MSG sues Inglewood mayor over “secret” arena plans
The Madison Square Garden Company (MSG) has filed a lawsuit against James T. Butts Jnr, the mayor of Inglewood, accusing him of defrauding its Forum venue over allegedly secret plans to build a new arena just south of the Forum.
The 46-page complaint, filed yesterday (5 March) in Los Angeles superior court, details what MSG calls “the improper actions of the city, Mayor Butts (in both his public and private roles) and other co-defendants that jeopardise the Forum”. The company says Butts and local authorities held secret negotiations with the LA Clippers, a basketball team, to “deprive” MSG of 15 acres of land it leased from the city for arena parking, allegedly telling MSG the city needed the land for a “technology park”.
“Knowing the Forum needed the land for parking and would not give up its lease for a competitive arena literally down the street, the city secretly negotiated with the Clippers,” according to the Forum’s lawyer, Marvin Putnam of Latham & Watkins.
“The city did not use the parking lease property for a technology park or comparable development, nor did Mayor Butts or the city ever intend to do so,” the lawsuit alleges.
The Clippers announced plans for a new “world-class basketball arena” – allegedly on the site of the proposed ‘technology park’ – last month.
“The city’s actions violated the lease between the city and Forum”
“Seemingly aware of his deception”, Butts, MSG alleges, even directed Forum executives to email him about the parking lease only at his personal Gmail account so he could keep discussions “confidential”.
“The city’s actions violated the lease between the city and Forum, the development agreement between the Forum and the city, and fundamental principles of good faith and fair dealing as required by California law,” says Putnam.
The development agreement between the two parties requires MSG to invest at least US$50 million in the venue and meet ongoing ticket minimums guaranteeing about $600,000 in revenue for the city each year for 30 years. In return, the lawsuit says, the city explicitly agrees to not engage in “any action or proceeding” that would cause “a material adverse impact on the […] economic competitiveness of the Forum.”
In addition to the 17,500-cap. LA Forum, Madison Square Garden Company owns Madison Square Garden, Radio City Music Hall and the Beacon Theatre, in New York, and the Chicago Theatre, as well as the New York Knicks and New York Liberty basketball teams and the New York Rangers ice hockey team.
The company also last month revealed plans for futuristic new venues in Las Vegas and London, based on its cutting-edge MSG Sphere concept.
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