A $4 million lawsuit filed by a Block 57 landowner against Salt Lake City and its Redevelopment Agency has been dismissed by U.S. District Judge David Sam.

"We've won the battle, but not the war," said City Attorney Roger Cutler. He said the fight will probably resume in state courts.

The lawsuit was filed by S.M. Horman and Sons, which owns the former Keith Warshaw department store and has a long-term lease on the Harver Parking Terrace and warehouse. The properties are located on Block 57, bordered by State and Main streets and Second and Third South.

The owner argues that the RDA should buy the property at full market value, or pay damages for illegally taking it temporarily. Since May 1982, the city has taken actions making it "practically and economically impossible" for the property owners to use the buildings for commercial use, the lawsuit said.

City attorneys filed to have Horman's suit dismissed, saying that under the provisions of the Governmental Immunity Act the issue belongs under state jurisdiction.

The block has been targeted for development by the Salt Lake RDA, but because two deals with major developers to package the whole block fell through, landowners filed two lawsuits to protest RDA policies.

A ruling by 3rd District Judge Raymond Uno in favor of a group of landowners prevents the agency from using a blockwide survey to determine blight and limits its condemnation power.