UPDATE: East Gate Argues Against Moorestown Mall Liquor 'Monopoly'

An attorney representing the owners of the East Gate Square shopping center questions whether council can limit alcohol sales to the mall.

UPDATE: The attorney representing the owners of East Gate Square wouldn't say whether they'd take legal action if the township restricts alcohol sales to the Moorestown Mall.

"Now, I'm an optimist," said attorney Jeff Johnson, "and when council puts its alcoholic beverage board hat on, (I'm hoping) they'll think, 'What are our regulations and what are the reasons for them?'"

He then added, "In reality, they'll probably keep the restriction."

Indeed, township council showed no signs Monday of relenting on its position to restrict the issuance of licenses solely to the mall.

Johnson said East Gate would "do its best to seek permission to participate in the bidding."

If they're denied, the only possible recourse would be to take the township to court, he admitted. "We haven't crossed that bridge yet … We’re kind of taking a wait-and-see approach.”

Johnson, on behalf of East Gate, sent a 10-page letter to township attorney Thomas Coleman last week detailing the shopping center’s objections to the proposed liquor license restriction.

Among other arguments, the letter specifically challenges the township’s assertion that it must enact referendum two—the one restricting sales to an “indoor shopping in the SRC zoning district,” i.e. the mall—because it was passed by voters. The township has cited the Faulkner Act, which provides governing guidelines for municipalities, as the basis for its position.

However, Johnson, in his letter, writes “the Faulkner Act is inapplicable where the Alcoholic Beverage Law (ABL), a more specific statute, clearly limits referendums to a finite number of issues.” In other words, he writes, the ABL “does not provide for a referendum applying any unique conditions on liquor license ... as Referendum Question 2 attempts to do.”

Johnson suggested council limit licenses to the entire SRC zone, but remove the caveat about an “indoor shopping mall.”

“If the government’s going to restrict the proposition, they have to do it reasonably,” he said.

PREIT president Joe Coradino had little to say about East Gate's challenge when reached for comment Wednesday, indicating the mall owner was "business as usual."

"We're not really party to this action," he said. "The voters have spoken, overwhelmingly; they've more than just spoken."

Johnson said East Gate had reached out to PREIT early on, before the referendum vote, but nothing came of those conversations.

Coradino said he had not personally spoken with anyone representing East Gate and was not aware if anyone else had.

"We've got a lot of people here," he said.


The owners of East Gate Square shopping center may be mounting a challenge to what they perceive as the Moorestown Mall’s “monopoly” on liquor licenses.

Speaking before township council Monday night, attorney Jeff Johnson, representing the owners of East Gate, put forth several arguments against restricting the issuance of liquor licenses to full-service restaurants “located on the same tax lot as an indoor shopping mall in the SRC zoning district,” as spelled out in the second referendum in November.

Johnson argued such a restriction would give mall owner PREIT (Pennsylvania Real Estate Investment Trust) a “monopoly” on alcohol sales in town and also constitutes illegal spot zoning.

“Illegal spot zoning, in a nutshell, is that you cannot favor one property owner above other similarly situated property owners without a valid reason,” he said.

East Gate is also located in the SRC zone, but lacking an indoor shopping mall, is precluded from bidding on licenses (per ). Johnson, an attorney with the Brown & Connery law firm, suggested council open up the restrictions to permit alcohol sales throughout the entire SRC zone.

He also argued the proposed restriction to the mall violates state law, which prohibits zoning by referendum, he said.

Township attorney Thomas Coleman has advised council all along that language in the referendums—written by PREIT—was legally permissible, and PREIT had obtained a from the director of the state Division of Alcoholic Beverage Control.

However, in the lead-up to the vote, on PREIT’s campaign, even going so far as to obtain a lengthy legal opinion, which raised objections strikingly similar to those put forth by Johnson.

Still, Coleman defended the township’s position Monday, noting the passage of the second referendum, according to Faulkner Act guidelines, was legally binding. In other words, the township has to abide by the will of the voters.

Though they respectfully heard Johnson out, none of the council members bought his argument.

“What you’re asking us to do is to undo what the majority of the voters voted for,” said Councilman Chris Chiacchio, “which is a pretty big step. I’m not sure I find the argument compelling to just ignore the will of the voters.”

Johnson also suggested the township, by restricting alcohol sales to the mall, is ignoring the obvious monetary benefits. PREIT has stated publicly it . The township is allotted six, based on its population (one per 3,000 residents).

“What we are leaving on the table is the income that can be derived from two liquor licenses,” said Johnson. “Assuming the amount suggested by PREIT would be applied to the other licenses, that’s another $2 million”—not to mention the added tax revenue from two more restaurants.

“The owners of the East Gate shopping center have a track record of obtaining and maintaining quality, full-service restaurants that serve liquor,” he noted. “You only have to look from the parking lot of the Moorestown Mall to see (those restaurants) in the Mount Laurel section of the East Gate shopping center.”

