Northridge Mall Lawsuit Keeps Dragging On

Northridge Mall in August 2022. Photo by Jeramey Jannene.

The City of Milwaukee’s quest to see the long-vacant Northridge Mall demolished will continue to be held up in court until at least September, if not longer.

Even Judge William Sosnay, who in August 2022 promised to bring the matter to a resolution, acknowledged the legal proceedings have become slow-moving.

“The light is still green and I still have my foot on the gas pedal, even if I might be moving 20 miles per hour,” said Sosnay on Tuesday morning. Meanwhile, new issues including a potential buyer and legal challenges over record requests continue to crop up.

Sosnay, in October, did his part to get the ball rolling. After inheriting the case, he ruled the city’s 2019 raze order was valid given the property’s condition. But the mall’s Chinese ownership group, U.S. Black Spruce Enterprise Group, is challenging that order in appeals court. Black Spruce is due to respond to the city’s brief by July 25, which would allow the court to rule on the appeal.

The circuit court judge has continued to indicate he could rule in the city’s favor if the appeals court affirms his raze order ruling. Earlier this year, the city asked for ownership of the 46.5-acre property in lieu of having to spend millions to demolish the approximately 900,000-square-foot structure and then attempt to recoup the demolition costs, plus more than $1 million in unpaid taxes and hundreds of thousands of dollars in fines.

“I’ll deal with that when the time comes when I have the authority to do so. Right now my hands are tied,” Sosnay said.

The judge set a September 29 hearing, a delay intended to give the appeals court time to rule.

But there is another potential issue waiting in the wings. Phoenix Investors, a Milwaukee-based firm that specializes in industrial redevelopment, now has an agreement to purchase the property from Black Spruce. It has paid to secure the former mall since March, ending a wave of trespassing and suspected arson.

City officials confirmed on Tuesday that they have continued to speak to Phoenix as they would any developer, but that the firm’s proposal is still one they oppose in part because of the subsidies requested. The firm wants the city to forgive delinquent property taxes, drop the raze order and issue a zoning change to allow a “mega indoor warehouse storage facility” said Department of City Development deputy commissioner Vanessa Koster.

Those discussions have caused the city to “pause” its efforts to demolish the one part of the mall structure it owns, the former Boston Store. It had solicited demolition bids in March, just before Phoenix became involved. Phoenix would reuse the mall structure, including possibly the Boston Store building.

“We will see what happens I guess,” said Sosnay, who emphasized that his raze order was still technically valid given the lack of a stay being issued by the appeals court.

“I fail to understand the business rationale of buying a property that has a raze order, unless there is something going on between them and the city that this court is not aware of,” said Sosnay. City officials insisted there wasn’t.

Sosnay also admonished Black Spruce’s three principals for their failure to comply with court orders, while noting that their Milwaukee-based attorney Christopher M. Kloth hasn’t had an easy client to represent.

“I’m not pleased with the response I have gotten from your client,” he said. The judge said he wanted to see all three principals, two of which are based in Asia and one in Canada, in court in September if the appeals court rules his ruling was appropriate. Only one of the principals has appeared in person and Sosnay, at multiple points, has ruled Black Spruce in contempt of court orders to secure the property. “I will deal with that at the appropriate time should I be in a position to do so. That’s not a threat, it’s a comment and an observation.”

A new issue in the case became public Tuesday. Black Spruce, through an open records request, is seeking more than a decade’s worth of city correspondence on the mall. Kloth submitted the request in April and the city denied it in June.

“This request is massive. It asks for a lot of attorney-client privileged information. It asks for attorney work product,” said assistant city attorney Michael Radavich. “We are talking about 15 years of documents covering thousands of city employees.”

The city is seeking a protective order to block the request, while Kloth said he intends to pursue a writ of mandamus to compel the city to fulfill the request. Sosnay said he would prepare a briefing schedule on the matter.

The mall, located near N. 76th St. and W. Brown Deer Rd., closed in 2003 after 31 years of operation. A predecessor of Black Spruce acquired the property for $6 million in 2008. It has proposed creating an Asian marketplace, but those plans have never advanced.

For additional information on the mall’s history and the lawsuit’s twists and turns, see our earlier coverage.

August 2022 Photos

April 2019 Photos