sPower, which announced last month it would seek to purchase land at the Calverton Enterprise Park for a massive solar energy installation, has brought a lawsuit to block the proposed sale of 1,643 acres to Calverton Aviation and Technology LLC, a joint venture between Luminati Aerospace LLC and Triple Five Real Estate I LLC.
In a complaint filed yesterday in State Supreme Court in Suffolk County, sPower argues that the town has no basis for refusing to entertain an offer from the solar energy company because a March 2017 letter of intent is now “unenforceable and of no effect.”
sPower is seeking an injunction against the sale and a declaratory judgment requiring the town to consider other offers.
A request for a temporary restraining order against the town taking any further action on the proposed sale to Calverton Aviation and Technology LLC was rejected yesterday by the court, according to Town Supervisor Laura Jens-Smith and Robert Hasday, an attorney for Luminati Aerospace.
Jens-Smith said at the Jan. 17 town board meeting that the town is bound by the letter of intent and could only entertain other offers if and when the proposed purchaser is determined not to be a “qualified and eligible sponsor,” which by state law is a prerequisite to the sale or lease of municipally owned land in an urban renewal zone.
The town’s interpretation of the letter of intent is “erroneous,” according to sPower, because the March 2017 letter of intent has been “abandoned.”
The letter of intent stated the buyer would be “a newly formed entity wholly owned by Luminati Aerospace LLC” but the proposed purchaser, Calverton Aviation and Technology LLC is jointly owned by Luminati Aerospace LLC, which according to the complaint has a 25-percent stake in Calverton Aviation and Technology and Triple Five Real Estate I LLC, which the complaint says owns 75 percent of the new entity.
sPower’s attorney Jason Stern of the Weber Law Group said at the Jan. 17 board meeting that his client would offer the town much more favorable terms than the $40 million offer now on the table.
The town is required to “solicit and evaluate” proposals for the property and it has “a fiduciary duty to obtain ‘the most beneficial terms for the town and its taxpayers in connection with such sale,” according to the complaint. The proposed sale constitutes a “waste” of town assets, sPower alleges.
Jens-Smith declined further comment on the lawsuit.
Hasday said the court’s decision denying the temporary restraining order was “made after deliberations about the local economic benefits from the development of a new aviation and technology center, including the employment of large numbers of highly paid skilled labor, compared to the operation of a solar farm, in which there are no onsite employees following construction.
“The Court also addressed the fact that this lawsuit was solely in the economic interests of the two solar companies and had nothing to do with the interests of taxpayers of the Town of Riverhead,” he said.
Not so, said sPower attorney Stern. “[A]lthough the TRO was denied, contrary to Luminati’s counsel’s representations, the judge rendered absolutely no decision on the merits of the case and, instead, directed that defendants submit responses to sPower’s injunction application within eight business days – i.e., well in advance of the Q&E hearing,” he said.
“sPower is confident that it will prevail on the merits of this action and is hopeful that it can ultimately work with the CDA to find the highest and best use of this uniquely important development property,” sPower’s attorneys said in a press release this afternoon.
The “qualified and eligible” hearing was scheduled by the town for Jan. 17, but on that day was adjourned “until further notice.” The town board is expected at its next meeting to set a new hearing date of Feb. 27 at 7 p.m.
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