The city of Norfolk, currently in negotiations with a developer to build a casino along the city’s waterfront, recently won a court decision against another developer that claimed it had exclusive rights to construct a casino in the Virginia city.
The Court of Appeals of Virginia upheld a lower court decision dismissing a $100 million lawsuit brought against the city. The Cordish Companies, the developer of Waterside District in Norfolk, filed the suit against three parties: the city of Norfolk, Norfolk Redevelopment and Housing Authority (NRHA) and City Attorney Bernard Pishko.
Pishko talked to the Virginian-Pilot after the ruling.
“We are pleased to have the court confirm that Cordish and [John] Lynch sued the city, city attorney and NRHA without a basis.”
Norfolk approved a land deal for tribe to build a casino along the waterfront
In 2020, Virginia lawmakers approved five locations in the state that could house casinos. Norfolk was one of the cities, along with Bristol, Danville, Portsmouth and Richmond. There are currently temporary or permanent casinos in three of the cities. Richmond voters twice rejected building a casino in the capital city, while ground has yet to be broken on a casino in Norfolk. Virginia online casinos remain illegal.
The Virginian-Pilot article noted that in 2013, the Baltimore-based The Cordish Companies began renovations on the Waterside project. Later, “when Norfolk leaders began to have conversations about bringing a casino to the city, Cordish-owned LLC Norfolk District Associates (NDA) argued it should have had the exclusive right to develop and operate one based on its Waterside development agreement and lease.”
But the city approved a land deal with the Pamunkey Indian Tribe in 2019. And when voters passed a referendum in 2020 to green-light a casino in Norfolk, the city moved forward with the tribe’s HeadWaters Resort and Casino plan on land less than a mile from Waterside.
That project, though, is currently held up in the city’s review process. HeadWaters developers must provide a plan the city’s Architectural Review Board will approve.
Norfolk Mayor Kenny Alexander has emphasized that the ball in in HeadWaters’ court, and both parties understand that at least a portion of the casino must open by November 2025 to meet the terms of the agreement.
Court rules agreement between city and Cordish was ‘unenforceable’
Last week’s court decision stems from the Cordish-owned NDA filing suit in June 2021. At the time, it alleged that “Pishko overstepped his authority and that he boasted to Cordish representatives he was the ‘real mayor’ of Norfolk.” The lawsuit quoted Pishko as saying:
“Mayors and council persons come and go, and in reality, [I am] the mayor.”
A Norfolk judge initially dismissed the lawsuit in 2022, saying at the time that Norfolk’s “agreement to agree” with Cordish “created no obligation on the part of the city and Norfolk Redevelopment Housing Authority,” according to the Virginian-Pilot.
In the appeal, Judge Richard Y. Atlee wrote the decision on behalf of the three-judge panel.
“All of NDA’s assignments of error, and the underlying claims, turn on the premise that the city and NRHA breached enforceable contractual obligations owed to NDA under the lease agreement. Because we find that section 10.2.1 was an unenforceable agreement to agree and a casino was not a permitted use under the terms of the agreement, we find that the circuit court did not err in sustaining the demurrers.”
