A major followup this morning to our status report yesterday on the idled Fauntleroy Place/Whole Foods development at 39th/Alaska/Fauntleroy: WSB has learned that a lawsuit has just been filed. The firm that has been developing the project, BlueStar Management, is suing Fauntleroy Place LLC (the official site owners), Seattle Financial Group, and Seattle Capital Group (one of the governing parties of FP LLC). We are working right now to get a copy of the full complaint, but a watchlist of newly filed lawsuits summarizes this one as alleging breach of contract and defamation. Construction on the site has been idle since last fall, and Seattle Capital disclosed in late January that they were in the process of selling the site, though they have not been available for comment this week and the status of the reported sale is unknown. More to come; we will add comments and documents to this story as we get them. 11:12 AM UPDATE: BlueStar’s Easton Craft referred us to the company’s lawyers for comment, and we expect to speak with them soon. There also is word of an additional lawsuit linked to this project, also filed this week, and we are working to get details on that. 8:09 PM UPDATE: We have a statement from Susan Rae Fox at Ryan, Swanson and Cleveland, the firm representing BlueStar, in response to several questions we asked:
BlueStar Management, Inc. filed the action to recover unpaid management fees incurred in connection with the Fauntleroy Place project and is merely seeking to be fairly compensated for the project development services it rendered. BlueStar has been committed to, and worked diligently for the Fauntleroy Place project from the very beginning and was shocked and saddened to be summarily terminated in December 2008.
The action was filed after a formal request for mediation was rejected and was in no way intended to adversely affect any current activity on the project. BlueStar continues to believe that bringing Whole Foods to West Seattle as part of the Fauntleroy Place development will be good for West Seattle. BlueStar wants to see the project succeed and does not believe that the filing of this action is inconsistent with that goal.