Will Flagstone Island Gardens continue its legal winning streak against the city of Miami?

The city of Miami could be facing a losing — and very expensive — legal battle.

More than a year ago, a Miami-Dade Circuit Court judge ruled that the city of Miami illegally derailed Mehmet Bayraktar’s often-troubled $1 billion resort project on Watson Island. Since then, the city has made several unsuccessful attempts to limit the dollar amount in damages owed to the Turkish developer, who is seeking to recoup roughly $122 million he claims he has invested in Island Gardens, a mega yacht marina and resort that has been on the drawing board since the early 2000s.

In March, according to court documents reviewed by The Real Deal, Miami-Dade Circuit Judge William Thomas denied the city’s request to grant the local government sovereign immunity, and rejected Miami’s argument that Bayraktar’s company Flagstone Island Gardens is only entitled to a refund of a $1.5 million deposit per its development agreement.

In March of 2018, following a seven-day non-jury trial, Thomas determined Miami elected officials breached a development contract with Flagstone when the city commission voted to find the company in default in May 2017. Commissioners moved to cut ties with Flagstone because construction had allegedly not started on the $31 million parking garage and retail component phase of the project.

Next Wednesday, the city’s legal team is scheduled to provide city commissioners with an update on the case during an executive session that is closed to the public.

Another trial to determine the exact amount of damages Miami will have to pay Flagstone is scheduled for later this month.

In one of his recent rulings, Thomas determined the $1.5 million security deposit is not enough to remedy the damages Flagstone has suffered.

“No one can wind the clock back to when the city should have issued Flagstone its entitlement approval to avoid the injury Flagstone suffered directly from the city’s years of delay,” Thomas wrote on March 27. “The choice the agreement offers Flagstone…is a ‘heads-you-win-tails-you-lose’ scenario.”

Flagstone attorney Eugene Stearns, and Laura Besvinick, the city’s outside counsel handling the defense, did not immediately return phone messages seeking comment.

Flagstone completed and opened the mega yacht marina in 2016, roughly 14 years after Miami voters approved a referendum allowing Bayraktar to build his project on Watson Island.

In addition to the marina, the garage and the retail space, Flagstone planned to build two luxury hotels.