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Court papers hint at heated eminent domain arguments in court tomorrow

According to the legal memoranda filed in the Atlantic Yards eminent domain case, the hearing tomorrow at 2 p.m. in Brooklyn federal court should be a lively one.

The defendants--city and state officials, the Empire State Development Corporation (ERSDC), and developer Forest City Ratner--are asking the court to dismiss the case, while the 13 plaintiffs--owners and tenants within the proposed project footprint--want the case to proceed so the court can order discovery, or the exchange of documents.

A work of fiction?

Forest City Ratner's most recent memorandum of law, filed 1/19/07, begins, "Plaintiffs' opposing memorandum is engagingly written, but that is true of many works of fiction."

The Empire State Development Corporation's (ESDC) memo charges, "What they seek, ultimately, is the judicial defeat of a public development project that has garnered the support of a wide range of elected officials." The ESDC calls the plaintiffs' allegations "conclusory, self-serving, hyperbolic and... gravely irresponsible."

The ESDC criticizes the plaintiffs' sequencing formulation--that "deference is warranted only where the legislature first concludes that developing a given area will benefit the public, then identifies the specific properties to be seized to advance that predetermined purpose, and then engages in a fair and open bidding process"--would "undermine" the state's legislative scheme, and should not be changed by the courts.

The defendants get the last word in the legal papers, but plaintiffs' attorney Matthew Brinckerhoff, asked to comment, countered, "Our legal analysis is fully consistent with the cases. All we did was suggest an analytical framework for organizing and examining the law in this area, i.e., a skeleton to hang the meat on."

State case

The ESDC also argues that the plaintiffs should not be allowed to add a state eminent domain law challenge to the federal case, saying that it would lead to a scenario in which the federal courts were flooded with claims from anyone threatened by a condemnation. The plaintiffs, allowed to respond 1/26/07 only regarding that narrow aspect, say in a memo that the defense ignores important precedent.

The ESDC argues that the case actually isn't ripe, since the scope of the project and the area to be condemned could change as a result of other court proceedings, "altered financial circumstances, or the mere passage of time." The ESDC notes that in other cases, such as Westway, only some properties were condemned before the project was stymied.

FCR's argument

Forest City Ratner lawyers argue that the plaintiffs rely on cases in which eminent domain apparently benefits only private parties, but reiterate that Atlantic Yards "contains the following essential components that have long been recognized as public uses": an arena, housing, transit improvements, open space, and the elimination of blight.

They cite a 1984 Supreme Court decision that says a court should not substitute its judgment "for a legislature's judgment as to what constitutes a public use." Whether the ESDC--a public authority created by a legislature--is truly a legislative agency may be argued in court.

Public review

FCR contends that the eminent domain findings "have been made here at the conclusion of a long public review process that included a public hearing before ESDC as well as numerous public meetings before other agencies, including the City Planning Commission."

(I'm not aware of other public meetings before agencies. The planning commission's meeting in September was highly scripted, and showed the commissioners generally uninformed.)

FCR argues that two Memoranda of Understanding signed 2/18/05, which the plaintiffs cite as the basis for asserting a predetermined outcome, don't constitute proof. For example, one MOU required approval by the ESDC and "review and acceptance" by the planning commission, and was nonbinding.

(While few doubted that ESDC and the planning commission would favor Atlantic Yards, it may not be easy to prove that. Then again, Mayor Mike Bloomberg, a year earlier, had said,
Then, we’ve got to find a find a ways--Bruce Ratner’s got to find a ways--to build this complex in Brooklyn.)

Kelo effects

Both the ESDC and FCR take aim at the plaintiffs' contention that the Supreme Court's 2005 Kelo eminent domain decision requires a heightened scrutiny of this case, arguing that, while Kelo concerned economic development, Atlantic Yards regards the removal of blight.

As for Justice Anthony Kennedy's concurrence, which set up some apparent standards for eminent domain takings, FCR lawyers contend they don't apply. Kennedy pointed to "the context of a comprehensive development plan;" FCR argues that "ESDC's exercise of eminent domain is part of a comprehensive development plan."

That's likely in dispute. While ESDC certainly held a hearing and issued findings, and an urban renewal area covering part of the footprint had existed for 40 years, there was no preexisting planning process or request for proposals for the project site itself.

Beneficiaries unknown?

Kennedy wrote that, in Kelo, "The identity of most of the private beneficiaries were unknown at the time the city formulated its plans." Brinckerhoff commented, "Every case where the courts have deferred to legislative judgments on eminent domain concerned a taking that was deemed necessary to accomplish a public purpose before the developer/beneficiary was known."

FCR lawyers argue, in a bit of a stretch, that Atlantic Yards would not simply be the transfer of property from private parties to another private party, pointing out that "major portions of the project will remain under public ownership," the city would own or lease space in one building for a school, and the publicly accessibly open space would be owned by a not-for-profit entity.

Unmentioned is that the developer would benefit from naming rights at the "publicly owned" arena. Also, according to the Final EIS, The proposed open space would be owned by a conservancy or other not-for-profit entity established by the project sponsors. In a footnote, FCR lawyers add that no one knows the identities of those renting or buying the apartments.

State response

The city and the state each seek to have city officials and former Gov. George Pataki dismissed from the case. The state's memo notes that Pataki left office before the properties had been taken, that he wasn't personally involved in the issue, and anyway, he should have immunity from the suit.

Lawyers for the state, in their 1/19/07 memo, deny the claim that Pataki "wholly controlled" the ESDC, noting that several cases point out that the ESDC and other public benefit corporations operate independently, despite the Governor's appointment process. (The 15-minute approval of the Atlantic Yards project probably wasn't a shining moment of independence.)

City claims

The city's 1/19/07 memo states, "Plaintiffs' conclusory allegations of conspiracy are simply not sufficient to preclude dismissal." The city argues that, because none of the city defendants are parties to the condemnation being undertaken by the ESDC, they shouldn't be liable.

In the memo, attorneys also argue that the city's $100 million capital commitment (now apparently $205 million) and its agreement to convey city streets to the state don't link the city to the condemnations. "The proposed condemnation of plaintiffs' property is only one small part of the Atlantic Yards project," the memo states.

That may be true, but it would be impossible to proceed with the initial phase--the arena block--without the property of some of the 13 plaintiffs. That's why there's so much at stake in this case.

Brinckerhoff commented, "The proposition we're asserting is very modest. The known facts give rise to a reasonable suspicion that a private purpose is drove this deal. All we're saying is that, given these unique facts, aren't we the people, we the residents and property owners in the footprint, entitled to scrutinize the decision-making process to make sure that it passes muster? We're just asking that our public officials be accountable." The defendants, of course, argue that the plaintiffs are going too much too far.

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