Coleman countered it was “a little presumptuous” for Johnson and his clients to assume the township would be unable to sell the additional licenses.

Johnson presented East Gate’s case prior to council voting on . After hearing his argument, council adopted the ordinance unanimously.

Johnson and a group of men who were with him, presumably his clients, stepped out of the room to speak for several minutes following the vote and were not prepared to comment further Monday night. He said he could not comment at that time on any potential action East Gate might take.

According to Coleman, Johnson had only reached out to him—via a 10-page legal opinion—within the last week.

Bill February 14, 2012 at 03:18 PM
East Gate’s challenge is, of course, no surprise. During the campaign last fall, many said that Q2 would not be enforceable and would be tested. Now that East Gate has come out into the open, it seems much more likely that there will be a lawsuit if Council enacts the Q2 ordinance. There are two legal problems with Q2. First, the Q2 referendum addresses zoning issues – permitted uses (sale of alcohol) in a zone. New Jersey law prohibits zoning through a referendum that is binding on the governing body. Q2 may legally be non-binding however. If Council enacts the Q2 ordinance, and it is challenged in court, I suspect a court would rule the referendum was non-binding and would not set aside the ordinance on that basis. The second problem with the Q2 ordinance is that it constitutes illegal spot zoning. East Gate is in the same SRC zone as the Mall. The Kmart plaza and the Young Avenue tract where the Acme used to be are also in the same zone. Under the Q2 ordinance, two portions of the same zone are treated differently. The sale of alcohol is permitted at the Mall, yet prohibited across the street in East Gate even though the properties are in the same zone. There appears to be no valid reason for the distinction. I believe a court would strike down the Q2 ordinance on spot zoning grounds. Cont'd in next post.
Bill February 14, 2012 at 03:18 PM
The approval PREIT received from the ABC with respect to Q2 only extends to alcohol-related issues. The ABC has no power to “rule” on the two issues, noted above. And they did not purport to do so. I do not understand the basis for the Township Solicitor’s statement that it would be presumptuous of East Gate to assume Moorestown would be unable to sell the fifth and sixth licenses. PREIT has said all along that they intend to buy four licenses. That leaves two more. How is Moorestown going to sell the two additional licenses if the only entity that can use the licenses – PREIT – only plans to buy four? PREIT does not care whether Q2 is enacted or upheld in court. Recall that PREIT’s 2007 initiative had no such restrictions. The only reason they were included last year is that PREIT believed it had a greater chance of prevailing with the voters if liquor was limited to the Mall.
Stacey February 14, 2012 at 03:32 PM
It is lovely to see how the monkey mind works. Catch 22.
George February 14, 2012 at 04:00 PM
i gonna move to a town what has only one lawyer
Chris Welch February 14, 2012 at 04:26 PM
“located on the same tax lot as an indoor shopping mall in the SRC zoning district,” Instead of wasting money on lawyers trying to fight the ordinance. Why not look into what legally defines an "indoor shopping mall." It might be as easy as enclosing the sidewalks in front of the strip malls (under the already existing canopies) so shoppers could walk from one store to the other...indoors. Problem solved. Go buy your license. From : http://www.icsc.org/srch/lib/SC_TYPES.pdf Mall General merchandise or fashion-oriented offerings. Typically, enclosed with inwardfacing stores connected by a common walkway. Parking surrounds the outside perimeter.
Bill February 14, 2012 at 07:33 PM
There are a few problems with that. One, enclosing the sidewalks may compromise the aesthetics of the buildings. That's for the owner, not you or me or the town to decide. Two, I'm not so sure it would be cheaper to do what you propose. At a minimum they would need site plan approval. Maybe variances. Maybe need to extend the sidewalks. Plus the costs of construction. But most importantly, the town shouldn't be passing illegal laws that discriminate.
Chris Welch February 14, 2012 at 07:43 PM
Yeah, why I said look into. As far as the legality of what the town did. I think that horse has been beaten to death already. Other towns have done it. Find a new argument.
Bill February 14, 2012 at 08:18 PM
While there has been a lot of commentary about the legality of the Q2 ordinance, as far as I am aware, it has not yet been challenged in court. In fact, East Gate's recent challenge before the Council is the first official challenge I'm aware of. I have said all along that it would be premature to mount a legal challenge in court to the Q2 ordinance unless or until it is enacted. I still feel that way. If Council approves the ordinance, it looks like East Gate will challenge it. So nothing has been beaten to death, except by the posters. Yes, other towns have ordinances limiting where alcohol can be sold. But those ordinances don't do what the Q2 ordinance would do, which is to allow liquor sales in one section of the zone, but prohibit them in another section of the same zone. The ordinances in other towns set up a special liquor zone in which anyone can sell liquor. They don't say only specific types of property (enclosed malls) in the zone can sell liquor. That is, the other towns' ordinances don't involve spot zoning while Q2 does. That, in my view, is the fatal weakness of the Q2 ordinance. In any event, it looks like we'll see soon enough.
