Tacoma Walmart developer sues city and individual council members for $1.8 million

The City of Tacoma’s attempts to stop Walmart from opening in Tacoma cost a real estate developer $1.8 million, according to a lawsuit.

Allenmore Medical Investors, the limited liability company controlled by developer Jeffrey Oliphant, filed suit in Pierce County Superior Court earlier this month. In addition to the city itself, the lawsuit names individual city council members and 20 unidentified city employees as defendants.

I’ve asked for comment from the city. I’ll update this post should I receive one.

UPDATE, 2:50 p.m: Elizabeth Pauli, the city attorney, called to say that the city was served with the lawsuit on Wednesday and had no other comment beyond that.

ORIGINAL POST: The roots of the lawsuit are found in the events of the fall of 2011, when the city council quickly enacted a moratorium on big-box retail stores in fear that Oliphant’s company planned to build a Walmart, the city’s first, on land he was developing in Central Tacoma.

The moratorium ultimately did not stop Walmart’s arrival. The store opened in June 2013.

The lawsuit contends that the moratorium itself was arbitrary. Specifically, using the legal phrasing, Oliphant contends the council and city staff’s actions were “irrational, arbitrary and capricious, failed to serve a legitimate governmental purpose, were done for an improper purpose – a naked attempt to delay and prevent AMI’s controversial but vested and entirely lawful development project from proceeding – and used improper means of accomplishing such improper purpose.”

The developer’s lawsuit also claims that from the time of the moratorium until construction began, city staff dragged their feet through all the remaining stages of the permitting process.

For example, according to the lawsuit, city staff told the developer that the building permit wouldn’t be issued until the developer met new conditions that included having all the buildings on the site be built at the same time, and that the businesses then would have to open at the same time.

Walmart was the only confirmed tenant at that time, though Oliphant planned to develop several smaller retail pads on the site. Starbucks and McDonald’s since have opened on two of those.

Staff eventually backed down from that requirement, the lawsuit claims, after the developer and Walmart complained.

The developer claims three big factors add up to $1.8 million in damages: Because of the delay, Oliphant had to pay more to the original property owner to extend his option to buy, and those payments didn’t apply to the final purchase price; the price of the property itself went up as time went on; and the developer had to give Walmart a discount on its final purchase price once the store was built.