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Bernard Miller, like a lot of folks in town these days, doesn’t care much for the campaign robocalls he’s been getting from at-large council candidate Michael A. Brown.
“I’ve gotten 10 phone calls, and I get upset. I get a knot in my stomach,” Miller says. “I’m the last person he wants to call.”
Miller knows Brown better than most. Since 2003, he’s been entangled with Brown in a business deal to run a copy shop on the premises of the new Washington Convention Center. The proposed partnership fell apart, and Miller took Brown to court for essentially pushing him out of a deal to co-own the enterprise. After two years of litigation (and counting), a jury recently endorsed Miller’s point of view, awarding him $1.24 million in compensation and $144,000 in punitive damages from Brown, his business partners, and the Washington Convention Center Authority.
More to the point, Miller’s lawsuit shines some light into the privileges that come with being Brown, the son of former commerce secretary and Democratic Party bigwig Ron Brown. The whole copy-shop drama, after all, arises from a contract that Brown and his partners managed to procure despite having no experience in that particular business. Brown, Calvin Johnson, and Rodney Keller, operating as Urban Hospitality LLC, had made their money to that point investing in restaurants and shoe stores.
In parallel with his entrepreneurial career, Brown has been busy trying to launch a political one. Over the past few years, Brown has made three runs for office—first a 2006 attempt at the mayoralty, then a tilt for the Ward 4 council seat, and now a run as an “independent Democrat” to replace Carol Schwartz. He seems to have finally found a race he can win; Brown has the clearest path to victory among a half-dozen non-Democratic candidates.
The Miller–Brown affair dates back to the late 1990s, when Shaw native Miller opened a copy shop on 7th Street NW. Soon after, across the street from Miller Copying Service, construction began on the convention center. In order to keep the neighborhood happy through the dust and noise and legions of dump trucks traversing local streets, city authorities made all sorts of promises—such as that local businesses would be able to lease retail space in the finished convention center. Miller claims that he, along with a local nonprofit, had been offered priority in running the hall’s business center—a plum gig in a spot where hundreds of thousands of conventioneers were expected to tread yearly, many needing to make copies or send packages or a use a computer.
Meanwhile, Urban Hospitality put in a bid for the convention center’s highly lucrative food service contract. It didn’t get it, but another contract was available: to run the business center. According to Miller’s court filings, convention center officials “asked [Miller] to include District of Columbia Mayoral Candidate Michael A. Brown and his corporation Urban Hospitality in the Business Center venture” because they “wanted to provide another opportunity to Brown.”
Miller’s lawyer, J. Michael Hannon, says he explained to the situation to the jury thusly: “What happened here is, Michael Brown is a connected person and he tried to get the biggest contract [at the convention center]: the food service. The people there couldn’t allow an incompetent businessman to run the food contract. But they seemed to have had no problem letting him run the business center.”
However, Brown & Co., per local contracting regulations, needed a partner certified as a local, small, or disadvantaged business (LSDBE). Miller had his LSDBE certification; Urban Hospitality didn’t. Claude Bailey, then the convention center’s general counsel (and now a supporter of Brown’s council run), suggested the twain meet, and on Jan. 5, 2003, Miller and Urban Hospitality signed a “non-binding” agreement to explore a partnership. About a month later, Miller gave Brown $10,000 toward the costs of the enterprise.
“We had some good talks and we decided to do a joint venture,” Miller says, with the understanding that Miller would run the operation with Brown, Johnson, and Keller as “money men.” In the summer of 2003, the three Brown partners formed a new corporation and signed a lease to run the business center—a lease including an LSDBE requirement that they couldn’t fulfill without Miller’s involvement.
Over the next two years, according to court documents, Miller and the Brown group repeatedly tried to formalize the partnership. “Then things kept getting put off, put off, put off,” Miller says.
The rift culminated in a November 2004 meeting, where Miller stormed out after he was refused no more than a 5 percent interest in the business’ ownership—an offer he found insulting.
“I only get 5 percent, and I’ve been here from the beginning?” he says. “I said, ‘Look, I don’t have time for this anymore. From here on, you’ll hear from my attorney.’” (Documents filed by Brown’s lawyer describe a less genteel reaction.)
Through 2005, discussions over who had the right to run the business center heated up. The convention center authority’s new general counsel, Eugene A. Adams, wrote to Brown on March 1 that not having Miller (or any other LSDBE) on board was a “major problem for the WCCA and the city from a legal and political standpoint.” In February 2006, Miller sued, alleging that Brown made “attempts to use his political influence with [convention center board members] and others to continue to deny [Miller Copying Service] its rights to participate in the operation of the Business Center.”
Shortly thereafter, the convention center signed a new lease with Brown & Co.—one that clearly left Miller out. Miller and Hannon didn’t learn of the new deal until a deposition months later.
In the subsequent litigation, lawyers for Brown & Co. argued that Miller had no claims since no formal partnership agreement between the parties had ever been signed. The jury rejected the essence of that argument, finding the various parties liable on counts including breach of fiduciary duty, civil conspiracy, and fraudulent misrepresentation.
Says Miller, “[Brown’s] word is not his bond. He doesn’t say what he means and mean what he says. He’s just in it for himself.”
