Twin Cities Builders Sue Minnesota GreenStar Rating Program

Twin Cities Builders Sue Minnesota GreenStar Rating Program

Ahhh, holiday time, when the sound of the clerk's stamp on green litigation rings merrily in my ears.  On December 9, the Builders' Association of the Twin Cities sued Minnesota GreenStar.  The complaint and motion for a temporary restraining order is available here

Most states and local governments have incorporated third party standards, like LEED, into their green regulations, and that has caused no little amount of controversy. Minnesota, by contrast, created its own green building certification standard for homes.

According to the Star-Tribune:

The program, funded in part with a grant from the MPCA, is voluntary and will have different criteria depending on the type of project. The standards for new construction, for example, will be different from those for a remodeling project. And the standards for an addition will be different from those for a simple kitchen remodel.

GreenStar was the nonprofit formed to create the standards and program, and was originally a partnership of the BATC, the Minnesota chapter of the National Association of the Remodeling Industry and the Minneapolis-based Green Institute. 

With the advent of the downturn in the economy, the partnership fractured into a controversy of green versus green, and the BATC withdrew from the organization. Again, from the Star-Tribune:

But with the construction market so fragile, any additional costs for green certification can be detrimental, especially when many buyers are wondering whether their home values have hit bottom, said Mike Otto, a home builder and remodeler.

That's the sentiment that was driving the builders' association to develop a broader range of standards that would allow builders and consumers more choices to earn the GreenStar certification. Dave Siegel, BATC's executive director, said that members want to embrace an "incremental approach" and create various standards, including some low-level certification that doesn't require more-expensive third-party verification.

At the time, the parties said the divorce was "amicable."  Like many families know, divorce is always amicable right up to the courthouse steps. 

In the spirit of "live and let live," the Builders' Association of the Twin Cities sued Minnesota GreenStar, claiming that it developed and owns the intellectual property to "Green Homebuilding Guidelines," and Green Star was granted the right to use the guidelines to further its mission, but did not own the rights to the materials. The BATC also loaned of $306,418.19, and the BATC claims Green Star cannot pay its debts, and therefore the loan is due and payable immediately.

In addition to filing the complaint, the BATC filed for a temporary restraining order enjoining GreenStar from:

[U]sing, in any way altering or damaging, and/or making or attempting to make any transfer, sale, assignment, license, sublicense or grant of rights or interests to any other person or organization with respect to all or any part of the Green Homebuilding Guidelines, including both the New Home User Manual and the Now Homes Checklist.

This week, Judge Gregg E. Johnson of the District Court of Minnesota granted the TRO, but limited its scope to "alteration, destruction, sale or licensing of the new home certification manual and checklist", and excluded the Green Remodeling Guidelines.  The court also required BATC to post a $150,000 bond by Monday.  GreenStar can still use the New Home materials in its ongoing work of certifying new projects.

The withdrawal of funding, participation and, potentially the new home checklist and manual undoubtedly threatens GreenStar's existence. The inititative was partially funded by the state of Minnesota, and so they may have a stake in the ownership and continued existence of GreenStar, and may be brought into the matter.  Stay tuned, a temporary injunction hearing is scheduled for January 24, 2011.

This post originally appeared on Shari Shapiro's Green Building Law blog and is reprinted with permission.