MULTI RESTAURANTS

CONCEPTS, LTD., CHAMPPS DFW

JOINT VENTURE, ASC STAR I,
LTD., and TEAM JOINT VENTURE,

Plaintiffs,

v.

DFW INTERNATIONAL AIRPORT

BOARD"

Defendant DALLAS COUNTY, TEXAS

ORIGINAL PETITION FOR DECLARATORY AND INJUNCTIVE RELIEF

TO THE HONORABLE JUDGE OF SAID COURT:

Plaintiffs, MultiRestaurants Concepts, Ltd., Champps DFW Joint Venture, ASC

Star I, Ltd., and Team Joint Venture ("Plaintiffs" or "MultiRestaurants"), file their

Original Petition for Declaratory and Injunctive Relief pursuant to the Declaratory

Judgments Act, Tex. Civ. Prac. & Rem. Code, Chapter 37, as follows:

1.0 Discovery Control Plan

1.01. Plaintiffs intend for discovery to be conducted under Level 3 of Rule 190.4

of the Texas Rules of Civil Procedure.

2.0 Parties

2.01 Plaintiff MultiRestaurants Concepts, Ltd., is a Texas corporation with its

principal place of business at 8008 Cedar Springs Road, Dallas, Dallas County, Texas

75215.

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ORIGINAL
 2.02 Plaintiff Champps DFW Joint Venture, is a Texas Joint Venture with its

principal place of business at 8008 Cedar Springs Road, Dallas, Dallas County, Texas

75215.

2.03 Plaintiff ASC Star I, Ltd., is a Texas limited partnership which has its

principal place of business at 8008 Cedar Springs Road, Dallas, Dallas County, Texas

75215.

2.04 Plaintiff Team Joint Venture,.is a Texas joint venture which has its

principal place of business in Dallas County, Texas.

2.05 Plaintiffs may be collectively referred to as "MultiRestaurants."

2.06 Defendant, the Dallas/Fort Worth International Airport Board (The

"Board"), is comprised of twelve (12) members and does business at DFW International

Airport, 3200 East Airfield Drive, DFW Airport, Texas 75261-9428. The Board can be

served \vith process by nlailing citation and a copy of the petition by certified mail, return

receipt requested to its general counsel who is the Board's registered agent for service of

process: Gary :Keane, General Counsel, Legal Department, Dallas/Fort Worth

International Airport Board, 3200 East Airfield Drive, DFW Airport, Texas 75261-9428.

3.0 Jurisdiction & Venue

3.01 Pursuant to Sections 24.007 and 24.008 of the Texas Government Code,

the Court has subject matter jurisdiction over this action. This Court has jurisdiction over

this lawsuit as the damages sought by Plaintiffs are within the jurisdiction limits of the

Court.

3.02 Pursuant to Section 15.001, et. seq., of the Texas Civil Practice &

Remedies Code, veriue is proper in Dallas County because all of the events or omissions

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giving rise to Plaintiffs' claims, which are the subject matter of this lawsuit, arose in

Dallas County.

4.0 Background Facts

4.01 In 1996, MultiRestaurants and Team Joint Venture contracted with the

Dallas/Fort Worth International Airport Board for the operation of food and beverage

concessions at DFW Airport (the "Airport") by various concession agreements. Article

2, of the original concession contract defines gross receipts as follows:

3. "GROSS RECEIPTS" shall include all monies paid or payable to the

Concessionain~ for sales made and· for services rendered at or from the Premised,
regardless of when or where 'the order therefore is received, and at the option of
the Board, outside the Premised, if the order therefore is received at the Premises,
and any other revenues of any type arising out of or in connection with the
Concessionaire's operations at the Premises, including, but not limited to , those
operations of the Concessionaries' agents or sub lessees, arising from any sales
made or services rendered at or from the Premises, provided, however, that Gross
Receipts shall not include:
A. Any taxes imposed by la~ which are separately stated to and paid by a
customer and directly payable to the taxing authority by the
Concessionaire, and alcoholic beverage taxes collected for remittance to
the taxing authority from the retail sale ofalcoholic beverages.

(emphasis added).

4.02 In 2005, extensions of the concessions contracts were executed between

the Board and MultiRestaurants, Team Joint Venture using a newly revised concession

form. Article 4, Section 4.01 of the concessions defines gross receipts as follows:

"GROSS RECEIPTS", sometimes called Gross Revenues and/or Gross Sales,

shall include all monies paid or payable to Concessionaire for sales made and for services
rendered at or from the Premises, regardless of when or where the order therefore is
received, and at. the option of the Board, outside the Premises, if the order therefore is
received at the Premises and any other revenues of any type arising out of or in
connection with Concessionaire's operations at the Premises including, but not limit to,
those operations of Concessionaire's agents or sublessees, arising from any sales made or
services rendered at or from the Premises, provided, however, that Gross Receipts shall
not include:

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 1. Any taxes imposed by law which are separately stated to and paid by a
customer and directly payable to the taxing authority by Concessionaire.

Champps and Star also executed a 2005 Concession with the Board.