The jury’s decision last month to award punitive damages is particularly damning. Jurors had to find that Brown & Co. acted “with evil motive, actual malice, deliberate violence or oppression, or with intent to injure, or in willful disregard for the rights of the plaintiff” or that his conduct “was outrageous or grossly fraudulent.” While the other parties were each found liable for $25,000 or less in such damages, the jury doinked Brown personally for more than $50,000.
Judicial doinkings have repeatedly come Brown’s way over the years. The aspiring power broker pleaded guilty in 1997 to a federal campaign finance violation, and in 2004 a judge ruled that a partnership he led owed more than $635,000 toward a MCI Center luxury box. That issue remains unsettled.
On the copying front, Brown says what all courtroom losers say: He plans to appeal the verdict. And about the punitive damages ruling, he says, “We took it as a victory. That low of a number when he was looking for a higher number, we were very pleased.”
Asked to speak generally about the lawsuit, Brown calls it “a simple contractual business dispute” involving a company in which he has only a 10 percent financial interest. “I’m a very small cog,” he says.
Miller, however, says Brown was “in it through the whole process,” and Hannon called Brown “the puppeteer” in his statements to the jury last month. “They wanted to give Michael Brown a piece of the action,” says Hannon. “It was all about Michael Brown.”
Brown says he’s pulled no strings. “I think [Hannon] was trying to paint a picture. I guess I have a highly recognizable name. He used that to get the jury to give him a big award. It didn’t work.”
If there’s one thing that all parties can agree on, it’s that dealing with the convention center has been utter hell. The build-out of a planned 7th Street storefront was repeatedly delayed, leaving the business center to operate from a small space underneath the escalator bank in the convention center’s lobby. With conventioneer attendance not meeting projections and with the retail space terribly mismanaged, the business center is “not even really breaking even,” Brown says. That’s even though records obtained in July indicate Brown and his partners haven’t paid their full rent since April 2007.
Hannon is still pressing in court to have Miller declared a partner and to be awarded his rightful share of profits from the business center venture. But Brown says that might not be such a good move.
“At the end of the day,” says Brown, “he could be writing us a check.”
Political Potpourri
• Is there a busier guy in town than Tom Lindenfeld? (OK, besides Hank Paulson.)
Not only is Mayor Adrian M. Fenty’s famed political strategist helping Barack Obama win Pennsylvania and salvaging Carol Schwartz’s write-in campaign, he’s been rallying council support for the controversial lottery contract in recent weeks.
LL learned last week that Lindenfeld has approached at least three councilmembers’ offices to lobby for the contract’s approval. Lindenfeld, who has long bragged to LL about his aversion to the John A. Wilson Building, says it’s his first-ever lobbying gig.
Lindenfeld says he expects a paycheck for his advocacy, which will probably come from the W2I partnership between Warren and Alaka Williams’ W2Tech and Greek vendor Intralot. (He also says he’ll be filing the necessary lobbying disclosure papers, too.)
“I think it’s in the best interest of the District, and I think we’re going to be able to save some money and [get a system] that won’t be hacked into,” he says. Take that, Leonard Manning.
The surprise lobbying comes as Fenty has taken a stronger hand to try to force action on the contract that’s languished since spring, awaiting council approval amid questions about numbers vendors old and new. Hizzoner included the lottery contract in his proposal to close a projected $131 million fiscal 2009 budget gap.
Make no mistake: Convincing Council Chairman Vincent C. Gray to allow a vote on the contract will be at least as hard as all that other stuff Lindenfeld’s got on his plate.
He declines to say whether the mayor personally asked him to go to bat for the contract, saying only, “I wouldn’t do anything that doesn’t help the mayor.”
• At-Large Councilmember Phil Mendelson, as chair of the D.C. Council’s committee on public safety and the judiciary, is the guy pretty much responsible for writing the city’s new gun laws in the wake of the Heller Supreme Court decision.
And Mendo, it will come to no surprise to anyone, is not much of a gun guy, having, by his own account, fired a weapon only twice before in his life. So he decided he needed to, ahem, give it another shot.
Last weekend, Mendelson ventured out to Odenton, Md., to visit an outdoor firing range at the invitation of Ricardo Royal, a D.C. native and local firearms safety instructor who had testified at one of Mendelson’s committee hearings on the gun bill earlier this summer.
Mendelson says he fired 10 rounds from a .22-caliber revolver. His impression? “The gun was too heavy!” he says.
Come on, Mendo. We’re not talking a Dirty Harry .44 here.
In any case, Mendelson demonstrated impressive marksmanship, considering an analysis of the paper target LL found posted on the door of his Wilson Building office last week. Royal, too, was impressed: “I think he did very well,” he says. Mendelson, he notes, is the first public official to take him up on his invite, which he first extended in 2003.
Mendelson said he went shooting in search of “understanding” about guns and gun safety programs—he completed a three-hour class led by Royal before shooting. What struck Mendelson most about his excursion? “There were about 17 people [at the range],” he says, “and 14 of them were women.”
Mendelson says he doesn’t have plans to purchase a newly legal handgun to protect his domicile. “Not at the moment,” he says.
Royal says he expects him back at the range soon, though. “I’m waiting for the second phone call,” he says. “He got bit. I saw it.…He truly doesn’t want others to know how much fun he had.”
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