Elvis Is On The Docket

A summary of a case scheduled for oral argument before the Tennessee Supreme Court is summarized on the court’s web page

• Elvis Presley Enterprises Inc. et al. v. City of Memphis et al.– The appellants, Elvis Presley Enterprises, Inc., EPPF, LLC, and Guesthouse at Graceland, LLC (collectively referred to as “EPE”), sought approval in 2014 for the Graceland Economic Plan in which it proposed to construct a hotel, convention center, theater, concert venue, and museum facility in Memphis/Shelby County. The plan was first approved by the Economic Growth Development Engine (“EDGE”) and then approved by Memphis City Council, the County Commission, and the State of Tennessee, and the plan was granted certain tax incentive funding. In 2017, EPE sought to supplement its previous proposal to include a 6,200-seat arena and to increase its tax incentive funding. Approval of the supplemental plan stalled. Thereafter, EPE filed a complaint against the appellees, City of Memphis (“City”), Shelby County, Tennessee (“County”), and Hoops, LP, the predecessor of Memphis Basketball, LLC (“Memphis Basketball”), for a declaratory judgment and claiming intentional interference with business relations. EPE alleged that Memphis Basketball caused the delay of their plan because it allegedly threatened to sue the City and County on the basis that the supplemental plan would violate a previous agreement related to FedEx Forum (the “Arena Use Agreement”). The trial court dismissed the complaint because it determined that EPE had not exhausted its administrative remedies and that it lacked standing to bring the suit. EDGE and the County Commission then separately voted to approve EPE’s supplemental plan contingent upon Memphis Basketball entering into a binding agreement that approval of the supplemental plan did not violate the Arena Use Agreement. Months later, EPE filed a second complaint against the appellees seeking only a declaratory judgment that would satisfy the contingency stated by EDGE and the County Commission. The trial court, again, dismissed the complaint on the basis that EPE did not have standing to bring the complaint because it was not a party or beneficiary to the Arena Use Agreement. EPE appealed the dismissal and a majority of the Court of Appeals affirmed the dismissal but on the grounds that the second complaint was barred due to res judicata. The majority did not reach the issue of standing. The dissenting opinion stated that res judicata did not apply and that standing should be the dispositive issue. On appeal to the Tennessee Supreme Court, EPE argues, among other things, that res judicata does not bar its second claim because a failure to exhaust administrative remedies is not an adjudication on the merits and that it has third-party standing to seek interpretation of the Arena Use Agreement. EPE also argues that the County conferred EPE’s standing in the suit by authorizing it to pursue the declaration from the appellees by way of the contingency. The appellees argue that res judicata bars the second complaint or that, in the alternative, EPE lacks standing to bring the action.

(Mike Frisch)