City ordered to pay Ducks $13.5 million

PULLOUT QUOTES:

"We live in America. The city lives in the Conch Republic." — Duck Tours attorney Mick Barnes

"I don't know what to say. I just don't know where the hell we get the money." — City Commissioner Harry Bethel

BY SCOTT FUSARO

Citizen Staff

KEY WEST — The city of Key West should pay Duck Tours Seafari $13.5 million because it drove the company out of business nine years ago, a jury found Monday.

"I think the jury sent a very clear message. They gave us every penny that we justified and every penny that we asked for," Mick Barnes, the attorney for Duck Tours, said after the jury had returned the verdict.

A city spokesman said Monday evening the city has not yet determined whether it will appeal the ruling or revisit its agreement with Historic Tours of America, which has the only franchise to provide sightseeing tours in the city.

"The city's waiting to talk to its attorneys [today] to see what options are available to us," said spokesman Michael Haskins.

However, Mayor Jimmy Weekley and Commissioner Harry Bethel both said Monday that an appeal will be forthcoming.

"Anything of this magnitude, you're going to appeal," Weekley said.

While the jury deliberated Monday, attorneys for both sides argued before Judge Howard Harrison a second phase of the case in which Duck Tours seeks to invalidate the city's franchise agreement with HTA, which operates the Conch Tour Train and Old Town Trolleys.

Even without a ruling from Harrison on the franchise agreement, Duck Tours founder and principal owner John Murphy said he plans on resuming tours.

"If the city believes after this ruling they can still enforce the franchise as they have, we'll deal with that when it comes up," Barnes said.

Larry Silverman, an attorney for HTA, said he believes the company's agreement with the city will remain intact.

"Our perspective is that any judgment against a municipality is automatically stayed on appeal. Nothing's going to happen for a good period of time, and we believe the city's going to prevail upon appeal," he said.

However, Mark Bauer, a professor of antitrust law at Stetson University law school in Gulfport, said it is hard to imagine a scenario in which the city's exclusive franchise agreement with Historic Tours would be valid.

Under the state action immunity doctrine, states may pass laws granting monopolies to companies due to matters of urgent public health. However, he said of Historic Tours' agreement with the city, "Unless the state of Florida were to pass special legislation allowing Key West to act, I can't see any way the franchise agreement can be validated."

Murphy said the verdict was a victory for businesses, sending the message that they must be able to operate unfettered by Key West politics.

"You can't get away with breaking the law, being so arrogant and thinking it doesn't make a difference, and expect to skate," he said.

David Audlin, who represented the city in the case, attempted to persuade the jury in closing arguments that city action against Duck Tours came only because the company never obtained the proper permits. The company's business plan was to operate without the required permits, pick a fight with the city, watch the business fail and file a lawsuit, he argued.

"If he collects his evidence and bides his time, he gets a great lawsuit, a really, really great lawsuit. This business was never intended to succeed," Audlin told the jury.

Moments later, Barnes rebutted the argument, asking, "How convoluted an argument can you make?" and questioning how Murphy could have attracted investors to a business that might well have been called "Going into Lawsuits."

"We live in America. The city lives in the Conch Republic," Barnes said.

The jury verdict came after only four hours of deliberation following nearly three weeks of trial testimony that included the recounting of a city commissioner shaking down another man who wanted to start a tour company in the 1990s. The mayor, assistant city manager and city planner all testified in the case. The city argued that the franchise agreement was intended to help regulate traffic.

The trial came a decade after Duck Tours filed its lawsuit against the city after going out of business. A summary judgment in the city's favor was overturned last year by the Third District Court of Appeal.

In its ruling, the appeals court found that the city's ordinances "grant monopoly rights to the Train and Trolley."

City Commissioner Carmen Turner said Monday evening she was "very, very disappointed" to learn of the award.

"I wonder how much of that Historic Tours of America is planning on kicking in," she said.

When informed of the verdict, Bethel pondered whether the city's choice to defend against the lawsuit was the proper decision.

"We should have maybe talked about some kind of settlement up front, at the onset of this thing," Bethel said. "I don't know what to say. I just don't know where the hell we get the money."