Town moorings prompt $36M in lawsuits - Trade Only Today

Town moorings prompt $36M in lawsuits

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A New York boatyard owner has filed a $19 million lawsuit against a Long Island town, some of its officials and a competitor for allegedly failing to recognize his winning bid for the town’s mooring and tender service.

Seymour’s Boatyard filed its suit in August in U.S. District Court for the Eastern District of New York. It names the town of Huntington, seven officials and Coneys Marine Corp. as defendants. The defendants filed a motion to dismiss in October.

The suit comes on the heels of a $17 million suit the boatyard filed in March, in the same court, against the neighboring village of Lloyd Harbor, 10 of its officials and Coneys. In that suit, Seymour’s makes similar charges against the village, alleging its officials “arbitrarily” revoked the permission Seymour’s had been granted to run its mooring and tender service.

In the most recently filed suit, Seymour’s said in court documents that in November 2007 the town of Huntington solicited bids to operate about 30 moorings at Gold Star Beach within Huntington Harbor.

In February, Seymour’s was notified it had submitted the winning bid for the exclusive license to operate the service, and it entered into a contract with the town. Previously, the service had been provided by Coneys.

In court documents, Seymour’s said defendant Matthew E. Coneys is “politically connected” and is a member of the town’s Harbors and Boating Advisory Council.

Conspiracy claim
Seymour’s contends that upon learning it was about to lose the concession, Coneys “conspired with the other defendants to cause the town to take the contract back and give the benefits of the contract back to Coneys Marine Corp.”

Seymour’s also says Coneys placed its moorings within all of the space available within town waters, though it did not have the proper permits, and the town did nothing to stop it.

“The defendants caused the town to revoke its acceptance of the plaintiff’s winning bid, to unilaterally repudiate the contract which had been awarded to Seymour’s, and to thereafter permit Coneys Marine Corp. to maintain all of the moorings, which defendant Coneys had placed into town waters illegally,” according to court papers.

Seymour’s claims it has lost substantial amounts of money as a result. It is seeking $4 million in compensatory damages and $15 million in punitive damages.

When granted a license to place and maintain moorings in Huntington Harbor, and to operate a marine tender service from Huntington’s town dock, a business can charge substantial fees for the service, not only on the Huntington side of Puppy’s Cove, but also on the Lloyd Harbor side, which accommodates an additional 300 moorings, according to court documents.

Matthew Coneys had no comment on the lawsuit. In a motion to dismiss the case, filed by his lawyers in October, Coneys denied the claims saying it was not awarded the contract and “a conspiracy theory is not viable.”

Huntington town attorney John J. Leo concedes Seymour’s did win the bid, but “the boating community and citizens would be charged more because both Seymour’s and Coneys could not come to an agreement about where moorings were and where they weren’t.”

Because of this, Leo says, the town took over the service itself.

“We tried to broker an agreement where they both could coexist and both thrive,” Leo says. But, he maintains, “we told them from the beginning if they don’t come to an agreement, the town of Huntington would take over the launch service and operate it itself, and that’s exactly what we did.”

A pre-motion conference was held Oct. 24 on the motion to dismiss. Oral argument was set for Feb. 13, 2009.

Lloyd Harbor suit
In the suit filed in March against the village of Lloyd Harbor, its officials and Coneys, Seymour’s claims the village never implemented a formal process by which anyone could apply for a mooring permit, and Coney’s has held the permit for approximately 200 moorings for the last 13 years.

Matthew Coneys, court papers say, is a member of the village’s Harbor Control Commission.

Once Seymour’s received its permit from the neighboring town of Huntington, it requested a mooring permit from Lloyd Harbor and subsequently received the exclusive mooring permit.

Court papers claim Matthew Coneys “conspired with the other defendants ... behind closed doors, to deprive the plaintiff of such mooring permits as well as the opportunity to apply for such permit.”
Seymour’s permission to run the service was then revoked, court documents say.

In this case, Seymour’s is seeking $2 million in compensatory damages and $15 million in punitive damages.

Village clerk Eileen Schulz says the village had “no comment” on the litigation.

This article originally appeared in the December 2008 issue.

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