MCA Says Disney Deal Is Illegal Because It Was Made in Secret

An attorney for MCA Inc. claimed Friday that a tentative agreement between Burbank and Walt Disney Co. to develop a $150-million to $300-million shopping center and entertainment complex is illegal because it was sealed in a secret meeting.

In a letter to city officials, attorney Dan Shapiro said that Disney and the City Council had secretly agreed in a closed meeting days before a public vote to approve Disney’s proposal to exclusively negotiate for the 40-acre site in a city-owned redevelopment area.

The City Council, acting as the Burbank Redevelopment Agency, gave Disney an option to purchase the property for $1 million in a public session on May 5.

Shapiro said Friday that the letter was “definitely a prelude to a lawsuit.” Under the state’s Brown Act on open meetings, a complaint has to be filed with the public agency before there can be a lawsuit.

“The agreement that was struck between Disney and the city was done behind closed doors, in strict violation of the Brown Act,” Shapiro said.

The act prohibits city councils, school boards and other governmental agencies from meeting on public issues in private, except in certain circumstances, including land negotiations. If the Brown Act were violated, the courts could cancel the agreement.

Responding to the letter, city officials denied they had violated the Brown Act.

Burbank Mayor Michael Hastings and City Atty. Douglas C. Holland said city officials did hold private negotiating sessions with Disney executives. But, they said, the council held no private meetings with Disney and no final decision was made on the project before the May 5 redevelopment agency meeting.

“We had no idea whether the agency would approve this or not,” Holland said. “No deal was struck at all. It was all up in the air.”

The letter was the latest volley fired in a bitter battle between the two entertainment giants. MCA Vice President Jay Stein earlier this month accused Disney of “blackmail tactics,” saying that Disney privately offered to withdraw its Burbank proposal if MCA would give up a proposed Florida studio tour.

The two companies have been warring over the “back lot” concept for two years, since an aggressive new management team at Disney proposed building a studio tour attraction in central Florida.

MCA officials also claimed that they were not allowed to submit a proposal for the Burbank site. Burbank Mayor Michael Hastings did solicit a proposal from MCA in April that would compete with Disney’s. But Stein said he never received information he requested from Hastings about the site.

Burbank City Manager Bud Ovrom called Shapiro’s letter “baseless and a publicity stunt. If MCA had seriously wanted to discuss developing that site, they would have been welcome to do so. This is not an attempt by them to meaningfully consider the issues.”

Holland said: “Burbank has become a pawn in MCA’s perceived war with Disney. They just want to keep Disney out of here, and they’re going to do a nickel-and-dime number on us.”

Tom Deegan, director of corporate communications for Disney, said he had not seen Shapiro’s letter and would have no comment.

Disney is now drawing up specifics for the Burbank project, called “The Disney-MGM Studio Backlot.” The project, if approved by the city, would allow the company to move its animation and other studios to the new site. Preliminary plans also call for the complex to feature behind-the-scenes Hollywood themes and street performers in addition to a retail shopping center.

Under the agreement with Burbank, Disney is required to submit a design, parking layouts and construction schedules within six months. Further plans and revisions are to be drawn up in the subsequent six months.

Either side can pull out of negotiations after the 12-month period if it is dissatisfied with final plans.