Some investors say Billy Bob’s Texas is at the center of a feud over how to develop the Fort Worth Stockyards. Tom Pennington Star-Telegram archives
Some investors say Billy Bob’s Texas is at the center of a feud over how to develop the Fort Worth Stockyards. Tom Pennington Star-Telegram archives

Fort Worth

Billy Bob’s Texas a ‘pawn’ in Stockyards development

July 24, 2017 09:06 PM

UPDATED July 24, 2017 11:53 PM

FORT WORTH

Dallas Mavericks President Donnie Nelson said Monday that the management of Billy Bob’s Texas is being used as a pawn in the development of the historic Stockyards, a situation he described as embarrassing.

Nelson, who owns roughly a 10 percent stake in the world’s largest honky-tonk, said he didn’t agree with efforts by the majority ownership to change management of the 127,000-square-foot entertainment venue and blamed people who are “real estate crazy” with creating the discord.

“We wouldn’t be here today if there wasn’t a real estate issue,” Nelson said after testifying at a court hearing. “That is when all this stuff started hitting the fan.”

The minority ownership is seeking a receivership to help break a crippling deadlock among the owners over how to run the iconic honky-tonk.

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Last I checked Billy Bob’s ownership group got along just fine for multiple generations and all of a sudden an opportunity shows up [to develop the Stockyards] and people get real estate crazy.

Donnie Nelson, Billy Bob’s Texas investor

“Last I checked Billy Bob’s ownership group got along just fine for multiple generations and all of a sudden an opportunity shows up and people get real estate crazy,” Nelson said. “We’ve got a difference of opinion on how the Stockyards should be developed that Billy Bob’s is being used as a pawn for interests outside the entertainment realm. I think that is not right.”

Dallas Mavericks President Donnie Nelson owns about 10 percent interest in Billy Bob’s Texas in Fort Worth.
Khampha Bouaphanh Star-Telegram archives

While brewing for years, the schism among the owners of Billy Bob’s broke into public view in May when a majority of the owners decided to fire manager Concho Minick for allegedly mismanaging the bar over the years, as well as disagreeing with some of his plans for developing the Billy Bob’s brand.

Minick, along with Murrin Brothers 1885, sued the majority owners after they attempted to fire him. He has continued to operate the bar under a temporary restraining order that preserves the status quo. They are seeking a temporary injunction to keep Minick at Billy Bob’s until their differences are resolved.

The lawsuit has pitted old drinking buddies against each other. Billy Minick, the former manager of the bar and Concho Minick’s father, is among those who sought to strip his son of Billy Bob’s reins in May.

The majority owners are led by Brad Hickman — whose family owns about 40 percent of the bar — the prime mover for the $175 million reimagining of the Stockyards along with the Majestic Realty Group.

But others have said the bitter feud among the owners — many of whom have been involved with Billy Bob’s since the 1980s — began when Hickman brought Majestic into the redevelopment effort about five years ago.

In 2013 the minority owners, who included the Murrin family that owns about 22 percent of Billy Bob’s, say they were blocked in developing a Billy Bob’s Texas Hotel after Hickman voiced opposition. Tension rose among the owners after Minick publicly voiced his concerns about the Stockyards development.

I think there are real fundamental issues on the management standpoints.

Marshall Searcy, attorney for the majority owners

Marshall Searcy, the attorney for the majority owners, rejected Nelson’s assessment that the lawsuit was spurred by the Stockyards project. He has described Minick and his backers as a “mercenary minority” that has threatened to liquidate Billy Bob’s at an auction. He has called the Minick lawsuit a “grim power play.”

“I disagree. I think there are real fundamental issues on the management standpoints,” Searcy said in an interview after court adjourned for the day.

Fundamental governance issues were at the heart of most of the hearing in state District Judge Michael Wallach’s court Monday.

Concho Minick, left, is seeking a receiver to help mediate the differences among the ownership of Billy Bob’s Texas.
Rodger Mallison Star-Telegram archives

Minick, Nelson and other minority owners believe Billy Bob’s is governed by a 2011 corporate agreement that states that it takes a unanimous board agreement to approve all major operating decisions. Hickman and others point to a certificate of formation that grants control to a smaller governing board.

Concho Minick testified that Billy Bob’s has thrived with him in the saddle and working under the corporate agreement. Billy Bob’s revenues have doubled during the last six years, to an average of $2.1 million a year, when compared to the six years before he took over in 2011. During testimony it was also reported that the honky-tonk has enjoyed $20 million in gross revenues over the past few years.

It was that kind of growth and activity — along with a longstanding love of country music — that convinced Nelson to invest in Billy Bob’s. He also bought his stake in the company in 2013 from veteran investor Don Jury because he was told he would have an equal voice in how the bar was being run.

“I would not have invested in Billy Bob’s without it,” said Nelson, who also owns a minority stake in Gilley’s Club in Dallas. “It incentivized it. ... I would not have purchased the stock without having a say.”

As a result, he found it “deeply disturbing” that he was not consulted in the termination of Minick, a move he didn’t support because of the record-setting growth in revenues. He said if Minick did stumble in management, those actions were “misdemeanors” that didn’t warrant him being fired.

Outside the courtroom, Nelson laid the discord at the doorstep of development. While he considered himself a supporter of a Stockyards rebuilding, he also called Billy Bob’s the “Grand Ole Opry of Texas,” something that needs to be protected. He thinks that no matter what happens, Billy Bob’s will thrive.

“I think it is unfortunate that we are being put into this position by a difference of opinion on how the Stockyards should be developed,” Nelson said. “I think it is a shame and I’m actually embarrassed to be here because we can’t find some middle ground on how the Stockyards should be developed.”

Max B. Baker: 817-390-7714, @MaxbakerBB