Corey lawsuit opens a window into more sketchy airport deals

You win some, you lose some. And then sometimes you learn you’ve been losing a lot more, for a lot longer, than you ever realized.

Atlanta taxpayers lost almost $3 million Monday when a federal jury found that the city in 2002 illegally steered an airport advertising contract to Clear Channel and a friend of former Mayor Maynard Jackson, Barbara Fouch. Those damages — plus some $11 million from Clear Channel and $3 million more from Fouch — were awarded to businessman Billy Corey, who also bid on the contract.

But most damning was the information that came out about the city’s poor oversight of airport contracts generally — a problem that may have cost Atlantans tens of millions of dollars over the years.

The fundamental problem with the airport advertising contract was that, once granted to Fouch and her partners in 1980, it was not opened for bidding again until 2002.

Favoritism wasn’t on display just when Clear Channel and Fouch — who, as a black woman, qualified as the “disadvantaged” business partner that Clear Channel needed in the 2002 bidding process — won what jurors found to be a rigged process. It was on display for more than two decades.

This contract and those for other major concessions at the airport were originally granted for a whopping 15 years; a two-year extension was then given to get Atlanta and the airport past the Olympics.

At that point, in 1997, the city was due a big rise in the rent paid by concessionaires if their contracts rolled over past their expiration date, unless the city formally agreed to keep the previous rates.

Yet, the city didn’t actually make such an agreement or enforce that rental increase against Clear Channel and Fouch. The increase that would have netted Atlanta some $15 million, according to Corey’s lawyers. Clear Channel disputes the claim.

Now, get this: To dispel the notion that Clear Channel and Fouch hadn’t been given undue favorable treatment, attorneys for the city argued in court that the city hadn’t raised the rent, or later demanded back rent, from any airport concessionaires, says Jeff Harris, an attorney for Corey.

“They tried to defend themselves by saying, ‘We weren’t showing favoritism to Clear Channel, we did it with everybody,” Harris says.

If that’s true — and it would require a thorough review of the airport’s dealings — more than a dozen major contracts may have been handled similarly improperly.

The cost?

“All [city officials] had to do was enforce the terms of their contracts” with all of these vendors, Harris says, “and they’d have $100 million more than they have now.”

All of this happened before Mayor Kasim Reed’s watch. But he’s the only one now who can put an end to this foolishness. His cash-strapped city can’t afford to forgo revenue or pay for any more legal losses, if it ever could.

But reversing the city’s stated intention to appeal the Corey ruling, and instead opening a new bidding process for airport advertising, won’t suffice.

As mayor today, Reed owes taxpayers a full accounting of what we’ve lost over the years and how much (or little) transparency exists in the other airport contracts. That, and a rebidding of any contracts that have expired or were also let under dubious circumstances.

Do all that, and Reed would “have the support of all the taxpayers in the city,” says no less an authority than John Sherman, head of the Fulton County Taxpayers Foundation.

At the very least, he would win over a large number of us who voted for Mary Norwood simply because she represented a break from business as usual in Atlanta.

84 comments Add your comment

omega

July 28th, 2010
7:27 pm

Politics to the right of Attila the Hun

July 28th, 2010
7:44 pm

Corruption in the Democratic controlled city of Atlanta. Imagine that! This business of big business teaming up with a minority who is usually just a figurehead reeks of cronyism and corruption.

on patroll

July 28th, 2010
7:46 pm

a large number of us who voted for Mary Norwood simply because she represented a break from business as usual in Atlanta.

did you just come to this city? oooh, you meant black people, my bad.

on patroll

July 28th, 2010
7:47 pm

yeah attila that’s why i am voting for deal

Dave

July 28th, 2010
9:32 pm

I’d like to hear the Mayor’s response to your demand. He’s looking for money to plug the anticipated deficit. A few mil just from making vendors live up to their current contract obligations and then maybe more than a few more mil by going back and making them cough up what they haven’t paid within the statute of limitations starts to add up. What say you Mr. Mayor?

