DU, barber settle lawsuit
Published: Wednesday, September 5, 2012
Updated: Wednesday, September 5, 2012 23:09
After a four-year battle between the two neighbors, Joe Madia’s Barbershop and Duquesne University settled the civil lawsuit June 26 for an undisclosed amount.
In the suit, Kevin Kappel, owner of Joe Madia’s Barbershop on Magee Street, accused Duquesne fraud and breach of contract, stemming from a “bait-and-switch operation” by the University that Kappel said cost his business $200,000 in lost revenue.
Kappel, 39 of Brighton Heights, signed a confidentiality agreement and could not disclose the amount of the settlement.
Duquesne began contacting Kappel with settlement offers in December, beginning with an offer of $16,000. Kappel said the University made several more offers between December and a June mediation hearing but he refused each one because he felt Duquesne was “low-balling” him.
The two sides could not reach an agreement at the mediation hearing, but things began to “snow ball” until Kappel agreed to the undisclosed amount three weeks later, Kappel said.
“I am completely satisfied with the settlement. They did the right thing,” Kappel said. “I think both sides walked away happy.”
Kappel said his business is doing well as he gets an average of 25 to 30 customers a day, many of whom are Duquesne students.
“I can’t be too mad because [Duquesne students] always come here since it’s convenient,” Kappel said. “These guys keep coming back even after they graduate so I want to have a long-lasting relationship with [Duquesne].”
Duquesne spokeswoman Bridget Fare said she could not discuss the settlement due to the confidentiality agreement.
The suit, filed Oct. 22, 2008, was from a perceived breach of contract in which Duquesne promised Kappel first-right of refusal for retail space within the Power Center, which had recently been constructed, after the shop was forced to move to its current location.
But Barnes & Noble, Jamba Juice and The Red Ring opened in the Power Center before Kappel could rent space in the building, which he believed violated his agreement with Duquesne.
According to a Sept. 8, 2004, letter from Vice President of Management and Business Stephen Schillo to Ronald Madia, whom Kappel purchased the shop from, “Duquesne University is prepared to commit to Mr. Kevin Kappel that he will have a one-time right of first refusal to rent up to 2,000 square feet of retail space, at market rates, for the shop when retail space is developed.”
For more than 80 years, Joe Madia’s was located at 1267 Forbes Avenue, where one of the Forbes surface lots is now. The barbershop was forced to decrease from 2,000 square feet to 425 and from eight chairs to two in the move.
Duquesne purchased the property, assessed at $125,000, for $625,000 in 2004.
Barnes & Noble signed an agreement to open a store in the Power Center on Nov. 14, 2005. Aramark establishments the Red Ring and Jamba Juice signed the same agreement on Dec. 20, 2006.
Kappel signed a contract for first-right of refusal on Oct. 18, 2004.
In a Jan. 25, 2012, Duke article, Duquesne counsel Jonathan McAnney said that since Jamba Juice and The Red Ring are owned by Aramark, which the University contracts for dining services, opening an Aramark store in the Power Center is not considered opening the space for retail purposes.
McAnney also said Barnes & Noble, which was previously located across from Starbucks on the second floor of the Duquesne Union’s, had a preexisting contract with Duquesne.
Kappel said he still disagrees with the University’s assessment of his first-right of refusal, but said there is no animosity between the parties.
“This is just a big relief,” Kappel said. “It’s good to have this behind me and I can say that they [Duquesne] are a great neighbor.”