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Saturday, December 22, 2012

Fulton judge says Atlanta's public vending program violates city charter, voids contract

Judge Shawn Ellen LaGrua
  • Fulton County Superior Court
  • Judge Shawn Ellen LaGrua
A Fulton County judge on Friday tore up Atlanta's exclusive contract with the private firm that manages all vending on public property throughout the city.

In a four-page order issued yesterday, Fulton County Superior Court Judge Shawn LaGrua said the city "exceeded the powers granted to it" in its charter by "creating an unauthorized exclusive franchise." Therefore, the judge ruled, the law and contract with GGP is "void and without effect." (A PDF of the judge's order is embedded after the jump.)

In 2009, then-Mayor Shirley Franklin outsourced the city's public-vending program to UK-LaSalle, a subsidiary of General Growth Properties, one of the nation's largest mall operators. Under the deal, LaSalle would install and rent kiosks to vendors who wanted to sell wares in downtown and, eventually, near Turner Field. Last we heard, the city expected to pocket approximately $125,000 each year until the contract expired in 2029.

In July 2011, Larry Miller and Stanley Hambrick, two vendors who sold t-shirts outside Turner Field, filed suit in Fulton County Superior Court with the help of the Institute for Justice, a libertarian law firm that's mounted a crusade to against unfair vending laws.

The vendors' lawyers claimed that kiosk rental cost ranged between $500 to $1,600 each month - much higher than the $250 licensing fee that vendors paid under the old system - and that the program violated the Georgia Constitution. On Friday, LaGrua agreed. In addition, the judge barred the city from preventing the two t-shirt vendors from selling items on public property.

"Today's ruling is a resounding victory not only for Larry Miller and Stanley Hambrick, but for all the vendors and entrepreneurs in Atlanta," Robert Frommer of the Institute for Justice said in a statement. "The Court's well-reasoned decision makes clear that Atlanta and other cities in Georgia cannot eliminate small businesses by giving a government-created monopoly to a big business with political connections."

Added Hambrick in a statement released by the institute: "For decades, I have worked hard to build a business that I hope to turn over to my youngest son someday. Atlanta's vending monopoly threatened to destroy my family's business, but today's victory has given my dreams a new lease on life."

Yasha Heidari, an Atlanta attorney who also represented Miller and Hambrick, hinted that other city agreements could deserve a look.

"I think it is a victory not only for the Plaintiffs in this lawsuit, but for entrepreneurs, small businesses, and consumers throughout the state," he said in an email to CL. "The order sends a strong and clear message that the city cannot crush competition and funnel money to a single company by creating an illegal monopoly. While this particular case dealt with street vending, the underlying issues apply equally to other city operations."

In a statement released early Friday evening, a spokesman for Mayor Kasim Reed said the city is "currently reviewing the order and evaluating its options going forward." GGP could not be reached for comment. Barristers are cordially invited to opine on the order's impact, including on Atlanta's food truck scene. That is, if the ruling is allowed to stand. We will update when we hear more.

Fulton County Judge's order voiding Atlanta's public vending program

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