General Growth Properties Inc. will have to defend itself against antitrust claims in a lawsuit filed by real estate developer Rick Caruso following an appeals court decision in his favor Tuesday.
The court reinstated the claims as part of a $40 million lawsuit brought by Caruso against the owner of the Glendale Galleria, which strenuously fought his plans to develop a mixed use project in downtown Glendale.
Caruso's Americana at Brand, modeled after the Grove in L.A.'s Fairfax District, was approved by the Glendale City Council and passed a referendum vote in September 2004 despite the objections of General Growth. The Glendale Galleria owner argued the project is not compatible with retailers at its indoor mall.
In his suit, Caruso claims General Growth intimidated tenants while his project was pending approvals.
"They threatened not to do business with them at their other shopping centers, and their principal target was the Cheesecake Factory, which had four or five deals with General Growth," said Caruso's attorney, Henry Shields, a partner at Irell & Manella LLP. "They told the Cheesecake Factory they would not go forward with the four or five pending deals if Cheesecake Factory did business with Caruso."
General Growth had appealed a Los Angeles Superior Court judge's ruling last year that retained most of the suit on anti-competitive grounds but threw out claims of antitrust violations, seeking dismissal of the entire suit. Caruso had separately appealed the ruling on the alleged anti-trust violations. In siding with Caruso, the judge turned down General Growth's appeal to have the remainder of the suit dismissed.
Americana at Brand is a $264.2 million mixed-use project on 15.5 acres that includes a pedestrian promenade, outdoor seating and more than 300,000 square feet of retail, dining and entertainment use. It also includes 100 condos and 238 apartments between the east side of the Galleria and Brand Boulevard.
Arthur Sohikian, a spokesman for General Growth Properties, called the recent decision a "preliminary ruling that does not reach the merit of any claims."
For reprint and licensing requests for this article, CLICK HERE.