The business partners behind City Hall Plaza’s popular Boston Winter festivities appear to be headed toward a messy divorce — with fallout that could cast a cloud over enduring attempts to remake the Government Center expanse.
The company that manages the seasonal festivities — Boston Garden Development Corp. — has filed a Superior Court lawsuit terminating its three-year-contract with Millennial Entertainment, a subcontractor that runs the vending booths and concessions, one of the main draws to the festivities.
Millennial executives, meanwhile, sent a letter to city officials Wednesday, saying they are terminating their involvement on their own, citing what they called “repeated breaches . . . bad faith, misrepresentation, blackmailing, and discrimination’’ by Boston Garden Development, a subsidiary of Delaware North, which owns and operates TD Garden.
In its letter, Millennial blasted city officials for failing to recognize their concerns with the management of Boston Winter, saying the city failed “small business . . . like us.’’ The group called for an independent investigation into the operations of Boston Winter and for the city to notify the state attorney general of its findings.
City officials pointed out that the administration’s contract is with Delaware North, which they said is meeting its obligations.
Millennial said Delaware North’s alleged contract breaches have “directly caused us and 110 participating vendors significant losses, and affected our livelihoods.’’ The group said nearly half of the vendors reported this year that they had lost money or barely broke even, and vendors have grumbled quietly about the setup of this year’s event, though it was not immediately clear which business organization was responsible for the setup.
The Millennial letter did not specify any grievances or provide documentation of discrimination, but executives said “we have overwhelming evidence of [the manager’s] misguided actions.’’
Meanwhile, Delaware North alleged in its suit that it is still owed $235,000 from the first year of the agreement in 2016, after paying hundreds of thousands of dollars in advance payments, and that Millennial officials have repeatedly attempted to amend the agreement while not meeting their obligations.
Representatives of Millennial said they had not been served Boston Garden’s lawsuit as of Thursday evening.
Boston Winter is managed by Delaware North under a three-year contract with the city to coordinate the seasonal festival and other events on City Hall Plaza — part of a strategy to enliven what for years had been considered a windswept brick desert of inactivity. The contract currently runs through the 2018-2019 winter.
Delaware North, which also operates a skating loop on the plaza, subcontracts the operation of the holiday market and shopping booths to Millennial. Delaware North also holds events on the plaza during warmer weather, such as beer tents and exercise lessons.
Tricia McCorkle, a spokeswoman for Boston Garden Development, said in a statement that the deal with Millennial was terminated “due to multiple breaches of contract and unfilled financial obligations.’’
She added that “we remain committed to our programming and obligations moving forward on City Hall Plaza.’’
But in the letter to Greg Rooney, the city’s property manager, Millennial executives said Delaware North has “adopted the unethical habit of taking full credit for the event.’’
Millennial’s cofounders, Lena Romanova and Johan Rizki, also lashed out at city officials, saying they have not responded to their repeated concerns. They contended that they have written more than 25 e-mails and letters to the city denouncing Delaware North’s business conduct since November 2016, “to no avail.’’ The Globe requested those e-mails Thursday, though they were not immediately available.
City officials confirmed they have received a letter from Millennial, though they noted that Delaware North, through Boston Garden Development Corp., was the vendor selected in 2016 “to enhance and activate City Hall Plaza,’’ and that any subcontracted work is that company’s responsibility. The city said all contract obligations to the city have been satisfied.
“The City of Boston values the work of the Boston Garden Development Corporation, city employees, subcontractors, vendors, public safety officials, and many others that allow for Boston Winter to bring new life to City Hall Plaza,’’ spokeswoman Nicole Caravella said in a prepared statement. “We look forward to continuing our work with our partners to ensure the success of the plaza for all to enjoy for years to come.’’
In a statement to the Globe last month, TD Garden officials said they were pleased with the operations of Boston Winter. The festival, which ran from the day after Thanksgiving to Dec. 31, surpassed last year’s turnout, with an expected 50 percent increase in the number of skaters. By Dec. 31, more than 500,000 people were expected to attend Boston Winter, they said, though Millennial officials questioned those figures, saying that total attendance was below 200,000.
The numbers did not represent a measurement of sales for any of the vendors, and many tickets to the ice skating rinks had been free handouts from local businesses and nonprofit groups, according to TD Garden representatives.
In the first year of the contract, TD Garden reported $1.2 million in operating losses, which it attributed in large part to first-time setup and planning expenses. The city gained, nonetheless: It was paid a $175,000 host fee, determined by a prearranged cut of sales and advertisements, such as naming rights for the event sponsor, Berkshire Bank.
Recently, several vendors grumbled in interviews with the Globe about the setup of the event, specifically the direction of pedestrian traffic and the location of the beer-and-wine tent that seemed to isolate some of their shops. Several concession stands were closed. And December’s frigid temperatures did not help either, leaving some vendors to wonder whether the cost of setting up business was worth it.
“We’ll see how the last weekend goes,’’ one vendor, who sold wool clothes, said just before Christmas, before the village closed. She asked for anonymity, so that she would not jeopardize her business.
She said the concept of Boston Winter was a “good idea’’ but questioned the costs of business. “I’ll have to do my calculations,’’ she said.
Milton J. Valencia can be reached at milton.valencia @globe.com.