Steel Magnolia

July 28th, 2010
9:48 pm

The next step is for every contract being administered by the city of Atlanta to be examined for similar shenanigans. It is naive to think that the airport is the only “profit center” for the corrupt.

@@

July 28th, 2010
9:50 pm

$100 million!!??!! Don’t see how the city could pass that up considering the present economic conditions. Reed would be a fool not to jump on that honey pot.

Liquid gold.

steve

July 28th, 2010
10:40 pm

Wingfield, your racism is unbelievable. Don’t you have anything positive to say about Atlanta leadership? Why don’t you start investigating State contracts where the real money is? Or is ok for your people to engage in shenanigans?

TaxpayerATL

July 29th, 2010
1:26 am

Imagine that, Corruption at Hartsfield-Jackson-Frankiln-Reed-What-eva International Airport. I can’t believe it.

MC W

July 29th, 2010
5:05 am

@steve—Your charge of racism reveals your utter inability to defend the city on ethical grounds.

So What's New

July 29th, 2010
5:46 am

You haven’t lived in Georgia very long if you didn’t know that Atlanta and all its businesses are beyond corrupt. Mostly everyone just talks about it, but occasionally an honest politician will force the issue. Be aware that this all continues with Bill Campbell’s replacement, Kasim Reed. Reed has got more secrets than all his predecessors combined. It’s a sad day for Atlanta and Georgia.

Churchill's MOM

July 29th, 2010
6:10 am

Kasim Reed is the Jackson Family’s boy, his main duty is taking care of the Jackson Family interest. If any of you think he will do anything to harm the Jackson Family interest you are a fool. Kasim Reed = Bill Campbell. But after Deal becomes Governor Kasim Reed will look honest.

Dave

July 29th, 2010
6:15 am

steve – congradulations you are “first” to play the race card here, but I’m sure not the last. The citizens of Atlanta are the ones who lose regardless of of their race. “Can’t we all just get along?”

Sherlock

July 29th, 2010
7:19 am

Steve doesn’t wanted to be treated like everyone else. That would be racist.

Kay

July 29th, 2010
7:42 am

What role did Ben De Costa play in this? And did Clear Channel help foot the bill for his $25,000 going away party?

Road Scholar

July 29th, 2010
7:46 am

Steve, and others who have slammed Reed: His actions to this and other issues will define him as a mayor and a man, not your opinions. Making the COA efficient and effective is a huge task, since many of the Departments have not measured up to the positive achievements of other local governments. As with the banks and industry, more oversight and enforcement of deliveables is needed to have them address their shortfalls.

UsmcDawg

July 29th, 2010
8:02 am

Folks,
This goes all the way back to “crooked” Maynard Jackson.
Maynard instituted black racist policies at the City of Atlanta and the Airport that still exist today.
How does Shirley Franklin and family have contracts at the CITY owned airport? That is a joke!
Can you say “conflict of interest”? Oh yeah, it does not translate into Ebonics.
And BROOK JACKSON, Maynard’s daughter has contracts at the airport. How does that work?
THE CITY OF ATLANTA IS RACIST AND CORRUPT- Plain and simple.
Thank You Kyle for having the courage to uncover and exploit this corruption.

One more laughable item:
If Barbara Fouch had $MILLION dollar contracts at the airport from 1980 to 2002, HOW IS SHE “DISAVANTAGED”?

Get rid of Affirmative Action. It is racist and corrupt.

Grand Forks

July 29th, 2010
8:21 am

“Wingfield, your racism is unbelievable.”

Steve has the IQ of a carrot.

No More Progressives!

July 29th, 2010
8:32 am

steve

July 28th, 2010
10:40 pm
Wingfield, your racism is unbelievable. Don’t you have anything positive to say about Atlanta leadership? Why don’t you start investigating State contracts where the real money is? Or is ok for your people to engage in shenanigans?

Who are “your people?”

You’re welcome to say something positive about Atlanta leadership.

We’re waiting.

