CenterCal Properties, the would-be developer of a now-scuttled plan to revamp the waterfront, has filed its fourth lawsuit against Redondo Beach—this time over the wildly popular BeachLife Festival.
In the lawsuit, filed last month in Los Angeles Superior Court, CenterCal argues that Redondo Beach's 10-year license agreement with the organizers of BeachLife—which wrapped up its inaugural three-day festival on Sunday—violated its own deal with the city that guaranteed the developer the right to lease the waterfront for up to 99 years.
CenterCal, in court documents, said under its agreement with the city it should have had the right to approve or deny the festival.
This lawsuit is just the latest in a string court battles and controversies over the waterfront since the $400 million project was thrown into doubt two years ago.
The city and CenterCal struck an agreement in January 2017 that gave the company the rights to enter into a lease with the city and ultimately redevelop the waterfront, a plan that would have created a roughly 525,000 square-foot seaside village where BeachLife took place.
(That agreement was not the same as an actual lease; rather, it was essentially a right-of-first-refusal that prevented other groups, such as BeachLife, from swooping in and signing a lease with the city before CenterCal.)
But in March 2017, Redondo voters passed Measure C, significantly curtailing future development on the waterfront. The municipal elections also brought new leadership to the City Council, making it politically untenable to move forward with the project.
Then came the series of lawsuits and controversies—including CenterCal withdrawing the project from California Coastal Commission consideration in 2018 and a court battle over the validity of the environmental study.
Still, CenterCal has maintained its agreement with Redondo is still active. And that agreement prohibits the city from entering into a waterfront deal with a third party unless it includes three provisions: The agreement can be terminated within six months, CenterCal gets notified and the developer approves the deal.
But the September 2018 agreement between the city and Sanford Ventures—the BeachLife producer, run by Allen Sanford, also the owner of Hermosa Beach's Saint Rocke—did not include those provisions, said attorney Betty Shumener, arguing the case for CenterCal.
Rather, the city's deal with Sanford Ventures allows BeachLife to occur twice a year for a decade, with a five-year extension.
"The city had to be able to exit the lease agreement, so that if we get to proceed with the waterfront project, they can exit from that lease," Shumener said in an interview Monday, May 6. "They didn't give themselves any out on that lease. And that's a material breach of our" agreement.
City attorney Mike Webb declined to comment Monday.
But in court, both sides have argued the other is in violation of the agreement: The city, for its part, has said CenterCal violated the agreement by not paying more than $1 million related to the environmental impact report and other legal fees.
In this suit, filed April 18, the developer wants to uphold its agreement to lease the waterfront property, Shumener said; that could be a determining factor in the developer's other lawsuit seeking roughly $15 million in damages, which also argues the city breached the agreement. CenterCal also wants the city to extend its right to develop the waterfront property beyond October 2019 expiration.
But Mayor Bill Brand, whose road to the mayor's seat came largely by fighting against the waterfront project, said the BeachLife Festival this weekend was a startling contrast to what would have been developed there.
"You gotta love it that the mall developer has filed another lawsuit related to their failed plan," Brand said. "Westport Capital and CenterCal have been all about the money from day one and they just continue to go after any money that they can."