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SEATTLE -- Tentative plans for a new professional basketball and hockey arena in Seattle do not violate state environmental law, a Washington appeals court said Monday in rejecting a challenge brought by longshore workers.

Hedge fund manager Chris Hansen has been trying to build a $490 million arena, with a $200 million public investment, to draw the NBA and NHL to Seattle. The International Longshore and Warehouse Union Local 19 sued, saying traffic congestion from basketball and hockey games would kill jobs because it would interfere with container shipping and related businesses nearby.

The longshoremen said a memorandum of understanding between Hansen and city and county officials violated the State Environmental Protection Act by creating irreversible momentum for building the arena, even before environmental studies were performed.

But a three-judge Court of Appeals panel unanimously disagreed Monday, upholding a lower court's ruling from February. The panel says the memorandum merely sets out how the decision over whether to build the arena will be made.

The memorandum does not license, fund, or undertake an activity that will directly modify the environment, nor does it purchase, sell, lease, transfer or exchange natural resources, the court wrote.

Hansen had been trying to relocate the Sacramento Kings to Seattle, but NBA owners rejected his $625 million bid. A group of investors led by technology executive Vivek Ranadive bought the team a day later for $535 million with plans to keep the franchise in place.

Statement from Chris Hansen s attorney Jack McCullough:

We are pleased with the court s decision today. The Memorandum of Understanding Chris Hansen signed with the City and the County was specifically intended to ensure that full SEPA review would occur before any final decision was made on possible public funding of the Seattle Arena. We are happy to see that the court properly acknowledged that this approach is fully in keeping with SEPA. In fact, the Draft EIS for the Arena was published just last month, and so we look forward to being able to focus on the completion of the SEPA process as originally planned.

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