Confidential
Settlement – $900,000Court
L.A. Superior Central West
Attorneys
Plaintiff
Defendant
Jeffrey M. Oderman
(Rutan & Tucker LLP)
Facts
In 1989, the plaintiff developer entered into a contract with the defendant redevelopment agency whereby the plaintiff agreed to acquire land and build a commercial retail shopping center and the defendant agreed to provide financial assistance in the way of tax increments and sales tax reimbursements. The plaintiff developer built the shopping center and claimed the defendant city refused to pay the promised financial incentives, having pledged or given the money for another use. The defendant claimed the plaintiff did not complete some of the free-standing building pads. The plaintiffs, the developer and the owner of the shopping center brought this action against the defendants, the city and the redevelopment agency, based on breach of contract, tort and civil rights theories of recovery alleging that the redevelopment agency and city had wrongfully jeopardized the defendants' ability to make the required payments to the plaintiffs by selling bonds that pledged the same revenues to bondholders and by imposing a moratorium to prevent the lease up of a large portion of the shopping center. The defendant redevelopment agency then brought a cross-action against the plaintiffs based on breach of contract due to the plaintiffs' alleged failure to complete the shopping center. The defendant redevelopment agency withheld payments that otherwise would have been due to the plaintiffs in the absence of such a breach.
Settlement Discussions
Per the plaintiffs, in September 1995, the plaintiffs offered to settle for $1 million, plus non-monetary concessions and payment of the owed taxes. The defendants made no settlement offer.
Damages
The plaintiffs claimed $7 million, $10 million or $32 million in damages, depending on whether the remedy was contractual, tort or rescission. The redevelopment agency claimed almost $1 million in damages in its cross-complaint, contending that it had the right to terminate the contract and discontinue making payments to the plaintiffs thereunder.
Other Information
The settlement was reached approximately three years after the case was filed. A settlement conference was held on May 5, 1996, before Judge Satt of Los Angeles Suprior Court resulting in the reported stipulated judgment.
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