hotel

properties nationwide in about 20 to 25 states, although to a

more limited and lesser extent than it wished in the northeastern

region of the country.

     b.   Allen Ostroff

     In about 1976, Allen Ostroff became a Prudential real estate

department employee and served as Prudential’s in-house

consultant on hotels and hotel operations.   Prior to joining
                               -134-

Prudential, Ostroff had worked for a number of years for Hilton

Hotels as a hotel manager and executive.     Ballard was

instrumental in Prudential’s hiring of Ostroff, as Ballard had

concluded that Prudential’s real estateright to use the Hilton

name as well as the services of the Hilton national hotel

reservation system.    The hotel owner then could have its Hilton-

franchised hotel managed and operated under a short-term

management contract with either Hilton Hotels (the franchisor) or

another hotel management company.65

     d.     The Gateway Hilton and John Connolly

     Beginning in 1976, one of Ostroff’s first assignments at

Prudential was to improve the operating condition of the Gateway,

a hotel at Newark, New Jersey.    The Gateway was located a few

blocks from Prudential’s corporate headquarters.    The hotel was

shabby, as Prudential had recently acquired it through

foreclosure.    Moreover, the class or type of customers that prior

operators of the hotel