In 1996, a recruiter for Texaco called Baskin to see if Mamo would be interested in becoming a distributor. The oil company had just settled a lawsuit by African-American executives over racial discrimination. “They needed a lot of heat taken off of them. Joe was the best known minority operator at the time,” says Baskin, who negotiated the deal that made Mamo the company’s first African-American distributor—a big break in an insular industry.
Being able to capitalize on the evolving needs of big companies—and to occasionally use public relations pressure to help them see things your way—proved to be a useful skill.
A couple years later, the Federal Trade Commission ordered Exxon and Mobil to sell some of their stations as part of a merger. The order put several D.C.-area properties into play. Mamo lobbied aggressively for the right to make a bid. But executives rebuffed his overtures. When the stations were sold to another distributor, one of Mamo’s companies, DAG Enterprises, Inc., sued, alleging racial discrimination.
Trial lawyer Willie Gary, famous in legal circles for civil rights litigation, argued the case, which dragged on for about a decade. Mamo also called in Ray and his team of lobbyists at D.C.’s Manatt, Phelps & Phillips, who labored so energetically on Mamo’s behalf that lawyers for Exxon complained in a March 2001 court filing: “DAG simultaneously aggressively pursued a lobbying campaign with Congress, the White House, and the Department of Commerce to influence the [Federal Trade Commission] divestiture decision.”
Jackson’s Rainbow PUSH Coalition had led the public condemnations of ExxonMobil for unfairly shutting out a minority business. Jackson’s group had also picketed in front of BP stations after Mamo sued that other oil giant in 2005 also alleging racial discrimination in the selloff of area stations.
As it happened, Mamo and his family members contributed $30,000 to Jackson’s Keep Hope Alive Political Action Fund in 2006 and 2007. Mamo says there was no quid pro quo. Rather, he says, Jackson’s organization was in a cash crunch and had put out a fundraising call, similar to ones he has always answered from civil rights groups. “We’ve been supporting Jackson for the past 10 years,” Mamo says. “To me, it’s my obligation to contribute to African-American organizations.” Jackson did not respond to requests for an interview.
Mamo lost the BP fight when the U.S. Court of Appeals for the 4th Circuit dismissed the suit in 2008. But a decade after Mamo’s suit against Exxon, the now-merged firm’s relations with him have changed dramatically.
In 2007, when ExxonMobil embarked on plans to sell its remaining Washington-area stations, the firm’s director of U.S. retail sales, Ben Soraci, requested a meeting. It could have been awkward since Mamo’s discrimination suit was in its eighth year. But Mamo and Soraci, who had spent time in Ethiopia while overseeing the company’s East Africa operations, hit it off immediately over a meal at Zed’s, an Ethiopian restaurant in Georgetown.
“We broke bread as we joked and got to know each other on common ground,” Soraci recalls.
Citing a confidentiality agreement, neither Mamo nor Soraci would discuss the details of the settlement that ended the lawsuit. But news that the case had been resolved broke on the same day in June 2009 that the oil giant announced it was selling its 30 remaining Washington stations to Mamo. Today, he owns about 200 Exxons and 40 Shells. All are in the greater Washington area, except 71 stations he purchased last fall in the outer boroughs of New York City.
Since that first meeting, Soraci says the Capitol Petroleum chief has repeatedly impressed him with his knowledge of the industry and even such minutia as his stations’ mystery shopper scores—the grades stations receive from company agents sent out anonymously rank station cleanliness and customer service.
“He knows his scores and he’s very proud of having the highest scores even in the worst, most challenging parts of the market,” Soraci says.
For most drivers, gas is gas, and one gas station is little different from another. But there’s one population that’s been distressed by Mamo’s quiet acquisitions: D.C.’s old-line, ma-and-pa gas station operators.
As a few increasingly large jobbers have bought up the country’s gas stations, dealers have been finding their new landlord is also their principal supplier—a situation, many of them say, that puts them at a competitive disadvantage. Several D.C. dealers banded together and took Mamo and ExxonMobil to court in 2009, charging unfair business practices. They say, among other things, that he has raised rents and the cost of gas, forcing them to up their prices, which has driven away customers.
Wholesale prices are set and publicly posted at terminals in Baltimore and Northern Virginia by the big oil companies. But dealers also pay for delivery. And they can’t usually shop around, since their station leases lock them into multi-year supply contracts.