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12.17.2003
The Entrepreneurs
BY JENNIFER LEVITZ
Journal Staff Writer
In March 2000, two brothers secured a liquor license from the Town of West Warwick to take over The Station nightclub on Cowesett Avenue.
Jeffrey A. and Michael A. Derderian sought to fit into the nightclub scene by putting themselves and their club in the public eye.
They began advertising aggressively. They went personally to meet the neighbors near the property at 211 Cowesett Ave. They rotated working weekends and oversaw the details of the establishment.
They became the public faces of The Station.
But while they owned the nightclub liquor license, the Derderians didn't own the building.
For almost 30 years, the worn structure with a history of vacancies and disrepair had been owned by a real estate company with holdings throughout Rhode Island and Massachusetts.
Raymond J. Villanova, the founder of the company, Triton Industries (later known as Triton Realty Limited Partnership), drove a Rolls Royce and owned a yacht.
Triton knew about buildings.
As a commercial landlord, the company dealt with tenants, architects, engineers, lawyers, designers, government agencies, and town and city officials.
In the Feb. 20 fire, which started when a band's pyrotechnics ignited the flammable foam tacked by tenants to the walls, the crowd's escape was impeded by the design of the main entrance. While the use of the building had been gradually changed from a restaurant to a nightclub, the entry had not been changed significantly in years.
Although The Station drew hundreds of patrons for rock shows, it maintained a cozy, restaurant-style double entrance. There were no exits in the back part of the building.
State Building Code Commissioner Daniel R. DeDentro has suggested that when the building's use changed from a restaurant to a nightclub in the early 1990s, it should have been subjected to modern state building regulations -- including sprinklers.
After the fire, Triton said it did not know its building in West Warwick had gone from a restaurant to a nightclub.
Four federal civil lawsuits are suggesting that Triton, which collected $4,000 per month in rent from the Derderians, knew or should have known.
THE CORPORATION that owned The Station formed first as Triton Industries in Massachusetts in 1970. The company shared its name with a mythological god who stilled the sea with a conch-shell trumpet.
But Triton's forte was on land.
The original mission was to run family-style restaurants.
There were eight directors, mostly New England businessmen.
The president, treasurer and primary founder of Triton was Raymond J. Villanova, who had graduated from East Providence High School and who had started his restaurant career with one New York System.
Villanova had ties to West Warwick, where his father owned a Burger Chef. In 1974, Triton invested in a building just down the street from that restaurant.
There were fancier towns in which to start a business. The textile mills that lined the Pawtuxet River were closed, and they looked cold and haunted, like old state mental hospitals do when they go vacant.
Triton bought land and property at 211 Cowesett Ave., where Polish immigrants once tended cornfields; by then, the lot held a flat-topped wooden building that had already chewed up and spit out a number of entrepreneurs. Since World War II, a string of entrepreneurs tried to make a go of it there. The dreamers had tried polka music and seafood. One man had tacked up cedar pickets and called the place the Cedar Acres Inn.
Triton renovated, added on, and opened an Italian restaurant, dubbed "P. Brillo's" that sold a pound of pasta for $6. The place was a success.
The company went on to open several restaurants in Massachusetts and Rhode Island. Triton bought two buildings and opened P. Brillo's restaurants in North Attleboro and in Seekonk. The company leased space to run other family-style restaurants, in Warwick and in North Providence, called Gantry's.
Anthony Donfrancesco leased space to Triton for the North Providence Gantry's. He said Triton showed old Three Stooges movies and let patrons toss peanut shells on the floor.
"It was a comfortable family restaurant," Donfrancesco said. "I'd take my kids there . . . Triton was nothing but good."
TRITON KNEW what a safe building looked like. It regularly dealt with town safety officials.
Triton was a topic for the Seekonk Selectmen on May 30, 1979, according to minutes from that meeting. The company had not, a month after the town requested it, placed panic hardware on the metal door in the restaurant's cellar.
"That cellar can hold in excess of 200 people and the only way out is the winding staircase because they don't have a panic bar on the metal door," said one selectman, according to minutes. "They've got a locked door there -- an actual door that is completely locked -- I've seen it with my own eyes. And that's been in effect for quite a while, for months."
Town records from the time do not indicate how the issue was resolved. Triton continued to operate its P. Brillo's.
In Framingham, Mass., Triton worked with the Planning Board and Fire Department.
In the 1980s, the company bought a strip mall on Route 9 in Framingham. Triton was ordered by the town to install fire sprinklers throughout the building. It complied.
In West Warwick, the Fire Department ordered Triton to address a number of violations after a grease fire at P. Brillo's at 211 Cowesett Ave. on Aug. 9, 1981.
West Warwick Battalion Chief Don A. Centracchio's report to Triton was forceful, listing the fire-code violations.
He informed Triton he would be back in a few days to inspect the building again. When he returned on Aug. 13, 1981 to find that the violations had still not been fixed, he wrote:
". . . Exits are obstructed by tables or drapes, front exit is obstructed by vending machines."
". . . At the time of the inspection, emergency lighting did not operate."
"Building lacks fire extinguisher equipment in dining room, bar area, extinguishing equipment in kitchen not tagged to date."
