Nassau University Medical Center is seeking $1 million from the former operator of its coffee and gift shop, which left in April in a dispute over unpaid fees, according to court filings and officials.
Dover Gourmet Corp. left after hospital officials said the company had not paid fees to operate the eatery since February 2015. The company has had the concession contract since 2001 and owes about $400,000, officials from NuHealth, the public benefit corporation that runs the East Meadow hospital, have said.
Butch Yamali, chief executive of the Freeport-based company, has called the $400,000 figure “fictitious.” He said hospital management did not fix the kitchen’s exhaust system after it broke, causing a downturn in business. He said he could not afford to pay the fees and offered a diminished menu after the machinery broke, making it impossible to grill or fry foods that had been popular with hospital visitors and staff.
Yamali has said there are “writings that say it’s OK to stay and not pay."
Dover filed a lawsuit in March after NuHealth ordered it to vacate hospital premises by March 31.
Dover left in April, and NuHealth filed two counterclaims, each seeking at least $500,000 in damages, according to a June 5 filing.
“The Board of Trustees at the Nassau University Medical Center needs every last dollar to carry out its important mission, that of providing medical care for everyone who needs it and we cannot afford to squander a single dollar,” NuHealth chairman George Tsunis said in a statement. “ … Taxpayer money will be respected.”
In court papers, NuHealth officials said Dover breached the contract because it did not fully pay a monthly licensing fee of 12 percent of sales.
Daniel Deegan, the Uniondale-based counsel for Dover, said he doesn't comment on pending litigation but noted, “We don’t owe any license fee. They breached the contract.”
The Town of Hempstead also has accused Dover of being late with fee payments. Last month, Hempstead officials said Dover had not paid rent for nearly a year on the popular Malibu Beach Park property and owed $531,400. Yamali told Newsday in July that Hempstead owes him more than $2 million for capital improvements added to the park and that Hempstead officials said he did not have to make rental payments until the dispute over improvement costs was settled.
"They said do not pay until we come up with an offset," Yamali told Newsday in July.
Last month, a state Supreme Court judge ordered Dover Hospitality Services, a related company, to pay Suffolk County Community College $290,347 for failing to turn over commissions for running the vending machines and cafeterias.
NuHealth struggled financially in 2018, posting a $46.6 million operating loss, up from $25.7 million the year before.