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Editorial Advisory Board: Baltimore, don’t use eminent domain to seize intangible property

Baltimore’s attempt to hold onto the Preakness Stakes through eminent domain is a sad spectacle, one that serves as a warning to businesses that the city will use the courts against them if public officials don’t like decisions private corporations make.

It’s not that we wish to see Baltimore’s premier racing event, one that has often brought positive publicity to our troubled city, move to fancier digs in Laurel. Nor are we taking sides in the factious debates underway about the Preakness’s future or the wisdom of spending public funds to keep it where the first race was run more than a century ago. The owners of the Pimlico Race Course and the Preakness Stakes may indeed have been willfully letting the facility deteriorate, as the city claims in the legal action it brought on March 19, though it might be an overstatement to say that Pimlico’s “undermaintained infrastructure” could eventually endanger both racing fans and horses.

What troubles us is less the mere fact of an eminent domain action than the fact that the city wants to acquire more than structures and the land on which they perch. How much more? “The name, common law and statutory copyrights, service marks, trademarks, trade names, contracts, horse racing events, and other intangible intellectual property that are associated with the Preakness stakes and the Woodlawn Vase.”  The city also wants full ownership of “all property of the Maryland Jockey Club … or its successors and assigns, including stock and equity interest in it, and including any and all property or property rights associated with it, whether tangible, intangible, real, personal or mixed.”

Those intangible assets, not the aging racecourse, are the real prize.

States and cities tend to avoid grabbing movable assets largely because businesses might whisk them away to avoid takeover, while other businesses would shy away from moving to a condemnation-happy jurisdiction.

Businesses considering the Free State as a place to establish themselves can see a track record. In 1984 the city rattled its seizure sabre to keep the Baltimore Colts in town, but owner Bob Irsay moved quickly before legal action could begin in earnest. And move he did: all the way to Indianapolis under cover of night. A decade ago, then-Gov. Martin O’Malley also threatened to use eminent domain to grab the Preakness. Then, in 2014, legislators threatened to condemn the intangible assets of “House of Cards,” the television series that had been filming in Baltimore but was considering moving out.

Perhaps the city is merely using its eminent-domain power now as a means to pressure the Preakness owners to stick around and a takeover is not really its plan. Even so, the damage to the city’s reputation as a nice place to do business is just as profound.

And let’s say the city hits the jackpot, winning ownership of the track, the intangibles and the Tiffany-designed Woodlawn Vase, worth a few million itself. How is Baltimore going to pay for everything, as is required in such a taking? Sell debt? Squeeze its taxpayers? Ask all Maryland citizens to chip in? The price tag could be stratospheric.

We would like the Preakness Stakes to remain in Baltimore. Hosting one of the nation’s most celebrated horse races adds luster to a city trying to regain its footing as a place to visit, one filled with joyous energy as well as a rich history reaching back to the nation’s early years. Pulling the Preakness from the Pimlico Race Course would also hurt the poor communities in the area. What we don’t want to see, however, is Baltimore scaring away private investment because the city used heavy-handed litigation in an attempt to force the Preakness to stay in place. That would be yet another sign saying Baltimore is not truly open for business.

Editorial Advisory Board members Arthur Fergenson and Michael Hayes did not take part in this editorial.

 

EDITORIAL ADVISORY BOARD MEMBERS

James B. Astrachan, Chair

James K. Archibald

John Bainbridge Jr.

Martha Ertman (on sabbatical)

Arthur F. Fergenson

Nancy Forster

Susan Francis

Michael Hayes

Ericka King

Stephen Meehan

William Michaels

Angela W. Russell

Debra G. Schubert

Mark Stichel

The Daily Record Editorial Advisory Board is composed of members of the legal profession who serve voluntarily and are independent of The Daily Record. Through their ongoing exchange of views, members of the board attempt to develop consensus on issues of importance to the bench, bar and public. When their minds meet, unsigned opinions will result. When they differ, or if a conflict exists, majority views and the names of members who do not participate will appear. Members of the community are invited to contribute letters to the editor and/or columns about opinions expressed by the Editorial Advisory Board.

Find out more about the members of the Editorial Advisory Board.