". . . Decorative material not flame resistant. All combustible decorative and acoustical material including curtains, streamers, cloth and cotton batting, straw vines . . . should be rendered and maintained flame resistant.
"Boiler not enclosed."
"Basement lacks fire extinguishers."
" . . . Building lacks alarm device."
Triton eventually fixed the violations at 211 Cowesett Ave.
BY THE mid-'80s, Triton had decided to concentrate mostly on owning and leasing property -- being a landlord -- rather than running restaurants.
In the restaurant business, said Stephen A. Hopkins, a Boston lawyer and one of Triton's limited partners, "you have to do a lot of monitoring, a lot of hand-holding."
In an interview with The Journal in 1985, Villanova said he was concentrating on real estate deals.
It was the building boom of the 1980s.
Villanova said in the interview that he had purchased land on the corner of Warwick's Routes 2 and 117 for $30,000 in 1980; by 1985, it was appraised at $175,000. The land was conveyed from Villanova to Triton, which became the official owner; Triton broke ground on a three-story brick office building that cost $745,000.
"It was like living in a fantasyland," said Donald Watson, a businessman who went in with Villanova on land in Warwick. "You buy something and in no time at all, it's worth a lot more."
Triton invested in a dockominium slip at the East Greenwich Marina, and in the 48-unit Woodhaven condominiums in Cranston.
Villanova and Richard Ahlborg, of O. Ahlborg & Sons Construction, bought commercial property on Route 6 in Seekonk for $400,000 in 1984. The signs posted on the property said a 12-store complex would be built. Triton Industries was listed as a contact.
The strip mall was sold in 1985 for $1 to Bay State Plaza Association. Bay State sold it in 1986 for $1.9 million, according to the Seekonk Tax Assessor's Office.
Triton also owned a building and the P. Brillo's restaurant across the street. Triton would lease that to a Bugaboo Creek restaurant.
Triton Industries liquidated in 1986.
Villanova and his partners formed a new company called Triton Realty Limited Partnership. Eight partners pledged capital totaling $2.8 million to the company, according to records filed with the Rhode Island secretary of state.
Villanova was both a general partner and limited partner. According to the Rhode Island secretary of state, the other limited partners included: Melvin Fox, a Worcester, Mass. restaurateur; Hopkins, the Boston lawyer; Roger W. Redfield, a Marblehead, Mass., insurance agent; and several other New England businessman including Harry M. Andrews, of Beverly Farms, Mass. and Karl J. Hirshman, of Wayland, Mass., and Bernard Stone and Sidney L. Sloane, both of Worcester, Mass.
Triton Realty continued its ascent in the 1990s and was sought after to be involved in the lucrative Route 2 market surrounding the Warwick malls.
By 1996, Triton and a part owner of Inskip, a luxury car dealership, were discussing a plan to jointly purchase 12 acres that abutted both their properties on Route 2.
The joint purchase was never made and Villanova eventually sold the property to N.K. Realty LLC for $1.8 million.
The thinking, Villanova explained in a statement given in a civil lawsuit, was that one large parcel that fronted Route 2 would "realize substantially greater development values." In the statement, Villanova explained his expertise in investments in commercial property.
In describing the transaction at the center of the lawsuit, Villanova said that he had been willing to put up approximately $500,000. "I would put the capital in and take a note back and pay myself back in the future."
In the same deposition, Villanova described Triton's responsibilities as a commercial landlord: "We locate properties for development; we deal with potential tenants; I deal with architects, engineers, lawyers, designers, town and city officials, government agencies, federal and state."
He said he was disabled, and that his activities in Triton Realty Limited Partnership, included minor administrative duties such as correspondence and interaction with other limited partners.
BY 1997, Triton was focusing on the finances of its Cowesett Avenue property in West Warwick, about a mile and a half away from the Route 2 property.
That year, Triton appealed to the town to lower the property taxes on the building, arguing that the $268,400 assessment was too high.
In his written appeal, Villanova said his opinion was that the fair market value of 211 Cowesett was much less, $157,223.
The town denied his request to lower the taxes.
Triton said the property had a history of long-term vacancies, and that the current tenants were behind in their rent. In the written appeal, Villanova wrote that "repairs are needed but tenant cannot make."
The building was in poor shape, according to a West Warwick contractor who said he was hired twice in the '90s to do small repairs there.
James Masterson, a licensed contractor, said he did work at 211 Cowesett Ave. twice. Once, he looked over the building for a man who was thinking of buying it.
"I advised him not to. The whole building was shot," Masterson recalled. "Poor quality, electrical system was rigged, basement had water in it, a lot of things didn't meet code. The whole building was a total nightmare in my opinion."
Masterson said he was hired once more, by Howard J. Julian, a musician and businessman, who had been leasing the building at 211 Cowesett Ave. from Triton since 1995. Julian was paying $3,300 in rent each month, to run "The Filling Station."
Masterson said Julian hired him to do minor repairs, such as removing a wall in the kitchen. He also asked Masterson to change a lightbulb on the ceiling of the bar. Masterson climbed up to the rafters. He found that the rafters were still black from a fire years earlier.
