Looking back at the legal battles: the eminent domain cases over nearly three-and-a-half years

The legal battles regarding the Atlantic Yards project are epic and, while nearing conclusion, hardly over. Here are some flashbacks to the arguments over eminent domain, first in federal court, later in state court.

I'll write at another time about the other cases, including those challenging the Empire State Development Corporation's (ESDC) environmental review, the revised Metropolitan Transportation Authority deal for the Vanderbilt Yard, and the ESDC's approval of the 2009 Modified General Project Plan.

Legal papers are posted on Develop Don't Destroy Brooklyn's web site.

Federal lawsuit announced: October 2006

The first eminent domain lawsuit was announced on 10/27/06, some six weeks before the Atlantic Yards received its final--or so we thought--approval. I wrote:

Lead attorney [Matthew] Brinckerhoff called the planned project a violation of the 2005 Supreme Court decision in the Kelo v. New London case: “This lawsuit presents a textbook example of what the Fifth Amendment expressly prohibits: the taking of one citizen’s property in order to benefit a powerful and influential private citizen.

First skirmish: November 2006

In a post headlined Eminent domain case gets day in court; public use, legislative process at issue, I wrote:

It was just a status conference, the first skirmish in a legal war, but two lines of argument emerged yesterday as lawyers in the case known as Goldstein v. Pataki, which challenges the use of eminent domain for the Atlantic Yards project, met in federal court in Downtown Brooklyn.

On the one hand, the plaintiffs (property owner Daniel Goldstein and nine others, owners and tenants, threatened with eminent domain) will be pressed to argue that the Atlantic Yards project would provide too little public use to meet the legal standard.

On the other, the defendants (Empire State Development Corporation, developer Forest City Ratner, and city and state officials including Governor George Pataki) must stretch to contend that the project was in fact considered by a legislative body, as evolving eminent domain law seems to require.

The parties were there to address two issues: a motion by the defendants to dismiss the case, and a request by the plaintiffs for discovery, the legal process under which a party to a case is compelled to provide relevant documents. But in essence they were discussing the whole case, which may break some new legal ground.

Preview of first hearing: February 2007

In a 2/6/07 post headlined Court papers hint at heated eminent domain argument in court tomorrow, I wrote:

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.

...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.

First District Court hearing: February 2007

Perhaps the most thoughtful legal argument came in the first hearing, a 2/7/07 hearing before federal Magistrate Judge Robert M. Levy, headlined “Public purpose” enters uncharted territory in marathon eminent domain “seminar”:

The marathon hearing in the Atlantic Yards eminent domain case yesterday at times felt like a law school seminar, as Magistrate Judge Robert M. Levy tossed hypothetical situations at lawyers for the plaintiffs and the defendants. Given a case that tests the boundaries of the law, Levy challenged them to suggest rules for determining when the balance of public and private purposes behind a project is so wrong that a court must intervene—and seemed unwilling to swiftly dismiss the case, as the lawyers for the defense hope. About 100 people listened intently in the federal courtroom in Downtown Brooklyn.

“I don’t think the fact that Forest City Ratner allegedly initiated” the project was crucial, [Forest City Ratner attorney Jeffrey Braun] said. “This is not Times Square, the crossroads of the world,” Braun said, referencing a previously-cited eminent domain case. “This is extremely derelict”—an assertion that drew angry gasps from the audience, which included a plurality, at least, of Atlantic Yards opponents who know that the blocks surrounding the Vanderbilt Yard have been the subject of notable, if uneven, development and that the value of property has been rising.

...The facts in the case, Brinckerhoff said, give rise to certain inferences. “The site was chosen and the map was drawn by Ratner,” he said. An MTA spokesperson had publicly said Forest City Ratner controlled the site long before any official bid.

The developer had responded to the MTA’s RFP but had not included the pro forma estimating its revenues and profits, as required. The Extell Development Corp. had bid $150 million for the railyard, but the MTA refused to meet with them, while Forest City bid $50 million—and later upped it to $100 million. (FCR contends that railyard improvements up the value of its bid.)

“We have our facts. They have theirs,” Brinckerhoff said. “What they can’t say is we’re creating a work of fiction when all we’re doing is compiling facts and suggesting a conclusion.”

And he scoffed at warnings that success in this case could open the floodgates to endless similar challenges. “Any competent government official will make sure not to set up a sequence of events like what happened here,” he predicted.

Brinckerhoff cited the issue—raised in this blog and by others—that the Atlantic Yards economic benefits would be much less than estimated, because the state’s projections “ignore a whole lot of public costs.”

“The standard is: was the primary motive to benefit Ratner?” Brinckerhoff asked. “How will we know until we know exactly what the benefit to the public is, and the benefit to Ratner?”

...As the hearing wound down, Levy presented [ESDC lawyer Douglas] Kraus with the brother-in-law example: “If there’s a public use and it benefited the brother-in-law, it wouldn’t violate the constitution?”

“That’s right,” Kraus responded. “It might violate state ethics laws. It might be an issue for the prosecutors.”

“If his client thinks this is a terrible process,” Kraus said of [plaintiffs' attorney Matthew] Brinckerhoff, “They can express themselves in the next election.”

First federal ruling: February 2007

Levy, however, stuck to narrow procedural issues. In a 2/24/07 article headlined Magistrate says eminent domain case belongs in state court, I wrote:

In a setback for plaintiffs in the Atlantic Yards eminent domain case, U.S. Magistrate Judge Robert M. Levy yesterday recommended that the federal case be dismissed without prejudice, leaving those challenging condemnations to do so in state court, where they would have less leverage to argue that the project results from a sweetheart deal.

Levy’s report and recommendations centered on narrow procedural grounds rather than the merits of Goldstein vs. Pataki, which occupied the majority of the lively 2/7/07 oral argument in the case.

...Near the end of his 42-page report, Magistrate Levy gave a respectful nod to the claims expressed in court earlier this month, in which Brinckerhoff argued that the benefits of the project were pretextual, and that the plaintiffs should be given the chance to prove that.

...In a coda to his decision, Levy wrote yesterday, "Plaintiffs’ Amended Complaint raises serious and difficult questions regarding the exercise of eminent domain under emerging Supreme Court jurisprudence, many of which were explored in some detail at oral argument. However, in light of my recommendation that this court abstain, it would be inappropriate to address plaintiffs’ claims on the merits."

...Levy then got to the crux of the matter: it’s easier to pry documents from the defendants in federal court. “Plaintiffs have good reasons for preferring federal court over state court, not the least of which is the lack of access to discovery in state court proceedings under the EDPL,” he wrote.

