Tuesday, May 18, 2010

Justice Friedman limits oral argument to issue of whether case involving Development Agreement should be transferred to Gerges in Brooklyn

Yesterday, I asked: will the Atlantic Yards Development Agreement--which gives far longer deadlines than officially proclaimed when the project was approved--get its day in court?

Well, it didn't happen today and it's looking less likely (though not impossible).

In a hearing that lasted little more than 20 minutes, Supreme Court Justice Marcy Friedman limited argument in the case, known as Peter Williams Enterprises, et al., vs. New York State Urban Development Corporation (aka Empire State Development Corporation, or ESDC), to questions of venue--whether the case even belonged in her court.

Her announcement at the start perked up ESDC attorney Philip Karmel and left the 15 or so project opponents in the audience somewhat frustrated. (Also in the audience, a few attorneys for Forest City Ratner, the meter ticking.)

Should she agree that it does, rather than move the case to a condemnation judge in Brooklyn who has ruled without question in the ESDC's favor, she'll then entertain arguments on the merits of the case.

(Sketch via Michael D.D. White's Noticing New York blog, which offers further commentary on the proceedings.)

In dispute

The plaintiffs argue that the ESDC should not have relied on the 2006 Determination and Findings (D&F) to exercise eminent domain but instead should have issued a new D&F describing the public use to be served by the project as of 2010, given that the Development Agreement, among other documents, points to a much longer buildout.

The ESDC says the case belongs before Supreme Court Justice Abraham Gerges because, should the plaintiffs prevail, it would affect the transfer of title he already approved.

If relief is granted, Karmel told the court, the ESDC would not be able to continue with the condemnation process--specifically removing two companies owned by Henry Weinstein from possession (though no longer ownership) of lots and a building at the corner of Carlton and Vanderbilt avenues.

It also "would serve judicial economy," Karmel said, "all the issues have already been argued before Justice Gerges." (He didn't exactly grapple with the Development Agreement, however.)

Moreover, said Karmel, a notice of appeal has been filed with respect to Gerges's condemnation order, setting up a situation in which that appeal would be heard by a different appellate court than the one that would hear an appeal of Friedman's decision.

(That case hasn't been appealed yet. If it is, it would have to be filed by October.)

Petitioners' case

Matthew Brinckerhoff, attorney for the petitioners, noted that one of them, The Gelin Group, occupies a house on Dean Street slated to be subject to eminent domain at a later date, and was not the subject of Gerges's decision.

Friedman asked whether The Gelin Group had standing, since the ESDC had pointed out that the family represented is not the owner of the house. Brinckerhoff said he had an affidavit from the owner, who assigned his right to The Gelin Group to defend against eminent domain. (Karmel later disputed it, but Friedman said her ruling would not be based on the issue of standing.)

He noted that the ESDC did not file any motion to dismiss the case when it was first filed in January, but rather waited until Gerges's decision.

Friedman's other case

Friedman, who in January held oral argument on a challenge--based on the State Environmental Quality Review Act, or SEQRA--to the 2009 Modified General Project Plan brought by several community groups and dismissed the case in March, said, "This [new] case is certainly not related to the SEQRA case."

Given that motions have been filed for Friedman to rehear the latter case, again based on the Development Agreement, it is, arguably, and Brinckerhoff tried to say so.

"I don't think that this case in in any way related to the SEQRA challenge," responded Friedman, with world-weary skepticism. "This involves findings leading to condemnation. I see them as totally different."

Brinckerhoff added a layer of diplomacy. "I hear what the court is saying," he said.

Friedman allowed that he had a good-faith basis to say they're related, but she disagreed.

Brinckerhoff tried to make his point, but also returned to the argument that Gelin has every right to be in Friedman's court.

He also urged Friedman to consider the issue of "public perception" in moving the case to Brooklyn.

Karmel defended the ESDC's motion, saying that it was made in a timely manner, only after Gerges's decision on title complicated the case.

Bottom line

Friedman said she'd rule on the venue issue shortly and, should she keep the case in Manhattan, she'd schedule oral argument on the merits of the case within two weeks.

Brinckerhoff asked for one more bite at the apple. "The Gelin Group has absolutely the right to have its case heard here," he asserted.

Friedman, slightly peeved at Brinckerhoff for trying to squeeze in another argument, gave Karmel a chance to respond. He passed.

The other Williams case


Though Peter Williams has his name on the case heard today, he and two other plaintiffs, Daniel Goldstein and Freddy's Bar, left the case after reaching settlements regarding their property.

Brinckerhoff said afterward that a separate case involving an easement owned by Peter Williams is still pending.

However, that didn't stop the ESDC from declaring vacant possession, setting the stage for the transaction in which Russian billionaire Mikhail Prokhorov bought 80% of the team and 45% of the arena holding company.

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