"All the rafters are charcoaled," he recalled. "I put my hand on it, it was black."
Masterson sued Julian, claiming that he slipped in the building and cut his ear. That lawsuit is continuing.
Masterson said club workers and bartenders did most of the repairs at the building.
Paul M. Vanner, a sound man who worked at Triton's building for several years until The Station fire, recalled it the same way. He said that once, when the roof was leaking, two employees crawled across the top of the building to fix the holes.
"It was always kind of patch, patch, patch," he said.
The need for repairs didn't hamper business at the building.
Julian brought in bands such as Quiet Riot, which had played at the Providence Civic Center in the '80s.
Triton's property was no longer a restaurant; it was a full-fledged nightclub.
By 1999, the Filling Station was billing itself as "Rhode Island's Number One Party Club."
The police were coming by in the middle of the night to count the patrons and measure the sound with a decibel reader. Julian was ordered to hire off-duty officers to keep order.
West Warwick's minimum housing officer sent Triton a certified letter to say the company was in violation of the law because work was being done on the property without a building permit.
The town's fire inspector wrote to Triton in December 1999:
"A complaint was received in this office concerning The Filling Station at 211 Cowesett Ave. in West Warwick. Therefore, it is mandatory that an inspection be conducted."
Town records from the time do not indicate how the issue was resolved. The business continued to operate. Julian changed the name to "The Station," and as 2000 approached, the club promoted the "Station Millennium Blowout."
Triton's lawyer, Daniel P. McKiernan, says the company was unaware that the building had become a nightclub.
Triton believed, said McKiernan, that "there was food and maybe some light entertainment from time to time."
He noted that neither the tenants, nor the town, ever changed the use permitted in the liquor license, a Class B restaurant license.
Triton had no reason to believe its property wasn't being properly supervised by West Warwick and that the tenants weren't complying with the fire codes and occupancy requirements, he said.
West Warwick fire inspectors visited Triton's building at least once each year, McKiernan noted.
"We did not possess any specialized knowledge that the fire inspector doesn't have," McKiernan said. "All we know is that it passed inspection."
The town inspectors were aware of the restaurant-style layout, he said.
The "basic layout of the building has not been changed substantially, and has been well known to various inspectors for many, many years," he said.
McKiernan noted that Rhode Island law treats commercial leases differently than residential leases. He said the landlord has limited discretion in telling the tenant what he can do in the property.
He said the lease between the Derderians and Triton required the tenants to maintain the property. He and another Triton lawyer, James T. Murphy, declined to make public the lease, citing the litigation involving the fire.
Dale Thompson, visiting assistant professor of law at the Ralph R. Papitto School of Law at Roger Williams University in Bristol, said judges have said that commercial tenants have the duty to do "normal" repairs on property. "Substantial repairs, that's different," he said.
When substantial repairs are needed, and the damage has not been caused by a tenant, that can "trip into another area," Thompson said.
The four federal civil lawsuits against Triton allege that the company knew or should have known that The Station "contained defects in construction," and that Triton "failed to comply with reasonable safety standards with knowledge that the public assembled on said property."
Thompson said such claims of responsibility are a "little trickier" than reading a lease to see who was supposed to do what. The claims that Triton should have known its building was unsafe will likely fall under traditional accident laws, he said, rather than simply landlord-tenant laws.
"Do I have responsibility -- that will be a key issue," he said. "Would the landlord have a duty to the general public to guard over how the property was being used? If they have that duty, did they take reasonable steps?"
IN MARCH 2000, Julian transferred his liquor license to new tenants, Jeff and Michael Derderian, a newsman and a businessman.
Michael had sold insurance -- life, health and accident -- in his own firm, and had gone on to sell stocks. He started an airplane leasing company. He owned a Cessna, drove a BMW, and gave his wife a Mercedes for her birthday.
Jeff Derderian started his career at Rhode Island College, where he was news director for the campus radio station. By the 1990s, he was working for WLNE-Channel 6 in Providence, where he was best known for "You Paid For It," a segment that exposed the waste of tax dollars.
His hard work took him to WHDH-TV in Boston, where he covered major tragedies, such as the Columbine High School massacre.
Like Ray Villanova and the principals of Triton, the Derderians were entrepreneurs; when the chance to own a nightclub came up, they took it.
"The opportunity just sort of presented itself," said Kathleen M. Hagerty, lawyer for Michael Derderdian. "I don't think it was a lifelong dream or anything."
The Derderian brothers kept their other jobs, but they formed a corporation, Derco LLC, and took over The Station's liquor license from Howard Julian.
But first, a number of repairs had to be made to Triton's building, per order of West Warwick's fire marshal.
The inspection for the transfer said the stage exit was blocked, and that two exits lacked panic hardware. The basement needed to be cleaned out, the stove covered, and the bathroom corridor illuminated with emergency lighting.
The transfer was approved, indicating the repairs were made. The Derderians took over, leasing the building from Triton Realty.
The rent eventually increased to $4,000 per month.
With staff reports from Zachary R. Mider and W. Zachary Malinowski
TOMORROW: The Fire Marshal
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