It’s the first time the sports retailer has publicly attacked the Palm Beach Gardens mall for the failed effort to sublease Sears’ second floor space.
Dick’s Sporting Goods, which just abandoned efforts to sublease space at The Gardens Mall from Sears, isn’t walking away from the deal quietly.
The nation’ largest sporting goods retailer has filed a federal lawsuit against the owners of the Palm Beach Gardens mall, an upscale shopping center east of Interstate 95 on PGA Boulevard.
The lawsuit is the first time Dick’s has publicly stated what Sears has alleged for years in court: That The Gardens Mall has done everything in its power to stop the seller of sports equipment and athletic apparel from leasing Sears’ second floor.
Dick’s complaint, filed in U.S. District Court on Feb. 3, dryly said: “This isn’t the first lawsuit filed against Forbes for misconduct related to the Dick’s sublease; it is just the latest in a series of lawsuits.”
Dick’s lawsuit names mall owners Forbes/Cohen Florida Properties and The Gardens Venture. A Forbes attorney was unavailable for comment on Tuesday.
Since 2011, Pennsylvania-based Dick’s has been trying to sublease the second floor of Sears’ department store building at the mall.
Sears, the struggling retailer, has subleased space at other store locations. The Gardens Mall has not been one of them, however, and in December, Dick’s gave up on the sublease.
Less than two months later, it filed the lawsuit.
In the complaint, Dick’s seeks lost profits from the never-built Gardens Mall store, which it said it could have opened as far back as 2016. Dick’s also seeks out-of-pocket costs and punitive damages.
The sporting goods retailer does not have a north Palm Beach County store, but it really wants one.
However, Dick’s alleged that Forbes blocked the Dick’s sublease because the mall wants the valuable Sears property back, despite the fact that Sears has a long lease on the site.
Developer Sidney Forbes built The Gardens Mall in 1988 and brought Sears in as an anchor tenant. The Sears lease was for 30 years, with four 10-year extensions. Sears is on its first 10-year extension, and has another three extensions left.
In 2014, after failed efforts to get a Dick’s sublease deal approved, Sears sued both the mall and the city of Palm Beach Gardens.
The city was included because in 2012, Forbes sought a resolution from the city of Palm Beach Gardens. The resolution said mall anchor tenants could not subdivide their space without the approval of both Forbes and the city.
In June 2017, the 4th District Court of Appeal found that the city resolution was unconstitutional because it impaired Sears’ contract rights.
As part of its decision, the 4th DCA granted Sears the right to subdivide its mall space. Since then, efforts began anew to sublease the Sears space to Dick’s.
But a Catch-22 emerged.
Forbes wouldn’t sign forms necessary for Sears to seek the city’s OK to add exterior signs and an entrance change. And the city wouldn’t consider the changes unless Forbes signed the forms.
In frustration, and to try to salvage the deal, “Dick’s even solicited a CEO-to-CEO meeting,” Dick’s lawsuit said.
But Forbes refused a meeting, the lawsuit said.
Dick’s lawsuit doesn’t name the city of Palm Beach Gardens, but Sears’ latest lawsuit does.
The latest complaint, filed as a counterclaim just last month by Transform Operating Stores, Sears’ parent company, seeks millions of dollars in damages from the mall, and the city of Palm Beach Gardens.
The damages are based on lost rent from the Dick’s store, according to the complaint, filed by West Palm Beach lawyer Gerald Richman.
Both the city and Forbes have denied any wrongdoing.