United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
VIRGINIA M. KENDALL, UNITED STATES DISTRICT JUDGE
Media Advertising, Inc. sued Clear Channel Outdoor, Inc.
claiming Clear Channel breached a contract between the two
parties when it bid on a Chicago Transit Authority (CTA)
request for proposal (RFP) to build and manage billboards on
one of its train yards, even though the parties' contract
allegedly stated Image Media had the right to bid on,
construct, and operate billboards on the yard. Clear Channel
moved to dismiss (Dkt. 14) the breach-of-contract claim
principally arguing that the contract included no right to
put up any additional billboards, and even if it did, that
right only extended to the property defined in the contract.
For the reasons discussed below, the Court grants Clear
Channel's motion (Dkt. 14) without prejudice. Image Media
may replead, if possible, within 28 days of the publication
of this Opinion.
Media is a family-owned billboard sign company that
advertises primarily along expressways near Chicago. (Dkt.
1-1 ¶ 8.) It earns revenue by selling the rights to
advertise on these billboards to various companies.
Id. Around March 17, 1997, Image Media entered into
a contract-the so-called “CTA Billboard Lease”-
with the CTA, receiving the right to construct, operate, and
maintain billboards on a specific parcel of CTA property.
Id. ¶ 9.
agreement specified that “[t]he property shall be used
solely to place and handle advertising by means of displays
on three outdoor advertising structures (as hereinafter
defined) and for no other purpose whatsoever, subject,
however, to all of the terms and conditions hereinafter set
forth.” (Dkt. 14-1 at 2-3, § 1.1(a) (emphasis
added).) Furthermore, it stated that “[t]his Agreement
is for the Property only. Nothing in this Agreement
shall affect in any way the Authority's right or ability
to grant, sell or otherwise convey advertising rights in
connection with locations other than the
Property.” Id. at 3, § 1.2(a)
(emphasis added). The CTA Billboard Lease defines “the
approximately 60 feet by 1, 695 feet and which is bounded by
the Eisenhower Expressway on the south, the Authority's
Des Plaines Avenue Terminal on the east, the Des Plaines
River on the west, and Concordia cemetery property on the
north, in Forest Park, Illinois as more fully described on
the plat of survey attached hereto as Exhibit A-1 (the
Id. at 2.
Media constructed and then sold the three billboards, among
other assets and permits, to Clear Channel. (Dkt. 1-1
¶¶ 10-13.) Around February 27, 2003, Image Media
and Clear Channel entered into another agreement, wherein
Clear Channel assigned its rights regarding the billboards
back to Image Media. Id. ¶ 15. This
‘sublease' noted, apparently for the first time,
that “Image Media shall have the right to construct and
operate any such Additional Billboards on the CTA property
pursuant to the CTA Billboard Lease; and Image Media . . .
[is] hereby released with respect to such Additional
Billboards . . .” Id. ¶ 18.
Media thus pursued local permits and license agreements in
order to construct these “additional billboards.”
Id. ¶¶ 20-24. Sometime between July 2006
and February 2007, Image Media “submitted a proposal to
the CTA to construct and operate the Additional Billboards
and negotiated with the CTA to obtain the right to construct
and operate the two of the Additional Billboards.”
Id. ¶ 25. The CTA informed Image Media that it
would have to issue an RFP for any additional billboards.
Id. ¶ 26. The CTA eventually did issue the RFP,
but for a large quantity of various properties, not just the
site for the potential additional billboards. Id.
site for the additional billboards is located on a parcel
called the Des Plaines Yard, 711 Des Plaines Avenue. (Dkt.
14-2 at 67, 69, 120.) The Des Plaines Yard is in Forest Park,
as is ‘the Property,' but the locations do not
overlap. The Des Plaines Yard is north of the Eisenhower
Expressway and not in the narrow strip of property between
Concordia Cemetery and the Eisenhower Expressway. See
generally Dkt 14-3. An overlap is especially implausible
because ‘the Property' defined in the CTA Billboard
Lease fixes the CTA's Des Plaines Avenue Terminal,
located at 711 Des Plaines Avenue, as its eastern boundary.
See generally id.
the CTA selected Clear Channel's bid, and around July 17,
2008, the CTA and Clear Channel entered into an agreement
that granted Clear Channel the “‘sole and
exclusive license to sell, install, display, operate and
maintain billboard advertising on the properties.'”
(Dkt. 1-1 ¶ 28.) This agreement purportedly included the
rights to the additional billboards. Id. ¶ 29.
As a result, the CTA stopped all negotiations with Image
Media from early 2008 through early 2010 while the agreement
with Clear Channel was in effect. Id. ¶ 32.
Channel and the CTA eventually rescinded their contract, but
not before delaying Image Media's procurement of an
agreement regarding the additional billboards for more than
two years. Id. ¶¶ 31, 34-35. Nonetheless,
the CTA resumed its negotiations with Image Media in 2010.
Those negotiations, however, were bound by the terms of the
original CTA Billboard Lease, which runs until 2022.
Id. ¶ 36. Image Media now believes that the
construction of any additional billboards is not economically
feasible in this narrow time frame. Id. ¶¶
38-39. Image Media sought to extend its contract with the
CTA, but to no avail. Id. ¶ 37.
2015, Image Media allegedly discovered that Clear Channel was
under contract with the CTA to design the additional
billboards during the time period that its own negotiations
with the CTA stalled. Id. ¶¶ 30-31. Image
Media thus blames Clear Channel for this delay because it
“ultimately destroyed” any possibility that Image
Media would reach an economically beneficial agreement with
the CTA. Id. ¶ 44. Image Media sued Clear
Channel in this Court to recover for its loss. (Dkt. 1.)