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Virginia College, LLC v. SSF Savannah Properties, LLC

United States District Court, S.D. Georgia, Savannah Division

February 4, 2015

VIRGINIA COLLEGE, LLC, Plaintiff,
v.
SSF SAVANNAH PROPERTIES, LLC; POLE POSITION RACEWAY, INC.; SAVANNAH RACEWAY, LLC; and P2R KARTING, INC., Defendants

Page 1371

For Virginia College, LLC, Plaintiff: Ollie A. Cleveland, LEAD ATTORNEY, Maynard, Cooper & Gale, PC, Birmingham, AL; Patrick T. O'Connor, Paul H. Threlkeld, LEAD ATTORNEY, Oliver Maner, LLP, Savannah, GA; Zachary Howard, Oliver Maner, LLP, Savannah, GA.

For SSF Savannah Properties, LLC, Defendant: Kirby G. Mason, LEAD ATTORNEY, Hunter Maclean, PC, Savannah, GA; Allan C. Galis, Hunter Maclean, PC, Savannah, GA.

For Pole Position Raceway, Inc., Savannah Raceway, LLC, Defendants: Christopher H. Smith, LEAD ATTORNEY, Thomerson, Macchiaverna, Smith & Freeman, PC, Greenville, SC; Jeffrey S. Ward, Drew, Eckl & Farnham, LLP - BWK, Brunswick, GA; Lindsey Ann Hobbs, Thomerson, Macchiaverna, Smith & Freeman, PC, Greenville, SC.

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PRELIMINARY INJUNCTION

LISA GODBEY WOOD, CHIEF UNITED STATES DISTRICT COURT JUDGE.

Someone thought it would be fine to install an indoor go-kart racetrack on top of a college. Because there is a substantial likelihood that the decision was not fine and, indeed, tortious, the Court grants, in part, the College's motion for a preliminary injunction.

Plaintiff Virginia College, LLC, operates a vocational college on the ground floor of what used to be a department store at the Savannah Mall. The Savannah Mall is owned by Defendant SSF Savannah Properties. Four years after the College moved into the space at the Mall, Defendant Pole Position Raceway entered into a lease with SSF to occupy the space directly above the College and operate a go-kart racetrack.[1] The College claims that the incessant whirring, bumping, and vibrations caused by the racetrack hamper its educational mission and will cause irreparable harm to the College and its students if the nuisance is not immediately abated. The College has filed a complaint against Pole Position and the Mall, and has asked this Court to issue a preliminary injunction enjoining Pole Position from operating its racetrack at all times. Dkt. no. 2. The Court GRANTS the College's motion in part and DENIES it in part. A complete injunction would not be equitable, nor necessary: Pole Position is enjoined from operating its racetrack on weekdays (Monday through Friday) until the conclusion of the May 11, 2015 trial. In the interim, Pole Position may continue its normal operations on the weekends (Saturday and Sunday). Additionally, Pole Position may continue to operate the non-racetrack components of its operation, such as the videogames,

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pool tables, and concession stands, seven days a week.

This Order is not a decision on the merits. Instead, the Court addresses only the precise question before it: whether the College is entitled to the extraordinary remedy of a preliminary injunction. This Court cannot issue an injunction unless Plaintiff shows " that [it] is likely to suffer irreparable harm in the absence of preliminary relief." Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 20, 129 S.Ct. 365, 172 L.Ed.2d 249 (2008). Because the College has failed to show that Pole Position's continued weekend operations will cause it irreparable harm, the Court denies its motion to the extent that the College seeks to enjoin those operations. However, after finding that continued operations during the week will irreparably harm the College's educational mission, the Court issues the injunction to that extent.

All Defendants have received notice and have participated in the hearings prior to the issuance of this Order.

In ruling on Plaintiff's motion for a preliminary injunction, the Court relies upon the following findings of fact and conclusions of law.

FINDINGS OF FACT

1. Plaintiff Virginia College (" the College" ), an Alabama-based for-profit school, leased approximately 51,781 square feet of space in the Savannah Mall for use as its Savannah Campus on July 15, 2010. The Lease was for 15 years. Dkt. no. 1-2 (" VC Lease" ).

2. The College leases the bottom floor of what used to be a department store at the Mall. The escalators and other equipment which connected the upper and lower floors of the department store were removed and the floor sealed off prior to the College leasing the space for its campus.