4.03 Plaintiffs did not intend Gross Receipts in the 2005 Concessions to include

alcoholic beverage taxes remitted to the taxing authority by the Concessionaire; as such, a

scrivener's error occurred in the drafting of the concessions contract.

4.04 Indeed, from 1996 through March, 2010, the Board never asserted that

Gross Receipts included alcoholic beverage taxes remitted to the taxing authority by

concessionaires.

4.05 By letter dated April 29, 2010, Zenola Campbell, Vice President of

Airport· Concessions, sent Plaintiffs a letter demanding payment of past due rents,

inclusive of Texas Alcohol and Beverage taxes ("TABC taxes"), based on the "Board's

position that rent calculations be based on the gross receipts inclusive of TABC taxes as

stipulated in the terms of the concession." Plaintiffs were informed further that "it is the

position of the Board that any past rents paid based on the net sales calculation be

recalculated and the difference be submitted to our Finance Department no later than

June 11, 2010." This was the first such notification to Plaintiffs of the Board's intent to

collect such amounts. It basically amounts to collecting revenue on an excise tax.

4.06 On May 12, 2010, Ken Buchanan, Executive Vice President, Revenue

Management for the Airport, met with Gilbert Aranza, representative of

MultiRestaurants, to discuss the TABC tax issue. At that meeting, Mr. Buchanan told

Mr. Aranza that he had personally researched the issue with TABC officials, the Texas

Comptroller's office, other Texas airports, and other Texas State officials and concluded

that both the Airport's auditor and counsel were incorrect in their position that the

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additional "rent" was owed. Mr. Buchanan had been provided with the Affidavit of Pat

Gleason - the former Vice President of Airport Concessions and Vice President of

Revenue Management who had supervisory control over the administration of the

concessionaires' concessions - and asked for letters on the issue from Brinker

International, franchisor and owner/operator of over 1,000 Chili's, Magianos and On the

Border restaurants, in 100 of locations in Texas, CRO franchise owner/operator of over

100 Cool River and Cantina Laredo restaurants among other brands, and Herb Weitzman,

commercial real estate agent. He asked that Mr. Aranza refrain from "sending in the

nukes" while he persuaded Jeff Fegan, Airport CEO, and the Board to drop the issue. On·

May 17, 2010, Mr. Buchanan shared the same views with Steve Johnson and Anthony

Alessi of HMS Host. Mr. Aranza, Plaintiffs, and HMS Host refrained from immediate

action consistent with Mr. Buchanan's request. Sometime between May 17, 2010 and

June 1,2010, however, when the concessions committee of the Board met, the Board and

Mr. Fegan apparently rejected Ken Buchanan's position and convinced the committee to

continue to pursue collection of the TABC taxes as "rent."

4.07 By letter dated June 15, 2010, Plaintiffs informed the Board that failure to

exclude TABC taxes was a mutual mistake between Plaintiffs and the Board. If not a

mutual mistake, at a minimum, there has been a unilateral mistake by Plaintiffs,

accompanied by fraud or other inequitable conduct of the Board, requiring reformation of

the concession in equity to conform to the parties' true agreement that excluded TABC

taxes from payment as "rent." The Board was given the Pat Gleason Affidavit. Mr.

Gleason was Vice President of Airport Concessions and Revenue Management in 2004

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when the new concession contracts was drafted and agreed with Plaintiffs' position.

Despite the Affidavit, the Board continues to press for payment.

4.08 By letter dated July 19, 2010, Plaintiffs informed the Board that they

would invoke section 4.03 of the Concession which provides that

"in the event of a dispute as to the amount to be paid [as rent], the Board shall
accept the sum tendered without prejudice and, if a deficiency is determined to
exist, the Late Payment Charge shall apply only to the deficiency."

Concession at Section 4.03 Schedule of Charges. Plaintiffs take the position that

there is no deficiency, dispute the amount owed as purported "rent" and that the Board,

while accepting the amount that Plaintiffs have tendered, has not done so without

prejudice to Plaintiffs' rights while the dispute is resolved. Specifically, Plaintiffs are

poised to receive earned bonus points which are critical to future requests for proposals at

the Airport. Upon information and belief, the Board will not award the earned bonus

points to Plaintiffs due to the dispute over the Concession terms.

4.09 The Airport issued Requests for Proposal for Terminal A on September

22, 2010. The Board has stated that any proposer with any unresolved claims with the

Airport will be disqualified. Another disqualifying event occurs when a proposer has

been in default or arrears of more than $50,000 under any previous agreement with the

Airport in the last 12 months.

4.10 Moreover, the draft concession for Terminal A included in the September

22, 2010 request for proposals provides that a concessionaire may deduct Mixed

Beverage Taxes from Gross Sales in determining rent due to the Board.

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 5.0 Causes of Action

REQUEST FOR REFORMATION OF CONTRACT

BASED ON MISTAKE

5.01 The concession contracts constitutes a contract between Plaintiffs and the

Board. The Board has been provided with clear evidence that there has been a mutual

mistake between the contracting parties (scribner's error),- or a unilateral mistake of the

Plaintiffs, coupled with fraud or inequitable conduct by the Board. Nevertheless, the

Board seeks payment of rent on TABC taxes that are not owed by Plaintiffs. The Board's

actions in continuing to demand TABC taxes as "rent" that is not owed, contravenes the

true agreement between the parties and has caused Plaintiffs' injury for which they seek

appropriate relief as set forth herein.

