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First Amended Complaint

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Lance R. Broberg (SBN 024103)

Timothy C. Bode (SBN 031484)

SEVENTH FLOOR CAMELBACK ESPLANADE II

2525 EAST CAMELBACK ROAD

PHOENIX, ARIZONA 85016-4237

TELEPHONE: (602) 255-6000

FACSIMILE: (602) 255-0103

EMAIL: lrb@tblaw.com / tcb@tblaw.com

Attorneys for Plaintiff

UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

Generations at Pinnacle Peak, LLC, a 

Michigan limited liability company; 

Plaintiff,

vs.

Whitestone Pinnacle of Scottsdale –

Phase II, LLC, a Delaware limited liability 

company; 

Defendant.

Case No. 2:17-cv-04597-DLR

First Amended Complaint

(Assigned to the Hon. Douglas L. Rayes)

Plaintiff Generations at Pinnacle Peak, LLC (“Generations”), alleges as follows:

Parties, Jurisdiction, & Venue

1. Generations is a Michigan limited liability registered as a Foreign LLC in 

Arizona

2. Generations does business in Maricopa County, Arizona.

3. The sole member of Generations is Generations at Pinnacle Peak Investment, 

LLC, a Michigan limited liability company.

4. The sole member of Generations at Pinnacle Peak Investment, LLC is IPA 

SH Holding, LLC, a Michigan limited liability company.

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5. The members of IPA SH Holding, LLC are IPA Holding, LLC, a Michigan 

limited liability company and individuals who are citizens of Michigan and Arizona.

6. The members of IPA SH Holding, LLC are A-G Capital Holding Corp., and 

individuals who are citizens of Michigan.

7. A-G Capital Holding Corp., is a citizen of Michigan because it is a Michigan 

corporation with its principal place of business in Michigan.

8. Accordingly, Generations is a citizen of Michigan and Arizona because its 

members are citizens of Michigan and Arizona.

9. Defendant Whitestone Pinnacle of Scottsdale – Phase II, LLC (“Whitestone

II”) is a Delaware limited liability company registered as a Foreign, LLC in Arizona. 

10. Whitestone II does business in Maricopa County, Arizona.

11. Pursuant to its filings with the Arizona Corporation Commission, the sole 

member of Whitestone II is Whitestone REIT Operating Partnership, L.P., a Delaware 

limited partnership.

12. Pursuant to Whitestone REIT’s 2016 10-K, Whitestone REIT is the sole 

general partner of Whitestone REIT Operating Partnership, L.P. and owns 96.4% of 

Whitestone REIT Operating Partnership, L.P.

13. Pursuant to Whitestone REIT’s 2016 10-K, the remaining 3.4% of units are 

owned by third parties, including certain trustees.

14. Upon information and belief, the limited partner(s) of Whitestone REIT 

Operating Partnership, L.P. are not citizens of Arizona or Michigan.

15. Complete diversity of citizenship exists amongst Generations and Whitestone 

II.

16. The dispute outlined in this Amended Complaint concerns real property 

located in Maricopa County, Arizona. 

17. All relevant conduct and events described herein occurred in Maricopa 

County, Arizona, or were directed towards Maricopa County, Arizona. 

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18. Generations and Whitestone II are parties to an Executed Agreement 

Regarding Development Matters dated March 7, 2017 (“Development Agreement”), out of 

which this dispute arises. A copy of the Development Agreement is attached as Exhibit A.

19. The Development Agreement includes a choice of law and venue provision 

that prefers the laws of the State of Arizona and that requires any suit or other legal action 

to be adjudicated in Maricopa County, Arizona. 

20. The Court has diversity jurisdiction over this action pursuant to 28 U.S.C. § 

1332(a), as this action is between citizens of different states and the amount in controversy 

exceeds the $75,000 jurisdictional threshold. 

21. Venue is proper in the United States District Court of Arizona pursuant the 

Parties’ valid forum-selection clause. Atl. Marine Const. Co. v. U.S. Dist. Court for W. 

Dist. of Texas, 134 S. Ct. 568, 581, 187 L. Ed. 2d 487 (2013) (“a valid forum-selection 

clause [should be] given controlling weight in all but the most exceptional cases.”) 

(internal citations omitted). 

General Allegations

22. Whitestone II owns and operates a commercial shopping center comprised of 

three buildings and a 2-floor parking structure located on the east side of Scottsdale Road 

north of Pinnacle Peak Road. Whitestone II’s tenants include a Starbucks, a restaurant, and 

an Orange Theory Fitness. 

