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Rogers v. Aramark, Part II
By Taggart Rogers, Past Commodore
About this time last year, many of you had received nasty notes from our benevolent concessioner, Aramark, informing you that unless you agreed to sign their latest draconian moorage agreement, they would begin charging you a “nightly rate,” almost double the monthly rate, for your slip or buoy. Under duress, many of you succumbed to this threat and surrendered your rights under the old contract. A number of us, though, refused to give up our old (pre-2003) contracts because there is no provision in these contracts for anything other than the monthly rate, and we wrote letters to Aramark saying so. Since the nightly rate threat hadn’t worked on us, Aramark then said they were terminating our old contracts because they were month-to-month contracts that they could terminate without cause. However, the old contracts don’t permit Aramark to do this either, and we wrote back again saying so.
After none of the threatening letters from his underlings had worked, Michael Walsh, the Water Operations General Manager for Aramark, began sending new contract termination letters with trumped-up charges of default to certain tenants with the old contract. Not surprisingly, I was one of these. My particular crime was an allegation that I had not provided Aramark with current boat registration information, that I had been so notified, that I had been given an opportunity to repent as required by my contract, but that I had not done so. Of course, as we would later show in Court, none of this was true. Nonetheless, the letter went on to say that if we didn’t remove our boat from its slip in the next few days, Aramark would remove and impound it. We endeavored to negotiate a stay of execution, but Aramark was (big surprise) wholly uncooperative, and so in order to protect our investment and preserve our rights under the old contract, my wife and I filed a lawsuit against Aramark.
In the newsletter article I wrote last summer I described our experience in the Federal Court for the District of Arizona. At our first appearance on May 9, 2009, the Court found in our favor and granted us a Temporary Restraining Order (TRO) that prohibited Aramark from boarding or removing our boat from its slip and from interfering in any way with our use and enjoyment of the boat. At the full hearing on May 20, the lawyers representing Aramark presented five different arguments supporting their client’s claim that it could terminate our contract and remove our boat from the lake. The Court found none of these arguments persuasive and again found in our favor, granting us a Preliminary Injunction with essentially the same terms as the TRO. The Preliminary Injunction has been in effect since then and will remain in effect until the lawsuit is settled, in Court or otherwise.
After the May 20 hearing, the Judge promulgated a schedule for the various things that have to happen before trial. The first date in the schedule was October 22, 2009, the deadline for good faith settlement talks. Our attorneys made telephone calls, sent emails, and sent letters to the attorneys for Aramark requesting discussion of settlement, but October 22 passed with no response from Aramark’s attorneys.
The next date in the schedule was December 4, 2009, the deadline for discovery. Discovery is a process whereby each party to a lawsuit may request information from the other party or parties. The requests may be for documents, answers to questions (interrogatories), statements of admission, testimony (depositions), and so on. In addition to the 45 documents (over 180 pages) we provided at the May 20 hearing, we submitted over a hundred additional documents to Aramark at their request. These were mostly correspondence between me and either Aramark or the National Park Service, nothing that Aramark hadn’t already seen.
Some of the documents we received from Aramark were more interesting. One was a 2007 email exchange between Jon Maris (Aramark) and Lou Good, NPS Chief of Concessions and Business Management for the Glen Canyon NRA. In his email, Mr. Maris complained that Aramark was having difficulty getting tenants to sign the new moorage agreement. He wrote that 758 tenants (out of 1811 occupied spaces) had old contracts and had failed to sign and return the new agreement despite repeated requests to do so. I had no idea the number was so large! He proposed that NPS approve charging these 758 tenants a “nightly rate” to force them to sign the new agreement. Mr. Good obediently agreed and wrote back, parroting Mr. Maris’s words, “[t]he reduced rate is a privilege, not a right…” Like his predecessor, Mr. Good doesn’t appear to know much about contracts. How do you suppose he would feel if he bought a car and, after his third payment, the bank told him that the payment amount was “a privilege, not a right,” and that it was going to double unless he signed a new contract?
In his email, Mr. Maris also mentioned another option to force tenants to sign the new agreement. He wrote:
“2. Threaten cancellation and impound.
a. This is only effective in about 5% of the cases and would be unmanageable if even 1% took us up on that.”
Interesting. I guess I’m in that 1%.
Included in the documents we received from Aramark were drafts and mark-ups of later (after 2002) versions of the moorage agreement. One of these was a draft of the 2006 agreement annotated with comments by the NPS reviewer. Alongside the provision requiring a waiver of subrogation, the reviewer wrote:
“We understand that waivers of subrogation are quite difficult to get, so NPS would accept the waiver or being named as an additional insured [emphasis added].”
The contract language was subsequently changed so that the tenant can simply name NPS as an additional insured, which generally costs nothing. Aramark, however, continues to insist on not only being named as an additional insured but also being provided a waiver of subrogation, in effect requiring the tenant to purchase at the tenant’s expense insurance to cover Aramark’s own negligence. In the past we were told that the waiver of subrogation was an NPS requirement. Now, however, the proverbial cat is out of the bag, and we should no longer have to endure such drivel.
Another NPS comment was written in reference to the risk of loss provision:
“I believe this language, which I do not believe I have seen before, violates the requirements of the contract between NPS and Aramark regarding Aramark’s duties to inspect and secure the boats in storage.”
In spite of these and other NPS comments, the final 2006 Aramark moorage agreement (Version 9/06) required tenants to acknowledge facts that were untrue, produce documents that were unobtainable, and abide by an NPS Solicitor’s opinion that NPS would not provide. To our knowledge, and supported by the documents provided by Aramark, the 2006 agreement was the only agreement with any meaningful input from NPS, and the result was still an abomination.
The next date in the Court’s schedule was January 22, 2010, the deadline for submission of dispositive motions. Since Aramark had provided no new evidence in discovery and continued to rely on arguments that the Court had already rejected, we filed a Motion for Summary Judgment (MSJ) in which we asked the Court to rule as a matter of law that there were no issues of fact to be decided and that we were entitled to judgment in our favor. Aramark filed an opposition, and we now await the Court’s decision as to whether to hear oral arguments from the parties in advance of deciding the motion.
Early in March, our attorney suggested to Aramark’s attorneys that they consider mediation as a way to resolve this matter without the necessity of going to trial. Mediation is a process whereby a mediator, who may also be a judge, talks to both parties to help each understand the other’s position and reach a mutually agreeable (or equally disagreeable) settlement. After several weeks with no response, we finally learned that Aramark would participate in mediation, and we are now trying to get it scheduled.
As you might imagine, our legal expenses in this endeavor have been significant, over $70,000 to this point. Barbara and I thank those of you who have contributed. You haven’t heard from me personally because one of the continuing discovery requests from Aramark is that I “identify each person that [I] have communicated with regarding the substance of this lawsuit,” and neither you nor I want Aramark to know who is helping us here. Until our lawsuit is resolved, I will have to do the same thing for anyone else who would like to contribute.
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