Mallspats: Unibail-Rodamco sues LA County over retail closures

Well, that escalated fast.

Two weeks after sending a letter urging Los Angeles County to reopen its indoor malls, Unibail-Rodamco-Westfield filed a federal lawsuit on Monday over the months-long shutdown.

In a 46-page lawsuit that features 13 named plaintiffs and seeks class action status, the French-based mall operator called the county “perverse” in keeping malls closed “without offering a single valid, science, or health-based reason for their actions.”

“The county and its officials have overtly discriminated against businesses in indoor malls and their employees without any rational basis whatsoever, trampling the constitutional rights of those businesses and individuals,” the filing reads.

The lawsuit against the county includes as plaintiffs the real estate investment trust’s malls in Century City, Sherman Oaks and Culver City plus individual store operators. It comes as the county is feeling increasing pressure over keeping malls shut down.

Gov. Gavin Newsom ordered indoor malls closed in mid-July after coronavirus cases spiked, but permitted individual counties to reopen malls on Aug. 28 if they met certain public health goals.

Each California county has now met those goals including L.A. But the state’s most populous county has struck out on its own in keeping malls closed.

Unibail-Rodamco’s “indoor malls are open in all other counties across California and throughout the world except for Los Angeles,” a company spokesperson said. In his three-page letter to the county earlier this month, Unibail-Rodamco’s president of U.S. operations, Jean-Marie Tritant, called the closures “arbitrary and based on the misconception that these facilities are less safe than functionally equivalent big box retailers that have been allowed to operate throughout the pandemic.”

For the first half of the year, the company’s American shopping centers saw a 15.3 percent year-over-year decline in net rental income.

The Simon Property Group-owned Del Amo Fashion Center has also filed legal action against L.A. County over the shutdown, and the National Retail Federation filed a records request with the county last week demanding the rationale behind the shuttered malls.

Particularly irksome to mall owners and retailers is that malls are closed, while other indoor retail stores like barbershops and massage parlors have reopened.

The county did not immediately respond to questions Tuesday. Earlier this month the County Health Department reasoned that it was cautious on mall reopenings due to fearing a rise in covid cases after Labor Day.

The county, however, has not experienced a post-Labor Day uptick in covid cases.