Rosenburg Development Corp. v. Imperial Performing Arts, Inc.

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In this contract dispute over whether a municipally created economic development corporation is entitled to immunity from suit as if it were a political subdivision of the state, the Supreme Court affirmed the court of appeals’ judgment denying an economic development corporation’s plea to the jurisdiction, holding that economic development corporations are not governmental entities in their own right and, therefore, are not entitled to governmental immunity. Rosenberg Development Corporation (RDC), an economic development corporation created by the City of Rosenberg under the authority of the Development Corporation Act, executed a contract with Imperial Performing Arts, a nonprofit organization, to renovate a historic theater. When RDC refused to extend the deadline to complete the theater’s renovation, Imperial ceased work on the theater project. This dispute followed. The immunity issue on appeal was limited to Imperial’s breach of contract and declaratory judgment claims. The trial court denied RDC’s plea to the jurisdiction, and the court of appeals affirmed. The Supreme Court affirmed, holding that economic development corporations are not governmental entities immune from suit. View "Rosenburg Development Corp. v. Imperial Performing Arts, Inc." on Justia Law