Peninsula Township owes 11 wineries on Old Mission Peninsula millions in damages over zoning ordinances that a federal judge ruled unconstitutional.
Judge Paul Maloney for U.S. District Court's Western Michigan district ruled the township's ordinance amounted to compelled speech by regulating what kind of branded merchandise wineries could sell, requiring them to promote agriculture on Old Mission Peninsula at events, and requiring the township's permission to host certain events, among other findings.
Hear reporter Jordan Travis discuss the story through the audio player above.
The judge previously struck down several parts of the zoning ordinance, ruling that a requirement that some of the plaintiffs use at least 85 percent fruit grown on the peninsula in any product they sell violated the dormant commerce clause. He also found "guest activities" regulations throughout the ordinance to be overly vague.
"Plaintiffs suffered actual injuries — lost profits — stemming from an impossible-to-understand ordinance and arbitrary enforcement of the same," Maloney wrote.
The judge awarded the plaintiffs a total of $49,263,007.68 in damages for not being able to host small or large events. Those ranged from $275,118.50 to Grape Harbor — operating as Peninsula Cellars — for small events to $11,726,910 to the company that owns Chateau Chantal for large events. A few plaintiffs didn't qualify for damages from large events, as they operated under a different set of zoning rules.
Those amounts are for the period from Oct. 21, 2017, to Dec. 13, 2022, or three years before the suit was filed until the township repealed the ordinance being challenged.
Maloney declined to enjoin the zoning ordinances the wineries and association challenged because Peninsula Township already repealed them, he wrote. And while the plaintiffs argued the replacement ordinances are largely the same, Maloney wrote that hasn't been determined in court.
Nor did Maloney agree with an argument the wineries and association raised during trial: that a closing time which doesn't appear in the ordinance but which the township enforced anyway violated the plaintiffs' life and liberty interests. That argument was raised too late to be fairly considered, he wrote.
He also declined to award damages for increased grape costs and merchandise sales restrictions, noting the plaintiffs' damages expert should have estimated gross profits for those, not net profits.
Township Supervisor Maura Sanders said in a statement that the township is considering options.
"We are actively reviewing the order and its underlying rationale," Sanders told the Record-Eagle. "Based on our preliminary review, we believe there are substantial grounds for appeal."
Read the full story in the Record-Eagle.
