Van AndelArena lawsuit heads to mediation

February 15, 2009
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Discovery and mediation are next after a recent decision by U.S. District Court Judge Janet Neff denied a dismissal motion made by the Convention and Arena Authority and SMG — defendants in a lawsuit filed last June by Delta-Turner LLC.

The suit charges the CAA and SMG with violating federal and state antitrust laws in the booking of some concerts at Van Andel Arena and with breaching the open-meetings and the freedom-of-information acts. The suit is seeking damages in the seven figures.

The CAA is responsible for operations at the arena, while SMG is the management firm that conducts daily operations at the building.

Delta-Turner, which owns the DeltaPlex Entertainment and Expo Center in Walker, has alleged that the defendants entered into a “preferred provider agreement” with Cellar Door Productions of Michigan, a subsidiary of the world’s largest concert promoter Live Nation Inc.

The plaintiff claimed the agreement calls for the arena to receive a third of the net-event revenue Live Nation collects from concerts it books at the DeltaPlex and three other venues in the area. In turn, the contract calls for the CAA to give Live Nation a third of the net-event revenue it gets from concerts at the arena that are booked by other promoters like AEG. Delta-Turner said the contract has been in place for the better part of a decade and that it creates unfair competition in the region because it diverts live shows away from other venues to the arena.

The CAA, a state-chartered public panel, and SMG said the lawsuit was without merit.

Richard Glaser, a member with Dickinson Wright PLLC, is representing the CAA. He said the mediation process is set to begin March 10.

“We have a facilitated mediation session set up that’s pretty typical of the federal courts to see if there is a way that the parties can reach some early resolution,” he said.

“Certainly, I don’t think you go into the facilitated mediation program in federal court unless each side feels they can reach some resolution, something that is mutually agreeable, so everybody’s attention can be focused back on more productive things,” Glaser added.

Glaser said the federal mediation program has been in place since the mid-1990s and parties volunteer to take part in the process. The purpose is to settle a case, if possible, before both sides spend a lot of time and money on discovery and litigation.

Douglas Van Essen, a partner at Silver and Van Essen PC and the attorney for Delta-Turner, said the discovery process was ready to get under way.

“We have some interrogatories and document-production requests that are outstanding, and the defendants now are focused on answering those and doing their own discovery. As we’re going to be entering a period of discovery, we’re also entering some court-ordered mediation to see if we can resolve the case. Those will be our immediate activities now for the next few months,” said Van Essen.

“We are doing the mediation through the courts’ auspices. The courts, both federal and state, strongly encourage it. We’re going to attempt what is called ‘early-case mediation’ in trying to resolve it early, if we can,” he said.

Glaser said a court date hasn’t been set. If the case does go to trial, it will likely be before a jury, as Delta-Turner has requested. Glaser doesn’t agree that juries have a tendency to favor the “little guy” in their decisions, which would be the smaller DeltaPlex, in this case.

“It’s been my experience that juries, collectively, listen carefully to the evidence,” he said. “And in the process of their deliberations, they more often than not come to the correct decision.”

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