CarPark Management Corp. Files Lawsuit Alleging Back Room Dealing At Caltrans; Jose Medina's 'Sweetheart' Deal Alleged In Lawsuit; Request For Governor and Attorney General To Investigate.

Business Editors

SACRAMENTO, Calif.--(BUSINESS WIRE)--Jan. 25, 2000

According to a lawsuit filed yesterday, Caltrans Director Jose Medina intentionally interfered with a Caltrans contract as a favor to a political ally. According to Stephen Kottmeier, an attorney representing CarPark Management Corporation, several sources within Caltrans have confirmed that the order to redirect a contract to operate a San Francisco parking garage previously awarded to CarPark came from Sacramento. Sources also confirmed that they were directed to award the contract to Priority Parking, a parking garage operator with whom Medina has close personal and political ties, he added.

&uot;I submitted the winning bid and complied with all of Caltrans' requirements,&uot; stated Minesh Mehta, owner of CarPark. &uot;It is grossly unfair to choose another company now, after we already won the contract fair and square.&uot;

&uot;Mr. Medina's relationship with Priority Parking, coupled with the unexplained rejection of CarPark's bid after Caltrans notified Mr. Mehta that he had been awarded the contract, leads to an unmistakable conclusion -- Mr. Medina wrongfully followed through on a 'sweetheart' deal at Mr. Mehta's expense,&uot; said Kottmeier, referring to allegations contained in the lawsuit.

On December 2, 1999 CarPark was awarded a 2-year lease for operation of the Trans Bay Parking Facility in San Francisco. The contract, which was to take effect January 3, 2000 was to go to the highest qualified bidder subject to a sealed bidding process.

After Caltrans notified Mehta that he had submitted the highest qualified bid and was therefore awarded the contract, Caltrans requested and received a number of items including a security deposit and advance rent totaling $327,000, said Kottmeier. Mehta also hired 15 employees and purchased signs, tickets and other items necessary to operate the facility.

According to Kottmeier, on December 13, 1999 Caltrans officials informed Mehta that all conditions of the lease had been satisfied. As a result, he provided Caltrans officials with two signed copies of the lease prepared and presented to him by Caltrans and was advised that he would receive the lease signed by Caltrans in a few weeks.

Kottmeier said that on December 31,1999, just before the lease was to take effect, Kristin Schober, Caltrans Senior Right of Way Agent, informed Mehta that his bid had been rejected and that the lease had been awarded to Priority Parking. According to Kottmeier, Schober later informed Mehta that the decision to award the contract to to Priority Parking came from Sacramento. This was later substantiated by Mark Avila, Caltrans Right of Way Agent.

Kottmeier said CarPark has since learned that Priority Parking's bid was not only lower than its own by at least $30,000, but that Priority Parking is now operating the facility even though it did not supply Caltrans with the necessary documentation or the security deposit required.

Mehta yesterday filed a lawsuit against Medina and Caltrans in Alameda Superior Court, and has asked the Governor and Attorney General to launch an immediate investigation.

CarPark Management Corporation has been operating parking facilities in the Bay Area since 1989 and currently operates ten lots, including seven on property owned by Caltrans.