In a footnote, he offered an observation that, from the plaintiffs’ perspective, must be ominous: “As one court has explained, ‘under the EDPL, the [condemning authority] holds nearly all the cards, with any aggrieved party having little right to participate in the initial determination and limited right to judicial review thereafter.”

He agreed with the defense that a ruling in favor of the plaintiffs might send future litigants to federal court. “No prospective condemnee, given the choice, would opt for narrow, on-the-record (yet constitutionally adequate) review in the Appellate Division if all of the benefits of federal review were freely available,” he wrote.

The larger issues

In another footnote, Levy seemed to acknowledge the larger issues. “As a matter of public policy, the availability of discovery could reasonably be expected to promote a full and robust public debate and enhance the likelihood of rational decision-making,” he wrote. “However, the constitutionality of the EDPL is not in question in this litigation, and it is not the place of the federal courts to determine public policy in areas of state and local concern such as eminent domain.”

Preview of second hearing: March 2007

I wrote a prelude to the second hearing, held before U.S. District Judge Nicholas Garaufis. The arguments were narrow, so the headline was Procedural arguments return as eminent domain case hearing approaches:

Remember, Levy recommended that the case be dismissed and more properly filed in state court. However, he did so based on only one argument by the defense; he agreed with two other arguments by the plaintiffs, 13 property owners and tenants organized by Develop Don’t Destroy Brooklyn (DDDB), that the case should remain in federal court.

Thus, while the DDDB plaintiffs are asking Garaufis to overturn Levy’s one argument for dismissal, the defendants—the city, the Empire State Development Corporation, and developer Forest City Ratner—are not only backing Levy’s dismissal argument, but contending that he was incorrect in not dismissing the case on other grounds.

...Levy had disagreed with the defense contention that the case should be dismissed because the plaintiffs’ injuries weren’t sufficiently concrete to be considered ripe for judicial review. The pertinent question, he wrote, “is whether the challenged condemnation is final, imminent, or inevitable,” but acknowledged that those concepts remain “amorphous, open to interpretation, and at any rate highly fact-specific.”

The ESDC, however, continues to maintain that the claims aren’t ripe “at least until ESDC commences a proceeding for transfer of title.” The question, according to the ESDC memo, “is whether the alleged future deprivation is imminent and ‘certainly impending.’” Levy's recommended ruling, argues the defense, “threatens… to open the floodgates to the federal courts” because plaintiffs should be in state court.

The ripeness argument drew a scathing response from the plaintiffs’ lawyers: “The upshot of Defendants’ argument is that this case is rendered unripe simply because an imaginative person could post an alternate universe in which Defendants will suddenly have an epiphany—recognizing that the Public Use Clause and fundamental notions of representative government are incompatible with their abuse of the power of eminent domain to consummate a private business deal—and decide to scotch the Project. Anything is possible, after all.”

Second District Court hearing: March 2007

My (secondhand) coverage on 3/31/07 was headlined Eminent domain case gets serious consideration in court (but the press mostly passes):

Apparently most of the press missed another doozy of an oral argument yesterday in federal court regarding the Atlantic Yards eminent domain case. U.S. District Judge Nicholas Garaufis considered some defense arguments skeptically, as he devoted more than three hours (including break) to the hearing.

Also, though there were no additional briefs on the issue, Garaufis spent a significant amount of time hearing arguments about the substance of the case, as he considered the defense motion that the case should be dismissed because of a failure to state a valid claim. He also expressed some skepticism about the political process that led to project approval--though that may not have significant bearing on the plaintiffs' charges.

A longer look at the March 2007 hearing

I followed up with a much longer look at the hearing, based on the transcript, in a 4/10/07 piece headlined Another look at the eminent domain hearing: signs point both ways.

I wrote:

Remember, the 13 plaintiffs organized by Develop Don’t Destroy Brooklyn (DDDB) were fighting an uphill battle; Magistrate Judge Robert M. Levy had already recommended that the case be dismissed from federal court, because it would interfere with proceedings that should better be heard in state court, based on a precedent known as Burford v. Sun Oil. The plaintiffs were arguing that Levy was wrong, that the federal court should not sit this out, that it wasn’t crucial for only state courts in New York to handle eminent domain cases.

In some ways, it looked good for the plaintiffs, renters and property owners in the southern section of the Atlantic Yards footprint, on Pacific and Dean streets below the Metropolitan Transportation Authority’s (MTA) Vanderbilt Yard. Garaufis (right) seemed somewhat receptive to their argument that Levy was wrong on Burford. And he seemed unreceptive to arguments by the defendants—the Empire State Development Corporation (ESDC), Forest City Ratner (FCR), and representatives of Mayor Mike Bloomberg and former Governor George Pataki—that Levy erred in declaring the plaintiffs’ claims ripe for adjudication.

But Garaufis also cut to the chase, hearing significant arguments on the substance of the Goldstein v. Pataki, given the defendants’ motion to dismiss the case based on a failure to state a legitimate claim. To move to trial, the plaintiffs must offer the court some measure of evidence that Atlantic Yards is a sweetheart deal, that the public benefits are pretextual, incidental to the private benefits accruing to developer Bruce Ratner. But there certainly would be some public benefits, and the ESDC argued that the inquiry should end there.

...[Forest City Ratner attorney Jeffrey] Braun pointed out that the eminent domain determination was actually made by the ESDC’s board of directors, representing a political subdivision of the state. (He didn’t mention some details: only four--a bare majority--were present, and they took 15 minutes, showing little understanding of the project.) The PACB, he noted, approved the state financial contribution of the project—which was a crucial green light.

“Are you a proper defendant here?” Garaufis asked. “Should you be here?”

“As a technical sense, probably not,” Braun acknowledged, noting Forest City did not ask to be removed from the case. “I wanted to participate.” The ESDC is the primary defendant, he said, adding that the developer’s interest “is so extreme.”

...Braun took up a theme that would recur through the rest of the hearing. “If you are in the state court or federal court, it’s clear that you don’t get discovery,” he said. “The issue of the subjective motivations of decision makers is just not an appropriate subject of inquiry…. I think the court is not allowed to look into the hearts and minds of the decision makers. I don’t think it’s allowed to get into reevaluation of whether the public uses are going to benefit the public as much as the decision makers thought.”

ESDC defense

The ESDC’s Kraus (right), on the counterattack, argued that the plaintiffs had no case. “What they’ve got to plead in order to make a prima facie case is that there is no legitimate public purpose, and that the project isn’t rationally related to any proper public purpose, and they have not done that here, and in fact, just the reverse is true.” He noted that nearly half the project is part of the Atlantic Terminal Urban Renewal Area (ATURA), designated as blighted by New York City in 1968.

