Dominium, based in Plymouth, MN, says it had worked with locally based Ryan to win the right to develop the 1.2-million-sf Sears project, formerly a retail and distribution center, from the City of Minneapolis. Ryan was the lead developer on the project, while Dominium would build the housing. But then Ryan "unilaterally" transferred development rights for the housing portion of the project to Sherman Associates.

Ryan officials did not comment on the lawsuit.

Dominium says it is seeking recovery of direct expenses, damages and any lost profits through the breach of contract lawsuit. Dominium claims it was to receive a developer's fee of $3.5 million, with millions more to be earned from managing rental housing at the project in the future. The $158-million redevelopment of the former Sears would include building corporate office space, an international marketplace, a hotel, and up to 300 housing units. The non-profit Project for Pride in Living is also developing 55 to 60 townhouses at the site.