23. Generations owns real property formerly owned by United Insurance 

Company of America (Generations also bought a piece from Whitestone II) and located 

immediately east and behind Whitestone II’s property and immediately north and behind a 

property owned by a related Whitestone entity. 

24. Crown-Phoenix V, LLC, as predecessor to Whitestone II, and United 

Insurance Company of America, as predecessor to Generations, entered into an Amended 

and Restated Declaration of Cross Easements and Parking dated February 26, 2007, and 

recorded at Maricopa County, Arizona Recorder’s number 2007-0251301, as subsequently 

amended from time to time, (“Cross Easement Declaration”). 

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25. A copy of the Cross Easement Declaration is attached as Exhibit B. 

26. The Cross Easement Declaration governs both relevant properties and 

provides, in pertinent part, as follows: 

a. The term “Common Areas” shall mean and include all parts of the 

Property which are, from time to time, devoted primarily to parking, 

parking approaches, sidewalks, pedestrian passageways, and interior 

roadways through the Parcels. [§ 1.3]

b. Each Owner hereby grants and conveys, and each other person who 

becomes an owner of any portion of the Property shall immediately 

upon becoming an Owner and without further act, be deemed to have 

established and conveyed, to each and every other Owner a perpetual 

nonexclusive appurtenant easement over, upon, and across the 

Common Areas for the purposes of pedestrian and vehicular ingress, 

egress, passage, and traffic of all Permittees, including but not limited 

to (i) unrestricted passage through the Common Areas of the Crown 

Parcel to and from Scottsdale Road; (ii) egress through the Common 

Areas of the Crown Parcel to the adjacent shopping center.... [§ 

2.1(a)]

c. [F]ree access over the Common Areas of the individual Parcels 

comprising the Property shall be maintained and shall not be impeded; 

provided, however, that such free access may be temporarily impeded 

during any time of construction, repair or maintenance of or within the 

Common Areas so long as alternative access is provided, if necessary. 

[§ 2.1(h)]

d. ...each and all of the easements and rights granted ... shall bind each 

and every person or entity having any fee, leasehold, or other interest 

in any portion of the Property.... [§2.3(a) and (b)(iv)]

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e. Each Owner hereby agrees to grant such other easements that may be 

required by the City or any utility company, including without 

limitation, access easements for emergency and services vehicles.... [§ 

2.1(j)]

27. Years later, having acquired their respective interests in the property, the 

instant Parties entered into the Development Agreement, defined supra. 

28. In the Development Agreement, Generations and Whitestone II

acknowledged the Cross Easement Agreement and agreed as follows: 

Fire Lane. As part of the Generations Development, Generations 

is required to modify the area servicing Whitestone’s building A, as 

depicted on the site plan attached as Exhibit C, and detailed in 

Exhibit G. Generations agrees to consult with Whitestone with 

respect to the timing of constructing such modification to avoid 

disruption of Whitestone’s operations during such period. 

Generations shall be responsible for all costs of such modifications. 

[§ 3] 

29. At all relevant times, it was understood by Generations and Whitestone II 

that Generations was required to have a dual access fire lane with one access located at the 

northwest of Generations’ property adjacent to a 21-space parking lot on Whitestone II’s 

property.

30. In October 2017, Generations was advised by the fire inspector that the 

second access point for the fire lane (the one referenced above and at issue) could not be 

installed towards the end of construction but instead must be installed prior to Generations 

bringing combustible materials (wood framing) onto the construction site. 

31. In good faith, Generations provided written notice, along with the plans for 

the anticipated installation construction, the fir inspector’s certificate confirming as much, 

and offering access to additional parking spaces controlled by Generations to mitigate any 

inconvenience to the customers of Whitestone II’s tenants’ customers. 

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32. On November 11, 2017, when fencing was being installed to permit the 

installation of the fire lane access, Whitestone II, or its agent, halted the improvement by 

calling the police. 

33. Whitestone II has at all times since employed a security guard to prevent any 

construction of the fire lane. 

34. Whitestone II’s security guard, in direct violation of the Cross Easement 

Agreement, has harassed Generations’ trade and other personnel including, but not limited 

to: prohibiting a truck from delivering 5 gallon water bottles of water to the Generations 

property site (for the construction trailer), prohibiting a Generations’ waste company from 

cleaning waste tanks located behind Generations’ construction trailer, and prohibiting 

trades from reaching or parking on the top deck of the parking structure which spaces are 

reserved for Generations. 