Not only is eradication of blight a legitimate public purpose, he said, “There are numerous other purposes. There are going to be hundreds of millions of dollars of mass transit and infrastructure improvements. There’s going to be a new public sports arena constructed. There will be green spaces, public green spaces that are built. There are going to be thousands of jobs, and millions of tax revenues coming into the public coffers.”

(Of course the “public green spaces” are not parks, and would not be built until the second phase of the project, which may take 20 years, rather than the promised ten, to complete. The “public sports arena” would be “public” in the narrowest way, leased to a private entity that has already sold naming rights for $400 million. And the estimates of jobs and tax revenues have been in steady decline.)

But Kraus took on that general challenge. “The plaintiffs don’t say there won’t be jobs here,” he said, arguing that overestimates of jobs or tax revenues aren’t enough to make a claim. “You have to say that there’s no proper public purpose or that if there is one, the project has no conceivable relationship.”

Justice Kennedy’s concurrence in Kelo, Kraus said, required a clear showing of favoritism and Brinckerhoff already acknowledged that the public record would support the ESDC’s rationale. “Well, if that’s the case, and they concede that, that’s the end of the inquiry,” Kraus declared.

Then Kraus offered the hypothetical that Levy entertained during the hearing nearly two months earlier, of a 22-acre project with a school on half an acre. Atlantic Yards, he said, would have to have similarly skewed facts to make out a prima facie (self-evident) case for favoritism. And, he noted, Kennedy gave no examples regarding what constituted impermissible favoritism.

So Kraus gave his own example, a case in which Target had threatened to leave a store in St. Louis if the city didn’t condemn land it wanted, an example that to the defense hardly resembles Atlantic Yards. And, he reminded the judge, the ESDC is legislatively directed “to seek out maximum private participation.”

"Well, you may like Governor Pataki or Mayor Bloomberg," Kraus said. "You may not like them, but all of these public officials are people with unblemished reputations for integrity"--several people in the room laughed--"and there's certainly nothing in the complaint that indicates otherwise."

The motivations of city and state official, Kraus argued, ultimately don’t matter. Rather, he said, “In a public-use case, what counts is, ‘Is the project for a legitimate public use, or is it not?’” Otherwise, he warned, the courts would be inundated by plaintiffs seeking to probe the motives of government officials.

Plaintiffs respond

Brinckerhoff stepped up to counter. “We would not be here if the facts in this case were the same as” in cases cited by the defense, he said. “In those cases, before any private developer was identified, there was a lengthy process, where a legislative body with representative, elected officials made decisions specifically about what should happen in a particular development,” then put it out for bid.

Garaufis offered a not-so-hypothetical example, seemingly a reading of Ratner’s thought process: if a developer sees an underdeveloped area and offers a use needed by the community and can bring it profits, “and I take that to the agency which is sponsoring or developing plans for such blighted areas… and the agency puts out a notice… and I get selected… what’s the problem with that?”

Brinckerhoff swung back. First, he said, it would have to be an area that had been already been determined to be blighted. His clients’ properties are not in ATURA, he reminded the judge. Secondly, he said, there was no competitive bidding process for the entire 22-acre footprint, just the MTA’s 8.5 acre Vanderbilt Yard, and that was questionable.

District Court ruling: June 2007

In a 6/7/07 article headlined Judge dismisses federal eminent domain lawsuit; appeal planned, I wrote:

In an emphatic yet potentially questionable decision, U.S. District Judge Nicholas G. Garaufis yesterday dismissed Goldstein v. Pataki, the federal lawsuit challenging eminent domain that Atlantic Yards opponents have considered their best hope for stopping the project.

In his decision, Garaufis ruled that even if public benefits—including new tax revenues, housing, jobs, and the elimination of blight—are less than promised, they’re sufficient to overcome allegations that the project is a sweetheart deal benefiting developer Forest City Ratner.

“Because Plaintiffs concede that the Project will create large quantities of housing and office space, as well as a sports arena, in an area that is mostly blighted, Plaintiffs’ allegations, if proven, would not permit a reasonable juror to conclude that the 'sole purpose' of the Project is to confer a private benefit,” Garaufis wrote. “Neither would those allegations permit a reasonable juror to conclude that the purposes offered in support of the Project are 'mere pretexts' for an actual purpose to confer a private benefit on FCRC.”

Despite the setback, the plaintiffs, 13 owners and renters whose properties lie in the southern segment of the 22-acre footprint, outside the longstanding Atlantic Terminal Renewal Area (ATURA) that encompasses the Vanderbilt Yard, vowed to appeal.

Gearing up for the appeal: October 2007

In a 10/8/07 post headlined In eminent domain appeal, plaintiffs say illegitimate sequence means case deserves discovery, I wrote:

The plaintiffs challenging the use of eminent domain for Atlantic Yards have a high-stakes argument Tuesday before the U.S. Court of Appeals for the Second Circuit, hoping for a second chance to move the case to trial.

U.S. District Judge Nicholas Garaufis already dismissed their case for a failure to state a claim, ruling that presence of some measure of public benefits—mass transit improvements, the removal of blight, subsidized housing, a sports facility, open space—trumped any allegation that the project might primarily confer a private benefit on developer Forest City Ratner.

There’s a difference, the plaintiffs argue in a final reply brief, and it has to do with process. Precedential cases, which drew on more egregious fact patterns—severe blight in Washington, DC (Berman), and a land oligopoly in Hawaii (Midkiff)—lead courts to defer to legislative determinations, as the Supreme Court in 2005 did in its narrow Kelo v. New London decision, upholding the use of eminent domain for economic development.

The brief says the courts must “resolve the obvious tension between and among” the three cases, which call for courts to defer to “a legislative determination that a taking serves a public purpose” but, as reaffirmed in Kelo, must look carefully at “plausible allegations that ostensibly ‘public’ purposes are pretextual and that the real purpose of a taking is to benefit a private developer.”

Oral argument in federal appeal: October 2007

In a 10/9/07 post headlined Eminent domain appeal faces engaged but skeptical panel, I wrote:

Plaintiffs appealing the dismissal of the Atlantic Yards eminent domain case this morning encountered an engaged but skeptical panel of three Second Circuit appellate court judges, who let the argument extend for an hour—well more than the initial time allotted—as more than 60 people looked on in the Lower Manhattan courtroom.

The plaintiffs—*13 residential and commercial tenants and property owners—are challenging U.S. District Judge Nicholas Garaufis’s dismissal of the case, as he ruled that the public purposes associated with the project—among them subsidized housing, blight removal, new transit facilities, and a sports facility—trumped any inquiry into the legitimacy of the sequence.