Grand Forks

July 29th, 2010
8:35 am

I think Obama is not only the first half-breed president, he’s also the first woman president. He went on The View to cry to the overweight left wing hags about how hard it is to be president. She also wears mom jeans to baseball games and throws far worse than any girl I’ve ever seen throw a baseball.

http://www.youtube.com/watch?v=147zPdfNoro

Grand Forks

July 29th, 2010
8:56 am

Can we please just go ahead an impeach the man-child now.

AP survey: A bleaker outlook for economy into 2011

The U.S. economic recovery will remain slow deep into next year, held back by shoppers reluctant to spend and employers hesitant to hire, according to an Associated Press survey of leading economists.

The latest quarterly AP Economy Survey shows economists have turned gloomier in the past three months. They foresee weaker growth and higher unemployment than they did before. As a result, the economists think the Federal Reserve will keep interest rates near zero until at least next spring.

Antoine

July 29th, 2010
9:08 am

Atlanta may be the only city in the country that is COMPARABLY AS CORRUPT as New Orleans and Chicago.

The CRIMINALS running this city (into the ground) are no different than the jive-talking, Ultra-Aggressive panhandlers they enable to roam the streets and harass the citizenry unchecked.

President Obama’s so-called “Administration” is Atlanta City Government on a National Scale.

barking frog

July 29th, 2010
9:16 am

this is just the price you have to pay to acheive minority participation.

Grand Forks

July 29th, 2010
9:16 am

Bush has been vindicated. Again.

What Would Happen if the Bush Tax Cuts Expire

Much of the focus has been on the wealthy, but what will the expiration of the tax cuts mean for everyone else? Brett Arends runs the numbers.

What would it actually mean for you if they let the Bush tax cuts expire at the end of this year, and we went back to the old Bill Clinton tax rates adjusted for inflation?

This is a thought experiment, not a prediction or a recommendation.

The tax cuts, passed in 2001 and 2003, are front and center now and will be a hot issue going into the elections this fall. Unless something is done by the end of the year, they’ll expire. With the economic recovery looking shaky, expiration is particularly controversial.

Most of the attention has understandably focused on highest earners, who are likely to be most affected by whatever happens. But as the debate has gathered pace I have been wondering what it might mean for everyone else. After all, according to the IRS just 4% of Americans earn more than $200,000 a year.

http://online.wsj.com/article/SB10001424052748703977004575393483572603148.html?mod=WSJ_hpp_sections_personalfinance

No More Progressives!

July 29th, 2010
9:29 am

Antoine

July 29th, 2010
9:08 am
President Obama’s so-called “Administration” is Atlanta City Government on a National Scale.

Do you really think that King Barry can replicate the corruption of Atlanta in 18 short months? It’s taken Atlanta, what, 30 years to sink this low.

As the King himself said, “Yes we can!”

Intown

July 29th, 2010
9:48 am

If you think Mary Norwood would’ve fixed this you are smoking something. she is a nitwit.

Churchill's MOM

July 29th, 2010
9:49 am

Why do you delete my off topics & let Grand Forks post hunderds of off topics?

Kyle Wingfield

July 29th, 2010
10:03 am

Church’s: I haven’t deleted anything, and don’t see anything from you that got caught in the spam filter.

Grand Forks

July 29th, 2010
10:12 am

“Why do you delete my off topics & let Grand Forks post hunderds of off topics?’

Your math must be as bad as your spelling. I’ve only posted THREE off topic comments, ma’am. Not “hundreds” like you claim.

3 is 3 too many

July 29th, 2010
10:22 am

Grand Forks, I think I speak for the majority of sane readers… your opinions and actions are overboard and tiring. You routinely hijack this blog and bully and drool. I wish Kyle would cut you off when you take over.

j

July 29th, 2010
10:24 am

dick cheney gave haliburton a no bid contract and no one sued. this guy is a sore loser that is all.

He thought he had an airtight bid and is upset. boohoo you lost deal with it.

Kyle when are you actually going to do your job and state exactly what the city did wrong by awarding the bid to fouch.

Did they violate any law? you stated they did something illegal so what law did the city violate?

More interesting would be the reason why the rent was not increased.

I have heard of clear channel i have never heard of this corey guy.

a rigged process. It is always a rigged process when you lose.