5.02 Based on the foregoing, there is a justiciable controversy between the

parties for which equitable re1iefi's appropriate.

5.03 Plaintiffs seek a declaration from the Court that 1) there is a mutual or

unilateral mistake of the parties as to the provision in the Concession regarding the

collection of TABC taxes as rent; 2) the TABC taxes sought by the Board as "rent" under

the Concession are not owed by Plaintiffs; 3) Section 4.03 of the Concession means that

in the event of the dispute as to the amount of rent to be paid the Board shall accept the

sum tendered by Plaintiffs without prejudice to Plaintiffs' rights pending resolution of the

dispute; and 4) the Board's actions, inter alia, in tying non-payment of the taxes to bonus

points and/or as a disqualifying event for the RFP process contravenes Concession

provision 4.03 because it prejudices Plaintiffs' rights to conduct its concessionaire

operations at the Airport, including receiving earned bonus points and participating in the

RFP process for Terminal A space, while the dispute is resolved; and 5) the parties' true

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intent is that the TABC taxes are excluded from the definition of Gross Receipts under

the Concession.

5.04 In addition to actual and/or nominal damages, attorneys' fees and costs,

Plaintiffs also seek reformation of the Concession to conform to the parties' true intent

that the TABC taxes are excluded from the definition of Gross Receipts under the

Concession.

6.0 Injunctive Relief

6.01 By letter dated October 7,2010, the Airport stated that it intends to default

Plaintiffs on the Concessions if payment is not made on or before November 12, 2010 (30

days from receipt of the letter). On November 2, 2010, the Concessions Committee of

the Board voted to proceed with recommending termination of the concessions to the

Board at its November 4, 2010 meeting. An injunction maintaining the status quo is

required pending determination on the merits of this declaratory action. Without an

injunction keeping the Concessions in place, Plaintiffs will suffer irreparable harm: the

concessions will be terminated and they will be removed from the Airport, and replaced

by other concessionaires before a result is reached on the merits of their declaratory

judgment claims. Plaintiffs can not be adequately compensated by monetary damages

because once they are removed from their concession spaces, any new concessions with

new concessionaires will supersede their interests. Maintaining a no default situation is

the last peaceable status.

6.02 Injunctive relief regarding the RFP's for Terminal A is also warranted.

The Airport issued Requests for Proposal for Terminal A on September 22,2010. The

Board has stated that any proposer with any unresolved claims with the Airport will be

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disqualified. Another disqualifying event occurs when a proposer has been in default or

arrears of more than $50,000 under any previous agreement with the Airport in the last 12

months.

6.03 Plaintiffs anticipate that the Board will disqualify them from submitting

proposals for Terminal A by the December 2010 deadline. Plaintiffs seek an injunction

requiring the Board to accept their requests for proposal pending the merits of this suit.

Plaintiffs are likely to succeed on the merits of their claims. Plaintiffs have submitted

clear evidence of the mistake from the former director of concessions swearing to the

mistake, the Board never attempted to collect the rent until 2010, and the future

concession for Terminal excludes TABC taxes which is industry standard. Plaintiffs will

suffer irreparable harm because if their proposals are not considered, they lose any

chance of occupying Terminal A. Thus, they have no adequate remedy at law because no

amount of monetary damages will compensate their inability to bid Terminal A space.

7.0 Request for Jury Trial

7.01 Plaintiffs request a jury trial on all allegations and causes of action set

forth herein as allowed by Texas law.

WHEREFORE, PREMISES CONSIDERED, Plaintiffs pray that Defendant be

cited to answer and appear herein and that upon final hearing Plaintiffs be awarded a

declaratory judgment ovef'and against Defendant as set forth herein and for damages as

appropriate, attorney's fees, costs of court, pre and post judgment -interest at the

appropriate allowable rates.

Plaintiffs request -that the Court issue a temporary restraining order, temporary

and permanent injunctive relief enjoining the Board, as follows:

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 1. That the Board not terminate Plaintiffs' Concessions pending the outcome of
the merits of this declaratory judgment suit; and

2. That the Board accept the request for proposals submitted by any or all of the
Plaintiffs and award the respective Plaintiffs the bonus points as earned at the
Airport and in accordance with the RFP dated September 22, 2010 pending
resolution of this matter.

Plaintiffs also request that the Court order any and all other relief at law and in

equity to which Plaintiffs may show themselves to be justly entitled.

RESPECTFULLY SUBMITTED, .

By: sl Elizabet
Elizabet . Handschuch
State Bar No. 08903950
Linda M. Dedman
State Bar No. 24007098
Floyd Clardy, of counsel
State Bar No. 04268010
202 High Point Centre
12225 Greenville Avenue
Dallas, Texas 75243
(214) 361-8885 (telephone)
(214) 363-4902 (facsimile)
bethh@coveragelawdallas.com
ldedman@coveragelawdallas.com
ATTORNEYS FOR PLAINTIFFS

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