Santa Clara, 49ers Settle Lawsuit Over Stadium Management

Santa Clara has agreed to a settlement with the San Francisco 49ers that lets the team continue to manage the publicly owned Levi’s Stadium.

As reported by The Mercury News of San Jose, Santa Clara City Council members emerged Tuesday evening from a reportedly tumultuous closed-session meeting where they discussed the acrimonious and long-running litigation with “no reportable action,” according to interim city attorney Steven Ngo. But on Wednesday afternoon, representatives of the two parties confirmed they had reached an agreement with the 49ers upping an offer they had previously called the team’s "best and final."

The settlement concludes the 2019 lawsuit filed by the 49ers against the city over the council’s decision to remove the team as the manager of non-NFL events at Levi’s Stadium. At the time, council members raised concerns that the team wasn’t complying with state wage and conflict-of-interest laws and alleged that the 49ers overstated the team’s management abilities.

In the years since, according to the News, the two sides have exchanged bitter public recriminations about backroom dealing and the impact of stadium management on everything from neighborhood noise levels to the ability of the stadium to bring in name concert acts such as The Weeknd and Beyoncé. The tussle has dominated city politics, with team owner Jed York sinking millions of dollars into council races and electing three of his four chosen council candidates in the last city election.

Last week, the team increased a previous $3.3 million proposal by $700,000 to cover interest costs and a new accounting system — both at the request of the city. The team added another $325,000 to the pot on Tuesday.

The 49ers will pay $1.675 million directly to the city’s general fund. There will also be a $650,000 transfer from the Stadium Authority’s discretionary fund to the general fund, as well as an additional $650,000 from the Stadium Authority’s discretionary fund to its operating fund. The 49ers will also waive $350,000 in accrued interest and pay $2 million for public safety costs.

“Today’s agreement represents the beginning of a renewed partnership between the 49ers and the City of Santa Clara,” 49ers spokesperson Rahul Chandhok told the News. “We’re pleased to put this fight behind us for the benefit of Santa Clara’s residents and the stakeholders who rely on Levi’s Stadium for jobs, revenue and entertainment.”

In an interview, Councilmember Anthony Becker called the agreement “fair” and said it would move the city’s relationship with the 49ers in a “positive direction” — especially at a time when the city is in dire straits with its finances.

“We took away a lot of litigation that was costing our residents a lot of money,” Becker said of the lawsuits settled between the city and the team this year. “We have a $27 million deficit. When the mayor often talks about giving sweetheart deals to the 49ers, I think she was really trying to give sweetheart deals to the attorneys.”

According to the News, the stadium management lawsuit was the last piece of litigation between the 49ers and Santa Clara, who have been locked in legal battles for years. There are two mediated disputes that have yet to be resolved, but those are expected to be finished by the end of the year, according to Chandhok.

The 2019 lawsuit was the second piece of litigation settled between the 49ers and Santa Clara this year. In February, the team paid the city $325,000 over a 2018 lawsuit it filed against the city. In it, the 49ers claimed it had overpaid more than $1 million for parking at the city-owned golf course near the stadium.