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Contingencies | 3 Months Ended
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Mar. 31, 2022
Commitments And Contingencies Disclosure [Abstract] |
Contingencies | Note 11 – Contingencies Securities Litigation The Company and certain of its officers and directors were named as defendants in three putative securities class action lawsuits (collectively, the “Securities Class Action Litigation”), each filed in the United States District Court for the Eastern District of Tennessee, on behalf of all persons who purchased or otherwise acquired the Company’s securities during a specified period of time. Those cases were consolidated on July 17, 2019, under the caption In re CBL & Associates Properties, Inc. Securities Litigation, 1:19-cv-00149-JRG-CHS, and a consolidated amended complaint was filed on November 5, 2019, seeking to represent a class of purchasers from July 29, 2014 through March 26, 2019. The operative complaint filed in the Securities Class Action Litigation alleges violations of the securities laws, including, among other things, that the defendants made certain materially false and misleading statements and omissions regarding the Company’s contingent liabilities, business, operations, and prospects during the periods of time specified above. The plaintiffs seek compensatory damages and attorneys’ fees and costs, among other relief, but have not specified the amount of damages sought. On May 3, 2022, the court dismissed the Company from the Securities Class Action Litigation but declined to dismiss the individual defendants. The court also lifted the stay of the proceedings and instructed the parties to confer on a proposed schedule. The outcome of these legal proceedings cannot be predicted with certainty. The Company's insurance carriers remain on notice of the Securities Class Action Litigation. The Company is currently involved in certain other litigation that arises in the ordinary course of business, most of which is expected to be covered by liability insurance. Management makes assumptions and estimates concerning the likelihood and amount of any potential loss relating to these matters using the latest information available. The Company records a liability for litigation if an unfavorable outcome is probable and the amount of loss or range of loss can be reasonably estimated. If an unfavorable outcome is probable and a reasonable estimate of the loss is a range, the Company accrues the best estimate within the range. If no amount within the range is a better estimate than any other amount, the Company accrues the minimum amount within the range. If an unfavorable outcome is probable but the amount of the loss cannot be reasonably estimated, the Company discloses the nature of the litigation and indicates that an estimate of the loss or range of loss cannot be made. If an unfavorable outcome is reasonably possible and the estimated loss is material, the Company discloses the nature and estimate of the possible loss of the litigation. Based on current expectations, such matters, both individually and in the aggregate, are not expected to have a material adverse effect on the liquidity, results of operations, business or financial condition of the Company. Environmental Contingencies The Company evaluates potential loss contingencies related to environmental matters using the same criteria described above related to litigation matters. Based on current information, an unfavorable outcome concerning such environmental matters, both individually and in the aggregate, is considered to be reasonably possible. However, the Company believes its maximum potential exposure to loss would not be material to its results of operations or financial condition. The Company has a master insurance policy that provides coverage through 2022 for certain environmental claims up to $10,000 per occurrence and up to $50,000 in the aggregate, subject to deductibles and certain exclusions. At certain locations, individual policies are in place. Guarantees The Operating Partnership may guarantee the debt of a joint venture primarily because it allows the joint venture to obtain funding at a lower cost than could be obtained otherwise. This results in a higher return for the joint venture on its investment, and a higher return on the Operating Partnership's investment in the joint venture. The Operating Partnership may receive a fee from the joint venture for providing the guaranty. Additionally, when the Operating Partnership issues a guaranty, the terms of the joint venture agreement typically provide that the Operating Partnership may receive indemnification from the joint venture partner or have the ability to increase its ownership interest. The guarantees expire upon repayment of the debt, unless noted otherwise. The following table represents the Operating Partnership's guarantees of unconsolidated affiliates' debt as reflected in the accompanying condensed consolidated balance sheets as of March 31, 2022 and December 31, 2021:
|  | As of March 31, 2022 |  |  | Obligation recorded to reflect guaranty |
Unconsolidated Affiliate |  | Company's Ownership Interest |  |  | Outstanding Balance |  |  | Percentage Guaranteed by the Operating Partnership |  |  |  | Maximum Guaranteed Amount |  |  | Debt Maturity Date (1) |  |  | March 31, 2022 |  |  | December 31, 2021 |
West Melbourne I, LLC - Phase I |  | 50% |  |  | $ | 38,691 |  |  | 50% |  |  |  | $ | 19,345 |  |  | Feb-2025 | (2) |  | $ | 193 |  |  | $ | 195 |
West Melbourne I, LLC - Phase II |  | 50% |  |  |  | 13,743 |  |  | 50% |  |  |  |  | 6,872 |  |  | Feb-2025 | (2) |  |  | 69 |  |  |  | 69 |
Port Orange I, LLC |  | 50% |  |  |  | 51,073 |  |  | 50% |  |  |  |  | 25,536 |  |  | Feb-2025 | (2) |  |  | 255 |  |  |  | 258 |
Ambassador Infrastructure, LLC |  | 65% |  |  |  | 7,001 |  |  | 100% |  |  |  |  | 7,001 |  |  | Mar-2025 |  |  |  | 82 |  |  |  | 83 |
Shoppes at Eagle Point, LLC |  | 50% |  |  |  | 33,585 |  |  | 35% |  | (3) |  |  | 12,740 |  |  | Oct-2022 |  |  |  | 127 |  |  |  | 127 |
Atlanta Outlet JV, LLC |  | 50% |  |  |  | 4,437 |  |  | 100% |  |  |  |  | 4,437 |  |  | Nov-2023 |  |  |  | — |  |  |  | — |
Louisville Outlet Shoppes, LLC |  | 50% |  |  |  | 7,947 |  |  | 100% |  |  |  |  | 7,947 |  |  | Oct-2022 |  |  |  | — |  |  |  | — |
Total guaranty liability |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  | $ | 726 |  |  | $ | 732 |
(1) | Excludes any extension options.
(2) | These loans have a one-year extension option at the joint venture’s election.
(3) | The guaranty is for a fixed amount of $12,740 throughout the term of the loan, including any extensions. Subsequent to March 31, 2022, the joint venture entered into a new non-recourse loan, which removed the guaranty. See Note 14 for additional information.
For the three months ended March 31, 2022, the Successor Company evaluated each guaranty, listed in the table above, individually by evaluating the debt service ratio, cash flow forecasts and the performance of each loan. The result of the analysis was that each loan is current and performing. The Successor Company did not record a credit loss related to the guarantees listed in the table above for the three months ended March 31, 2022. For the three months ended March 31, 2021, the Predecessor Company evaluated each guaranty, listed in the table above, individually by evaluating the debt service ratio, cash flow forecasts, the performance of each loan and, where applicable, the collateral value in relation to the outstanding amount of the loan. The result of the analysis was that each loan is current, performing and, where applicable, the collateral value was greater than the outstanding amount of the loan. The Predecessor Company did not record a credit loss related to the guarantees listed in the table above for the three months ended March 31, 2021.

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