Spin Cycle

News, views and commentary on Long Island, state and national politics.

John Catsimatidis, reacting to news reports about past labor-related lawsuits against his businesses, took aim today at “ambulance-chasing attorneys that have wreaked havoc, chasing restaurants, supermarkets, drug stores, chasing everybody.”

“Someone has to expose them,” the billionaire businessman, who owns the Gristedes and Red Apple store chains, told Newsday. “You’ve got to protect employees, but they don’t care about protecting employees. They care about creating bills.”

In a phone interview, the mayoral candidate gave his account.

advertisement | advertise on newsday

The first legal case in question, he said, started about 12 years ago, and concerned a delivery service that handled groceries from Gristedes stores as well as Duane Reade and A & P. By his account, the law firm went after the service, listed by the state Labor Department as failing to pay minimum wage. The company, Charlie Bauer, went bankrupt and closed. So the plaintiffs went after the stores, he said, even though “we never had control of them coming and going.”

A & P, he said, “surrendered in 38 seconds for $3.5 million.” Gristedes agreed to $3 million plus $600,000 in legal fees. “It was all paid. Ten seconds after we settle the case, one of the employees, sees the newspaper and runs to the law firm, and opens up a case and says, ‘I’m a dairy manager, and I’m not getting paid overtime as a manger.’ Eighty percent of those employees were members of the union. The union is in our stores every week,” and they get resolved, he said.

After a seven-year legal battle, “we finally settled for $3.5 million because our legal fees are going up,” he said. “Gristedes was starting to pay, and Gristedes makes the least money of our companies.” Paying $120,000 per month, they sought to reduce the monthly payment -- not the total.

“I don’t know why the judge got annoyed at me, but he hit the gavel and made me personally responsible — which I thought was not a correct thing to do. I had not run the company in 10 years...”

But, Catsimatidis said, “I paid the money and then we appealed it because I thought it was wrong.” When the firm submitted bills for $6 million in legal fees, he said, he brought in an investigative firm and “found $2 million in mistakes right away on the bills.” After that claim was reduced, with an error acknowledged, a dispute lingers, he said, adding that he thinks it's wrong that lawyers would collect more than the plaintiffs.

advertisement | advertise on newsday

“Any other company in New York City in a similar predicament would have filed bankruptcy without a shareholder like me behind them,” he said, “and [nearly] 2,000 people would have lost jobs.”