Crying wolf in the State Center suit

Litigants in the case against the State Center development in Baltimore are decrying a bill that passed the House of Delegates setting out new rules for public-private partnerships in Maryland. At issue is a provision that allows a party in such a suit to appeal a circuit court judge's denial of a motion to dismiss before the two sides are forced to exchange documents through the discovery process, and before they are allowed to present evidence at trial. The coalition of downtown property owners who are suing to stop State Center — attorneyPeter G. Angeloschief among them — is calling the bill, which applies to current as well as future cases, an extraordinary intervention by the legislature in an ongoing court proceeding.

There is no doubt that it is unusual, but it is neither unprecedented nor unconstitutional. In fact, relevant case law shows that such a procedural change by the legislature is presumed to affect current cases unless the General Assembly specifies otherwise. The bill does not, as has been widely and incorrectly reported, send cases like this one straight to the Court of Special Appeals. Circuit courts would still have original jurisdiction. Nor does it tilt the scales in favor of the State Center project. The legislature is not changing any of the standards by which the State Center lawsuit will be judged but is instead adding another step to the legal process. If the case that the state broke its procurement law in approving the State Center deal is as strong as the litigants say it is, then the only effect of the General Assembly's action will be to drag out the legal process even more, which only benefits the project's opponents.

The government buildings at State Center have aged beyond their useful life. They do not suit the state's needs well; they are expensive to maintain; and, in some cases, they may actually be dangerous to the civil servants who work there. Faced with that reality, the state could have knocked the buildings down and built new ones in their place, at a cost of hundreds of millions of dollars, or more. It could have abandoned the complex and rented office space for workers downtown — the preferred solution of the litigants in this case. But that would have left a giant ghost town in central Baltimore and would have forced state agencies to split themselves among commercial buildings.

The solution the state arrived at instead was to enter a deal in which a private company will demolish the State Center buildings and construct new ones in several phases as part of a mixed-use development plan. The state would help finance the project through long-term guaranteed leases and some tax incentives. Although the opponents of the redevelopment have raised a host of issues, including whether the state will be paying too much in rent, whether the development will adversely affect downtown and whether the project should qualify for the term "transit oriented development," the case boils down to a question of whether the selection of the developer was a violation of the state's competitive bidding laws.

The state filed a motion to dismiss the case and a counter-suit claiming that the litigation was nothing more than a nuisance suit to kill the project through delays. Baltimore Circuit Judge Althea M. Handy denied the motion to dismiss and threw out the state's counter-suit. If this legislation passes, it merely gives the state the opportunity to appeal Judge Handy's decision to let the litigation proceed. The state faces the same exacting standard to prevail in such a motion in the Court of Special Appeals that it did in circuit court.

Whatever the eventual legal merits of the case against State Center may prove to be, it has certainly pointed to the need for a more specific state law detailing the procedures for evaluating and approving public-private partnerships. They tend to be time-sensitive deals that can be killed by the months or years of delays that lawsuits can cause, and it is reasonable for the legislature to conclude that allowing the appeal of the denial of a motion to dismiss is appropriate in these cases. It certainly would have been preferable for the state to have passed a law like this one before putting together the State Center deal in the first place. But the accusation that this bill is no more than an attempt to kill a pending lawsuit is false. It sets out a procedure that will be used in this case and any like it in the future.

That wasn't true the last time the General Assembly so prominently changed judicial procedures in the middle of a lawsuit. A circuit court judge's ruling in 1997 limited the state's case against tobacco companies, and state officials feared it would force them to present testimony from thousands of individual smokers — a nearly impossible barrier. The next spring, the General Assembly passed a bill backed by then-Attorney General J. Joseph Curran that allowed the state to present statistical evidence of the harms of smoking instead, effectively increasing the state's chances in court and increasing the size of any eventual judgment against the tobacco companies. The private attorney who led the state's case eventually pocketed a fee of $150 million. His name:Peter G. Angelos.

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