Eight years have passed since the San Diego City Council approved then-Mayor Kevin Faulconer’s 20-year lease-to-own plan to acquire the former Sempra Energy office tower at 101 Ash St. In 2022, the city bought out the lease, even though the building could not be safely occupied. Faulconer is now running for county supervisor. And the legal fight to overturn the original contract was before a state appeals court Friday in a long-shot bid to turn back the clock. Lawyers for taxpayer John Gordon, whose lawsuit was dismissed last year weeks before it was scheduled to go before a jury, urged a three-judge panel of the 4th District Court of Appeal to throw out a lease they say was illegal from the start. “The city is stuck with this building down the street that is unusable, and the perpetrators walked away with $91 million,” attorney Mike Aguirre told the appellate court. “At least let us go back and try the case.” But lawyers for the city of San Diego, along with its former landlord and lender, defended the arrangement. The Gordon lawsuit is moot because the city settled its own case against the companies, and Superior Court Judge Joel R. Wohlfeil properly dismissed the Gordon suit last year, they said. “The summary judgment solved this case,” said John Schena, a private attorney representing San Diego in the litigation. “That’s what the trial court decided: There was no relief that could be granted because of the settlement.” No ruling was issued Friday. Instead, the court took the matter under submission, and a decision is expected in coming weeks or months. The long-running 101 Ash St. saga, which has roiled San Diego politics for years and cost taxpayers hundreds of millions of dollars for a building that cannot be used due to asbestos and other issues. The city did not perform an independent assessment of the property’s condition before officials acquired the building, paying millions more than a $67 million appraised value dubbed “hypothetical.” The Gordon lawsuit was filed in August 2020, nearly four years after San Diego began paying $535,000 a month to rent the building as new work space for 1,000 or more city employees. The suit argued that the lease did not comply with a provision of the California Constitution that bars cities and counties from going into debt without receiving a direct benefit in the same year in which they spend public funds. The 101 Ash St. property violated that rule because city taxpayers were not able to occupy the building, Gordon alleged in his lawsuit. He said the lease should be invalidated. Faulconer had cited the same section of the state constitution when he decided to suspend monthly lease payments on the building in September 2020. By that time, San Diego had paid some $24 million in rent and tens of millions more on renovations to the building. Lawyers for the city, landlord Cisterra Development and private lender CGA Capital of Maryland argued that the public was receiving what’s called consideration — something of value for each party to a contract — for the $6.4 million a year they were paying in rent. “Consideration doesn’t mean they have to occupy,” said Michael Myers, the attorney for Wilmington Trust, the representative for lender CGA Capital. “The city still had the building. The only reason they couldn’t repair that building is the city’s contractors released asbestos.” At least one of the three judges questioned that legal assertion. “It seems like it’s an illusory consideration, isn’t it?” Judge Julia C. Kelety asked. “How does being required to pay for improvements do anything toward consideration? It’s hard to imagine how the asbestos wouldn’t have been released at some point.” After the city leased the building, it began renovations aimed at increasing how many people could work in the 19-story office tower. But the upgrades exposed asbestos that led to a series of violations by county regulators, who at one point ordered work halted until the danger could be safely addressed. The construction also uncovered a slew of problems with the mid-century high-rise’s infrastructure, including its elevators, fire-suppression system, heating, plumbing and other mechanical systems. Two months after Gordon sued in an effort to reverse the lease, the city filed its own lawsuit. Records later showed that Sempra Energy executives had concluded the building was “functionally obsolete” in 2014, a year before the company vacated the building. In 2021, former mayoral real estate adviser Jason Hughes acknowledged he had received $9.4 million in fees for his work advising the city on the Ash Street deal and a similar agreement for the nearby Civic Center Plaza. Hughes said he told at least six city officials that he expected to get paid for his expertise. He provided a letter signed by the city’s former real estate director acknowledging he would seek compensation. Faulconer and the others all denied knowing Hughes collected millions and millions of dollars. The real estate adviser later pleaded guilty to a misdemeanor conflict of interest charge. The plea agreement called for Hughes to repay the $9.4 million in ill-gotten commissions. He also paid a $400 fine and served one year of probation before he was able to nullify the conviction. By 2022, as more embarrassing details emerged from deposition testimony and other court filings, Mayor Todd Gloria proposed buying out both the Ash Street and Civic Center Plaza leases for $132 million in cash rather than going to trial. The City Council agreed with the recommendation, over the objections of City Attorney Mara Elliott. The settlement also called for the city to pay any future legal costs incurred by Cisterra or Wilmington Trust. Once the leases were paid off, city lawyers dropped their cases and urged the judge to dismiss the Gordon lawsuit. “We dealt with the duly elected representatives of San Diego and reached a settlement that voided the lease, terminated in its entirety,” said attorney Michael Riney, who represents 101 Ash LLC, a Cisterra subsidiary. “There was never (legal) standing on the part of Mr. Gordon,” Riney told the appellate judges. The 101 Ash St. property remains vacant, with no plan in sight for using the building. Negotiations for an affordable housing plan fizzled earlier this year after lengthy discussions. City officials invited subsequent bids and narrowed their deliberations to two developers, after last month rejecting an offer from a businessman to buy the property for $10 million and build some 800 supportive housing units. Meanwhile, the city continues to pay millions of dollars a year to maintain the building and to pay off the 30-year bonds issued last year to backfill funding diverted to buy out the leases.