Come on kyle why was it a rigged process? dude start earning your pay. You think the lowest bidder always wins a contract?

so where is the favoritism if all vendors did not receive an increase?

Kyle are you sure you were paying attention during your classes in college?

Who cares about mary norwood’s supporters? they lost and need to get on board or get out the way.

Middle-of-the-road

July 29th, 2010
10:28 am

The taxpayers will have to pay the bill for the Corrupt, Inept Management of Atlanta. That is sad. There needs to be oversight and accoutabiility. Enough of the family and friends plan for elected officials. Does the City of Atlanta think it is like the DeKalb County Board of Education? Oooppps! What are the similarities between the two government entities? It all needs to stop. There is too much waste. Too many programs that need funding that are cut. Why did we name the airport after Jackson with all the greed and graft taking place there during his administration. What message does that send to the world? Just because it has occured in the past does not mean the greed and graft needs to continue.

Dirty Dawg

July 29th, 2010
10:29 am

Billy Corey is as big a ‘crook’ as anybody in the outdoor business – and that’s saying a lot. Once again, I’m astounded that you, Kyle, would go after your buddies at Clear Channel…I mean since they’re the ones that run the most vile, right-wing, talk crap across the country (OK, in Atlanta that’s WSB, but pretty-much everywhere else.) I would think you’d ‘cut ‘em some slack’. Of course Clear Channel wasn’t around back when the contract was supposedly let – according to you – in ‘80, and the people that Ms. Fouch may have partnered with over the years have had a long record of handling airport advertising – unlike Mr. Corey – and they pay the airport and the City of Atlanta pretty much the ‘going rate’ as is paid across the country…but that’s not your story is. You just want to play ‘boogieman’ journalism and keep painting the right-wing strategy of claiming that Atlanta’s black politicians are more corrupt than somebody else’s white ones.

By the way, you have any idea how long certain road contractors have had ’sweetheart’ deals/contracts with the DOT in this state? Better check on that cause there’s a hellofalot more money being handed out there than in airport advertising commissions. – oh, I forgot, those are ‘all-white’ companies and require no ‘minority’ participation to bid, so you aren’t interested.

The point is that often times the nod for these things go to company that is better equipped, and financed, to do the job. The last thing those in charge want to have happen is to award a contract to somebody that’s in way over their head and fails. Of course, if I know Corey, he would have just ‘partnered’ with Clear Channel, or bought out their kiosks and other ad locations, hired their people and started channeling the money to Billy’s crooked business instead of the other ones. Is this a great country, or what?

You know, this kind of thinking – awarding no-bid contracts to companies based on the ’story’ that they are the only ones that are ‘equipped’ to handle them – is exactly why we give Halliburton billions and billions every year to help do out killing for us…along with their ‘partner’ Dick Cheney, but then the only minority he’s a member of is the multi-billionaire, gained from tapping directly into the US Treasury. club.

midtownguy

July 29th, 2010
10:48 am

Invoke the termination clause on all Atlanta Airport contracts. Put them all up for re-bid with a maximum of five years. Have each city councilman appoint a representative to a Contract Oversight Committee which must approve all contracts by a 70% vote. Problem solved. No new taxes needed.

No More Progressives!

July 29th, 2010
10:52 am

KBR (Haliburton) to Get No-Bid Army Work as U.S. Alleges Kickbacks

http://www.businessweek.com/news/2010-05-06/kbr-to-get-no-bid-army-work-as-u-s-alleges-kickbacks-update1-.html

May 06, 2010, 11:27 AM EDT

From your pure current administration.

Kyle Wingfield

July 29th, 2010
10:57 am

j: Try reading some of what I’ve written before: http://bit.ly/bEUij7

Or you could read some of the news coverage the AJC has had on this case. But something tells me you’re not really interested in answers.

