Robert's Market Report

Rick's Steaks Exits Market Oct. 31

Rick Olivieri has until Oct. 31 -- Halloween -- to serve cheese steaks at the Reading Terminal Market.

Under the terms of a settlement announced in court before trial was to begin this morning, Olivieri will avoid being on the hook for nearly $700,000 in the RTM's legal fees if he vacates the market peaceably. (Olivieri's own legal fees are understood to be in the six-figure range, also.) The settlement also frees him from nearly $27,000 in rent penalty fees he held back.

The sole issue that would have come to trial if the settlement had not been reached was Olivieri's claim for restitution for improvements to the Rick's Steaks stand in anticipation of his lease being renewed. Under the settlement, Olivieri receives $1,500 for those improvements without any admission of guilt by the market.

Throughout the morning in Judge Mark I. Bernstein's courtroom, Olivieri appeared confident and smiling, with his family by his side and more than a half-dozen fellow merchants seated behind him. In speaking with reporters after the settlement was announced in open court, however, he needed to take several brief breaks to compose himself.

Olivieri said he considered market management's actions toward him "despicable," repeating his charge that he was singled out because he had aggressively represented merchants as president of their association during lease negotiations. RTM spokesman Kevin Feeley denied those charges, saying Olivieri had sought lease terms for his own business that were different than those he negotiated for other merchants.

Olivieri became most emotional when speaking of his five full-time and four part-time employees. "I've got employees who've been with me for 20 years. It's like a family," he said.

The cheese steak scion is looking at potential locations for when he leaves the market, but admits "you'll never find a location like the market. But I've got a good customer base, and people will seek me out." He also will continue his license agreement for the Rick's Steak stall operated by Aramark at Citizens Bank Park, at least through the end of this season.

When asked why RTM agreed to the settlement, Feeley, the market's spokesman, said management "wanted to do this as humanley as possible. The judge was ready to evict him today." He added that as part of the lease, tenants are responsible for legal fees the market faces when tenants sue them over lease and related issues. Of the nearly $700,000 in the market's legal fees, about $250,000 were for the market's suit against Olivieri seeking his eviction, and $445,000 for the market's defense of Olivieri's suit against the market.

Feeley and RTM Board Chairman Ricardo Dunston made a point of stating that the legal fees incurred by the market will have no impact on the rents charged to merchants or market capital improvement programs. Those fees which are not reimbursed by the market's insurers would come from the non-profit corporation's contingency reserves, they said.

As for who will be a new cheese steak vendor at the market (Spataro's in center court also serves cheese steaks), Feeley said that since the market now knows it will have the Rick's Steaks space available after Oct. 31, it can seek a new tenant. He noted that all discussions with Tony Luke's ended when Olivieri filed suit last July, and that Luke had said he would not entertain opening in the RTM until Oliveiri's dispute was resolved.

Dunston and Feeley emphasized that the market's by-laws preclude any leases to franchises.