White Flint Mall Credit: Andrew Metcalf

Lord & Taylor’s fight against White Flint Mall suffered a setback Wednesday morning when a federal appeals court ruled that forcing the mall’s owners to restore the now almost completely vacant mall to its previous state is too difficult to enforce.

The ruling upheld an earlier U.S. District Court ruling against an injunction that would have prohibited the mall’s owners—Lerner Enterprises and Tower Cos.—from moving forward with the redevelopment of the mall on Rockville Pike.

In its lawsuit, Lord & Taylor had requested the owners return the mall to its previous state as a high-end shopping center. However, the appeals court ruled doing so would not be possible.

“It would have necessitated an affirmative injunction ordering White Flint to transform the now-fading Mall back into a ‘first class, high fashion regional retail shopping center’—the kind of order that is so hard to draft with specificity and then to enforce that Maryland courts generally will grant it only as a last resort,” wrote Judge Pamela Harris in the unanimous opinion by the three appeals judges.

The judges also noted that enforcing Lord & Taylor’s lease with the mall, which is scheduled to last until at least 2042, would have entangled the court in ensuring that the mall’s owners maintain it as specified in the lease agreement, which the judges ruled would have been a significant task.

“The scale and complexity of the Mall’s operations—spread over 45 acres, and potentially involving dozens of new counter-parties as the Mall repopulates—and the duration of the proposed injunction have no parallel in the Maryland case law,” Harris wrote.

Even simply stopping the demolition of the nearly-vacant mall would not be feasible, according to the court. The judges found that stopping demolition “would freeze in place a vacant and partially demolished Mall, tantamount to a judicially mandated blight on the area,” which would not serve the store, the mall’s owners or the public. Only Lord & Taylor remains open at the former regional shopping center.

The decision by the judges still leaves one count of Lord & Taylor’s complaint active: a request for damages for what the retailer claims is a violation of its lease agreement with the mall. The count also asks the court that the landlord not be able to redevelop the site in any way inconsistent with the lease agreement.

The decision is the latest development in a wide-ranging dispute that recently involved depositions from Lerner Enterprises officials, including the company’s founder and Washington Nationals owner Ted Lerner, that were shared with Lord & Taylor by his brother Lawrence Lerner’s attorneys. The retailer claimed these interviews prove that the mall’s owners did not have an advanced plan to redevelop the mall.

A sketch plan for the mall’s site from Dec. 2011, which was submitted to Montgomery County planners in the fall of 2012, depicts the owners’ plans to redevelop the mall site into a town center-style development with residential, retail and office buildings as well as a new neighborhood park.

It’s not immediately clear what the appeals court decision means for the mall owners’ ability to begin redevelopment of the mall site. Lawyers from the firm Greenberg Traurig, which are representing Lord & Taylor, were not immediately available to comment Wednesday morning.

Full ruling:

White Flint Mall Ruling – March 4, 2015