Dirty Dawg: Since lots of readers like to accuse me of protecting/shilling for the kind of people you say I’m now “going after,” I’ll take (part of) your comment as a compliment…

As for whether Corey wasn’t well-equipped to carry out the contract: If that’s really why the city declined Corey’s bid, it could have docked Corey for competence on the original scoring. If it should have done so and didn’t, I take that as another sign of a flawed process.

luangtom

July 29th, 2010
11:05 am

Yer a day late and a dollar short in your reporting this. CBSatlanta reported this and current lack of payment for airport advertising amounting to the City of Atlanta being shorted close to $23-million during Ben DeCosta and Shirley Franklin’s watch. Neither would give answers to the questions posed as to why favoritism was shown in ad-space and lack of funds to the city.It is not a new subject. Now, besides the recent award of $3-million that Atlanta is to pay out, they still have to account for the lack of funds received amounting to the other $23-million. Update yourself, please.

booger

July 29th, 2010
11:09 am

For all the Halliburton haters. All of the no bid contract investigations were done years ago and in the end the reason Halliburton got the contracts was that they were the only company who could do the work required from day one. Other than a very few large oilfield service organizations there are no other companies in the world who have a standing infrastructure throughout the middle east. When you are in a war, you do not have the time to let a company build this infrastructure. Halliburton had existing offices throughout the middle east capable of purchasing, distributing and providing services whereever and whenever. The few other companies capable of doing this choose for a number of reasons not to bid.

j

July 29th, 2010
11:16 am

Yet, Corey claims he actually should have beaten Clear Channel by 12 points because Fouch should not have qualified as a DBE because she’s neither disadvantaged nor a business operator; a judge’s order in the case notes that Fouch’s own DBE application to the city stated that her company owned no business equipment. Curious, huh?
—–
Hey kyle you can’t be serious. I think the problem we have here is people who have no knowledge of how businesses operate.

Just because your business doesn’t own equipment doesn’t mean you aren’t a real business. Have you not ever heard of leasing?

You stated that she had a contract for several years with the city. Was she not operating a business during this time? Did she not file tax returns? Isn’t this operating a business?

How is fouch not a disadvantaged businesswoman? I thought you said she was a black woman. Did she develop vitiligo?

The guy is just a sore loser.

Once again what did the city do that was illegal as you have stated? Answer the question Kyle?

midtownguy

July 29th, 2010
11:21 am

j’s thinking is the perfect example of what is wrong with Atlanta. As an Atlanta taxpayer of no small portion, I am not concerned about legalities (although a judge seemed to be). I want the city to award contracts for the least amount possible, garner the greatest income, and tax me less. If you are not a significant atlanta taxpayer (let’s say over $5,000 a year in property taxes) your opinion doesn’t matter on this issue.

booger

July 29th, 2010
11:22 am

My brother-in-law owns a nice well run construction business in the metro are several years ago he decided he would try to get some wok in the city of Atlanta. He had a discussion with officials and was told it was no use to bid unless he had a minority partner. Of course the officials were happy to give him a list of approved partners, non of which had ever been in the construction business. Also as it turns out, their only duty was to show up for their checks. Being an ethical and honest business owner, he decided not to do business with the city.

I worked over seas for many years and this is exactly how business is done in most third world countries. Of course over there it’s called bribary.

Kyle Wingfield

July 29th, 2010
11:28 am

From the jury’s verdict, j:

Question 1: Did the City of Atlanta intentionally violate Corey’s equal protection rights by unequally applying a facially neutral ordinance to select Clear Channel as the most responsive proponent of the airport advertising contract in 2002?
Jury’s answer: Yes

Question 2: If the answer to Question 1 was “YES” — was the violation the result of a custom of the City of Atlanta?
Jury’s answer: Yes

Question 3: If the answer to Question 2 was “YES” — was the violation of Corey’s equal protection rights of the City of Atlanta the proximate cause of money damages suffered by Corey?
Jury’s answer: Yes

Question 4: Did Clear Channel conspire with the City of Atlanta to deprive Corey of its equal protection rights?
Jury’s answer: Yes

Question 5: Did Barbara Fouch conspire with the City of Atlanta to deprive Corey of its equal protection rights?
Jury’s answer: Yes

