Court Fight in Fabulous Inns Case Continues

SAN DIEGO —  The current management of embattled Fabulous Inns of America on Thursday appealed a Superior Court order to relinquish control of the company to the executives they ousted last year.

The appeal is the latest round in an ongoing fight for control of the small but profitable Mission Valley hotel company. It remains uncertain, however, whether the appeal will actually delay an order issued Tuesday by Superior Court Judge G. Dennis Adams. He ordered that the directors representing the ousted management--elected during a disputed special shareholders meeting last summer--be seated May 12.

Adams ruled that last summer’s meeting was valid and overruled a recommendation by mediator C. Hugh Friedman that a new election be held without the disputed board assuming power.

Ordered New Election

Adams also ordered that a new election be held July 10 and stipulated that former Chairman Henry Maxwell, former President Walter L. Palmer and former director and Chairman Ernest M. Stanley be barred from serving as directors or executives of Fabulous Inns.

Attorneys for current management, led by Chairman Jeffrey R. Krinsk, a former dissident shareholder, believe that their appeal and a writ they plan to file today or Monday will serve to stay Adams’ order.

But attorneys representing the ousted management contend that it will not.

Friedman oversaw 10 weeks of hearings examining the ownership dispute, sifting through 3,000 pages of trial transcripts and about 400 exhibits.