For much of the past year, Star Park, owned by the Schlesinger Companies, has been encroaching on the Goodman family's City Center Parking monopoly. On some blocks where their lots are in close proximity, both operations have dropped daily and monthly rates--a nearly unprecedented move.
Last week, the street-corner shadowboxing entered the legal realm when the Goodmans accused the Schlesingers of engaging in unfair and illegal business competition. How? The Schlesingers hired a lot attendant and occasional supervisor who once worked for the Goodmans.
On Jan. 21, City Center's attorney sent a cease-and-desist letter to Star Park. The letter asked Star Park to "cease practices which amount to tortious interference with CCP's contractual rights and business relationships."
Translation: Star Park, according to Barry Schlesinger, hired Mustafa Babiker, a $9-an-hour lot attendant and occasional supervisor.
A separate letter from Nudelman accuses Babiker of violating an employment agreement: "This Agreement places severe restrictions on your post-separation business activities and expressly prohibits you from engaging in any business activity that would be competitive with CCP in the 'parking related business.'"
Indeed, according to a copy of the employment contract signed by Babiker in April 1999, the 47-year-old Sudanese attendant agreed that "for a period of three years following a separation from employment, for whatever reason, the undersigned agrees not to directly or indirectly engage in any business activities, as an owner, manager, employee or otherwise, ... that would be competitive with the business of CCP."
That's what's known as a "no-compete" contract. Paul Ostroff, an employment lawyer at Lane Powell Spears Lubersky, says such contracts normally involve senior managers or sales and marketing employees who possess trade secrets or information in which the employer has a "protectable interest." Ostroff, who was speaking generally and does not represent either party, says it's "pretty unusual" for a worker earning modest hourly wages to be involved in no-compete contracts.
Babiker acknowledges signing the letter but says that after he did so the scope of his employment changed and he was demoted from supervisor to lot attendant. "I have a right to work for other companies," Babiker says. "They [City Center] didn't buy me."
Schlesinger says the Goodmans' letters stunned him. "I'd like to think that we live in a more enlightened city than this," Schlesinger says. "But it's their normal way of trying to bully and intimidate people."
The Schlesingers and the Goodmans have long regarded each other with less than admiration (see "Space Invaders," WW, Aug. 23, 1993). But Schlesinger says he's never received any similar communication in the past, although his company has previously hired people from the Goodmans. "We will continue to employ Mustafa," he says. "And we'll take whatever legal steps are necessary."
Greg Goodman of City Center Parking told WW that he knew nothing about the letters regarding Babiker and referred questions to his attorney, who says a deal is a deal. "There's an agreement that says that he wouldn't compete, and now he's working for a competitor," says Jeffrey Nudelman. "It's that simple."
No matter how the bout over Babiker is resolved, the clash of the two venerable Portland families is not over. Last year, the Schlesingers raised the stakes dramatically when the new Hilton Executive Tower opened. For two decades, Portland developer Pete Mark had always partnered with the Goodmans. But when his new Hilton opened with one of the largest parking structures in the city, the name on it was "Star Park" rather than "City Center."
The Hilton brought to 30 the number of Star Park facilities in the central city, up from five only a couple of years ago. Star Park now controls slightly more than 2,000 spaces, according to Schlesinger. But that's still a small fraction of the number the Goodmans control.
A far larger battle between the parking behemoths looms this summer. In August, the Goodmans' contract to operate six parking garages owned by the City of Portland will come up for competitive bid, and Schlesinger has his eye on that pivotal piece of business. He's clearly hoping to use last week's threat from the Goodmans to gain some leverage.
"I'm concerned that the city gives contracts to a company that forces people to sign contracts like this," he says.