Then again, they gave plaintiffs’ attorney Matthew Brinckerhoff a lot of time to explain his argument that the sequence behind Atlantic Yards—in which the project was promised to a private developer without any other bids—differed from that in the cases the Supreme Court had upheld eminent domain, and that Garaufis's ruling should be reversed so the case can actually go forward.

...And while the judges did not press attorney Preeta Bansal, representing the Empire State Development Corporation and other defendants, as closely as they did Brinckerhoff, they did question her somewhat startling contention that, even if there were illicit motive in the case, as long as the project results in some public use, “that’s the end of the inquiry.” (The other defendants include Mayor Mike Bloomberg, former Gov. George Pataki, and Forest City Ratner.)

Law professors express doubt: November 2007

In an 11/5/07 post headlined Does the AY eminent domain lawsuit have a shot? Two law profs are doubtful, I wrote:

Two legal experts, while not expressing support for the Atlantic Yards project, nevertheless said at a panel discussion last Wednesday at Yeshiva University’s Cardozo School of Law that they thought the pending eminent domain challenge would fail in a federal appellate court, given current legal doctrine.

The court will dismiss the suit, as did the trial court judge, they said, because of the presence some public benefits, and because judges are loath to set a precedent in which courts investigate the motives of decision-makers.

Appeal dismissed: February 2008

In a 2/2/08 post headlined In dismissal of eminent domain case, court cautions against appeal, I wrote:

In another blow to the Atlantic Yards opposition, a three-judge panel of the U.S. Court of Appeals for the Second Circuit yesterday unanimously upheld Judge Nicholas Garaufis’s dismissal of the Atlantic Yards eminent domain case and even suggested that a U.S. Supreme Court appeal would be tough to mount.

While the court acknowledged that eminent domain is an “immediate and intrusive” power for which “monetary compensation may understandably seem an imperfect substitute,” federal judges may not act on their sympathies, and Supreme Court precedent requires them to let elected representatives balance the costs and benefits.

The Atlantic Yards project clearly has some benefits, which the plaintiffs acknowledge, the court said, and that's essentially the end of the inquiry. Then again, its reading of the plaintiffs’ allegations about economic benefits and blight will be disputed, as will be its willingness to grapple with some allegations of a sweetheart deal.

..Still, the appellate court yesterday went out of its way to cast doubt on an appeal, suggesting in a footnote that Kennedy, whose nonbinding concurrence in Kelo buttressed the plaintiffs’ skepticism, would not look askance at this case.

Judicial deference to elected officials

The court concluded the 24-page opinion: This case has been very well litigated on both sides. At the end of the day, we are left with the distinct impression that the lawsuit is animated by concerns about the wisdom of the Atlantic Yards Project and its effect on the community. While we can well understand why the affected property owners would take this opportunity to air their complaints, such matters of policy are the province of the elected branches, not this Court.

That brought the issue full circle, echoing the statement in court 2/7/07 by Empire State Development Corporation (ESDC) attorney Douglas Kraus, “If his clients or if other members of the community think this was really a terrible project, they can express themselves in the next election when they vote for their City Council representatives, their State Senators, their State Assembly members, their Congresspersons, and their federal Senators."

That's an awkward fit with this case, as none of those officials had a vote on Atlantic Yards, and even Deputy Mayor Dan Doctoroff now acknowledges that such a project should go through the city’s land use review process, which does include a vote by City Council members. The ESDC, while a creation of the legislature, is essentially controlled by the governor.

Supreme Court appeal: April 2008

In a 4/2/08 article headlined AY eminent domain appeal asks the Supreme Court to clarify Kelo decision, I wrote:

According to two previous federal court decisions, the Atlantic Yards eminent domain case was dismissed because of evidence that the project would--or was believed to--bring a plethora of public benefits, thus trumping any questions about legitimacy of the approval process.

According to the just-filed appeal in the case, known as Goldstein v. Pataki, the Supreme Court should take a look because its controversial 2005 Kelo v. New London decision leaves open the possibility of challenging an eminent domain decision if the taking occurs as a “pretext” to benefit a private party.

The tension between those two postures raises an interesting challenge, given that an appellate court cursorily dismissed the pretext issue in a decision February 1. The court stated that other cases in which courts had considered pretext differed from Atlantic Yards, because the latter would contain some undeniable public benefits while the others did not.

But the appeal stresses another angle, not the quantity of public benefits--which is in dispute--but that of legitimacy. The appeal notes that courts evaluating Atlantic Yards relied on Supreme Court precedent like Berman v. Parker (1954) and Hawaii Housing Authority v. Midkiff (1984), which defer to legislative decisions, while a 2007 case decided by the District of Columbia Court of Appeals, Franco v. National Capital Revitalization Corporation, declares that Kelo allows inquiry into the question of pretext.

...Neither the brief, nor any document in the case, yet addresses the single most comprehensive explanation for the decision--made before Kelo emerged--to choose Ratner’s plan, that given by Andrew Alper, then president of the New York City Economic Development Corporation, at a 5/4/04 City Council hearing:

The developer came to us with what we thought was actually a very clever plan. It is not only bringing a sports team back to Brooklyn, but to do it in a way that provided dramatic economic development catalyst in terms of housing, retail, commercial jobs, construction jobs, permanent jobs.

So, they came to us, we did not come to them. And it is not really up to us then to go out and try to find a better deal. I think that would discourage developers from coming to us, if every time they came to us we went out and tried to shop their idea to somebody else. So we are actively shopping, but not for another sports arena franchise for Brooklyn.

Whether or not there's corruption, as the plaintiffs allege, the question remains as to whether the city and state did sufficient due diligence; after all, the ESDC and governor's office both on 3/4/05 issued press releases relying on revenue projections made by the developer’s paid consultant, Andrew Zimbalist, rather than commission their own analysis.

The plaintiffs argue that public purposes of the project such as the provision of affordable housing could be achieved without the use of eminent domain; however, a sports arena at and over the railyards likely would include eminent domain. And there’s a limited number of basketball franchises, which helps explain the city’s decision.

Supreme Court denies cert: June 2008

In a 6/23/08 article headlined Supreme Court denies AY eminent domain appeal; state case would be more of a long shot, I wrote:

The Supreme Court's decision, announced today, to reject the Atlantic Yards eminent domain case, Goldstein v. Pataki, is certainly a setback for project opponents, though the case was always a long shot.

Remember that the decision does not mean that the cases below were decided correctly, just that the appeal didnt present enough issues of law--conflicts in the interpretation of the 6/23/05 Kelo v. New London decision--to merit review.

