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Legal Matters: Settled – Resort to pay Garden Foundation

By Stephen Floyd

A lawsuit against the Oregon Garden Foundation by the owner of the Oregon Garden Resort has been settled after three years of litigation.

Parties agreed to terms Aug. 29 during a settlement hearing in Marion County Circuit Court including a financial payout to the foundation and the return of online login credentials.

The case was otherwise scheduled for trial Oct. 16.

Foundation Board Chair Ken Hector told Our Town they would not be disclosing details of the financial settlement, except that payment was due in 24 monthly installments starting in October. He said the foundation is “pleased that this is over and done with,” and looks forward to moving on.

Dirk Winter, owner of Moonstone Garden Management Inc., parent company of Oregon Garden Resort, said they are also looking toward the future.

“The Resort is always interested in helping the Garden grow into an outstanding world-class garden,” said Winter. “We want to see it thrive.”

Moonstone took the foundation to court in August of 2020 amid a dispute over whether or not the company was in violation of a management agreement for The Oregon Garden. 

Moonstone began managing the garden in 2008 through an agreement with the foundation and the City of Silverton, which was also a defendant in the suit. 

That same year Moonstone opened Oregon Garden Resort, a private business next to the garden which the company owns and operates independent of the garden.

Moonstone claimed the foundation and city failed in their obligations to promote the garden and support the company, and accused them of unjust enrichment. It claimed, since 2008, the foundation received $944,794 in shared guest revenue and the city $2.3 million in occupancy taxes, while Moonstone incurred $3.6 million in debt.

The company ultimately defaulted on this debt and in November of 2020 management of the garden was passed to the foundation, which operates the facility today. According to Hector, this transition was bumpy as Winter kept the garden’s Facebook, Instagram and URL login credentials, and had moved the annual Christmas Market from the garden to the resort.

Back in court, defendants denied wrongdoing and claimed Moonstone violated the management agreement by failing to adequately staff and maintain the garden. The foundation further countersued for $1 million, claiming Moonstone owed outstanding profit shares and allegedly damaged garden facilities.

The settlement nullified the terms of the management agreement and all parties have agreed to hold each other harmless from further claims. 

Winter agreed to turn over the garden’s online login credentials, which Hector said will make “a huge difference.” The Christmas Market will remain at the resort, while Hector said the foundation is considering its own holiday event at the garden similar to what was held in the past.

In a separate settlement with Silverton, Moonstone agreed to build a sidewalk on city-owned property connecting the resort to the garden, with the city contributing $1,000 to the project.

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