City Told To Pay Parkway $5 Million A Federal Appeals Court Reinstated A Jury Award. It Found The City Had Conspired.

Posted: September 23, 1993

Finding that the city and its Parking Authority "conspired" to close an underground Center City garage, a federal appeals court yesterday ordered the city to pay $5 million to the garage's operator, Parkway Corp.

The money represents the cost of repairs Parkway was ordered to make to the garage, at 15th Street and JFK Boulevard.

The appeals court action, in effect, restores a 1992 federal jury verdict on behalf of Parkway. The verdict was vacated several months later by Chief U.S. District Judge Louis Bechtle, who found that there was insufficient evidence of a conspiracy by the city to force Parkway out of its lease for the garage.

Yesterday's decision is another development in the long legal battle over the city's decision in late 1990 to shut down the 25-year-old garage, arguing that it was in "imminent danger of collapse."

In a series of lawsuits in Common Pleas and federal courts, Parkway officials have claimed that the city and Parking Authority falsely raised the safety issue to hide their real intent: to force Parkway out of a long-term, low-rent lease.

In 1987, a consultant advised the city that the terms of the lease would lessen the amount the city could have received if the garage were put up for sale, which was under consideration at the time.

The appeals court yesterday concluded that Mayor Wilson Goode and/or Managing Director David Pingree "were improperly motivated because the garage had considerably more value to the city if it could relieve itself of the Parkway lease."

Noting that the economic interests of the Parking Authority were identical to the city's, the court in its opinion held that the authority - whose lawyer, David Fineman, the court said, was a "close friend and political ally" of Goode's - began a series of "unfounded" lawsuits over the next two years intended to terminate Parkway's lease.

The appeals court also voided a $1 million award made by the same federal jury to Parkway on the ground that the city breached its contract with the company.

Sam Klein, attorney for Parkway, was elated with the decision to reinstate the $5 million award. "We feel vindicated the court has recognized that Parkway really was abused by the city and the parking authority," said Klein.

Carlton Johnson, divisional deputy solicitor for the city, declined comment until he had a chance to review the opinion.

Fineman could not be reached for comment.

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