Develop Don't Destroy Brooklyn indicates that it will organize a case to be filed in state court. That is surely more of a long shot than the federal case, but even that case might delay key elements of project--the acquisition of property via emiment domain and the opportunity to issue bonds for construction--by several months. Then again, some of the 11 plaintiffs in the federal case may feel increasing pressure to settle.

State lawsuit filed: August 2008

In a 8/5/08 post headlined State eminent domain suit filed, raises new state claim; hearing in January, I wrote:

As expected, the Atlantic Yards eminent domain case has taken a last-ditch trip to state court and, though some of the arguments have already been dismissed in the (likely) more hospitable federal court system, the case filed Friday adds a novel claim, based on grounds untested in court, which might make the argument interesting.

Thus, it looks like the Atlantic Yards legal battle will not be resolved until 2009, despite developer Bruce Ratner’s stated claim--which itself represents a slowdown in the timetable--that groundbreaking would begin in January. (Two other lawsuits are pending, as well as questions over project financing.)

Appellate Division case preview: February 2009

In a 2/20/09 post headlined As oral argument in state eminent domain case approaches, questions of a cost-benefit analysis and a different state standard, I wrote:

The new case has to be considered a long shot. The EDPL [Eminent Domain Procedure Law] allows only 15 minutes for oral argument, and there’s no opportunity to cross-examine witnesses or acquire documents through discovery--reasons why critics say New York law is in desperate need of reform.

...Some but not all of the arguments in Goldstein et al. v. Empire State Development Corporation (ESDC) reprise those made in the federal case, though, in one new argument, the plaintiffs may have established an advantage.

They contend that, in order for the state to assess whether public benefits from the project would trump the private ones, the ESDC should have conducted an analysis, but didn't do so.

The ESDC's response is to proffer a report that was not released publicly before the project was approved and did not truly represent an analysis, the plaintiffs point out.

Appellate Division oral argument: February 2009

In a 2/24/09 post headlined In a swift half-hour, eminent domain argument touches on balance of public and private benefit--but not much more:

In a quick but somewhat disjointed 30-minute argument before a four-judge appellate court panel yesterday, attorneys in the Atlantic Yards eminent domain case touched lightly but inconclusively on several contested issues.

Does the state constitution, as the plaintiffs contend, require a stricter evaluation of public use--the bedrock of condemnation--than does the federal constitution? The judges in the ornate Brooklyn Heights courtroom of the Appellate Division, Second Department, seemed willing to consider the argument, but also injected skepticism.

The plaintiffs gained ground on one potentially important point. While the defendant Empire State Development Corporation (ESDC) had in legal papers claimed (without foundation) that a document quantified the private benefit to developer Forest City Ratner, that document went unmentioned.

Indeed, an ESDC lawyer conceded no such analysis comparing private and public benefit was performed, but quickly argued that no such analysis was required. Indeed, case law suggests that even if there's substantial benefit to a private entity, the condemnation should be confirmed if public purpose is dominant--and an ESDC lawyer claimed there's "overwhelming public benefit."

...Lead attorney Brinckerhoff, taking the remainder of the allotted 15 minutes, gained some steam, pointing out that the state offered many other benefits beyond the $100 million, such as “extraordinary infrastructure” (actually, that’s just a potential benefit) and “triple tax-free bonds.”

However, there was not enough time to argue, as he had in federal court and as expressed in briefs in this case, that Atlantic Yards seems to be a sweetheart deal, with, for example, a blight study limited to the properties Forest City Ratner sought and a likelihood that the arena would be a money-loser for the city in terms of tax revenues....

Questions of blight

Eng raised the issue of the railyard at the heart of the footprint. “We’re talking about acres and acres of blight,” he said.

“You consider it blighted,” Brinckerhoff responded.

It has been found to be blighted, Eng replied, referencing the state’s blight study.

“I’m not trying to say you can’t make a reasonable argument that that area is blighted,” Brinckerhoff conceded.

(It was a legitimate admission on legal grounds—the railyard is part of the Atlantic Terminal Urban Renewal Area, or ATURA, which is per se blighted, and all the plaintiffs have property outside ATURA. But it glossed over a much larger issue: the Vanderbilt Yard has been a working railyard rather than a fallow spot, and, as it finally became feasible as a site for high-rise development, the city and state never built a platform to entice developers nor put the site out for bid, until Forest City Ratner was anointed the site.)

However, he said, “you still have to argue the private benefit,” he said, stressing that there was no competing bid for the site (presumably he meant for the site as a whole; there was a belated RFP for the Vanderbilt Yard).

May 2009: state case dismissed

In a 5/15/09 post headlined Eminent domain case is dismissed unanimously; appeal in this and EIS case remain as last legal hurdles, I wrote:

The Atlantic Yards eminent domain case was always a long shot in state court (even more so than in federal court), and today a state appellate court dismissed Goldstein et al. v. Empire State Development Corporation (ESDC) in an unanimous opinion.

In New York State, an appellate court, rather than a trial court, hears eminent domain cases, and no testimony or cross-examination is allowed.

The straightforward language of the 16-page decision, which gave no quarter to the petitioners' claims, contrasted with the appellate decision in the case challenging the Atlantic Yards environmental impact statement (EIS), which took pains to express some skepticism about the project and featured a concurrence that sounded like a dissent.

Appeal issue

Eminent domain law in New York State gives unusual deference to the government condemnor. A major issue raised in legal briefs and the February oral argument is whether the defendant ESDC conducted a study to measure the relative benefit to developer Forest City Ratner.

In legal papers, the ESDC claimed it had done so, though it cited a document that didn't perform such a measure. In court, the ESDC lawyer said it wasn't necessary, and the court agreed.

Appeal accepted: June 2009

In a 6/30/09 post headlined State's highest court accepts eminent domain appeal; oral arguments in October, thus complicating AY end game, I wrote:

The Atlantic Yards end game just got a whole lot more complicated.

Despite claims May 15 by Forest City Ratner CEO Bruce Ratner that the unanimous dismissal of the state eminent domain case in May "is really the last hurdle," the state's highest court, the Court of Appeals, has accepted an appeal in the case and won't hear oral arguments until the middle of October.

While eminent domain law still tilts significantly to the advantage of the condemnor, in this case the Empire State Development Corporation (ESDC), the court's willingness to hear it indicates that it believes the originating court, the Appellate Division, did not address some aspect of the legal argument.

Preview of Court of Appeals argument: October 2009

In a 10/12/09 post headlined The eminent domain battle Wednesday: an easy call for the Court of Appeals or a fresh look at blight, "public purpose," and relative benefits?, I wrote:

The case challenging eminent domain (Goldstein, et al. vs. New York State Urban Development Corporation d/b/a/ Empire State Development Corporation, or ESDC), to be heard Wednesday in the Court of Appeals in Albany may be the only case standing in the way of arena construction, even though other lawsuits challenging Atlantic Yards are expected.

