The legal battle between the city of Holmes Beach and the Bali Hai Beach Resort is ongoing.
But the resort claimed a recent victory.
Judge Charles Sniffen of the 12th Judicial Circuit dismissed Jan. 5 the city’s second amended counterclaim in a lawsuit that sought injunctive relief against the resort for continuing to operate a spa and bar/lounge despite a posted stop work order.
The city has until Feb. 4 to amend the claim.
Bali Hai, 6900 Gulf Drive, Holmes Beach, opened in 1971 and was purchased by developer Shawn Kaleta in 2019 for about $20 million. He’s since completed extensive renovations, including improvements to a small two-story spa and bar/lounge.
The city, claiming the resort is not permitted to operate a bar, issued a stop work order for construction on the property in January 2020, citing a lack of permits and failure to submit an updated site plan.
Attorney Louis Najmy of the Bradenton-based Najmy-Thompson law firm, representing the resort, has said the business was allowed to operate a bar/lounge when it was purchased and the allowance should have continued under Kaleta’s ownership.
Ownership filed a site plan detailing changes and adding the accessory uses. However, the city commission voted last October to approve a plan that prohibits live music, special events and the bar/lounge, and allows the spa for guests only.
The dispute has led to several lawsuits between the city and business, culminating in a federal lawsuit filed Dec. 31 against the city, claiming the city has run a “black-ball campaign” against Kaleta that has resulted in more than $3 million in damages.
Kaleta owns other properties in the city, including the Coconuts Beach Resort, the Islands West Resort, 305 73rd St. and 102 48th St., which have been the focus of other interconnected legal battles with the city.
Najmy told The Islander Jan. 6 that Sniffen’s order showed the city couldn’t underestimate the resort’s claims.
“It’s sort of just a second warning to the city that there are things out there they’re not going to be able to wrestle out of,” he said.
Najmy added that the ruling also could support the resort’s federal lawsuit against the city, which he said was the business’ “only avenue” for recourse.
“A city with normal intentions doesn’t take all those actions to keep creating and reinterpreting additional requirements for the general public, only when they’ve got some specific animosity towards an individual,” he said. “I think the mounting evidence suggests that everything they do against Shawn Kaleta is done in an arbitrary and capricious manner.”
Najmy also said that since filing the federal lawsuit, former city employees have contacted him to corroborate such behavior. However, he said he could not share details because the investigation is ongoing.
City attorney Erica Augello did not respond to a Jan. 6 call from The Islander.
City code enforcement officers posted eight violations Jan. 7 at the resort, including:
- Renting golf carts and low-speed vehicles without city approval for an accessory use;
- Operating a bar/lounge and spa without a valid business tax receipt from the city;
- Continuing to work after a stop-work order had been served to the property;
- Replacing air conditioning in pool/laundry building without permit;
- Change in use/occupancy and operating a bar/lounge without an approved site plan;
- Completing electrical work/remodeling in pool/laundry building without permit;
- Construction on second floor of building without a permit;
- Plumbing work/remodeling done in pool/laundry building without permit.