US Supreme Court rules in favor of MOA in dispute over Sears lease
WASHINGTON -- The U.S. Supreme Court has sided with the Mall of America in a dispute over a longtime lease with the now bankrupt Sears corporation.
The court's unanimous ruling means MOA can proceed with its challenge of the transfer of the lease from Sears to a holding company, Transform, owned by former Sears CEO Eddie Lampert. The sale occurred after Sears declared bankruptcy in 2018.
MOA contends Lampert had no intention of occupying the space, and instead planned to sublease it "without any consideration for the Mall of America's tenant mix or status as a global shopping and entertainment destination."
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A lower court had previously ruled in MOA's favor in challenging the lease, but Transform was successful on appeal in arguing that bankruptcy law meant the court had no jurisdiction in the case.
Upon review, the high court ruled that the code cited by Transform was not jurisdictional.
"Nothing in Transform's creative arguments in this case persuades us that [the bankruptcy code] is jurisdictional under our clear-statement precedents," Justice Ketanji Brown Jackson wrote in the court's ruling. "Because the Second Circuit's judgment rested on the mistaken belief that [the code] is jurisdictional, we vacate that judgment and remand the case for further proceedings consistent with this opinion."
Until its closure in 2018, Sears was one of MOA's four anchors since its opening in 1992.