George February 14, 2012 at 08:47 PM
dint our lawyer approve the referendum ? mus be ok then
Mall Fan February 15, 2012 at 02:55 PM
What are the restaurants in East gate that are not in Mt Laurel and want a license? Is Friendly's looking to grow or does 5 guys want to serve beer with the burgers?
Stacey February 15, 2012 at 05:41 PM
I love how the monkey minds work. It's the Italians.....
Arch Fisher February 16, 2012 at 02:06 PM
If new restaurants are coming to the mall, one might suppose that new restaurants will come to East Gate. One might ask why PREIT has chosen to indicate that they are willing to purchase 4 of the 6... by the way, is there an update on that issue? Why leave money on the table? Unless of course there was some kind of agreement...
Our Town February 16, 2012 at 04:18 PM
Why wait until now to mount a legal challenge? These issues and the potential hurdles have been hashed out ad nauseum for months and years prior to the vote, so why would East Gate wait until the vote wash made to mount what will become a more intensive and more expensive legal wrangle rather than lobby to have to wording modified before the passage? Being such close proximity, there is not as much competition as there would be more opportunity to drive traffic to all the businesses in the proximity. Does anyone really consider the East Gate area in competition with the Mall? If you need something in the mall, you go to the mall, if you need something in the East Gate stores, you go to those stores, sometimes consumers actually may visit both. I would think it would have made a lot more business sense for PREIT and East Gate to partner up to create a resolution for the area that worked for all. It would not have been that difficult. The two entities are not much of a threat to each other and if either side had half as much capacity for business strategy as they do money to throw at short sighted ventures, they could have seen the vastly greater benefit in teaming up rather than a futile effort to compete.
Our Town February 16, 2012 at 04:20 PM
The real question becomes what was the real motivation and real source of money behind the Friendly's buy out on Main Street and when will that legal challenge be brought to council?
Arch Fisher February 16, 2012 at 04:23 PM
What would (is) the legal challenge to the Friendly's property. I must have missed something in the Patch...
Our Town February 16, 2012 at 07:05 PM
No, nothing missed, just far flung speculation that Friendly's was purchased and intentionally shuttered for other uses. If a group might successfully challenge the zoning, might another also challenge the rules against proximity to Church's and Schools? I just find it hard to believe anyone with enough capital to buy a business like Friendly's cannot have the business sense to run a 40 year company beyond 6 months. Something about the lack of details regarding the purchase to the remodel to the running it out of business seems awfully fishy.
Boozer February 16, 2012 at 07:21 PM
Better get that tape measure out. Who knows a plan of a cozy "family pub" may be tye thought of the closed friendlys. It appears to be 202.3 ft from that church. What would stop it from happening?
diehardrep February 16, 2012 at 10:01 PM
Friendly's reopened on a shoe string, and the shoe string broke, nothing else. The answer is simple. What would stop Friendly's from opening with liquor is the fact that Main Street is not in the SRC zone. But, East Gate is. That's the whole point of their argument.
Boozer February 16, 2012 at 11:05 PM
Oh so your suggesting we go after the other friendlys in east gate for booze? Do not touch that. We all enjoy that place.
diehardrep February 17, 2012 at 03:25 AM
Boozer, I'm not suggesting anything of the sort. My point is weather it is Friendly's, Buddy's, or Unfriendly's, Main Street is not in the SRC zone, and therefore is not eligable for liquor sales. Sober up.
Boozer February 17, 2012 at 03:32 AM
Well now that it officially passed by town council and Perhaps by march 19 ,they could be auctioned Off.
diehardrep February 17, 2012 at 04:03 AM
That probably won't happen. East Gate wants a shot at the licenses, and can only get that if they challenge Q2 in court. They cannot even get the fifth or sixth license because Q2 states within a closed mall, within the SRC zone. The Council can't sell East Gate the unused licenses for the same reason. A court battle takes time.
Our Town February 17, 2012 at 02:47 PM
Yes, but if you have a legal team ready to challenge the 'mall' terminology within the SRC zone, what is to stop another legal team from mounting a challenge against the anti-competitiveness of the SRC zone only ruling of the licenses? Seems there would be ample basis for the Main Street businesses to contend that Liquor at only the mall complex unfairly damages their businesses. Just sayin'. I'm just playing devil's advocate. I find it hard to believe that any business venture is so inept to plunk down $400,000+ to buy a 40 year business only to run it to closure within 6 months. Shoestring or not, I find it hard to believe ulterior motives are not in play for that location.
BooZe zone February 20, 2012 at 03:35 PM
Hi whatz uuup! This is all about zoning. Or as the east gate lawyers say "spot zoning".. East gate, kmart, the shopping strip on young ave, parts of new Albany road, parts of flynn, and the mall are all in the SRC zone. The east gate group may have a claim here. So only one property can have it and the others with the same Zone can't? To be determined what east gate and others may do?


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