After 7 years, $6 million in legal fees, Hartford to pay $10M to end battle over ballpark development

HARTFORD — The city of Hartford would pay nearly $10 million to end a 7-year court battle over the development of Dunkin’ Park and the land around it, clearing the way for further apartment construction in the area, perhaps starting by the end of this year.

The $9.9 million settlement, outlined in a letter Thursday from Hartford Mayor Luke Bronin to the city council, is with insurance company — Arch Insurance Co. — that financed the completion of the $71 million ballpark just north of downtown. The settlement is not directly with the former developers — Centerplan and DoNo Hartford LLC — who were fired by Bronin from the unfinished ballpark project in 2016, and a year later, the mixed-use development around the 6,100-seat stadium.

Negotiating directly with Arch was critical to reaching a settlement, Bronin wrote. The settlement relieves Centerplan chief executive Robert Landino of paying a court-ordered $34 million to Arch for finishing the ballpark, making the settlement acceptable to the developers. Arch also would pay the developers $1.8 million under the settlement.

Centerplan and DoNo Hartford filed a wrongful termination civil lawsuit shortly after being fired and initially sought $90 million in damages. The lawsuit touched off a court battle that stretches back to the earliest days of Bronin’s two-term tenure.

Bronin is asking the city council to convene a special meeting Monday where Bronin will seek approval of the settlement.

Bronin, who is not seeking a third term, steadfastly has defended his decision to terminate the developers.

The city was victorious in a jury trial in the case in 2019; and even though the developers successfully appealed that decision to win a new trial — set to begin in the spring — Bronin has maintained the city would again be on the winning side. There was, however, the prospect of years of further appeals.

“While I remain confident that the city would have prevailed again in another trial, that litigation would have cost the city many millions of dollars in legal fees (likely $5-$6 million in additional legal fees altogether,)” Bronin wrote in the letter. “It would have likely prevented the city from moving forward with the development of the parcels around the ballpark for many years to come.”

“And, of course, there is always the risk in any trial that the outcome is not what you want or expect, exposing the city to uncertain financial risk in the future,” Bronin wrote.

Since 2016, legal fees paid to outside firms with expertise in construction law have reached about $6 million. With those fees, the actual costs of defending and settling the lawsuit are closer to $16 million.

If approved by the city council, Bronin noted construction of the North Crossing development could resume moving forward. The developer who replaced Centerplan and DoNo Hartford had completed one phase of the development — the $50 million, 270-unit apartment known as “The Pennant.”

But RMS Cos. of Stamford had been blocked from moving on to the second of four planned phases for more than a year by the litigation. RMS’ founder and chief executive Randy Salvatore has stated multiple times that he remained committed to the development.

In Thursday’s letter, Bronin said moving forward with North Crossing was important for several reasons. They include generating new taxes to help pay off the city’s costs in building Dunkin’ Park; reconnecting neighborhoods with new development decades after being separated by the construction of I-84; and fueling economic development, which took a hit in the pandemic.

“I also believe that it is important for the new administration to move forward without the cost and distraction of a new trial and inevitable appeals,” Bronin wrote.

Bronin was not immediately available for further comment, but he has scheduled a press conference for Thursday afternoon.

Negotiating with Arch Insurance

The settlement turns on a 2019 federal court ruling in which Centerplan’s Landino was ordered to pay Arch Insurance about $34 million tied to the ballpark’s completion.

Arch successfully argued that Landino had failed to reimburse the insurer for what it paid out to finance the completion of the ballpark. Arch hired a new construction company and the stadium — the home field of the Hartford Yard Goats — opened for its first season in 2017, a year later than planned.

Bronin noted that Arch paid about $34 million to complete the ballpark, and the settlement was less than 30% of that amount.

“Had the city not terminated Centerplan and called the bond in 2016, the city would have been responsible for that $34 million, at a minimum, and probably more in order to complete the ballpark,” Bronin wrote to the city council.

Bronin wrote that the city has reserved “sufficient funds” for the settlement from prior year surpluses, “which means this settlement will not have any impact on the current year budget, and will not require us to draw down any funds from our unassigned fund balance.”

Bronin’s letter toned down the stronger, public comments he has made in the past defending his decision to fire Centerplan and DoNo Hartford. Bronin often has said, and as recently as July in an interview with The Courant, that he never regretted his decision to fire Centerplan and DoNo Hartford.

“There is no doubt in my mind that if we hadn’t made the decision that we made in 2016, we would not have a baseball park even today,” Bronin said, in July. “Instead of an award-winning, nationally recognized baseball park, we’d still have an unfinished hulk of concrete and steel.”

New trial ordered

The Centerplan and DoNo lawsuit has spawned nearly 700 court filings since 2016.

Centerplan and DoNo Hartford were hired for the ballpark project and the development of a swath of empty parking lots around it by Bronin’s predecessor, Mayor Pedro E. Segarra.

In 2019, a Superior Court jury sided with the city’s decision to terminate the developers. But last year, the state Supreme Court ordered a new trial because the critical question of who had legal control over the stadium and its design was ambiguous. Centerplan and DoNo Hartford have argued it was the city, that the designs were flawed, resulting in cost overruns and delays in the ballpark’s construction.

After the city’s 2019 court victory, the city chose RMS as the new developer. But when a new trial was ordered, Centerplan and DoNo Hartford last year also moved to essentially take back control of the development around Dunkin’ Park. That stopped RMS from moving beyond what the first phase of North Crossing.

The barrier to further development strengthened in May when a Superior Court judge ruled that who had the right to develop needed to come after the new trial and a decision on the wrongful termination case. The new trial was scheduled for April, 2024.

Check back for updates.

Kenneth R. Gosselin can be reached at kgosselin@courant.com.