No settlement in wineries suit

Mar. 28—TRAVERSE CITY — Another afternoon of settlement talks between Peninsula Township and several wineries challenging its zoning ordinance came up short.

Wineries of the Old Mission Peninsula and 11 wineries in the township couldn't reach an agreement after what Joe Infante, one of the plaintiffs' attorneys, called a round of good-faith negotiations. He didn't anticipate a third settlement conference, but said a settlement is still possible before trial begins on April 29.

Raymond Kent, a U.S. District Court magistrate judge for Michigan's western district, met with township officials and attorneys representing the wineries and association, plus nonprofit and intervening defendant Protect the Peninsula Wednesday. They gathered in offices in Front Row Centre, owned by township resident Marty Lagina. He also owns the parent company of Mari Vineyards, one of the plaintiffs in the case.

Township trustees had a brief public meeting there where residents, plus some Protect the Peninsula members, implored them to stand by the zoning ordinance and heed public opinion opposing more commercial uses on agricultural lands.

Grant Parsons told trustees he was concerned the wineries and association would drop their "bling" — the claim for an estimated $135 million in damages — in exchange for the township backing down. Mike Dettmer, who's with Protect the Peninsula but said he was speaking on his own behalf, went further, calling the damages claim "bull—."

"It is only going to be used as a ploy to get you to get away from (the ordinance) so they can trade it for their ordinance," he told trustees.

Winery owners previously argued the township's zoning unfairly tied their hands by keeping them from hosting weddings and other non-agriculture events, using kitchens for off-site catering and supplementing a limited supply of grapes when the peninsula's growing seasons go poorly, among other issues.

After nearly five hours of negotiations, trustees briefly reopened the public meeting. Peninsula Supervisor Isaiah Wunsch thanked everyone for taking the time.

"It's unfortunate that we weren't able to reach a resolution, but I appreciate everybody putting in the time and energy into trying," he said.

The association, also called Old Mission Peninsula Wine Trail, and wineries filed suit in October 2020, challenging zoning laws regulating everything from operating hours to allowable merchandise. District Court Judge Paul Maloney sided with the plaintiffs on several points, including that Peninsula Township can't require the businesses to use at least 85 percent of fruit grown in the township or limit what type of events they can host.

Other issues remain, including whether the wineries waived their rights to challenge the zoning, how much they can claim for damages and what sort of time limit the law would put on those damages.

The wineries and association revised its estimate downward. Infante previously said that reflected corrections for input errors and failing to account for pandemic closures in the first estimate.

Protect the Peninsula attorney T.J. Andrews previously pointed out winery owners' acknowledgement during questioning that wine-tasting traffic dies down significantly in the evening.

Plaintiffs' previous estimate figured wineries lost $66,138,000 over five years because of a closing requirement of 9:30 p.m. at the latest, or earlier at the township's discretion.

The latest damages estimate is confidential, and Infante previously said the mistakes in the first were fixed, as court rules require.

More recently, Maloney rejected the wineries' and association's argument that state law precluded the township from setting operating hours that would require them to close before the state-imposed 2 a.m. cutoff for alcohol sales.

While Andrews previously said that, and other parts of that ruling, could substantially cut the damages the plaintiffs could claim, Infante previously denied this, since the lawsuit argued some of the same issues under different legal theories.

Settlement conferences like Wednesday's are confidential under court rules, although the lack of information has rankled township residents before.

Protect the Peninsula board member Dave Murphy echoed Parsons in asking trustees for transparency. Everyone he talks to while volunteering on several township issues, including its master plan rewrite, asks him what's going on in the lawsuit.

"To me, the single key factor here is, if everybody put their cards on the table, I think the public would be out in force supporting you guys in greater numbers," he told trustees.

Andrews also noted that she and Protect the Peninsula were never in the same closed-door discussion Wednesday when the plaintiffs' attorneys were. That's not the only way to hold such talks, she said.

Infante said that's how the parties have been negotiating throughout the suit.

Andrews said she also was grateful for how everyone engaged in good faith Wednesday.

"I think sometimes you can't just force a settlement, and these are really big issues in this community," Andrews said.