Judge dismisses developer’s lawsuit against city

Ozaukee County Circuit Judge Adam Gerol last week dismissed a lawsuit filed against the City of Port Washington by Mequon developer Cindy Shaffer, whose plans to create a large subdivision on the community’s far west side were lauded by officials initially but ultimately fell through after 17 months of negotiations.

While Shaffer argued that the city did not negotiate in good faith, Gerol disagreed, saying the fact the city continued to extend the deadline for negotiations well beyond the original date showed officials wanted to make a deal.

“The parties negotiated for a long time ... and simply couldn’t get to yes,” he said. “There comes a point where parties to a negotiation can walk away. Nothing requires indefinite negotiations.

“Good faith and due diligence in many ways depends on perspective. The city did not find what was being proposed was mutually agreeable.”

The hour-long hearing on Friday, March 27, centered around a motion by the city to dismiss the lawsuit brought by Shaffer’s company, Shaffer Development.

Attorney Remzy David Bitar, who represented the city, told Gerol that when the city approved Shaffer’s offer to purchase the city-owned Schanen farm at the corner of Highway 33 and Jackson Road, it was expected that it would take 90 days to reach a development agreement.

By the time the city’s final deadline lapsed, he said, 264 days had passed.

“I don’t think there’s any breach of any terms,” Bitar said. “There was good faith, multiple (deadline) extensions. It took almost three times longer than originally envisioned.”

But Shaffer’s attorney Ben Prinsen said the offer to purchase required the two sides to negotiate an agreement and the city failed to do so.

“They have to negotiate in good faith and execute a developer’s agreement,” he said.

A key clause that the two sides could not agree would have allowed the city to buy the property back if work on the project did not begin by a specific date, Bitar said, noting this was important because the city wanted to ensure the project would be completed.

Gerol noted that it’s not uncommon for business deals to fall through after significant negotiations.

In the lawsuit, Shaffer sought more than $4 million.

Her development proposal for the Schanen farm was one of two submitted for the 39.4-acre property, and the Common Council agreed to work with her in October 2023.

The lawsuit alleged that the two sides negotiated a purchase agreement that called for Shaffer to buy the land for $1 million, but it was contingent on the city and Shaffer approving a development agreement.

Her plan was to create The Farm, a 263-home subdivision that would have included small, economically priced single-family homes and rental units within a walkable neighborhood with traditional features found in the city’s neighborhoods.

The neighborhood, which was to include amenities such as community gardens, a hydroponic vertical farm, pollinator gardens and shared spaces, would have taken five years to build, she estimated.

Shaffer and the city spent nine months working on the agreement, and the final deadline of March 21, 2025, passed without an agreement being reached.

After a March 18 closed session, the council stopped negotiating “without any explanation or reason,” according to the lawsuit, even through Shaffer had requested a deadline extension.

“The city, in its refusal to act and refusal to provide any explanation to cease negotiations, breached the express and implied terms of the offer to purchase,” the suit stated.

Shaffer contends the city was seeking “numerous unreasonable terms” in the negotiations.

She said failure to move ahead with the project cost her about $200,000 in “hard costs” and a potential $4 million in profits she stood to make on the development.

Shaffer has also filed an open records  complaint against the city, saying she requested but has not received records, including materials, notes and agreements from the March 18, 2025, closed session of the Common Council as well as other closed sessions dealing with her proposed project in an attempt to understand why the city ended negotiations.