Live updates: Michigan football at Ohio State

Judge has 'serious concerns' over Carmack's suit against Detroit

Christine Ferretti
The Detroit News
Robert Carmack

Flint — The fate of a federal lawsuit alleging the city and its mayor retaliated against an auto shop owner over a land dispute is unclear after a judge cited "very serious concerns" over how it's being prosecuted.

During a Thursday motion hearing over whether to dismiss counts in the suit, U.S. District Court Judge Matthew Leitman pressed for specifics to support claims being made on behalf of Detroit businessman Robert Carmack and raised issue with actions of Carmack's attorney, Andrew Paterson, that seemingly violated an order barring discovery in the case. 

Leitman also raised alarm Thursday over Carmack's public actions and statements, including a Wednesday news conference at his Michigan Avenue repair shop.

The judge said news stories have suggested there's a link between Carmack's decision this month to publicly release video footage of Duggan's comings and goings, plus his alleged threats to provide additional information, and the litigation he's been involved in.

"I would have grave concerns if I learned that a litigant before me was directing, toward an opposing litigant before me, a direct or implied threat to release information about that litigant in order to take a certain position in the litigation," the judge told Paterson. "Would you communicate that to Mr. Carmack so he’s not confused about my view of the world?"

Paterson said he had no involvement in Carmack's decisions or actions.

"He tells me to my face, 'No, I'm not going to let you get involved in this,'" Paterson said of Carmack. "I have the same vague curiosity about it as anyone."

Leitman told Paterson to consider whether he and his client may want to drop the case altogether, noting while he hasn't made any decision yet, the defense arguments have "very substantial merit" and he has "very serious concerns about how this case is being prosecuted."

He then gave Carmack and Paterson a week to determine their next moves. After the hearing, Paterson told The Detroit News he would be conferring with his client.

Detroit Corporation Counsel Lawrence Garcia provided a statement saying he appreciated the judge's concerns over the case "and I share them."

"Whenever lawyers and their clients misuse the legal process, it is disturbing," Garcia said. "My office will continue to press for a favorable resolution of this case."

In the suit filed in March, Carmck alleges the city and mayor retaliated against him for exercising his free speech rights during a March 2015 City Council meeting about a nearly decade-old development deal for property along the city's riverfront.

He also contends he was targeted in response to a subsequent television news report tied to the city's effort to tear down a Michigan Avenue property he maintains he owned. He's seeking damages of more than $1 million. 

James Noseda, an attorney for the city, said during the hearing Thursday that he, the city's top lawyer, Carmack and others met about a month ago to discuss settling multiple pending cases, including a separate suit filed by the city that alleges Carmack fraudulently sold a city-owned property for $1 million.

Carmack, he said, made clear he'd "rain hellfire on the mayor if it didn't go away," Noseda told the judge.

Noseda called the federal complaint "frivolous" and told the judge it has "absolutely no allegation of individual conduct by the mayor."

Duggan this week asked the Michigan State Police to investigate whether Carmack's recent actions amount to extortion. 

Carmack has denied the claim that he's attempted to extort the mayor.

Carmack's suit primarily points to the 2016 demolition of his property at 8024 Michigan Ave., which he contends happened in response to his public statements about the riverfront land dispute.

The suit, among other things, contends the city breached a contract it long had with Carmack for the industrial land. Carmack contends he'd been given a purchase agreement and Paterson argued Thursday that the "city failed — deliberately — to follow through on that."

But city officials have said it was Carmack who neglected to complete the requirements to execute the sale. The land was ultimately sold to another party.

The suit also alleges Carmack had been targeted with blight violations "purely out of spite and retaliation" for the property on Michigan Avenue as well as a separate site at 8107 Michigan Ave. that is the subject of an eviction proceeding in Detroit's 36th District Court.

Attorneys for the city and building authority both questioned Thursday whether Paterson should face sanctions related to the handling of the case, including his failure to file certain briefs and asking questions about the property that's the subject of the federal case during depositions in the eviction case, allegedly in violation of Leitman's orders.

Noseda, during the hearing, told Leitman that he just learned that Paterson issued subpoenas to take depositions of several former building authority employees related to the eviction case. But during those interviews, he inquired about the property that's the focus of the federal lawsuit, he said. 

Leitman asked Paterson why he shouldn't order sanctions in the case.

"That's serious business," the judge said. "Help me understand why I shouldn't be jumping up and down and signing a contempt order?"

Paterson explained to Leitman that the depositions "helped me verify some of the allegations in this complaint."

Leitman interjected: "Don't you already know that? The more we talk, the more concerned I get."

The lawsuit argues that the city and land bank proceeded with an "unlawful demolition" of the property in April 2016, without first clearing and quieting the title, "falsely asserting" that they had the legal right to tear it down.

A lower court previously ruled that both properties were owned by the city when one of them was torn down. The state Court of Appeals later denied an appeal in the matter, attorneys noted Thursday.

Noseda said the Michigan Avenue building was demolished 13 months after Carmack appeared at the 2015 council session.

"How the riverfront property has anything to do with the demolition of the dangerous building, it defies comprehension," he said. "There's really nothing plausible in all of these allegations."

The judge told Paterson that he's reviewed the First Amendment complaint carefully to identify relevant conduct by the mayor to support the claims and said: "I have to confess, I didn't see any."

Paterson responded, asking: "How do you unravel a conspiracy?"

“He (Duggan) is skillful at managing and managing without fingerprints. That’s the allegations in this complaint, that he’s behind all of the actions taken against him (Carmack)," Paterson told the judge.

The lawsuit also alleges extortion by Detroit Councilman Gabe Leland.

The second-term council member was indicted by a federal grand jury in October on bribery charges and is accused of agreeing to accept $15,000 and free car repairs from Carmack in exchange for the councilman’s efforts to delay or prevent the sale of the riverfront property. 

Carmack wore a recording device during conversations with Leland in which the councilman agreed to accept the cash, the indictment alleges.