East Gate Owners Sue Township Over Liquor Restriction

The owners of East Gate Square Shopping Center have sued the township, alleging its restriction of alcohol sales to the Moorestown Mall is a violation of state law.

East Gate filed the lawsuit last week, five months after voters, by a roughly 2-to-1 margin, , and at the same time voted to restrict those sales to the Moorestown Mall.

The second referendum question—written by mall owner PREIT (Pennsylvania Real Estate Investment Trust)—approved by voters restricts 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.” East Gate is also located in the SRC zone, right across the street from the mall, but lacking an indoor shopping mall, is precluded from bidding on licenses.

Township council adopted on second reading last week an ordinance making the restriction official, thus prompting East Gate’s lawsuit.

A statement released by Archer & Greiner, the firm representing East Gate, argues the ordinance is an example of “zoning by referendum,” which is not allowed by law, and “unfairly favors the mall property.”

“Limiting the privilege of serving alcohol to the mall property constitutes illegal ‘spot zoning’ and  violates both the New Jersey and United States Constitutions,” the statement reads, “which prohibit unequal treatment between similar persons and properties.”

Township attorney Thomas Coleman has asserted all along the township’s solid legal standing in the matter and did not waver when reached for comment Wednesday.

He said in the lead-up to the referendum vote, the township did its own independent analysis to make sure the second question was legit—reviewing case law and , as well as other municipalities regarding their liquor license policies.

Coleman criticized East Gate for its 11th hour lawsuit, calling it an “unbelievable waste of taxpayer money.”

“First and foremost, I echo not only the mayor and the rest of council, but also the will of the voters … We are extremely disappointed at the legal maneuverings being undertaken by East Gate,” Coleman said. “Where were they on Nov. 9, Dec. 9, Jan. 9? … It’s ridiculous; they’re out of time.”

He said East Gate first contacted the township in January .

Coleman said ultimately East Gate should be held responsible for whatever expense the township incurs to fight the suit.

However, local attorney Bill Cox, , believes East Gate has a much stronger case than even he had.

“I would be surprised, frankly, if they don’t prevail,” said Cox, a commercial litigation attorney. “It’s a pretty straightforward legal issue.”

Cox claimed he thought PREIT’s question looked like spot zoning all along, but didn’t raise it as an issue in his suit because he was trying to keep alcohol off the ballot altogether.

Should the court rule in East Gate’s favor, Cox suggested it could open the door for the establishment of alcohol-serving restaurants in other parts of town, like the Kmart shopping center (across the street from the mall) or the , both of which are in SRC zones.

Coleman said PREIT, though not named in East Gate’s suit, has asserted itself in the case as a defendant.

All the parties have already had preliminary discussions with the judge in the case, with another scheduled for Friday, according to Coleman, with the intent of expediting the matter.