So stakes are high. Should the Court of Appeals rely on a line of cases that have expanded the notion of "public use" to "public purpose," and which have expanded the understanding of blight from clearing slums to removal of "stagnation," it will uphold the dismissal of the case, concluding that the state constitution offers no tighter protections than does the federal one.

Should the court, however, look more expansively and closely at the case, it could raise serious questions. Consider that blight was presented as justification for eminent domain well after Atlantic Yards was announced and the menu of promised public benefits has shifted and arguably diminished, according to evidence that emerged after the project was initially passed in December 2006, a record the ESDC wants very much to exclude.

The court could also avoid both lines of inquiry by ruling more narrowly in favor of the defendants, saying the case was filed too late and/or presents no new constitutional questions. Or it could rule more narrowly in favor of the petitioners on the basis of failure to weigh costs and benefits, or the argument that state funding for such a project requires it be limited to low-income residents.

Larger implications

The implications go beyond the dispute and parties in this case. The city of New York has filed an amicus (friend-of-the-court) brief, supporting dismissal of the case, saying longstanding state practices shouldn't be disturbed, given the importance of eminent domain as a tool for redevelopment. Examples cited include Times Square and MetroTech.

The libertarian Institute for Justice (IJ)--which brought the 2005 Kelo v. New London case to the U.S. Supreme Court--has filed an amicus brief asking the state court to depart from its precedent, pointing to state courts in Michigan and Ohio that reversed themselves in 2004 and 2006, respectively.

And last week the IJ issued a report saying that New York is "one of the worst states in the nation when it comes to abusing eminent domain for private gain." In both documents the IJ cites an article by William Stern, former CEO of the Urban Development Corporation, arguing that eminent domain was not needed for the revival of Times Square, a project over which he presided.

Why accept case?

Why is the Court of Appeals even hearing the case?

It's a bit of a mystery, given that the case--after a version was rejected at three levels of federal court--was dismissed unanimously at the Appellate Division (where eminent domain cases in New York begin). Unlike in the parallel case challenging the environmental review, there was no blistering concurrence to give ammunition to appellants seeking clarification from the state's highest court. (A request for the Court of Appeals to hear that case is pending.)

Then again, in this case, the petitioners make ample citation of that concurrence by Judge James Catterson, who said the ESDC was being used as a tool of the developer.

There's been little doubt about the contours of eminent domain jurisprudence in New York, says the ESDC, which, along with Forest City Ratner, has expressed no doubt about the outcome in this case.

In fact, the ESDC asks that the case be summarily dismissed without getting to the merits, saying the case wasn't filed on time and that it's essentially an effort to re-litigate the same public use issues on which the petitioners (now nine property owners and renters, organized and funded by Develop Don't Destroy Brooklyn, or DDDB) lost in federal court.

Court of Appeals oral argument: October 2009

In a 10/15/09 post headlined (in retrospect, overoptimistically) At eminent domain oral argument, judges skeptical of both sides; court spends more time on process, low-rent housing issue than AY as sweetheart deal, I wrote:

While Brinckerhoff was on shakiest ground in declaring that public use, in New York State, had to mean strict public use, ESDC attorney Karmel stumbled when faced with inconvenient facts, notably that, when the project was announced in 2003, there was no mention of blight removal as a justification.

He strained to suggest that a Memorandum of Understanding (MOU) signed on 2/18/05 mentioned the Atlantic Terminal Urban Renewal Area, or ATURA, a justification for redevelopment and eminent domain to remove blight. (Actually, the main MOU for the project ignored ATURA and blight, while a secondary one, not publicly released until discovered by Develop Don't Destroy Brooklyn via a Freedom of Information Law request, did mention ATURA.)

And, under pressure, Karmel essentially acknowledged that Atlantic Yards, above all, was a market-rate housing project.

Smith, who questioned whether the state "had gerrymandered" the project site to suit Forest City Ratner, seems likely to write a forceful dissent, especially since Karmel essentially agreed that the state has carte blanche to take anyone's home for eminent domain.

But it was unclear whether he would bring anyone with him. Several judges held their counsel, and positions may not emerge until court conferences and the writing of an opinion.

Albany Law School Associate Dean Patricia Salkin commented that the court "spent a lot of time on whether they even had jurisdiction in this case." Assuming they do get to the merits, she agreed the judges wouldn't reevaluate public use....

Public use expanded

Judge Victoria Graffeo suggested that the state had long ago expanded public use beyond public ownership, bringing up the elephant in the room: a 1975 case known as Yonkers Community Development Agency v. Morris that was given short shrift in the appellants' briefs.

Brinckerhoff dodged the issue somewhat, saying the question was whether the state court would follow the Supreme Court's controversial 5-4 2005 opinion in Kelo v. New London, allowing eminent domain for economic development.

"What about our cases?" Graffeo asked.

There are no cases, Brinckerhoff said, that justify eminent domain on the grounds of economic development. (While the plaintiffs argue that that's the state's justification, the ESDC cites multiple justifications for the project and eminent domain.)

Lippman stepped in: Wasn’t Kelo specifically rejected in Goldstein vs. Pataki, the eminent domain case brought in federal court?

Brinckerhoff assented, but said the state court had not had the opportunity to "go as far" as the majority did in Kelo.

Blight and economic development

"They didn't have the kind of study that was occasioned in this case," Graffeo (center) suggested, apparently citing the long administrative record that the ESDC had developed, a record aimed in part at showing courts that the agency had acted rationally. "There wasn't that kind of record developed in Kelo, was there?"

(Her claim was quite arguable, given that in Connecticut the case was ventilated at the trial court level, which is unavailable in New York, but Brinckerhoff didn’t debate it.)

Court of Appeals decision: November 2009

In an 11/24/09 post headlined Court of Appeals upholds AY eminent domain 6-1, I wrote:

In a decision (PDF) that gives the crucial--but perhaps not final--boost to the Atlantic Yards project, the state's highest court, the Court of Appeals, approved the use of eminent domain by a 6-1 margin, saying that it's not the role of the courts to intervene in agency decisions, given the wide latitude in state law to decide on blight.

The case, which involves nine petitioners (homeowners, commercial property owners, and residential and commercial renters) is known as Goldstein, et al. vs. New York State Urban Development Corporation d/b/a/ Empire State Development Corporation (or ESDC).

