Fashion retailer Peter Nygard faces jail time in the Bahamas in a dramatic escalation of his long-running feud with a billionaire neighbour over parties and construction at his island vacation property.
Mr. Nygard, Winnipeg-based owner of the eponymous 170-store women’s clothing chain, was sentenced to 90 days in jail and fined US$150,000 last Friday by the Supreme Court in the Commonwealth of the Bahamas. He is currently in Canada.
It was the latest in a series of legal and personal setbacks for the 77-year-old that started more than 14 years years ago as a squabble with next-door neighbour Louis Bacon, a New York hedge-fund founder. Mr. Bacon took on Mr. Nygard over the latter’s habit of throwing massive parties and expanding his six-acre, Mayan-themed estate by dredging sand from the ocean floor.
Mr. Bacon is a director and major backer of a Bahamas-based environmental group called Save The Bays. The Bahamian jail sentence came after Mr. Nygard was found to be in contempt of court for violating an injunction barring him from publishing e-mails, which were stolen from Save The Bays, in another, related court fight in New York with Mr. Bacon.
“I would characterize this decision as unfair, unreasonable, unnecessary and unheard of under the law,” said Jay Prober, Mr. Nygard’s Winnipeg-based lawyer. In an interview Monday, he said Mr. Nygard plans to appeal the ruling, from Canada. Mr. Prober said the jail sentence stems from a civil legal proceeding and the government of the Bahamas lacks the rendition rights needed to force Canadian authorities to send Mr. Nygard to the islands.
Mr. Nygard, who did not appear at Friday’s hearing, was ordered by the Bahamian court to make a full written apology, explain his absence and give an undertaking to discontinue the use of the e-mails within seven days. He must also pay a US$5,000 fine for every day that he doesn’t comply with these orders. The US$150,000 fine must be paid within the next seven days or he will be sentenced to an additional 30 days in prison and a further US$5,000 for every day it remains unpaid.
Mr. Nygard bought a modest beach bungalow in the Bahamas in 1984 for US$1.76-million. He then began renovating, eventually building a 32,000-square-foot main hall and 6,000-square-foot sauna billed as the world’s largest. Mr. Nygard calls his property a “Robinson Crusoe playground” and it was featured in episodes of the television show Lifestyles of the Rich and Famous. Vanity Fair magazine noted that the retreat features stone cobras that hiss steam and giant urns that belch smoke, like volcanoes, and bashes ran to 2,000 guests.
The parties sparked problems with neighbours. Mr. Bacon bought the property next door in 1994 for US$5.9-million and initially complained about his neighbour’s loud music. The complaints escalated to a fight over dredging and the launch of Save The Bays. In the time since Mr. Nygard bought his property, his piece of land has almost doubled in size.
In recent years, Mr. Nygard faced one reversal of fortune after another in the Bahamas. In 2009, his property’s main hall burned down in an electrical fire. In 2013, local authorities blocked Mr. Nygard from dredging sand. Last September, the Bahamian court seized Mr. Nygard’s estate over his failure to pay more than US$3-million in legal fees owed to Save The Bays. He regained control of the property two months later after paying the fees.
Other Save The Bays backers include local business leaders, former U.S. Treasury secretary Nicholas Brady and actor Sean Connery, who filmed James Bond movies on Bahamas beaches and now has a home on the islands.