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City’s lawsuit against billboard company at standstill

Tuesday, September 8, 2009 by John Davidson

A lawsuit the City of Austin brought against Reagan National Advertising in April has ground to a halt after a judge denied the city’s request for a partial summary judgment on Aug. 10, according to Travis County court records.


The city filed suit in April against Reagan Advertising, a company that owns billboards on land the city purchased last year in northwest Austin for the construction of Water Treatment Plant 4. The previous landowners, DHD Ventures, had two separate lease agreements with Reagan that allowed them to maintain billboards on the property. The agreements included covenants requiring future owners to give 60 days notice and a refund of unearned rent in order to terminate the leases.


In July 2008, the city told Reagan that it was terminating the leases, but Reagan sent rent checks to the city on Aug. 1 and Dec. 1, 2008, that covered 12-month terms, respectively. The city received and deposited these checks, according to court records, but then filed suit on April 3, 2009, claiming Reagan was trespassing on city land and that it had not paid rent.


Reagan had sent the checks to Austin Energy–to the same address the company claims it had previously sent rent on other city-owned properties. An affidavit by Junie Marie Plummer, a city real estate services agent, states that she found out about the rent payments in July 2009–months after the city had already filed its lawsuit against Reagan.


For its part, Reagan’s attorneys claim that the city invalidated its claim to terminate the leases by accepting rent. Furthermore, Reagan’s attorneys say the city never sent written notice of their intention to end the lease, as required in the land covenants.


At this point, the lawsuit is at a standstill and no trial date has been set.


“We’re in the process of talking through a possible resolution with the city,” said J. Allen Smith, an attorney for Reagan. “We’re trying to see if there’s something we can work out with the city. We’re hoping to see if we can sit down with the city and work something out before we spend more time and energy on this.”


Asked for a comment on the suit, a city spokesperson issued a statement saying only that “Reagan National’s billboards are trespassing on City property,” and that “discovery is ongoing.”


The land in question is part of 92 undeveloped acres in northwest Austin near FM 620 Road and Bullick Hollow Road, west of Lake Travis. The construction of Water Treatment Plant 4 is currently underway. Reagan’s billboards are still up on the property.

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