Massachusetts Bay Transportation Authority v. Clear Channel Outdoor, Inc. (Lawyers Weekly No. 09-017-18)
COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT. 1884CV00268-BLS2 ____________________ MASSACHUSETTS BAY TRANSPORTATION AUTHORITY v. CLEAR CHANNEL OUTDOOR, INC. ____________________ MEMORANDUM AND ORDER ON CROSS-MOTIONS FOR PRELIMINARY INJUNCTION This lawsuit arises from the imminent expiration of a 15-year license agreement under which Clear Channel Outdoor, Inc., has been operating billboards on property owned by the Massachusetts Bay Transportation Authority. The MBTA recently issued a request for responses by parties willing to enter into a six month license to operate the same billboards after the current license expires. The MBTA received bids from Outfront Media LLC, which agreed to enter into a six-month license, and Clear Channel, which refused to accept a term that short. The MBTA disqualified Clear Channel. It then awarded a six-month license to Outfront Media. The MBTA brought this suit seeking declarations that its request for responses was lawful, Clear Channel is not entitled to enforce its right of first refusal, and Clear Channel is contractually obligated to transfer the disputed billboards as well as whatever permits are needed to operate the billboards to the MBTA. Clear Channel has asserted counterclaims alleging that the MBTA breached the existing contract by offering a new license on terms that are not commercially reasonable and by not allowing Clear Channel to exercise its contractual right of first refusal, and that Clear Channel therefore has no contractual obligation to transfer the billboard structures to the MBTA at the end of the current license term. The MBTA now seeks a preliminary injunction that would bar Clear Channel from interfering with any use of the billboards on MBTA property, or terminating or otherwise disposing of its existing permits for billboards on MBTA property. Clear Channel seeks a preliminary injunction that would bar the MBTA from proceeding with the new license it has issued to Outfront Media or otherwise interfering with Clear Channel’s ownership of billboard structures and associated permits. The Court will ALLOW the MBTA’s motion and DENY Clear Channel’s motion. – 2 – 1. Legal Background. 1.1. The Public Interest in MBTA Advertising Revenues. The MBTA is a governmental entity, established by the Legislature as a “political subdivision of the commonwealth” that consists of 65 cities and towns within the MBTA’s service area. G.L. c. 161A, § 2 (political subdivision) & § 1 (defining the cities and towns within the “area constituting the authority”). The MBTA is now governed by the board of directors of the Massachusetts Department of Transportation. Id. § 3. “The MBTA’s essential function is to provide mass transportation services” in the greater Boston metropolitan area. See Massachusetts Bay Transp. Auth. v. City of Somerville, 451 Mass. 80, 86 (2008). The MBTA obtains most of its operating funds from taxes […]