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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND SAFEWAY, INC., Plaintiff, v. SUGARLOAF PARTNERSHIP, LLC, Defendant; SUGARLOAF PARTNERSHIP, LLC, Plaintiff, v. SAFEWAY, INC., Defendant. * * * * Case No. RWT 04cv3929 * * * **** * * * * Case No. RWT 05cv679 * * *

MEMORANDUM OPINION These two cases concern the same dispute between Sugarloaf Partnership, LLC, the landlord of a shopping plaza in Germantown, Maryland, and Safeway, Inc., a food retailer that at one time operated a supermarket in that shopping plaza. The dispute concerns the terms of the lease for that supermarket. Safeway closed the supermarket on June 6, 2000, and notified Sugarloaf of the closure on January 10, 2001, but has maintained its lease and paid rent on the property since then. On October 12, 2004, Sugarloaf notified Safeway that it was exercising its claimed right to terminate the lease because Safeway had left the property vacant. Safeway's position is that this notification was ineffective, because under the terms of the lease as Safeway reads it--incorporating the Second Lease Modification Agreement, dated October 9, 1985--Sugarloaf had only thirty days from Safeway's store closure notification to terminate Safeway's lease. Sugarloaf's position is that it had no time limit, because the original lease does not provide for one, and the Second Lease Modification Agreement says that it modifies "the second

sentence of Paragraph 30" of the lease, not Paragraph 13(c), the "Abandonment" provision that permits Sugarloaf to terminate the lease in response to a vacancy. To resolve this dispute, each party filed suit against the other. Safeway filed a complaint in this Court (the "Safeway action," Civil Case No. 04-3929) on December 14, 2004, seeking reformation of the lease to make the amendment clear, a declaration that Sugarloaf did not and can not terminate the lease, and various monetary damages. Also on December 14, 2004, Sugarloaf filed a Complaint and Summons Against Tenant in Breach of Lease, seeking possession of the premises, in the District Court of Maryland for Montgomery County. Safeway ultimately removed this action (the "Sugarloaf action," Civil Case No. 05-679) to this Court. The underlying merits of the dispute are not yet ripe for adjudication. Rather, now pending before the Court are several motions that were filed over the course of the spring, summer, and fall of 2005: Safeway's Motion to Consolidate [Case No. 04cv3929, Paper No. 14]; Sugarloaf's Motion to Remand and for Costs or in the Alternative to Abstain [Case No. 05cv679, Paper No. 18]; Sugarloaf's Motion for an Abstention and Remand Order [Case No. 04cv3929, Paper No. 20]; Sugarloaf's Motion for Partial Summary Judgment [Case No. 04cv3929, Paper No. 49]; Sugarloaf's Motion to Strike Safeway's Expert Report [Case No. 04cv3929, Paper No. 46]; and Safeway's Motion to Amend Complaint [Case No. 04cv3929, Paper No. 52]. A hearing on three of these motions was scheduled for October 31, 2005, see Case No. 04cv3929, Paper No. 33, but was cancelled after the Court was advised that a settlement in this case was likely and after it became clear that the motions were suitable for disposition on the papers pursuant to Local Rule 105.6, see Case No. 04cv3929, Paper No. 60.

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The Court has withheld disposition of the motions in the continuing hope that a peaceful resolution of this case would be forthcoming. However, more than a year has passed since the first of these pending motions was filed, and more than five months have passed since the first suggestion that this case would imminently settle. It is therefore prudent to assume that this case will proceed further in litigation. Accordingly, the Court now rules on each motion, but with the hope that the parties can conclude their efforts at a mutually satisfactory resolution of these cases. Failing that, the business of justice will proceed without further delay.

I. Sugarloaf's Motions to Remand or Abstain In the Sugarloaf action, Sugarloaf has moved under 28 U.S.C.

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Maryland Law