Lawsuit Against Metropolitan Airport Authority to Continue After Appeal
An Illinois appellate court has reversed a 2018 Rock Island County court ruling siding with the Metropolitan Airport Authority in a dispute with former developer Todd Raufeisen, who alleges the authority cost him millions.
In 2012, the authority and Moline ended a development agreement with RDC Case Creek Trails (Raufeisen) that involved a proposed development on airport authority property. The city and the authority argued there was a lack of financing for the development.
RDC filed suit in 2012, arguing the airport violated the development agreement by asserting it could lease the land in question to RDC when it required Federal Aviation Administration approval before leasing or selling the land for a non-aviation purpose, and failed to get that approval.
The suit alleges the contract parties were working on that federal approval when the development agreement was terminated. The failure of the project allegedly cost Case Creek $13.8 million in costs and unrealized profits.
The appellate decision, handed down in May, and filed Tuesday in Rock Island County, reversed a 2018 ruling by then-Circuit Judge Lori Lefstein. Her ruling had halted RDC’s suit.
It was a summary judgment in the authority’s favor that centered on its argument that the suit should be dropped because RDC did not officially notify the authority of the alleged breach before suing, according to court documents. That notification, the authority argued, was mandatory before a suit could be filed.
The appellate court, however, ruled that the notification requirement ended when the development agreement did, and notification was not required before the suit’s filing, according to the appellate opinion.
RDC filed an amended complaint in January 2019, while the appeal was still underway. It alleges breach of express warranty, fraudulent inducement and negligent misrepresentation based on its contention that the authority stated it could lease the property.
The authority had not filed an answer to that complaint as of Wednesday.
In such filings, the defendants in lawsuits have an opportunity to respond to the allegations against them.
The airport authority has had a countersuit since 2016. An amended version of it has also been filed and accuses RDC of fraud.
The countersuit's allegations include that RDC falsely stated it had procured a Marriott Courtyard as a tenant.
RDC had not filed a response to the countersuit as of Wednesday.
Raufeisen is serving a 72-month federal prison sentence in a fraud case.
Raufeisen was charged in May 2017 with money laundering and wire fraud, according to federal court records. A plea agreement and Raufeisen's pleas of guilty were filed the same day. He was accused of stealing about $1.7 million from investors who contributed to his projects.
He was sentenced to 72 months on each count, but the sentences are concurrent. He must also serve three years of supervised release and pay about $1.7 million in restitution.
Raufeisen is scheduled for release in 2023, according to the U.S. Bureau of Prisons.
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