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Drug deal goes sour for Warren County

Tar Heel Tattler – january 2004

Drug deal goes sour for Warren County
By Kathy Brown

Four and a half years ago, Warren County commissioners thought they had been given the perfect prescription for a sick economy. But a proposed CVS Corp. distribution center proved bad medicine for the state’s second-poorest county.

Woonsocket, R.I.-based CVS — with 4,100 stores, one of the nation’s largest pharmacy chains — said in June 1999 that it would build a $60 million distribution center near Interstate 85 and the Virginia border. It would bring 600 jobs with salaries averaging $26,000 a year, a big prize for a county with a 1999 per capita income of $15,556 — 61% of the state average. The county wasted no time spending $600,000 to buy 100 acres, which it planned to lease to CVS.

Trouble is, the project never happened. The following spring, CVS decided to expand an existing distribution center in neighboring Vance County. Warren County sued CVS, claiming breach of contract and failure to deal fairly and in good faith, in an attempt to recoup the $600,000. The case caught the eyes of industrial recruiters across the state.

But after fighting nearly three years, the county didn’t have much to show. It had been clobbered in court and had spent more in legal fees — $700,000 — than it did for the property. “It’s time to let this thing die,” County Commissioner Janet Humphries says. “I think the general consensus around the community is that it’s time to let the issue go.” Commissioner Luke Lucas, a lawyer, agrees. “There is not one significant legal grounding for this lawsuit,” says Lucas, who like Humphries was elected in 2002, the year after the suit was filed.

Other commissioners were reluctant to give up and wanted to appeal decisions by Superior Court Judge John R. Jolly. He ruled in August that the county did not have enough proof to proceed on the breach-of-contract claim but that a jury should decide whether CVS had dealt in good faith. But in October he ruled that the entire suit was groundless and “futile.” He declared CVS the winner on all claims.

Jolly’s latest ruling — for which he gave no explanation — left commissioners quarreling over what to do next. After a 6 1/2-hour session in early December, they voted 3-2 not to appeal. Humphries, for one, is relieved yet bitter over the time and money the county has spent.

“I think it has scared off some other companies from locating here,” she says. “Instead of trying to sell the land to someone else, we said, ‘We’re stuck with it, and we want our money back.’ We tried to shove it down the throat of CVS. That’s not the best decision from a business perspective.”

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