A Los Angeles Superior Court judge on Monday, March 15, 2021, threw out the bulk of an $85 million dollar lawsuit in which the developer of a long-planned, but now-abandoned outlet mall along the 405 Freeway made allegations of financial mismanagement and negligence against the city of Carson.
Cam-Carson, a partnership between mall developers Macerich and Simon Property Group, filed the lawsuit last year against the city and Carson Reclamation Authority, the agency created to oversee the complex and expensive environmental remediation effort required to turn the 157-acre tract atop a former garbage dump into usable land.
Cam-Carson had accused the city and authority of running out of money to complete the needed remediation work. An attorney representing Cam-Carson did not immediately respond to a request for comment.
“It’s a huge victory for us,” City Attorney Sunny Soltani said. “Their entire case is now dwindled down to nothing more than a simple breach of contract case.
“We will be filing a cross-complaint against them now to perform their contractual obligations,” she added, “or pay up monies owed to the CRA and sell the property to another developer and get out of the transaction.”
Construction work stopped on the site in January 2020.
City officials say they have another developer ready to step in and develop at least part of the site, which has a long history of aborted development proposals, including two proposed NFL stadiums.
Soltani said the agreement between the CRA and Cam-Carson to develop the regional outlet mall on what is one of the largest remaining tracts of developable land in Los Angeles County expressly took into account the possibility that unforeseen issues with remediating the site could result in additional expenditures.
That’s why the legal remedy is for the parties to dissolve their agreement and sell the site, she said, not demand millions in damages in any lawsuit.
Former Mayor Al Robles, an attorney who was head of the CRA when the agreement with Cam-Carson was drafted, said he was “very proud of our legal foresight.”
“The filing of this frivolous case against Carson was merely a bullying tactic by Simon,” Robles said via email Monday, “and today’s ruling dismissing the case clearly shows the judge agreed this case was completely meritless.
“I just hope,” the former mayor added, “that this puts an end to Simon’s shenanigans and this project can now move forward with or without Simon.”
There are still considerable hurdles to overcome, however.
The city also filed a lawsuit last June against the state, arguing the Department of Finance is preventing it from issuing bonds Carson needs to pay for the “final leg” of the environmental clean-up.
“Without the requested bond financing that is the subject of this case, this critical environmental remediation project will collapse,” the city lawsuit said. “Such an outcome would not only pose a serious public health risk, but also an incredibly unfortunate waste of public funds given that the remediation process is already about 80% complete for the most important portions of the site — all after the expenditure of hundreds of millions of dollars in public funds.”
The city estimates the project would produce $40 million in additional sales taxes for the state from the outlet mall, as well as about 1,000 new homes.