Bill spawned by stalled New Orleans WTC redevelopment headed to House debate, vote

By Karen Kidd | May 27, 2016

NEW ORLEANS – A bill that once stood to cost the losing bidder in the World Trade Center redevelopment litigation tens of millions of dollars to maintain its lawsuits against the city, but now likely won't, is headed to the state House floor.

Debate on SB 447, rewritten and re-engrossed during its month-long sojourn in the House Committee on Civil Law and Procedure, is scheduled for debate on the House floor on Wednesday. A vote on the bill is expected to follow.

The original bill would have made it harder for losing bidders to file lawsuits over the development of public property in New Orleans by requiring bond or security be posted. The proposed legislation doesn't name Two Canal Street Investors, the losing bidder and now litigator behind two lawsuits over development of the former World Trade Center in New Orleans; however, the development company faced having to post millions of dollars to maintain those lawsuits under the original bill.

That portion of the original bill was scuttled earlier this week and replaced by vaguer wording that suggests a suing developer would be required to post security should a presiding judge grant a temporary restraining order or preliminary injunction to halt development of a challenged project.

The revised bill now doesn't specify only the city of New Orleans and its building corporation, as did the original, but would apply to any benefit corporation that meets the requirements of Louisiana R.S. 41:1215(B). The revised bill also creates narrow time limits for appealing and challenging a bidding process in situations similar to New Orleans' attempt to redevelop the World Trade Center. Those time limits include how quickly such challenges would have to be tried, judgments rendered and appeals court decisions handed down.

Few are commenting on these changes and those who are, aren't saying much.

"Yesterday's unanimous decision in House Civil Law is yet one more step in the right direction," Greg Beuerman, spokesman for the Carpenter-Woodward litigation team that is working with developer Four Seasons New Orleans, said in an email to the Louisiana Record following the committee hearing Monday.

While Two Canal Street Investors seems the clear winner in the bill's revisions, an attorney for the development company was even more reticent to comment.

"We're really waiting to see how the final bill reads prior to offering comment," Charline K. Gipson, an attorney with the New Orleans Davillier Law Group that represents the company, said in her own email to the Louisiana Record. "As it stood, based only on the House committee amendments proposed during Monday's public meeting, the expedited adjudication and appeal provisions seem highly impractical for both lawyers and judges; and may be inherently biased in the assumption that any such lease is presumed valid at the outset of any legal challenge."

The New Orleans' Mayor's office didn't respond to repeated requests to comment.

The bill passed to the House on April 21 following a near unanimous vote in the Senate, where it was sponsored by Sen. Conrad Appel (R-District 9). The bill's sponsor in the House has been Rep. Jimmy Harris (D-District 99).

Action on the bill in the state legislature follows in the wake of Two Canal Street Investors' two lawsuits over the World Trade Center's development, both filed in Orleans Civil District Court. The older of the two lawsuits is against the city and New Orleans Building Corp. while the second lawsuit names members of the real estate consulting team who advised the city in that process.

The lawsuit against the city and New Orleans Building Corp, filed last spring, is scheduled to go to trial on Oct. 24.

The development of New Orleans' 33-story World Trade Center, located on the riverfront, was leased last year to the development team led by Carpenter & Co. of Massachusetts and Woodward Interests of New Orleans.

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Carpenter-Woodward Davillier Law Group

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