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Glenwood Halsted LLC, An Illinois Limited Liability v. Village of Glenwood

April 2, 2012

GLENWOOD HALSTED LLC, AN ILLINOIS LIMITED LIABILITY COMPANY, PLAINTIFF,
v.
VILLAGE OF GLENWOOD, AN ILLINOIS MUNICIPAL CORPORATION, ET. AL., DEFENDANTS.



The opinion of the court was delivered by: Charles P. Kocoras, District Judge:

MEMORANDUM OPINION

This case comes before the Court on the motion of Defendants Village of Glenwood ("Glenwood"), Kerry Durkin ("Durkin"), and Kevin Welsh ("Welsh") (collectively, "Defendants") to dismiss the complaint of Plaintiff Glenwood Halsted LLC ("Plaintiff") pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons stated below, the motion is granted in part and denied in part. Additionally, the Court dismisses all claims against Donna Gayden without prejudice.

BACKGROUND*fn1

Plaintiff is a company that owns a shopping center complex (the "Shopping Center") in Glenwood, Illinois with between twenty-four and thirty units available for rent. Plaintiff alleges that, beginning in 2008, Defendants began a scheme to diminish the value of the Shopping Center and force Plaintiff to sell it to Glenwood or Defendants' friends at a substantially reduced price. At all relevant times, Durkin was the Mayor of Glenwood and Welsh was a building inspector for Glenwood. Defendants' Interference with Plaintiff's Existing and Prospective Tenants Plaintiff alleges that, between 2008 and 2011, Defendants sought to diminish the value of the Shopping Center and force Plaintiff to sell it at a substantially reduced price by influencing Plaintiff's existing and prospective tenants to leave the Shopping Center or to not rent from Plaintiff. For instance, Durkin and Welsh warned prospective tenants, including a church and a grocery store, that Glenwood was going to condemn the Shopping Center, or that they would not support the prospective tenant's business activity. Durkin also informed several existing and prospective tenants that the Shopping Center was going into foreclosure, that Glenwood was going to condemn the Shopping Center, and/or that Defendants were trying to "starve out" the Plaintiff. Welsh told one of Plaintiff's existing tenants that Glenwood would be taking over Plaintiff's property, Glenwood was "waiting out" Plaintiff in anticipation of Plaintiff shutting down its business due to a lack of tenants, Glenwood would be fining Plaintiff's tenants, Glenwood was trying to drive down the value of Plaintiff's property, and that Welsh would get the Governor or another developer to purchase Plaintiff's property.

Additionally, in 2010 and 2011, Defendants interfered with Plaintiff's ability to lease property to prospective tenants by declining to issue business licenses to those tenants. For example, two prospective tenants sought licenses from Glenwood to operate a day care center and a tavern. Glenwood declined to issue licenses to those prospective tenants even though the previous tenants used each property for the exact same purpose. Building Code Violations

Beginning in September 2009, Defendants and their agents began issuing false or exaggerated building code violations to the Shopping Center. Welsh repeatedly went to the Shopping Center, sometimes up to three times per day, to conduct inspections. Welsh did not conduct such frequent inspections of other commercial shopping centers in Glenwood. Although Defendants initially threatened significant fines for the alleged violations, Defendants dismissed or settled the code violations for a minimal fine after Plaintiff contested the violations and threatened a lawsuit.

Durkin's Request for Financial Benefits from Plaintiff

According to Plaintiff, Durkin and others sought financial benefits from Plaintiff. For example, around September 2009, an unnamed individual purportedly representing Durkin told Plaintiff that it needed to do "public relations" work, which Plaintiff interpreted as a request for financial contributions to Durkin for his mayoral campaign. Additionally, an unnamed individual, seeking employment as Plaintiff's consultant, told Plaintiff that it needed to do "public relations" and claimed that his services were necessary to obtain what Plaintiff wanted from Durkin.

In September 2010, Durkin requested that Plaintiff provide him with rent-free use of property within the Shopping Center for his election campaign. Plaintiff understood Durkin's request to be an ultimatum to provide financial benefits to Durkin or suffer adverse consequences from Glenwood. Before this, Durkin told Plaintiff to do what he said or he would kick Plaintiff out of town and sell the Shopping Center to another developer.

Statements about Plaintiff's Owners

Plaintiff's owners are of Greek descent. Durkin stated that "two cheap Greeks own" the Shopping Center, so "why should we give them the money?" The complaint is unclear regarding whether Durkin was referring to money to purchase the Shopping Center or to purchase space for his election campaign or something else. Additionally, at a public meeting in 2010, Durkin and Welsh called Plaintiff's owners derogatory names.

Glenwood's Offer to Purchase the Shopping Center

On October 18, 2011, Donna Gayden ("Gayden"), the administrator of Glenwood, sent a letter to Plaintiff offering for Glenwood to purchase the Shopping Center at a price below fair market value. Gayden indicated that Glenwood would institute proceedings to acquire the property by eminent domain if ...


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