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Mirbeau lawsuit narrows focus


Claims of interference include alderwomen, current mayor



Developer adds current mayor to defendant list Along with Mirbeau of Geneva Lake's amended complaint, four new defendants have been added to the $29 million lawsuit against the city of Lake Geneva. Current Mayor Jim Connors, Lower Density Development, Tom Muenster and Richard Malmin were the latest additions to the defendant list which already includes the city, current and former elected officials Todd Krause, Gary Dunham, Mary Jo Fesenmaier, Arleen Krohn, Larry Magee, Tom Spellman, Don Tolar, Bill Chesen, Penny Roehrer and Frank Marsala. In the complaint, Mirbeau calls Connors the founder and treasurer of the "Vote No Mirbeau-Hummel." The complaint states that Connors "organized, led and participated in unjustified and improper activities designed to interfere with Mirbeau's purchase and sale agreement with Geneva Ridge." Mirbeau also cites Lower Density Development as a Delaware limited liability company with a place of business in Chicago, whose "registered agent is the Corporation Trust Company. Mirbeau states that "LDD was formed for the sole and unjustified purpose of intentionally interfering with a purchase and sale agreement between Mirbeau and Geneva Ridge Joint Venture through its improper activities in Wisconsin." Muenster, according to the complaint, resides in South Dakota, and is the manager of LDD. The complaint states he "organized, led and participated in unjustified and improper activities assigned to interfere with Mirbeau's purchase and sale agreement with Geneva Ridge. Muenster also is J.B. Pritzker's brother in law. Pritzker is one of wealthiest men in the country and is a Geneva Lake front estate owner. The complaint against Malmin, a Linn Township resident who lives close to the proposed development site, is the same as Muenster's.
July 07, 2010 | 09:01 AM
For 39 pages, Mirbeau of Geneva Lake's amended complaint filed last week in federal court read much like previous complaints.

There are claims for violating the U.S. and Wisconsin Constitution, due process rights, open records, open meetings and retaliation.

But, on Page 40, the eighth claim narrows the focus on five individuals and provides some details not previously provided in other complaints by Mirbeau or Geneva Ridge Joint Venture.

Mirbeau of Geneva Lake is suing the city of Lake Geneva for $29 million, alleging its rights were violated and treated differently during the zoning process for its failed 100-room retreat and other facilities. Geneva Ridge also is suing the city for about $123 million and has provided notice to the city regarding a lawsuit surrounding racketeering allegations. If that goes to court, that could add up to more than $247 million.

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In the most recent complaint filed by Mirbeau, the focus moved to current Alderwoman Mary Jo Fesenmaier, former alderwoman and Friends of Geneva Lake leader Penny Roehrer, current Mayor Jim Connors, Linn Township resident Richard Malmin, Lower Density Development, and Tom Muenster, brother-in-law of lakefront owner and billionaire J.B. Pritzker.

The eighth claim is for "tortious interference with a contract" and the cause of action is against those five people and LDD.

Mirbeau, which had a contract with Geneva Ridge to purchase 54.5 acres of the property for its development, states that Fesenmaier, Roehrer, Connors, Malmin, Muenster and LDD "intentionally interfered with the Mirbeau purchase contract." The complaint states this effort included trying to drive down the value of the property so LDD could "acquire title at less than market price."

There are 17 pages of the amended complaint about these claims.

According to the complaint, following LDD's offer to purchase the 718 acres for $10 million, a "flurry of behind-the-scenes activity, spearheaded by Roehrer, Muenster, LDD, Fesenmaier, Malmin and Connors.

"These defendants developed, organized, planned and led a multi-front attack on Mirbeau, all designed to delay, disrupt, and interfere with Mirbeau's purchase contract," the complaint states.

Some of the behind-the-scenes activity is reflected in e-mail transmissions between Malmin, Roehrer, Muenster, Pritzker, Fesenmaier and Connors. Roehrer was "regularly communicating with Fesenmaier in an effort to obtain inside information concerning the City Council's handling of Mirbeau's pending zoning amendment application."

The complaint states LDD made promises and representations to Roehrer, Malmin, Connors, Fesenmaier, other members of the Friends of Geneva Lake and to the public that the development plans for the property would be much more desirable and acceptable than those of Mirbeau and Geneva Ridge.

At the time this was occurring, Mirbeau claims Muenster, who they believe to be involved with LDD, attends Friends of Geneva Lake meetings.

Friends of Geneva Lake members met Dec. 14 and discussed how the city's referendum on the Mirbeau-Hummel project would be worded.

The complaint also states that Friends of Geneva Lake and LDD's strategy was "to delay a vote on the Mirbeau-Geneva Ridge project for as long as possible, to improperly pressure the duly elected City Council members of abdicate their duties, accept the results of the improper referendum and defeat the zoning amendment application." With that, Mirbeau's purchase contract would expire, preventing Mirbeau from acquiring the land for its project.

In an e-mail Dec. 20, 2007, between Friends of Geneva Lake member Penny Roehrer to Muenster, Pritzker and other FOGL members, "We'll see what time does to Mirbeau/Hummel, hopefully it will wear them down and Hummel will sell."

The complaint states the efforts by the same individuals continued into 2008.

"As the LDD led multi-front attack on Mirbeau's purchase contract solidified, Roehrer became more arrogant and confident in the group's purchase contract interference plans," the complaint states.

In an e-mail Jan. 18, 2008, to Malmin, Muenster, Pritzker and other Friends of Geneva Lake members and supporters, Roehrer outlined an agenda for the Friends group. It included: "Vote No update, discussion of pending sale/auction of Hummel property (what do we know for sure and what might we expect -- ie. removal of filing and need for referendum???)."

Roehrer's minutes from the Jan. 18 Friends meeting "reflect the involvement of Connors in LDD's multi-front attack on Mirbeau's purchase contract," according to the complaint. He was "actively involved in creating and controlling the activities of Vote No," the Friends subcommittee "dedicated exclusively to defeating Mirbeau's efforts to purchase the property."

Roehrer's meeting minutes also "reference yet another facet" of the attack on the purchase contract. The complaint mentions contacts with Hack-Ma-Tack, a "national organization dedicated to acquiring property for purposes of creating wildlife refuges."

The claim states that LDD "was making representations to Malmin, Roehrer, Connors, Fesenmaier and other FOGL and Vote No members and supporters that it would consider donating a portion of the property to Hack-Ma-Tack, or some other conservation group, if it could acquire the property."

The clam also states that after Roehrer was elected to the council in April 2008, she "continued to advise Muenster and LDD on the appropriate strategies for acquiring the property."

On March 4, 2009, after the Mirbeau zoning amendment application was defeated and after the purchase contract expired, Muenster sent an e-mail to Roehrer and attorney David Williams stating, "I would like your opinion on LDD's exposure to tortious interference."

Geneva Ridge and Mirbeau teamed together in an effort to develop 718 acres of land near Big Foot Beach State Park. After the effort with Mirbeau failed, Geneva Ridge, better known as Hummel, went on their own in an effort to develop the property. That also failed.

In general, both developers are alleging among other things, "unlawful conduct by certain city officials who control the local government." It involves a "systematic and ongoing pattern of intentional unequal treatment ... without any rational basis. These city officials individually and collectively have abandoned and ignored legal obligations of their elected offices, as well as the rules, regulations and procedures of their own municipal zoning ordinances."

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