COLUMBUS - A unanimous Ohio Supreme Court sided yesterday with Perrysburg Township over Rossford in the dispute about the financing of the failed arena and amphitheater project.
The high court upheld an appeals court decision that said the township can move forward with its lawsuit against the Rossford Arena Amphitheatre Authority to recover $5 million in township funds lost in the deal.
A visiting judge, Joseph Schmenk of Defiance County Common Pleas Court, is assigned to the case.
The authority was formed in 1999 to finance, construct, own, operate, and maintain a sports arena and amphitheater between State Rt. 795 and U.S. 20/23 on land Rossford annexed from Perrysburg Township.
On June 29, 1999, the authority entered into an agreement under which Perrysburg Township contributed $5 million for the project, with the authority agreeing to repay the amount over two years, plus 8 percent interest.
When the arena and amphitheater project collapsed because of a lack of funding, Perrysburg Township filed two lawsuits, asserting that the authority, the city of Rossford, and Rossford Mayor Mark Zuchowski had violated state securities laws in negotiating the agreement.
The township is seeking $8 million from the arena authority.
The lawsuits were dismissed in Wood County Common Pleas Court, based on rulings that the financial instrument in the deal was not a "security" under state law.
Writing for the Supreme Court, Justice Paul Pfeifer said the agreement between the authority and Perrysburg Township is a "security" because the authority promised it would repay the township.
Yesterday's decision focused on the Supreme Court's interpretation of how a 75-year-old state law defines a "financial security."
The state Supreme Court used criteria that the U.S. Supreme Court set in 1990 to figure out which types of financial agreements fall under the category of state-regulated securities.
Attorney John P. Donahue, representing Perrysburg Township, said he and his client were "very pleased" that the court held that the agreement between the township and the arena authority "can be determined to be a 'security,' and thus an investment."
"The court's opinion is of great significance to the people of Perrysburg Township, to Ohio's securities marketplace, and to all Ohioans who invest their money in fixed-rate securities," Mr. Donahue said.
"The time has come for the city of Rossford to accept responsibility for the loss of $5 million of the public funds of Perrysburg Township and to negotiate in good faith with the goal of resolving this litigation," he said.
Attorney Peter Silverman, representing the Rossford Arena Amphitheatre Authority, wasn't available for comment. Rossford Mayor Bill Verbosky didn't return a message seeking comment.
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A unanimous Ohio Supreme Court sided yesterday with Perrysburg Township over Rossford in the dispute about the financing of the failed arena and amphitheater project. The high court upheld an appeals court decision that said the township can move forward with its lawsuit against the Rossford Arena Amphitheatre Authority to recover $5 million in township funds lost in the deal.