Schiavone Management files suit against Yale

Joel Schiavone, the vice president of Schiavone Management Company (SMC) and a Republican candidate in the New Haven mayoral race, is suing the University. SMC, which manages many of the properties on Chapel Street across from Old Campus, and, until Wed., Feb. 14, many of the stores on Broadway, filed a complaint with the New Haven Police Department on the morning of Thurs., Feb. 15 after several Yale University employees allegedly removed files from company offices.

PATRICK MCGARVEY/YH The Shubert Theater is among the properties operated by the Schiavone Management company.

SMC issued a press release Thursday evening quoting Schiavone's statement to police. On Wednesday afternoon, "Yale officials were upstairs and removing our files," the statement reads. "While these files reference Yale-owned properties, they are clearly our files and not theirs. I told them to stop, which they refused to do."

In a telephone interview, Schiavone explained, "I tried to stop them. I stood in front of the elevator and they tried to shove me out of the way."

The removal of the files apparently related to Yale's Wednesday termination of SMC's management of many properties on Broadway. SMC had managed those properties for several years but the contract for managing them had expired. Schiavone said SMC was ousted in direct response to a lawsuit it filed against Yale in Meriden Superior Court on Mon., Feb. 12.

University Spokesman Thomas Conroy said SMC was eliminated as manager of the properties because, "The University wants to ensure the best management of those properties for the tenants of those buildings and for their customers." He said SMC was not providing that management, even though the University has "worked very hard to try to help Schiavone become a better manager."

He also said that when Yale employees were at SMC offices they were simply "taking possession of certain files that are Yale's property." Schiavone, however, characterized the removal as illegal. "Yale people are used to having their way," he said. "I will stand up and fight," which is the reason he filed the police report on the advice of his attorneys.

He claims SMC filed the lawsuit against Yale in the same spirit. The lawsuit lists the Schiavone Management Corporation and the Corporation's president, Craig S. Schiavone, as plaintiffs against Yale. Craig Schiavone is Joel Schiavone's former wife.

The lawsuit relates to a 10-year management contract the University signed with SMC in 1998 for the management of 13 properties on College and Chapel Streets, including those where Claire's Corner Copia and the El Dorado building are located.

Prior to Yale's 1999 purchase of the properties on Chapel and College Streets, the properties were owned by SMC. When First Constitution Bank, which held SMC's mortgage, failed in 1992, the FDIC took over the bank's interest in the properties. Yale purchased the buildings from the FDIC and SMC, but retained SMC as manager of the properties.

The lawsuit says Yale has "systematically sought to undermine the plaintiff, Schiavone [Management Corportation]," by failing to reimburse it for employee benefits, failing to award it construction contracts, interfering with its ability to secure new tenants and leases, and otherwise breaching "the duty of good faith and fair dealing" as required by the contract. It also alleges sexual discrimination in the form of inappropriate inquiries into the personal life of Schiavone's wife Craig. The lawsuit seeks more than $15,000 in compensation, the highest possible bracket.

Speaking on behalf of SMC, Schiavone focused on the complaint that Yale stopped providing money for employee benefits in January of 2000. Yale provides SMC with a weekly check to pay its employees and other costs, he said. Starting in August of 1999, when Yale purchased the Chapel and College Street properties, the University provided SMC's employees with sick time, vacation time, and holiday time as part of their base pay.

In January 2000, he said, the University decided that those benefits were not part of base pay and then went on to decrease the base pay as well. It also failed to increase the amount it provided for benefits, which would have allowed SMC to continue to provide its employees with paid time off. According to an SMC press release, Craige Schiavone paid these expenses out of pocket.

Schiavone said that when SMC complained there weren't enough benefits for its employees, the University responded, "We don't pay these [benefits] for some of our other suppliers." He continued, "They said other employers don't pay for health care, so [SMC] absorbed the cost" of providing the time-off benefits to their employees. He said Yale doesn't want to provide its employees with a fair wage, saying this was part of the reason Yale decided to terminate SMC's management of the stores on Broadway.

Conroy responded, "[Schiavone] is not properly characterizing Yale's decision." "Yale's desire in any contract," he continued, "is that they treat their employees well. The University made the change [in property managers] to ensure the best possible service to the tenants of those properties and their patrons, including Yale faculty and students."

But Schiavone claimed Yale is engaged in a concerted effort to drive SMC out of business. Regarding the lawsuit, Conroy said, "The University believes that the suit in its entirety is without merit. Yale will vigorously defend against the lawsuit. Any claim that is in the lawsuit, we reject."

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