Airport Must Pay Tenant $3.3 Million

Atlanta's Hartsfield-Jackson International Airport must pay a company that operates all the retail shops in the airport's Atrium $3.3 million because their profits have declined since extra security measures were installed after the Sept. 11, 2001, terrorist attacks, a Fulton County Superior Court jury ruled Thursday.

The company pays the airport about $8 million a year to lease space for about 16 shops. Jurors ruled that the airport should have reduced the rent after sales dropped because the increased security measures caused fewer passengers to drop in and buy merchandise.

Some jurors said they based their decision in part on an aviation security law passed by Congress that included a provision urging airports to talk with their tenants about adjusting their rents to account for lower profits.

Most passengers hurry past the Atrium's shops because they know they could get stuck in a long line at the security devices, said Henry Chalmers, a lawyer who led the trial team that represented three companies that filed the lawsuit against the airport. The lawsuit requested $8.2 million.

The gleaming Atrium --- once billed as Atlanta's front door --- is no longer a shopping mall where it's pleasant to pass time browsing in stores. Now it's a place passengers rush through on the way to the security checkpoint, Chalmers said.

"People want to get to the concourse just as soon as they can," Chalmers said. "They don't shop in the Atrium."

Consequently, sales at the Atrium's retail shops have dropped by 23 percent, according to the lawsuit filed in December 2004. It was brought by WH Smith Airport Services, Airport Management Services and Hartsfield Air Ventures. The first two companies have interests in Hartsfield Air Ventures, the company that holds the lease.

Ben DeCosta, the airport's general manager, agreed in his testimony that sales have dropped, but not by as much as the lawsuit contends. DeCosta said that in 2004 he ended three years of negotiations over the amount to be paid to the company for lost profits because the conversations were going nowhere.

"It reached the point where we thought they were being greedy," DeCosta said.

The companies were seeking to invoke a section of a contract that provides for the airport to reduce the rent if the number of passengers boarding planes drops because of any action taken by the federal or state governments. But a lawyer for the airport, Robert Caput, said the companies knew when they renewed the lease in 2000 that retail revenues at the Atrium's shops were falling.

Caput said the companies "want to take advantage of a terrorist act ... to get out of a bad business decision."

Chalmers said he didn't expect a spate of similar lawsuits against other airports. Atlanta is unique in having a large retail area open to passengers who have not been through a security gate.

Juror Mia Long said she supported the companies' claim because of the terrorism act passed by Congress and because the city's contract was vague.

"The contract was too broadly worded," said Long, an Atlanta resident who teaches public speaking at Clayton State University. "The letter from Congress said airports should have conversations about rent abatements."

Caput said the city will consider appealing the ruling. Any amount paid to the companies will be drawn from the airport's funds, which do not include any taxes collected from Atlanta residents, he said.

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