Marion County Judge Allows Pan Am Suit To Proceed Under Public Standing Doctrine

City attorneys have failed in their efforts to block a lawsuit filed by fellow blogger and attorney Paul Ogden on behalf of several citizens against the City and the Indiana Sports Corporation for violating the terms of a restrictive covenant governing the use and disposal of the public area downtown known as the Pan Am Plaza. At issue is whether the Indiana Sports Corporation should have been required to repay millions of dollars to the City of Indianapolis when the City authorized the sale of the Pan Am Plaza to a politically-connected real estate developer at the close of Mayor Bart Peterson's administration in 2007. An original restrictive covenant governing the use of this land for public use required repayment of taxpayer funds used to redevelop the site--as much as $6 million--in the event the ISC stopped using the property for a public use.

Marion Superior Court Judge Heather Welch ruled in an Order signed on September 21, 2009 that the citizen plaintiffs have standing under public standing doctrine because they "are attempting to enforce a public not a private right in this case when trying to prohibit the MDC and the City of Indianapolis from reducing the restrictive covenant area which was created when the area now known as Pan Am Plaza was transferred to ISC." Judge Welch continued, "The restrictive covenant was created to allow a public gathering at Pan Am Plaza for the enjoyment of citizens of the City of Indianapolis." "Thus, there is no doubt that the Plaintiffs qualify under the public standing doctrine by attempting to enforce a public right by claiming that the government action was improper and not in accordance with the statute."

Judge Welch ruled against the City's motion on the pleadings arguing that the disposal of Pan Am Plaza came about as a result of a project agreement and not a redevelopment plan. In the case of the former, no approval by the city council is required, whereas the latter requires council approval. "It is clearly confusing as to whether these documents were redevelopment plans or project agreements," she writes." Judge Welch also rejected the City's argument that no triggering event had occurred--until the restrictive covenant is completely dissolved. Judge Welch ruled that there exists "a dispute of material fact" whether a "substantial reduction of the restrictive convent is the triggering event" as the plaintiffs contend. Finally, Judge Welch rejected the City's specious argument that the suit should be dismissed because the plaintiffs' counsel failed to give notice to the City under the tort claims act. "The restrictive covenant that is at issue in this case is an express contract between the City of Indianapolis by MDC and ISC", Judge Welch ruled, noting that the plaintiffs complaint alleged no tort claims.

Judge Welch sided with the City's attorneys only on one point. That pertained to a statute that requires the MDC to determine compliance of a redevelopment plan with the comprehensive plan of development. Judge Welch determined that it would not matter whether the 2007 action involved a redevelopment plan or a project agreement because the statute in question did not require city council approval in either event. Accordingly, she granted the City's motion to dismiss the plaintiffs' claim based on this statute.