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Friday, February 23, 2024 | Back issues
Courthouse News Service Courthouse News Service

East Bay City Can Kill Casino Deal

SAN FRANCISCO (CN) - The Easy Bay city of Richmond may back out of a casino development deal with a small Northern California tribe and a private developer, a federal judge ruled.

The Guidiville Rancheria of California and developer Upstream Point Molate had asked the court to stop legal proceedings allowing Richmond to pull out of the casino deal.

The tribe and Upstream sought to stay the court's judgment against them in a legal fight with the city, to certify orders for interlocutory review and to amend its complaint against the city and the federal government.

But U.S. District Judge Yvonne Gonzalez Rogers denied the motions on Oct. 2, saying the tribe and Upstream "have not met their burden to establish the exceptional circumstances required for certification of the interlocutory orders. The request to stay the action pending interlocutory appeal is denied without prejudice as premature, since no appeal is pending."

Rogers ruled in December that Richmond did not breach an agreement with the plaintiffs when city officials decided against supporting a proposed tribal casino. City officials said increased traffic and impacts on historic resources would be too great.

When the agreement between Richmond and Upstream was made, an environmental review of the project under the California Environmental Quality Act had not yet been completed.

In March 2011, the city certified a final CEQA Environmental Impact Report indicating the project would be detrimental to the city. The city determined that the casino would have significant effects upon traffic and historic resources, and backed out of the deal, leading to the breach of contract complaint against it.

Rogers ruled against the breach of contract complaint, saying it "constituted an improper attack on the city's exercise of its discretionary CEQA approval authority."

Rogers found that in their subsequent motions challenging the ruling, Upstream and the tribe contend "there is still unclear and inconsistent authority" on whether their claims "for breach of the Land Disposition Agreement for failing to issue a final determination under CEQA or failing to exercise its discretion to evaluate the CEQA considerations" constitute challenges to the approval process under CEQA that could be made only by writ petition.

"However, plaintiffs cite no competing authority and offer nothing but their own conclusory arguments to establish 'substantial ground for difference of opinion,'" Rogers found.

"Likewise, disagreement with the court's ruling is not sufficient to establish a 'substantial ground for difference of opinion.'"

When requesting certification of orders for interlocutory review, Rogers says, Upstream and the Tribe argued that "certification is appropriate upon nothing more than a showing that 'the case law is confused,' citing out-of-circuit authority. This is an incorrect statement of the applicable Ninth Circuit law" and "is a standard that they have failed to meet in any event."

Rogers also says the Tribe and Upstream did not demonstrate how "interlocutory appeal of the orders at issue would materially advance the ultimate termination of the litigation. Rather, it appears that interlocutory appeal of these orders would lead to piecemeal appeals and unnecessary complication of procedural matters."

In 2004, Upstream paid Richmond $250,000 for exclusive rights to redevelop a depot and then entered into a Land Disposition Agreement with the city, which agreed to transfer the property to Upstream for development of a tribal casino upon the project's final legal approval.

In her December ruling affirming the city's right to kill the deal, Rogers wrote: "CEQA regulations provide that, when the EIR shows that the proposed project would cause substantial adverse changes in the environment, the governmental agency can respond to it in several ways, including '[d]isapproving the project.'"

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