Planning and Development
Golf Course Redevelopment Continues to Spur Litigation
This blog has previously observed how golf course redevelopment commonly leads to land use disputes between, on one hand, those seeking to redevelop the former course, and on the other hand, neighboring landowners benefiting from the status quo.[1] These disputes may find their way to court even when every government regulator has approved the redevelopment. This was true in recent litigation concerning proposed residential redevelopment of the former Mississippi Dunes golf course in the City of Cottage Grove. This case is instructive that even though securing all necessary approvals is no guarantee against litigation, attentiveness and thoroughness in the approval process can prove decisive in court. The proposed housing development, known as Mississippi Landing, received full approvals from local, state, and federal regulators. As part of project due diligence, the development team, in coordination with federal regulators, analyzed what impact, if any, the project would have on numerous protected plant and animal species, including the Rusty Patched Bumble Bee (“RPBB”). Incorporated into the project were several efforts to preserve the limited area containing suitable habitat for the RPBB; for example, the developer conveyed land to the Minnesota Department of Natural Resources and agreed to seed roughly eight acres with native seed mixes. During the city review process, a vigorous opposition formed arguing, among other things, that the project would have deleterious effects on natural resources. The developer argued that it had complied with all applicable state and federal regulatory criteria. The City Council unanimously approved a preliminary plat and planned unit development. The opponents then organized a fundraising campaign to challenge the approvals in court. Under the banner of a nonprofit named “Friends of Grey Cloud,” the opposition filed suit against the developer and the City of Cottage Grove asserting state environmental protection claims and requesting injunctive relief to stop the project. The initial court filing was done in coordination with the news media, which gave the filing prominent coverage. A district court judge administratively denied the opponents’ request for “ex parte” emergency relief (viz., the opposition sought an injunction without the developer or the city first being heard). A hearing was later scheduled on the opponents’ request for a court order stopping all site work pending trial. A stay of construction would have had severe economic consequences—the developer presented evidence that an injunction would cause over $3 million in damages. The opponents argued that injunctive relief was appropriate under the Minnesota Environmental Rights Act, also known as “MERA.” The opponents suggested that the project would harm protected plant and biological species, including the RPBB. The opponents emphasized that the project area is considered highly probable for RPBB. The developer argued in response that the golf course had, during its operation, extensively damaged the native habitat; that federal regulators had determined the project was not likely to harm the RPBB; that a habitat study showed that most of the Mississippi Landing site was not suitable for RPBB—except for the land being conveyed to DNR; and that any claim of harm to the RPBB was speculative, unsubstantiated, and contrary to the record. The district court agreed with the developer, opining that the opponents had failed to prove the presence of protected species on the project site, and furthermore, had failed to show how the protective measures the developer had implemented were inadequate. As the district court observed: “‘[A]most every human activity has some kind of adverse impact on a natural resource,’ but MERA is not construed as ‘prohibiting virtually all human enterprise.’” The district court ruled that the opponents had not shown entitlement to injunctive relief. The district court’s ruling had an immediate, powerful impact. Two weeks later, the opponents dismissed their case with prejudice. What ultimately carried the day for the developer? Perhaps most important was the substantial work of the development team during due diligence to study the property and consult with regulators. The developer argued to the district court that the opponents were asking the court to second guess professional regulators, an argument the court adopted in concluding that public policy did not support an injunction. Furthermore, that the developer had carved out certain land from the development to protect natural resources placed a difficult burden on the opponents to show inadequacy of those measures. Finally, the developer successfully argued that, in contrast to the speculative environmental harms argued by the opponents, an injunction would cause considerable economic damage. Larkin Hoffman attorneys Peter Coyle, Bryan Huntington, and Rob Stefonowicz represented the Mississippi Landing developer in connection with its land use application and related litigation. [1] https://www.larkinhoffman.com/real-estate-construction-blog/hollydale-golf-course-the-complex-road-to-redevelopment-approval.
