OPINION: The Key West Carve Out
Duck Tours started this fight in 1995. Fourteen years and $8 million later, the same questions remain.
There are two Historic Tours of America companies.
There’s the one that competes.
In Washington, D.C., HTA competes. Same in San Diego. Ditto for Boston, San Antonio, St. Augustine and Nashville.
Then there’s the one that calls Key West home.
Only in Key West did it wind up in court defending a franchise system judges ultimately concluded unlawfully restrained competition.
That’s odd.
Because HTA doesn’t need the help.
It’s one of the most successful tourism companies in America.
Not quite Disney, although I suspect there are some delusions of grandeur wafting about 201 Front St.
But very successful, nonetheless.
Yet somehow, every time another entrepreneur tries to sell visitors a different ride around the Southernmost City, the argument eventually ends up in a courtroom.
John Murphy was first with Duck Tour Safaris.
In 1995, Murphy rolled a fleet of World War II DUKWs, better known as Duck boats, into town believing tourists might enjoy seeing Key West from the harbor instead of the streets.
He wasn’t looking for a government contract, incentives or exclusive rights.
Murphy just wanted to compete.
Instead, all he got was harassment from the city, allegedly at the behest of HTA and its owners Ed Swift and Chris Beland.
And Key West bought itself 14 years of litigation.
Really expensive litigation.
The city said it was regulating traffic.
The courts eventually said something very different.
The words “antitrust” and “monopoly” echoed through the courtroom.
Key West didn’t settle. The taxpayers got the bill.
It was quite the trial.
There were accusations HTA pressured commissioners and then-City Manager Julio Avael to enforce its monopolistic franchise agreement.
Key West Police Department investigators testified under oath they couldn’t find any violations.
Murphy’s drivers testified they were harassed by investigators.
The first verdict totaled $13.5 million.
The courts later sent the damages back for recalculation.
By the time everyone finally quit fighting in 2009, the city had written an $8 million settlement check and burned through 14 years of legal bills totaling nearly $750,000.
City Commissioner Carmen Turner famously quipped, “I wonder how much of that Ed Swift is willing to cough up?”
Then it was revealed that HTA settled with Murphy for a rumored $800,000 before the city ever faced a jury.
Murphy then sued for attorney fees totaling nearly $650,000.
By the time the checks were cashed, city reserves had dropped to about $4 million.
That’s one expensive traffic study.
The verdict rattled City Hall badly enough to push a young Mark Rossi into politics.
“We might have to sell the historic waterfront to pay for this,” Rossi warned.
People laughed.
Then the city wrote the check.
You’d think that would have cured everybody.
It didn’t.
Next came Robert Eggers.
Eggers says HTA expressed interest in buying his shuttle business. Negotiations collapsed.
HTA launched a similar business, Bone Island Shuttle.
Then City Hall, the police and code enforcement suddenly became very interested in his buses.
Eggers sued.
But his lawsuit died on the statute of limitations before a jury ever heard it.
What is old is new again.
In recent months, following a vote to extend HTA’s grip on its transportation franchise, the same questions are being raised.
Before commissioners voted on the latest HTA extension, Commissioner Greg Veliz remembered Duck Tours.
Eight million dollars has a way of sticking with you, like a bad toothache.
So do the words “antitrust” and “monopoly.”
Those are the same words now being bandied about at City Hall and in the halls of justice yet again.
Veliz asked part-time City Attorney Mayanne Downs to take another look before the city walked back into the same neighborhood.
The commission voted anyway.
Six to one.
The lone dissent came from Commissioner Sam Kaufman.
He appeared to be the only commissioner unwilling to be cowed by HTA and its owners — still huge donors to candidates sympathetic to their cause.
Once more unto the breach.
And because this is Key West, the story doesn’t stop with trolleys.
Campaign finance reports show Historic Tours recently wrote a $10,000 check to Families & Friends for the Keys, the political action committee chaired by Jack Niles and registered in Tallahassee.
That doesn’t include the tens of thousands of dollars HTA, Swift and members of the Swift family have contributed to incumbent Mayor Danise Henriquez during this election cycle.
There were other donors to the PAC.
Planning Board member Michael Browning, through his company. Denise Holland-Schmitt. Restaurateur Bobby Mongelli. Hollywood developer Jeffry Cornfeld, of Peary Court infamy.
Soon afterward, cell phones across Key West started lighting up with attacks on Kaufman intended to bolster Henriquez.
If social media is any indication, it doesn’t appear to be working.
Want to know who paid for the annoying text messages?
That’s public record.
The text messages are public record, too.
Draw your own conclusions.
Mine is simple.
HTA competes just fine throughout the rest of America.
Only in Key West has it spent three decades at the center of lawsuits over exclusive franchises while tightening its grip on a compliant City Commission.
Duck Tour Safaris.
Eggers Transport.
And now.
Different decade.
Same address.
Same company.
Same old story.
And the City of Key West has lived through it and paid for it before.
Follow the money.