough money to pay both.”
The complaint also portrayed the Bondurants as left in the dark at key junctures in the bankruptcy case.
They demanded that the court replace Timother Shaffer, the Scottsdale chief restructuring officer appointed to resolve the creditors’ claims.
Her attorney accused Shaffer of being disrespectful and rude and depriving her of the ability to investigate the creditors’ claims and “the opportunity to determine if
what they are owed, or better said, what they are claiming, is properly owed by the company.”
Shaffer fired back, stating, “The only time the Bondurants have shown up in the case has been to further their own interests to the detriment of the estate.”
He said the Bondurants – principally Patricia since her husband was virtually incapacitated – had objected to the school’s sale and that the creditors had no faith in her ability to respect their claims.
“She is not capable of distinguishing between her own desires and the needs of the estate,” Shaffer told the court.
He urged the judge to reject her attorney’s request for a new restructuring officer and instead appoint a U.S. trustee.
“The Bondurants are hopelessly conflicted between protecting the interests of creditors of the debtor’s estate and protecting their own personal interests and vendettas,” his petition said. “The only solution to resolve the conflict is to appoint an independent third party to safeguard creditor rights.”
On Oct. 22, Martin rejected the Bondurants’ request that Shaffer be replaced and dismissed a motion for sanctions against him.
A few days later, she appointed attorney Terry Dake as a trustee and set a hearing for Nov. 20 on Dake’s request to put the case into Chapter 7 bankruptcy, which would effectively end the Bondurants’ fleeting efforts to have any further say about repaying the debtors.
Shaffer also has indicated that the Bondurants and their son could be held liable for any debts not covered by the remaining money left from the time they owned the school.
“All that remains is (a) determining and paying the administrative claims, (b) determining and paying the priority and unsecured claims, and (c) determining what litigation claims, if any, need to be commenced and prosecuted by the estate,” Dake’s petition states. “There is nothing to be ‘reorganized.’”