Postville to pay landlord $450,000

Des Moines Register

The city of Postville settled two discrimination lawsuits last week by agreeing to pay a Jewish landlord $450,000 and host a community workshop on diversity issues.

The landlord, in return, dropped the lawsuits and waived his right to pursue any further legal action against the city or its officials.

Gabay G. Menahem, 38, filed complaints last year in state and federal courts against the city, the city clerk and two council members.

Menahem accused council members Virginia Medberry and Jeff Reinhardt of making bigoted statements against the town’s Jewish population, and discouraging people from renting Menahem’s properties.

City Clerk Darcy Radloff allegedly ran up thousands of dollars in debt in Menahem’s company, GAL Investments Ltd., by refusing to disconnect water from tenants behind on their bills. She then refused to credit his properties when payments were made, the lawsuit said.

David Goldman, a Des Moines attorney who represented Menahem, said the case is more significant than most religious discrimination allegations, which are usually limited and accuse an employer of not hiring or mistreating someone.

“What’s unusual about this is the city itself is embroiled, not just an individual,” he said. “What were they thinking?”

City attorney Anne Loomis said the agreement settled a contested claim, and was not an admission of guilt by the city or its officials.

Menahem said he settled the lawsuits because taking them to trial would have been a lengthy and expensive process.

He is disappointed that city officials faced no consequences because of the alleged discrimination, he said.

“Nothing was done. They committed to some things, they paid some money out, and everybody’s in the same position. Nobody was disciplined. Nobody resigned,” he said.

The federal lawsuit alleged Radloff and others made it their mission to “run GAL Investments into the ground if that’s the last thing I ever do.”

City officials allegedly said “we wish the Jews had never come here,” and “I wish the Jews would leave Postville.”

The lawsuit also claimed Medberry publicly called Menahem a “shyster.”

Menahem said he also doubted his ability to receive a fair trial in Iowa because of his orthodox Jewish faith. The Chabad-Lubavitch movement is a devout arm of Orthodox Judaism known for reaching out to secular Jews and trying to bring them back to the faith.

The 27-year sentence Sholom Rubashkin, a former executive of the Agriprocessors kosher meatpacking plant, received following a 2009 conviction on federal fraud charges led him to question the impartiality of the courts, he said.

Rubashkin, also a Chabad-Lubavitch Jew, was found not guilty last year of 67 misdemeanor child labor charges in state court.

Goldman, Menahem’s attorney, said a 2008 immigration raid on Agriprocessors that led to the charges against Rubashkin likely contributed to the alleged discrimination against his client.

He said Agriprocessors’ rapid growth created an economic boom in the city, while the raid abruptly destroyed those gains.

“That’s hard on any society, and it doesn’t always bring out the best in everybody,” he said.

Menahem used to operate the second-largest real estate company in Postville, a town of 2,227 in northeast Iowa.

He owned about 130 properties in Postville, before banks foreclosed on them and a 6,000-square-foot house he had built for his family, Menahem said. He now runs a similar real estate business in Miami Beach, Fla. A native of Israel, he and his wife have three children.

The settlement money allowed him to repay debts he accumulated after city officials escalated their efforts to run him out of town following the immigration raid, he said. “I’m clean right now and that’s the main thing. It is a fresh start,” Menahem said.