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Attorneys deny Mirbeau claims

WHAT IS TORTIOUS INTERFERENCE? According to Wikipedia, tortious interference, in the common law of tort, occurs when a person intentionally damages the plaintiff's contractual or other business relationships. Tortious interference with contract rights can occur where the tortfeasor convinces a party to breach the contract against the plaintiff, or where the tortfeasor disrupts the ability of one party to perform his obligations under the contract, thereby preventing the plaintiff from receiving the performance promised. The hardcore instance of this tort occurs when one party induces another party to breach a contract with a third party, in circumstances where the first party has no privilege to act as it does and acts with knowledge of the existence of the contract. Such conduct is termed tortious inducement of breach of contract.
July 28, 2010 | 08:58 AM
The long process continues in the $29 million case of Mirbeau of Geneva Lake versus the city.

Through their attorneys, current and former city officials have responded to Mirbeau's amended complaint filed July 1, which included an additional claim for "tortious interference with a contract."

In separate answers filed by insurance company attorneys Amy Doyle of Crivello Carlson, and Joe Wirth, of Piper and Schmidt, the defendants denied the claims of unlawful and improper conduct and are asking for dismissal of the complaint.

Doyle is representing current aldermen Mary Jo Fesenmaier and Arleen Krohn and former aldermen Tom Spellman and Penny Roehrer. Wirth is representing current aldermen Todd Krause, Don Tolar and Frank Marsala and former elected officials Bill Chesen, Gary Dunham and Larry Magee. No response has been filed for recently-added defendants, current Mayor Jim Connors, Linn Township resident Richard Malmin, Tom Muenster and Lower Density Development.

Mirbeau 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 suit goes to court, it could add up to more than $247 million.

Among the defenses listed in the response include that "these responding defendants enjoy all immunity from claims and limitations on actions and damages provided by Wisconsin statutes," that the action must be dismissed for "lack of standing," if there were damages suffered by the plaintiffs, it was caused in whole or in part by its own actions or omissions or failure to mitigate damages, the plaintiffs have failed to exhaust avenues for relief available in forums other than circuit court, the plaintiff's have "improperly and incorrectly joined inconsistent claims," and the actions of the members of the City Council are legislative in character and therefore any motives to take legislative action are not subject to judicial scrutiny.

In the amended complaint filed by Mirbeau, the focus moved to Fesenmaier, former alderwoman and Friends of Geneva Lake leader Roehrer, Connors, Malmin, Lower Density Development, and 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.

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 Roehrer, 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???)."

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 Mirbeau and Hummel 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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