Project backers had long expressed confidence about the result, given the state court's general deference to agency decisionmaking, but the court's willingness to accept the case in the first place--the Appellate Division had unanimously upheld the Empire State Development Corporation (ESDC) in the first round--had left some room for ambiguity.

Moreover, two of the seven judges seemed skeptical of the ESDC during the oral argument October 14, though the judges spent the most time on procedural issues and the attorney for the nine petitioners faced similar skepticism. One of those judges, Robert Smith, filed a blistering dissent that stated:

[T]he majority is much too deferential to the self-serving determination by Empire State Development Corporation (ESDC) that petitioners live in a "blighted" area, and are accordingly subject to having their homes seized and turned over to a private developer.

...It is clear to me from the record that the elimination of blight, in the sense of substandard and unsanitary conditions that present a danger to public safety, was never the bona fide purpose of the development at issue in this case.

Two judges concurred in the result but not the opinion, saying that they didn't think the petitioners should even have been in court, having filed too late, thus filing the 30-day limit of the Eminent Domain Procedure Law (EDPL). They said essentially that the merits of the case had been sufficiently addressed in federal court.

Here's an FAQ I wrote later that day:

Why did the Court of Appeals accept the Atlantic Yards eminent domain case, Goldstein vs. ESDC, after it was decided unanimously at the lower court level, the Appellate Division?

Well, the Court of Appeals was divided. It seems that Judge Robert Smith, who wrote the dissent, wanted to argue that courts should have more of a role in overseeing the exercise of eminent domain. Two judges, Susan Read and Eugene Pigott, didn't think the petitioners even belonged in court, so they concurred with the result but did not address the merits, which they said were decided in federal court.

Should limitations "upon the sovereign power of eminent domain as it has come to be defined in the urban renewal context" be "a matter for the Legislature, not the courts," as stated in Judge Jonathan Lippman's majority opinion?

Generally speaking, yes. Legislative bodies can deliberate on the boundaries of a law in a way that courts cannot. However, in many other states courts have refined, and redefined eminent domain law. More state legislatures have done so. Given the failure of the New York Legislature to do so, in the wake of the Supreme Court's controversial 2005 Kelo v. New London decision, the Court of Appeals would not have shocked anybody by intervening.

What happened to the petitioners' argument that the state didn't perform an (allegedly) required comparison of public and private benefits?

Nothing. Both the majority and the dissent ignored it.

What about the "gerrymandered" (Smith's words in oral argument) site map, which supports the contention that it's a developer-driven project?

It was ignored.

What happened to the petitioners' argument that blight was a pretext because it wasn't mentioned as a justification for the project more than a year after it was announced?

Smith took it seriously. The majority ignored it.

What happened to the petitioners' argument that state funds for such a project could only go to low-income housing? Wasn't Lippman interested in that, noting that the project would be mainly luxury housing?

Well, he was interested in it during oral argument, but he dismissed it roundly in the opinion.

What are "relatively mild conditions of urban blight"?

From the majority opinion:

The land use improvement plan at issue is not directed at the wholesale eradication of slums, but rather at alleviating relatively mild conditions of urban blight principally attributable to a large and, of course, uninhabited subgrade rail cut.

This raises the question: can't such blight be alleviated in other ways, such as rezoning the land and putting it out for bid?

Did the court say anything about the state's claim that a piece of property not fulfilling at least 60% of its zoning capacity is blighted?

No.

Are the blocks where the petitioners live and own property "a normal and pleasant residential community," as stated by Smith?

Only in part. Dean Street between Fifth and Sixth avenues is--well, was--a pleasant enough residential block, while Pacific Street between Fifth and Sixth was a mixture of industrial buildings (some of them dormant) and housing. The part of Dean Street just east of Sixth Avenue was a pleasant set of row houses, while the counterpart on Pacific Street is industrial space. Most buildings on the southeastern block of the AY footprint are industrial, not residential. But then-Assemblyman Roger Green, an AY supporter, did say that the neighborhood wasn't blighted.

In the aftermath, the Columbia decision, December 2009

I had covered the oral arguments in the eminent domain case regarding the Columbia University expansion. In a 5/22/09 post headlined In Columbia eminent domain case, some skeptical judges, AY echoes, and signs of emerging strategy for community resistance, I wrote:

Lawyers representing two property owners resisting the use of eminent domain for the Columbia University expansion maintained a passionate argument in appellate court yesterday, calling the Empire State Development Corporation’s (ESDC) actions in bad faith and seeing an ESDC lawyer clearly on the defensive before two clearly skeptical judges.

“Nobody’s opposed to Columbia expanding. They’re opposed to eminent domain,” attorney Norman Siegel said in his closing remarks before a five-judge panel of the Appellate Division, First Department. “The [skeptical] questions [from the Court] I hope will reflect the decision.”

Harlem State Senator Bill Perkins, speaking after the hearing on the sidewalk outside the courthouse, at 25th Street and Madison Avenue, was blunt: “It looks like Columbia’s going to lose.”

That’s unclear, given that three judges were largely quiet and ESDC lawyer John Casolaro, despite facing some withering skepticism from Justice James Catterson, reminded the court that the condemnor had a structural advantage. Their job, he told the judges, is to decide whether ESDC has some foundation for its decision. If they decide that the ESDC “had a reasonable basis or a basis, the inquiry is at its end.”

AY echoes, and a different strategy

There were echoes of and contrasts with Atlantic Yards, notably as Siegel compared parallel blight studies for each project, the petition pointed out that no alternative project was considered, and the judges found reason to consider the AY site a somewhat more legitimate subject for eminent domain.

...Catterson, in the appeal of the case challenging the AY environmental review, wrote a concurrence that read like a dissent, and Siegel (I'm told; I missed part of the argument) opened up by quoting the judge's opening line: that the the Urban Development Corporation Act is ultimately being used as a tool of the developer to displace and destroy neighborhoods that are "underutilized."

As Siegel’s aggressive strategy showed, there were hints of a road not taken in the AY case. (Siegel, a veteran civil rights attorney and candidate for Public Advocate, as he was in 2005, represented Develop Don't Destroy Brooklyn in the early stages of the AY fight.)

On behalf of client Nick Sprayregen of Tuck-it-Away Storage, the legal strategy included but went beyond questioning the benefit to a private actor, as has been the focus of the AY eminent domain cases.

As the Columbia project went through its approval process before the ESDC, Siegel created a factual record of 10,000 pages--as noted in the 107-page petition--to be presented for a court challenge in which there would be no new chance at fact-finding. Documents were gained through Freedom of Information Law (FOIL) requests, and a “No Blight” Study of the neighborhood countered the state’s Blight Studies. (The ESDC commissioned a second Blight Study after consultant AKRF was charged with conflict of interest.)

