Jury awards Kela Tennis $9.3 million for Mount Vernon bubble destruction

Mount Vernon was hit with a nearly $9.4 million verdict on Friday for breaching its contract with the operators of the tennis center at Memorial Field when then-Mayor Richard Thomas ordered the bubble taken down early one morning five years ago.

The full amount owed to Kela Tennis Inc. will be about $15 million once required annual interest of 9 percent is calculated. The city must pay it all as its insurance company would not cover the lawsuit because it involved an alleged breach of contract. The verdict could have a catastrophic impact on the city's already strapped coffers, as a $15 million one-time payout would amount to a 30 percent tax increase.

The city will likely appeal the verdict, primarily on the grounds that its main defense — that the 2015 contract with Kela should have been nullified because Mayor Ernie Davis was not authorized to enter into it — was disallowed at the outset of the trial by state Supreme Court Justice Lewis Lubell.

“My family and I have suffered greatly because of what Mount Vernon did to us, and we prayed this day of vindication would come," Kela Simunyola said in a statement issued through his lawyers, James Borkowski and Andrew Tureaud of the firm Keane & Beane. "Mount Vernon should do the decent thing, and settle this case.”

Borkowski said that one of the jurors afterwards referred to the demolition and the city's actions leading up to it as a "parade of horribles."

Simunyola's call to settle the case despite winning a huge monetary award was in recognition of what could be a long appellate road ahead that would delay him and his family receiving anything. Borkowski suggested Mayor Shawyn Patterson-Howard had committed "mayoral malpractice" and was as responsible for the result as Thomas because she has not seriously entertained negotiations that would have limited what the city would owe.

But Patterson-Howard said in a statement Friday afternoon that the city made an offer of $1.2 million last week that was rejected. That money was all that was available from the city's contingency fund, she said, adding that without the insurance coverage, the inability to use Covid relief funds for lawsuit settlements and the lack of savings or a credit rating "the city could not make a stronger financial settlement offer in good faith."

"It appears that the jury and the lawyers for Kela believe that Mount Vernon has access to capital that doesn’t exist," she said.

The mayor added that she would confer with the city council and comptroller about pursuing all options including an appeal so that the $15 million "is not carried wholly by our residents."

The city last year settled a separate lawsuit by NFS Leasing, the Massachusetts company that rented the bubble to Kela Tennis, agreeing to pay $532,500 over three years.

The city's liability in Kela's lawsuit was established last week by the same jury, when it rejected the counter claim that it was Kela that breached the contract by not making its required monthly lease payments for more than two years. In the damages phase this week, the plaintiff's expert detailed what Kela lost in the initial period of the contract and what it likely would have earned if allowed to run the tennis center for the 15 years of the lease.

Liable: Mount Vernon found liable over the infamous destruction of Memorial Field tennis bubble

Although a Westchester County-funded plan for renovating Memorial Field was underway when Davis returned to the mayor's office in 2011, he reworked it to give tennis more of a presence in the new park. In early 2015, he entered into the lease agreement with Simunyola and his family that included a commitment by the city to complete a clubhouse that would serve a number of tennis-related businesses for Kela.

But the clubhouse was never completed, forcing Kela Tennis to spend $365,000 on things the city was supposed to provide.

The contract was amended in late 2015 - before Davis left office and Thomas took over as mayor - to cut the monthly lease payments in half. But Simunyola was told the following year not to make any more payments until after the clubhouse was completed and the money he had already spent could be reconciled with what he owed for the lease.

In 2018, Thomas was trying to get the long-stalled renovation of Memorial Field going and sought to have the tennis center moved to the back of the property to ensure that a regulation size 8-lane track could circle a new football field.

When Simunyola refused, weary of past city promises, the administration began efforts to evict Kela, focusing on the unpaid rent.

Thomas insisted that there were other reasons besides the non-payment of rent that necessitated the bubble's removal. The city was under a consent order with the state Department of Environmental Conservation to clean up contaminated debris that Davis had allowed to be dumped at Memorial Field, some of which was under the tennis courts.

Just after midnight on June 1, 2018, as Mount Vernon police officers stood watch, contractor Michael Figueroa and his employees deflated the bubble and removed some of its hardware without any of the steps usually taken to do so. The bubble was damaged after being left dangling off the unfinished clubhouse.

The jury awarded: $2.3 million for the breach of contract during its first two years; $6.9 million for June 2, 2018 through 2029; $526,000 for the actual damage caused to the bubble; and the $366,000 Kela expended on the property in those first two years. Reductions were made for the lowered lease payments and for Simunyola's earnings since the bubble was taken down.

Thomas, who is seeking to run in the Democratic primary for mayor this year, expressed disappointment in the verdict and said the city must appeal, citing that "critical" information could not be presented to the jury. He justified the ouster of Kela Tennis because of the environmental hazards that existed.

"It is truly backwards for a city to be dumped on and then be told to pay damages to an outside group because they are on top of a dump and don't want to comply with environmental laws," Thomas said.

But Kela argued that Thomas' focus was making room for the track and the middle-of-the-night, secret removal had nothing to do with environmental concerns.

The city's expert on damages was precluded from testifying. Marc Oxman, the lawyer representing the city, tried to convince the jury that Kela's estimate of damages was flawed for several reasons. He said the amount of what the business would have made through 2029 if allowed to operate was speculative. But more significantly, he argued that once the county resurrected its interest in completing the Memorial Field renovation in late 2018, Kela Tennis would have been evicted then because its contract with the city was not permitted under the the 2008 agreement with the county.

He said it was not speculative that the county would have removed Kela because it was certainly interested in completing what it started a decade earlier. That was proven when the new Memorial Field opened this past fall. he said.

Oxman said that will be part of the city's challenge of the verdict but that the main contention in the appeal will be that the city should not have been found liable for breaching a contract that never should have existed.

"It's a significant award, but the story is not finished being written here," Oxman said.

This article originally appeared on Rockland/Westchester Journal News: Tennis bubble case: Mount Vernon hit with $9.3 million verdict