Malibu Developers File Federal Suit Against Measure R

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Malibu City Hall

It’s a new year, but Measure R continues to stir up the same old controversy in Malibu.

Malibu developers who last year campaigned against Measure R, the voter-approved formula retail and development ordinance, filed a federal lawsuit against the City of Malibu on Monday, alleging the local law violates the U.S. and California constitutions.

News of the suit, which was filed on behalf of The Park at Cross Creek LLC (owned by Steve Soboroff) and Malibu Bay Company, comes less than a week into the new year and barely a month after the new law hit the books. It seeks to permanently bar the new law from ever being enforced by the City of Malibu.

City Attorney Christi Hogin called the suit “premature” but indicated that her legal team is up for the challenge of defending Measure R.

“I’m confident that the city will implement it in a way that’s consistent with the Constitutions of the United States and California, and I think it’s pretty quick on the trigger for property owners to run to the court and complain about it,” Hogin said.

Hogin scoffed when asked if an outside counsel could be needed to face the suit.

“Anyone who thinks I would shrink from a fight doesn’t know me very well,” Hogin said, adding, “I didn’t read anything in the lawsuit that surprised me or deeply troubled me.”

Measure R enacted a 30 percent cap on the number of chain stores in shopping centers citywide, and created a voter-approval requirement for new commercial centers to be built in Malibu if they measure over 20,000 square feet. 

Following the November vote, which had Measure R passing with 59% of the local vote, Malibu Bay Company President David Reznick indicated that a lawsuit could be underway.

“No one should be surprised if one or more legal challenges are filed,” Reznick told The Malibu Times.

According to a statement released on Monday, plaintiffs allege the ordinance is unlawful on several grounds, including violating the U.S. Commerce Clause, and that it takes power away from elected officials.

“It is arbitrary, discriminatory and lacks a reasonable and rational relationship to a proper legislative purpose,” said Cox, Castle & Nicholson attorney David Waite, who filed the suit. “Under the provisions of this misguided measure, developments are no longer subject to any standards other than the whim of the electorate. In so doing, Measure R divests the city’s elected leaders of their proper and lawful government functions pertaining to local land use and development.”

The Bay Company owns a parcel of land where the Chili Cook-Off is held annually on the northeast corner of Civic Center Way and Stuart Ranch Road. Plans for the 80,000-square-foot project include stores, office space, restaurants and a new Malibu Urgent Care facility.

Soboroff, of The Park at Cross Creek LLC, was the face of the opposition to Measure R throughout the months-long campaign and poured tens of thousands of dollars into the “No on R” campaign.

“The restrictions enacted by Measure R infringe on our constitutional rights to a point where we had no choice but to file this complaint,” Soboroff said in the statement. “This lawsuit raises fundamental questions about how far a law can go in constraining the rights of a select few property owners by altering detailed and legal land-use rules in a community.”

Soboroff hopes to build a Whole Foods supermarket in the Civic Center.

According to the lawsuit, plaintiffs are going to federal courts in the hopes Measure R will be declared “invalid based on violations of the United States Constitution, the Constitution of the State of California and California planning and zoning law.” 

According to the Commerce Clause of the U.S. Constitution cited in the lawsuit, Congress has the power “to regulate commerce with foreign nations, and among the several states, and with the Indian tribes.” Plaintiffs believe such commerce is a federal issue, and not a local or state concern.

At the state level, the plaintiffs allege they are denied equal protection and due process under the California Constitution, on the grounds that the measure oversteps its legal boundaries by giving too much power to voters. They also take issue with Measure R allegedly not having a “single subject matter” when it was placed on the November ballot.

“Measure R contained two distinct regulatory components — subjecting any commercial development over 20,000 square feet to a public vote and placing limitations on the ability of commercial property owners to lease their retail space to formula retail tenants,” opponents argue.

The suit goes on to call the ordinance “discriminatory” and alleges that “Measure R’s specific plan … exceeds the initiative power reserved to the people of California.”

Malibu Mayor Skylar Peak, the only elected official to publicly back Measure R, said that now the initiative is law, the city will be dedicated to backing it, even those who opposed it in the election.

“It’s the vote of the people in Malibu, and that’s what they clearly want, so they have to defend it,” Peak said.