Firms Using Environmental Law To Battle Competitors
To stop the project of a competitor near the University of Southern California, Conquest Student Housing used a legal weapon that one of its co-owners compared to a cheap and destructive bomb.
Conquest has 17 buildings that it rents out to USC students. When a new complex that aims to house 1,600 was proposed by developer Urban Partners, a lawsuit was filed by Conquest under the landmark environmental law of California.
Similar challenges were then filed by Conquest against unrelated Urban Partners projects in other parts of the state. Only after Urban Partners filed a lawsuit on federal racketeering that the challenges were withdrawn by Conquest.
The legal skirmish was possible since California is among the three states that necessitate private projects to abide by its own environmental law. That measure, the California Environmental Quality Act, is responsible for aiding in the preservation of the swaths of the Mojave Desert, Sierra Nevada and coastline. But as state politicians rushed to assure the voters that they are trying to generate jobs, they have turned on the four-decade law and the litigation industry that it has spawned.
Dan Rosenfeld, the Urban Partners principal who handled the development at the University Gateway, said, “These are the laws that allow a solo bird-watcher to protect an endangered animal, but they’re being used by a sophisticated real estate entity to kneecap the competition.”
Project developers are required by the law to go through an extensive public process which requires the detailing of environmental effects of the project and how they will be mitigated. Any local party can challenged the findings in court.