35. Whitestone II has previously caused substantial delay to Generations’ 

construction. 

36. Whitestone II refused to execute and deliver certain easements required by, 

and in favor of, the City of Scottsdale (“City”) to permit the City to maintain the water and 

sewer lines necessary to service Generations’ property (“Utility Easements”). 

37. Whitestone II’s delay and refusal was a direct violation of a prior Declaration 

[Attached as Exhibit C, see section VII(A)(II) which provided: Upon request, the owner of 

a parcel shall grant such easements directly to utility companies or governmental entities 

as may be necessary to carry out the purposes of this subparagraph (ii).] and the Cross 

Easement Declaration at Exhibit j, quoted above. 

38. On threat of litigation, Whitestone II eventually executed and produced the 

required Utility Easements. 

39. The unjustified delay by Whitestone II, however, caused substantial, 

quantifiable damage to Generations.

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Count One

Breach of Contract

40. Generations incorporates the above allegations as stated herein.

41. The Cross Easement Agreement is a valid, enforceable contract by and 

between Generations and Whitestone II. 

42. By virtue of the conduct described above, Whitestone II has breached its 

obligations to Generations as set forth in the Cross Easement Agreement. 

43. Generations has been damaged in an amount to be proven at trial. 

44. Generations is entitled to an award of its attorneys’ fees and costs pursuant to 

the contract document and A.R.S. §§ 12-341 and 12-341.01.

Count Two

Breach of Contract

45. Generations incorporates the above allegations as stated herein.

46. The Development Agreement is a valid, enforceable contract by and between 

Generations and Whitestone. 

47. By virtue of the conduct described above, Whitestone II has breached its 

obligations to Generations as set forth in the Development Agreement. 

48. Generations has been damaged in an amount to be proven at trial. 

49. Generations is entitled to an award of its attorneys’ fees and costs pursuant to 

the contract document and A.R.S. §§ 12-341 and 12-341.01.

Count Three

Breach of Implied Covenant of Good Faith and Fair Dealing

50. Generations incorporates the above allegations as stated herein.

51. Every contract under Arizona law implies a covenant of good faith and fair 

dealing.

52. The implied covenant of good faith and fair dealing is as much part of the 

contract as express terms.

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53. The Cross Easement Agreement and Development Agreement are binding 

contracts between Generations and Whitestone II.

54. Whitestone II breached the implied covenant of good faith and fair dealing 

by, inter alia, refusing and delaying the execution and production of the Utility Easements, 

blocking the access of Generations’ and its invitees to Common Areas and easements, and 

blocking and delaying the installation of the fire lane and emergency vehicle access. 

55. Generations has been damaged by Whitestone II’s breaches in an amount to 

be proven at trial.

56. This is a contested action arising out of a contract or contracts and 

Generations is entitled to an award of his attorneys’ fees and costs pursuant to those 

contracts and A.R.S. §§ 12-341 and 12-341.01.

Prayer For Relief

WHEREFORE Plaintiff prays for judgment against Defendant as follows:

A. An order preliminarily and permanently enjoining Whitestone II and 

all those acting in active concert with Whitestone II from interfering with Generations 

easement, ingress, egress, and other rights under the contract documents; 

B. An award of the damages caused by Whitestone II’s wrongful 

conduct in an amount to be proven at trial; 

C. An award of the attorneys’ fees and costs expended by Generations

in connection with this action pursuant to the Parties’ contracts as well as A.R.S. §§ 12-

341 and 12-341.01; and 

D. Such other and further relief as this Court deems just or appropriate.

DATED this 20th day of December, 2017.

By: /s/ Lance R. Broberg

Lance R. Broberg

Timothy C. Bode

Seventh Floor Camelback Esplanade II

2525 East Camelback Road

Phoenix, Arizona 85016-4237

Attorneys for Plaintiff

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CERTIFICATE OF SERVICE

I hereby certify that on December 20, 2017, I electronically filed the foregoing 

with the Clerk of the Court using the CM/ECF system which will send notification of 

such filing to the following CM/ECF registrants: 

Douglas H. Allsworth

Kutak Rock LLP

Doug.Allsworth@kutakrock.com

Attorney for Defendant

/s/ Laurel S. Brassell

Laurel S. Brassell

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