Three days after Allentown Mayor Ed Pawlowski unveiled detailed plans for a $100-million, metal-and-glass minor league hockey arena designed to rejuvenate the downtown, a local developer filed a lawsuit that could potentially stall the project.
The suit brought by Abraham Atiyeh, through his company, Whitehall Manor Inc., objects to the city's use of eminent domain, which allows government to take private property for economic development.
Lehigh County Court by attorney John Vanluvanee of Doylestown, argues such seizure of property must benefit the public good, while the arena project simply lines the pockets of private enterprise.
"The mayor should have had all his ducks in a line," Atiyeh said. "I'm not looking to sabotage or block their deal, but the law is written for a reason and they are abusing eminent domain law."
Pawlowski did not return a call requesting comment. City spokesman Mike Moore said the city won't comment until after it has been served with the suit.
The lawsuit questions the legal basis that city officials relied upon to buy the 34 properties needed to build the arena. And it's an argument that experts have warned could force the project — already on a tight timeline to open for the 2013 season — into a lengthy court battle.
"The judge has it within his or her power to approve some form of temporary injunction," Joseph Sabino Mistick, a professor of law at Duquesne University in Pittsburgh, said Friday. "If the taking (of property) itself has been properly challenged, most municipalities would probably wait until this is resolved."
Atiyeh has been a tenant in the historic Dime Savings and Trust property at 12 N. Seventh St. since July 2004. On Sept. 7, the city condemned the property, which is on the National Register of Historic Places, saying it may be incorporated into the arena façade.
A month later, owner John McClave settled with the city for $870,000 and transferred the property to the Allentown Commercial and Industrial Development Authority, the authority the city has designated to finance the arena project.
Atiyeh's lawsuit argues that the city should not have condemned the building because it is not blighted — one common reason the courts have sanctioned the use of eminent domain. Under Pennsylvania's eminent domain laws, governments are usually forbidden from taking private property for commercial development unless the property meets a strict definition of blight.
If it doesn't meet that definition, then the courts have to decide whether the city's ultimate plan — in this case, an arena owned by a city authority but operated by a for-profit firm — is a public use.
In the lawsuit, Vanluvanee argues "the arena won't be open to the general public and that admission to the arena will require the purchase of tickets."
"We don't believe, from what we can tell, that there is a public purpose behind the condemnation," he said. "Originally this was a private initiative and it still seems private parties are involved."
City officials have said they expect to allow the facility to be used for local high school sporting events and graduations.
Vanluvanee added that if a judge rejects the lawsuit, upholding the city's use of eminent domain, then Whitehall Manor will seek compensation for its broken lease agreement.
The lawsuit also claims there are legal holes in the city's resolution to condemn property for the project. It doesn't state the arena is for a public purpose, the suit says. The resolution also doesn't specify proposed uses for the events center and "related public facilities" that are cited as part of the reasons for the condemnation.
Atiyeh says he should know. He was originally behind the idea to bring a minor league hockey team to the Lehigh Valley, examining sites downtown, on Airport Road and in Lower Nazareth Township.
"I was in the arena business before the mayor was," he said.
He said the project never materialized, mostly because his partnership splintered with the Pittsburgh-based Brooks Group, which now owns the Phantoms, the Philadelphia Flyers' affiliate slated to play in the Allentown arena.
Could lawsuit stall arena project?
Developer Abraham Atiyeh says the city is abusing eminent domain law.
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