CWDI, Cambridge City Council come to agreement in lawsuit

CAMBRIDGE — Cambridge Waterfront Development Inc., Yacht Maintenance Company and the Cambridge City Council have come to an agreement in a lawsuit filed by the city in May.

According to Maryland court records, the case was closed on Wednesday. The suit was dismissed without prejudice, meaning that it could be refiled at a later date.

Cambridge Mayor Stephen Rideout said that the terms of the settlement include the ability for CWDI to transfer part of its property to Yacht Maintenance. Also a part of the settlement, the city and CWDI will enter into a memorandum of understanding to address issues between the city, county, state and CWDI that were not included in the lawsuit.

Rideout said the parties are currently working on developing the memorandum of understanding.

In May, the City Council filed a lawsuit against CWDI, the group spearheading the Cambridge Harbor project, and Yacht Maintenance, a boat service company. The lawsuit alleged CWDI was in violation of a transfer agreement it entered into with the city in June 2021.

The transfer agreement gave CWDI roughly 22 acres of land — including about 2.6 acres of land subject to a lease agreement between the city and Yacht Maintenance — for $5.

The city’s lawsuit sought $75,000 in damages and requested temporary, preliminary and permanent injunctions stopping defendants from transferring any portion of the property in violation of the covenants of the 2021 transfer agreement.

In its lawsuit, the council argued that CWDI violated the agreement in March 2022 by transferring city-donated property to CWDI Holdings, a limited liability company also named in the suit.

Later that month, CWDI and CWDI Holdings filed a response to the lawsuit, alleging the city and CWDI agreed to CWDI creating CWDI Holdings to hold title to property named in the property transfer agreement.

With the settlement, the city and CWDI have entered into an agreement that allows CWDI to transfer property from the 2021 transfer agreement to Yacht Maintenance.

Rideout said the lawsuit was dismissed without prejudice for technical legal reasons.

“Something could come up in the future with regard to CWDI in the city or the county, and we didn’t want to interfere or have this litigation be a roadblock to that litigation,” he said.

‘A FRESH START’

CWDI Board President Angie Hengst said CWDI’s Board of Directors is feeling great about the settlement.

“This just allows us to move forward,” she said. “Hopefully we’ve opened up lines of communication with all of our partners, and hopefully this is a fresh new start as we move forward and just advance the Cambridge Harbor project.”

Hengst said they are “eager” to move forward with the property transfer to Yacht Maintenance, which she hopes will happen in the next few weeks.

At the most recent CWDI Board meeting on July 31, the board talked about concerns with finances and the need for CWDI to sell property so that it can use that money to pay for other things. On Friday, Hengst told the Star Democrat that being able to sell property to Yacht Maintenance will help the organization’s financial situation.

“We need the proceeds from selling property to contribute to our operating budget,” she said.

The settlement follows almost three months of mediation between the city and CWDI before a retired judge.

Rideout said the city is still in discussion with CWDI “on a number of issues.” He said he thinks they will be able to reach agreements on these issues to “help the future development go more smoothly.”

Hengst hopes CWDI will be able to make some significant progress on Cambridge Harbor now that a settlement has been reached in litigation between CWDI and the city. She said CWDI hopes to break ground on its promenade expansion project soon.