Changes surely on tap after Aramark judgment

Sports and entertainment concession companies are waiting nervously for fallout from a lawsuit that hit industry giant Aramark Corp. with a $105 million liability judgment following a drunk-driving incident that involved one of its customers.

Last month, a jury in Hackensack, N.J., socked Aramark with $30 million in compensatory damages and another $75 million in punitive damages after hearing the case of Daniel Lanzaro, who was served a number of beers at a New York Giants game in 1999 and later was responsible for a car crash that left Antonia Verni, now 7, paralyzed from the neck down. (Lanzaro was assessed $30 million.)

Aramark declined to comment on the case except to say that the amount awarded was excessive and that it plans to appeal.

Lanzaro, who is now serving a prison sentence, admitted at trial that he was an alcoholic who tipped a vendor $10 to serve him six beers. Aramark does not allow anyone to buy more than two beers at a time and prohibits obviously intoxicated patrons to be served at all.

Aramark, a $5 billion company that reported a profit of $264 million for the 2003 fiscal year, argued that its employees get rigorous training to help them spot customers who are drunk and that Lanzaro, according to his own version of events, had several postgame drinks at a local strip club before the accident.

Concessionaires who sell alcohol to large crowds received a stern warning from the New Jersey jury, since punitive damages can be awarded only if the defendant is found guilty of "willful and wanton disregard for the safety of others."

Rick Abramson, president of Sportservice, said, "Whenever a tragedy happens in our field, it's going to be an eye-opener and definitely wake us up. It reminds us that, no matter how hard we work to train our staff, we have to be even more rigorous."

Abramson, whose company serves 21 major sports and entertainment venues, admitted that he wasn't surprised by the verdict but that the amount of the award was a stunner.

He also conceded that the New Jersey case could have financial ramifications for other food and beverage vendors.

"I think it's too early to say exactly how those things all might play out," Abramson said, "but obviously the cost of liability insurance — which you carry on every contract — might change. We'll just have to watch what happens and react to it then."

Some industry experts indicated that the Aramark verdict, if it stands under appeal, could force concessionaires to alter business practices and that the public might bear the cost.

"It's quite possible that this will be reflected in prices to the public," said Bill Caruso, president of William Caruso and Associates, a consulting firm with a large portfolio of food and beverage clients. "Ownership, teams and so forth will not want to pay for this."

Caruso also suggested that some of the large concession companies — notably Aramark, Centerplate, Sportservice, Levy Restaurants and Sodexho — could be less inclined to bid on smaller contracts where potential revenue might not justify the liability risk.

"You also might see these companies insist that clients be self-insured, or at least share the cost to bind very high umbrella liquor liability coverages," Caruso said.

Another highly respected consultant, Chris Bigelow of the Bigelow Cos., wasn't quite as sure that the case would be a body blow to the industry, but he recognized some potentially unpleasant consequences.

"Companies have been well aware of the liabilities of serving alcohol and have had fairly tight controls in place — limiting the number of beers sold, cutting off sales at some point during an event, etc.," Bigelow said. "This certainly will get everyone's attention to improve monitoring of those rules, though.

"In the long run, you may see some venues or states limit or eliminate vending in the stands, as they've already done in California and Massachusetts. Hopefully, that won't happen."

Those on both sides of the issue agree that tailgating in parking lots before sports events or concerts increases the risk of incidents involving drunken customers.

Just a few days after the verdict, the New Jersey Sports and Exposition Authority executive board passed a resolution authorizing president George Zoffinger to monitor fans more aggressively in the parking lot and within the stadium during an event.

Zoffinger said that during a typical Giants or Jets game, 50-60 fans are detained because of drunkenness.

"In almost all those cases," Zoffinger told the Bergen Record, "these are people who started drinking a couple of hours before the game, in the parking lots. We're cognizant of that, but (stadium employees) have to make a judgment, and sometimes people are reluctant to do that. But this incident shows just what can happen if people do nothing."

Zoffinger vowed that his organization would get tougher on problem drinkers but warned that there will be "serious resistance" from fans.

Most industry analysts believe that teams, vendors and facility managers do take alcohol-related matters seriously and that enforcement is already good — but it will become even tougher. They also suggest, however, that baby-sitting 75,000 people has its limits.

"Even if you do everything humanly possible," said Abramson, "there are things that are just beyond your control."