That “No Blight” Study examined the concept of blight, arguing that it must be seen in context of physical and social conditions impeding normal development and the suppression of investor interest leading to worsening social and physical conditions. (In other words, to quote planning professor Lynne Sagalyn, “the fabric of a community is shot to hell.”)

Less than six months later, we learned the result. In a 12/3/09 post headlined Appellate Division overturns ESDC's use of eminent domain for Columbia expansion; how different is it from AY?, I wrote:

From the plurality majority opinion in the Appellate Division's 3-2 overturning of the Empire State Development Corporation's (ESDC) planned use of eminent domain for the Columbia University expansion:

It is recognized that Kelo, as described below, did not concern an area characterized as "blighted." However, the blight designation in the instant case is mere sophistry. It was utilized by ESDC years after the scheme was hatched to justify the employment of eminent domain but this project has always primarily concerned a massive capital project for Columbia. Indeed, it is nothing more than economic redevelopment wearing a different face.

So too did the Atlantic Yards petitioners argue that blight was a pretext because it wasn't mentioned as a justification for the project for more than a year after it was announced--an issue ignored by the majority in the Court of Appeals decision last week.

In a 12/4/09 post headlined Can decision in Columbia eminent domain case reopen AY case? DDDB is trying, but there are both similarities and contrasts (and also precedent), I wrote:

Based on the surprising 3-2 Appellate Division decision yesterday blocking the the Empire State Development Corporation's use of eminent domain for the Columbia University expansion, Develop Don't Destroy Brooklyn, organizer and funder of the Atlantic Yards eminent domain case, hopes that it can succeed in the rare step of reopening the latter.

It's not easy. First, the Court of Appeals has to agree to such a rare step.

Then the plaintiffs have to win. And that wouldn't be easy, either, because the decision in the Columbia case was in significant tension with the Court of Appeals' decision just last week in the Atlantic Yards eminent domain case.

And even if the Columbia decision is not overturned, it is possible--depending on which frame the court uses--to make a distinction between the Columbia case and the Atlantic Yards case. Then again, there are some fundamental similarities.

Fundamental flaw

The fundamental flaw in Justice James Catterson's (two-judge plurality) opinion yesterday is that he completely ignored the Court of Appeals decision in the Atlantic Yards case, an opinion cited in Justice Peter Tom's Columbia dissent as compelling the Court of Appeals to defer to the ESDC's designation of blight.

...Brinckerhoff acknowledged there the underlying facts of the two cases pose distinctions.

I'll point out a few:

• There's no evidence that any part of the Columbia site was blighted prior to the university's pursuit of expansion. In the case of the Atlantic Yards site, more than half the site (mainly the Vanderbilt Yard) was long part of the Atlantic Terminal Urban Renewal Area (ATURA), and thus considered blighted. Those challenging eminent domain were property owners and renters in blocks below ATURA.
• The ESDC's use of not one but three blight studies in the Columbia case, as well as the denial of Freedom of Information Law requests to the plaintiffs, showed evidence of bad faith.
• The plaintiffs in the Columbia case conducted their own "No-Blight Study" to counteract the ESDC's finding; while AY opponents filed a forceful response to the official Blight Study, it was not used in the same way in court.
• While in the Columbia case the court found no evidence of a public benefit, in the Atlantic Yards case, multiple (though highly debatable) benefits were found, including the arena, the improvement of transit facilities, and the provision of affordable housing.
• Catterson's decision relied on Supreme Court Justice Anthony Kennedy's concurrence in the federal Kelo vs. New London case, which set out indicia--such as "substantial commitment of public funds to the project before most of the private beneficiaries were known"--of a sweetheart deal. The Atlantic Yards plaintiffs unsuccessfully raised those issues in federal court, and in state court relied on state cases and the state constitution.

Still, said Brinckerhoff, on core issues such as what constitutes blight--Catterson slammed the ESDC's use of the concept of underutilization--and the use of vague standards, "it has to apply to Atlantic Yards."

Catterson wrote:

The petitioners assert, inter alia, that UDCA is unconstitutional as applied by the ESDC because the agency has failed to adopt, retain or promulgate any regulation or written standard for the finding of blight.

Catterson agreed. While the plaintiffs in the AY case did not raise this issue, the same lack of standards would apply to the pursuit of eminent domain in Brooklyn.

In the aftermath, challenges to the condemnation: January 2010

An effort to get the Court of Appeals to take the unusual step of reconsidering its November decision is pending, but some of the issues were raised in court when the ESDC moved for condemnation.

In a 1/30/10 post headlined Condemnation on hold after judge promises prompt review of claims; streets unlikely to close on February 1, I wrote:

No, the Atlantic Yards condemnation case was not going to be simple, after all.

After nearly two hours of oft-contentious oral argument Friday before Kings County Supreme Court Judge Abraham Gerges--argument that, according to counsel for the Empire State Development Corporation (ESDC) went well beyond the proceeding at hand--the judge chose not to rule on the motions and counter-motions filed in the last two days.

"While the court will proceed promptly, the parties are entitled to a review of their claims," Gerges said at the end of the hearing, promising to "proceed expeditiously." (Gerges, at left, in photo by Kate Emerson/Brooklyn Paper. Photo above and set by Tracy Collins.)

Gerges's focus is on the narrow law of condemnation, so it would be unusual for him to allow argument on claims that the project has changed so much--and after the chance for public comment on such changes--that the ESDC should issue a new Determination & Findings.

So he could simply dismiss the new claims filed by property owners and leaseholders. Or he could ask the ESDC to revise the petition because of technical defects. Or--the longer shot--he could look at the broader claims, or hold this case in abeyance while another court examines those claims.


...Gerges was not unskeptical about the claims raised by attorney Matthew Brinckerhoff, representing several footprint property owners and a leaseholder, who argued that changes in the project after the ESDC's 2006 approval of the eminent domain Determination & Findings (D&F) were so significant that a new D&F was required.

Weren't such issues supposed to be dealt with in other cases, the judge asked.

Brinckerhoff pointed out that other courts considering AY-related cases had relied solely on the record as of December 2006. "The fact that they changed the project so much has to be considered by someone," he said.

(He's pictured with Develop Don't Destroy Brooklyn legal chair Candace Carponter. Photo by Tracy Collins.)

Brinckerhoff suggested, by way of example, a situation in which a D&F had been approved but there was absolutely no financing for a project. In such a case, despite the D&F, he said, a condemnation court would not have transferred title.

He said: "The question is: where on the continuum from nothing changing to everything changing do we get heard?"

We should know soon, in the coming weeks.