Seeks temporary restraining order and preliminary injunction to prevent agreement between Marketing Development Corporation and Snapple

View Court Papers filed by the Comptroller

New York City Comptroller William C. Thompson, Jr. today announced that he has filed an action in New York State Supreme Court in order to stop the New York City Marketing Development Corporation from implementing the $126 million contract naming Snapple an exclusive beverage vendor for all City public buildings and as a marketer of the City’s name. With the petition, the Comptroller has also asked the court to expedite the hearing and to prevent implementation of the contract .

“ The Administration sold Snapple the exclusive right to use our City’s name in a backroom deal.  Today we are asking the court to ensure that this cannot happen without an open, transparent, public process ,” Comptroller Thompson said. “No one has the right to sell the use of the City’s name without public disclosure, review and debate. I believe the courts will agree that the Administration acted in cavalier disregard for the law and system of checks and balances established by the charter.”

In the court papers, attorneys cited numerous clauses in the City Charter as grounds for their arguments. Section 374 states that a City agency may not grant a concession unless it has complied with the Franchise and Concession Review Committee’s (FCRC’s) procedures including requirements for FCRC review and approval. The Comptroller’s court papers argue that because the Administration failed to submit the entire Citywide agreement to the FCRC, the contract should not be implemented.

The motion also cites section 327 of the Charter, which states that where a contract including a concession has been awarded, the Mayor must certify that “the procedural requisites for the solicitation of the award of the contract have been met.” In the case of the MDC contract, the Comptroller did not receive any certification from the Mayor or Corporation Counsel, therefore justifying the Comptroller’s refusal to register the contract and today’s court action.

“From the language in the City charter, it is clear that the entire contract should have been brought before the FCRC,” Thompson said. “The Charter also requires certification from the mayor, which also did not happen. These actions need to be taken immediately.”

Last month Comptroller Thompson announced his intention to reject the New York City Marketing portion of the contract with Snapple. This development came with the release of his audit of the Department of Education’s agreement with Snapple, where auditors found that DOE did not follow a fair vendor selection process. At that time, Thompson urged DOE to cancel the school vending machine contract and conduct a new process, that complied with DOE’s RFP manual and ensures a “fair and reasonable result.”

The Comptroller’s office is being represented by Judd Burstein, P.C.

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