Successful Settlements in Cutting-Edge Eminent Domain Cases

$3.1 Million Settlement in Cutting-Edge Eminent Domain Litigation

In a complex, novel eminent domain proceeding, which received first-page coverage in The New York Times, we represented the owner of commercial property that the government agency chose to condemn and take so that it could transfer ownership to a private developer. This case was brought after the US Supreme Court ruled in the Kelo case that such takings were permissible upon a proper showing. The condemnor’s original offer was approximately $1.6 million, but under the final settlement agreement the condemnor’s transferee agreed to pay at least $2.6 million in cash or pay $1.9 million and provide assets worth another $1.2 million for a total of $3.1 million in value. Case Name: Redevelopment Agency of the City of Santa Cruz v. Lau et al. (Sup. Ct. of Cal., Santa Cruz Cty. 2005, Case No. cv-151983).

Real Property Settlement in Novel Post-Condemnation Dispute

In a sequel lawsuit to the Lau condemnation, we brought suit on behalf of Mr. Lau after the condemnor’s transferee defaulted on its payment obligations to Mr. Lau (the condemnee), whom we continued to represent.

Accordingly, we sued the condemnor, its transferee, and related parties, alleging that the original taking was unlawful because it was not done for a necessary public purpose or for the reasons set forth in the resolution of necessity, and alleging further that the transferee’s recorded security (given in exchange for the taking) should be treated as an “equitable mortgage” that protected the condemnee from foreclosure by the transferee’s construction lender.

In a confidential settlement, whose terms were subsequently publicly disclosed by the press, our client, Mr. Lau, recovered $530,000 in addition to his part of the original recovery, which was $1.7 million, so that the Lau parties’ total recovery was $2.455 million, as opposed to the condemnor’s original offer of $1.6 million.

The case raised a series of novel challenges concerning the interplay between a public condemnor, a defaulting private transferee, and the transferee’s lender. Case name: Lau v. Cirillo et al (N.D. Cal. 2013, Case No. 5:13-cv-03946-LHK).