Question 6: If the answer to Question 4 OR 5 was “YES” — did Corey suffer money damages as a direct result of a conspiracy to deprive Corey of its equal protection rights?
Jury’s answer: Yes

Question 7: Did Corey suffer money damages for lost profits from 2002 to 2007 (the 5 year term of the contract)?
Jury’s answer: Yes

Question 8: What is the amount of damages Corey has proven it suffered as a result of the violation of its equal protection rights?
Jury’s answer: $8,500,000

Question 9: Do you find that Clear Channel Outdoor, Inc. and/or Barbara Fouch acted willfully and maliciously in the violation of Corey’s equal protection rights or acted intentionally with gross disregard for Corey’s equal protection rights, so as to entitle Corey to punitive damages?
Jury’s answer: Yes to both

j

July 29th, 2010
11:29 am

hey booger why was your in-law chasing government contracts? private work too tough for the sob?

please go to the library find a dictionary and look up the definition of bribery.

Your in-law was being told the rules of doing business with the city. the city did not ask him for money to obtain a contract.

Grand Forks

July 29th, 2010
11:31 am

“Grand Forks, I think I speak for the majority of sane readers… your opinions and actions are overboard and tiring. You routinely hijack this blog and bully and drool. I wish Kyle would cut you off when you take over.”

1: You don’t speak for anyone.
2: The only people who want other people banned are whinny little left wingers.
3: Why do you hate free speech?

No More Progressives!

July 29th, 2010
11:35 am

Thank you, booger. Many, many people don’t realize how unique Haliburton is. Coincidentally, these same people who villify Haliburton are the same people who villify Dick Cheney on a daily basis.

Grand Forks

July 29th, 2010
11:40 am

No More Progressives!

Left wingers don’t know anything about companies in the first place. How would you ever think that they know anything about Halliburton? Most left wingers throw that name out there because Bill Maher and Keith Olbermann told them to.

Grand Forks

July 29th, 2010
11:42 am

Left wingers have a new hero.

Woman charged in France over babies’ bodies

French prosecutors said Thursday they charged a woman with murder after she admitted giving birth to and smothering eight babies over a 17-year period in northern France.

The woman, Dominique Cottrez, said she hid the pregnancies and deaths from her husband, who said he had no idea what she had done, prosecutor Eric Vaillant told reporters. Cottrez is overweight and was able to conceal the pregnancies, he said.

Cottrez told investigators the reason she killed the babies was that she did not want to have any more children and did not want to see doctors for contraceptives, Vaillant said.

http://www.cnn.com/2010/WORLD/europe/07/29/france.dead.babies/index.html?hpt=T1

Dirty Dawg

July 29th, 2010
11:43 am

So Kyle, you ‘take it as a compliment’ that I seemed to be criticizing you for criticizing Atlanta’s ‘black’ political leaders? And that you’ve been criticized by others for ‘not’ criticizing them in the past? I’d like to see that one, cause I’ve never noticed it and it certainly seems out of character and contrary to why the AJC added you to their ‘mix’ in the first place.

As for Atlanta ‘requiring’ a minority partner for doing business with the City, guess when the political power structure changed colors, the strategy of ‘not’ considering minority contractors changed as well. Maybe it’s high time that the practice was changed, but the fact is municipalities and counties all over the State have, or don’t have, minority-participation requirements based on who’s in charge.

midtownguy

July 29th, 2010
11:51 am

Booger: Actually, if the city actually told your brother-in-law that he had to have a minority partner, he should have reported that to Federal Officials if any federal money was involved in the contract. The presence of a minority partner gives you additional points on the RFP grading but it cannot be required. The “approved” list of minority partners is also forbidden (I wonder how many Hispanic and Disabled individuals were on the list as minorities). Seriously, he might get a few mil himself, provided any of this was in writing from the city where it could not be denied.

No More Progressives!

July 29th, 2010
11:51 am

j

July 29th, 2010
11:29 am
Your in-law was being told the rules of doing business with the city. the city did not ask him for money to obtain a contract.

You have no concept of what doing business with SBA 8(a)set-aside is like, do you? Not a bloody clue, methinks.