Wrigley Field Renovations Mired in Litigation

Earlier this off-season, the Chicago Cubs began work on their long-awaited renovations to Wrigley Field. The team launched phase one of the project in October, tearing down the stadium’s existing bleachers with the hope of rebuilding and expanding them in time for Opening Day. In addition, the $575 million project will eventually include new clubhouses, luxury suites, concession areas and signage throughout the stadium — as well as the construction of a nearby hotel and office-building complex.

Unless, that is, owners of the rooftops overlooking Wrigley Field get their way. These building owners have filed two lawsuits over the past four months — the first coming this past August, and the second on Thursday — in an attempt to stop the renovations. In particular, the rooftop owners fear that two new scoreboards to be constructed as part of the renovation project will block their views into the stadium, threatening the roughly $20 million in annual ticket revenue the rooftops currently generate.

In an interesting twist, though, rather than suing the Cubs, the building owners have instead sued the City of Chicago in the hopes of having the renovation halted. Understanding why the rooftop owners would sue the city, rather than the team, requires some knowledge of the lengthy history of the dispute.

Back in 1998, the City of Chicago approved a local ordinance officially allowing the owners of buildings neighboring Wrigley Field to sell tickets to watch Cubs games from their rooftops. The Cubs – which at the time received no compensation from the rooftop owners – quickly realized they were losing out on a substantial profit stream. So the team filed suit in 2002 claiming the neighboring buildings were, among other things, misappropriating their property.

That lawsuit settled in 2004. Under the terms of the 20-year settlement agreement, the building owners agreed to pay the Cubs 17% of their annual gross revenues from the rooftop ticket sales. In return, the Cubs agreed to officially endorse the rooftop businesses, and – under certain conditions – provide compensation to the building owners should any future expansion of Wrigley Field block views from the rooftops into the stadium.

Meanwhile, around the same time, the city officially designated Wrigley Field a local landmark. This designation meant a number of the stadium’s historic features – including the uninterrupted “sweep” of Wrigley’s grandstand and bleachers – were protected under the law.

Fast forward to the present. With the idea of restoring and modernizing Wrigley Field, the Cubs have announced a $575 million renovation project to be completed over the next four years. Most significantly for present purposes, in addition to expanding Wrigley’s outfield bleacher seating, the Cubs’ renovation plans also call for the construction a 5,700-square-foot scoreboard in left field, and a smaller, 650-square-foot scoreboard in right field.

Due to Wrigley’s local landmark designation, however, the team first had to secure the city’s approval of its renovation plans. Meanwhile, the rooftop owners – fearing the new scoreboards would obstruct their view into the stadium – also lobbied the city, arguing the renovation proposal should be rejected because the additions would destroy the protected, historic “sweep” of Wrigley’s bleachers.

After much politicking by both sides, the city granted its final approval of the Cubs’ plans in July 2014. At that point, the rooftop owners took to the courts in August, filing suit against the city and its landmark commission – which had the primary responsibility for reviewing and approving the team’s renovation project.

So why sue the city instead of the team? The answer is in the Cubs’ 2004 settlement agreement with the rooftop owners. Under Section 6.6 of the agreement, the team promised not to “erect windscreens or other barriers to obstruct the views of the Rooftops,” language that would seemingly exclude the possibility of constructing the proposed new scoreboards. However, the same provision goes on to state, “Any expansion of Wrigley Field approved by governmental authorities shall not be a violation of this Agreement, including this section.” So if the city approves any proposed expansion of Wrigley, then under this provision the team would presumably be free to build barriers — including scoreboards — blocking the view of the rooftops.

As a result, the rooftop owners have apparently determined that their best course of action is to challenge the city’s approval of the expansion plans. In their August 2014 lawsuit, the building owners contend the city’s landmark commission failed to follow the proper procedure when approving the Cubs’ renovation plans, depriving the rooftop owners of the opportunity to fully participate in the review process. In addition, the suit challenges the city’s conclusion that the construction of the scoreboards would not disrupt the historic “sweep” of Wrigley’s bleachers.

But while the August lawsuit was proceeding through the courts the Cubs decided to change their renovation plans by adjusting the location where the new scoreboards would be built in left and right field. The team claims that the redesign was necessary to obtain a $75 million federal tax credit from the National Park Service.

The rooftop owners contend the Cubs’ true motives were more nefarious, though. In a new lawsuit filed last Thursday — which challenges the city’s December approval of the revised renovation plans — the building owners contend the real reason the team altered its plans was to block the view from certain rooftops while enhancing the view from other buildings.

You see, after the city’s approval of the Cubs’ renovations plans in July, it appears the team went out and purchased some of the rooftop buildings itself. The latest lawsuit alleges that the revised renovation plans were designed to maximize the views into Wrigley from these Cubs-owned buildings, while further obstructing the views of any building owned by someone else.

So what does all of this mean for the Wrigley Field renovation plans? The rooftop owners face an uphill fight in their two suits against the city, as courts are usually fairly deferential to the decisions reached by administrative bodies like Chicago’s landmark commission. However, should the building owners successfully convince a court to set aside the city’s approval of the renovation plans, the building owners would have succeeded in delaying the construction of the new scoreboards. This, in turn, would give the rooftop owners greater leverage in any future negotiations with the team.

Meanwhile, assuming the court refuses to interfere with the city’s approval of the renovation, then the building owners’ only recourse would be to challenge the project under their 2004 settlement agreement. The rooftop owners would likely be forced to argue that even though the city may have approved the expansion of Wrigley Field, that approval does not necessarily permit the team to build new scoreboards under the terms of the settlement agreement.

Specifically, the rooftop owners could argue the phrase “expansion” in the settlement agreement should be limited to projects that actually increase the size or seating capacity of Wrigley Field. Under such a definition, the construction of new scoreboards would not be considered an expansion since they don’t increase the stadium’s size. And if the new scoreboards are not an expansion, then the prohibition against the Cubs building any “barriers to obstruct the views of the Rooftops” under Section 6.6 of the settlement agreement would arguably still apply, even though the city has approved the renovation project.

Admittedly, this argument is a bit of a stretch considering the new scoreboards are an integral part of the Wrigley Field renovation plans approved by the city. But if the rooftop owners could convince an arbitrator to rule in their favor — under the 2004 settlement agreement, all disputes between the Cubs and building owners must be arbitrated, not litigated in court — then the owners could potentially prevent the Cubs from building the proposed scoreboards.

Still, the odds appear to be stacked against the rooftop owners. The courts will likely be reluctant to strike down the Chicago landmark commission’s approval of the Wrigley Field renovations, and the building owners’ legal arguments under the 2004 settlement agreement are of questionable strength at best. Therefore, while the recent lawsuits may threaten to delay the stadium renovations, they ultimately appear unlikely to derail the project.