The jury in the Hot Creek Development versus Town of Mammoth Lakes lawsuit returned a verdict of guilty with damages of $30 million awarded.
Hot Creek had alleged that the Town of Mammoth breached a development agreement signed with the development firm several years ago. In a press release issued after 5pm Friday, Town officials said that the jury ruled that the Town breached a development agreement between the two parties when the Town responded to directives from the Federal Aviation Administration in 2004. The FAA forbids residential development at airports and Hot Creeks condo project planned for land adjacent to Mammoth Yosemite Airport fit the description.
The Towns press release goes on to say that this was a very complex case, and the decision was based on both the findings of the jury and rulings by the judge. The Town then points out that the rulings of the judge and the jury verdict are subject to appeal. The press release says, The Town and its legal team believe that the Towns actions with respect to the Hot Creek matter and the FAA directives were legal, ethical and proper, and that they will be upheld at the appellant court level.
With an annual budget of around $15 million, the jury award of damages in the amount of $30 million is staggering. Town officials say that the damages are automatically set aside while the decision goes through the appeal process. Officials added that the Town has moved ahead with the administrative process relating to the availability of insurance coverage for the claim. The Town had earlier lost a claim for an insurance company to pay legal fees on this case. At last report, this denial was under appeal.
This trial, which lasted two weeks, has already cost the town more than $1 million will likely cost a lot more as an appeal proceeds.