3. Section 3(g) of the College's Lease states:

[SSF] shall have the exclusive right to remodel, expand, contract or otherwise alter or change any portion ... of [Savannah Mall] other than the Premises [leased to the College] . . . provided that such activities shall not materially interfere with [the College's] use. . . .

4. Section 11 of the VC Lease states:

[SSF] agrees that if Tenant shall perform all of the covenants and agreements herein to be required to be performed by Tenant, Tenant shall, subject to the terms of this Lease, at all times during the Term have peaceful and quiet possession of the Premises and the rights, easements and appurtenances thereto leased to Tenant hereunder. [SSF] represents to and covenants with Tenant that: . . . (e) [SSF] shall not enter into any covenants, easements or other agreements after the date of this Lease that prohibit or restrict Tenant's Permitted use or otherwise change the terms of this Lease without Tenant's prior written consent, which may be withheld in Tenant's reasonable discretion.

5. At its Savannah Campus, the College offers 14 vocational programs to approximately 550 students, including massage therapy, medical billing and coding, cosmetology, business administration, pharmacy technician, and surgical technology. Most of the College's students are " non-traditional" students. Hr'g Tr. 18. Many of the students work other jobs while pursuing their degrees or certificates, some are working parents, and approximately 20 percent are veterans of the armed services. Id. at 18, 31-32. It is not uncommon for some of the former servicemen and women to have been diagnosed with Post Traumatic Stress Disorder, or PTSD. Id. at 30, 32. The College also employs 56 workers full-time and about 20 adjunct instructors part-time. Id. at 18.

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6. The College's programs are designed to meet accreditation and licensing standards for the vocational degrees and certificates it offers. For example, the massage students must complete a certain number of hours of hands-on massage training on paying members of the public. Id. at 54-55. Likewise, the cosmetology students must practice their techniques on members of the public. Id. at 20. These customers pay the College for the services the students provide them, and they also fill out evaluation forms on the students' performance so that instructors may evaluate their skills and progress. Id. at 55.

7. Sometime in 2013, after the College was well-established in its space at the Savannah Mall, SSF entered into a lease agreement with Defendant Pole Position Raceway (" Pole Position" ) for the space directly above the College's campus. Defendants entered into the Pole Position Lease with the intention and understanding that Pole Position would renovate the space and use it as an indoor go-kart racetrack.

8. On November 14, 2013, counsel for the College sent a letter to SSF declaring that the College would not consent to the Pole Position Lease without assurances from SSF that Pole Position's premises would be adequately soundproofed to prevent any disturbances to the College's campus. Dkt. no. 1-3.

9. On December 4, 2013, counsel for SSF responded to the College, stating that " [d]ue consideration was given to Pole Position's particular type of use and operation and to Virginia College's permitted use of its Premises before the Landlord made it determination to enter into the Pole Position lease without seeking your client's approval." Dkt. no. 1-4.

10. The College never consented to SSF's lease with Pole Position.

11. Before opening its track for business, Pole Position hired an acoustic consultant to conduct a sound study of its operations in July, 2014. The consultant tested the noise generated by the operation of the go-karts at several locations within the College. The study found that the normal, ambient sound level in the college was 30 decibels. When Pole Position simulated operations for purposes of the test, the sound levels rose into the 40s and were " even over 50 [decibels] on occasion . . ." Dkt. no. 17-2 (" Ehnert Aff." ), p. 7. The report did not state, and the parties have since been unable to say, what specific decibel level the noise reached when it peaked in the 50s. Id.

12. Savannah City Code Section 9-2034 limits sound levels, as measured from the receiving premises, to 65 decibels for businesses and 55 decibels for " noise-sensitive areas" Savannah City Code § 9-2034. " Noise-sensitive areas" are places where " noise-sensitive activities" are conducted, and such activities include the operation of schools. § 9-2032(15), (16).

13. No one disputes that Virginia College is a school.

14. Virginia College's mission statement states:

The goal of Virginia College lies in its responsibility to its students, the technical and business communities, and the general citizenry. The college provides educational opportunities through curricula in business, business-related, administrative, management, technical and professional programs that are designed to prepare the student for direct entry into the job market.

" Mission Statement," Dkt. no. 23-1, p. 3.

15. Pole Position had a " soft opening" to the public on December ...


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