The Multinational Monitor


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Trying Harder -- At Racism?

The owner of five Avis franchises in the Carolinas instructed his employees over a period of years not to rent vehicles to African-Americans, a lawsuit filed in November alleged.

The class action lawsuit was filed by the Washington Committee for Civil Rights on behalf of hundreds of African-Americans that were affected by the policies. The group accused the franchise owner of "a vicious, offensive pattern of discrimination over the last 10 years."

The lawsuit claimed John Dalton, owner of five franchises in North and South Carolina, instructed employees to find reasons not to rent vehicles to blacks and that Avis executives were aware of the practice and did nothing to stop it.

A former station manager at the Wilmington Avis franchise, Kenneth Ross Jessup, said that Dalton told him that he classified potential customers by the color of their skin. "He told his employees to make it more difficult for black individuals who did not appear wealthy or have corporate sponsorship to rent cars than similarly situated white individuals," Jessup said in an affidavit.

"He told his employees to look for reasons to deny rentals to black customers,"Jessup said in the affidavit. "If a black customer expressed an intention to drive a long distance in a short amount of time, he instructed his employees to deny the rental on safety grounds. Black individuals were required to have more credit available on their credit card than similarly situated white individuals."

Avis issued a statement expressing concern about the allegations, saying the company "does not tolerate discriminatory practices of any kind."

"As a franchisor, Avis Inc. is not responsible for any discriminatory practices that may have been carried out by a franchisee or his/her employees," the statement said.

California Shakedown

A coalition of Silicon Valley executives engaged in a last minute shakedown of corporate law firms in an effort to defeat California Proposition 211, a citizen initiative which would have lowered the threshold of proof needed by investors victimized by fraud, thus increasing the liability exposure of executives, accountants, lawyers and stockbrokers engaged in fraudulent transactions.

Prop 211 also would have prohibited companies from insure officers and directors against a fraud suit, a provision that drove corporate executives up the wall and to their checkbooks.

In an October 23 memo to big corporate law firms in California, the executives commend a number of law firms -- including Baker & McKenzie and Gibson, Dunn & Crutcher -- for taking public action against Prop 211. The memo went on to urge those law firms that had yet to take a public stand to do so.

"Following the election, whether 211 wins or loses, the members of our respective organizations will remember which law firms took a leadership role in this important fight," wrote Duane Roth, president of Biocom, and James DeLapa, president of the Software Industry Council, and other executives in their letter to law firms. "Our members may very well consider a law firm's position on 211 when making a determination on the retention of legal services, although that decision is obviously an individual one."

California voters rejected the initiative by an overwhelming 74 to 26 percent margin.

"The wealthy special interests opposing Prop 211 spent $41 million waging the most expensive and misleading initiative campaign in California history to confuse and scare voters," says Lois Wellington of the Congress of California Seniors.

Prop 211 supporters, primarily trial lawyers, raised and spent an estimated $8 million.

In addition to the high-tech firms, Prop 211 opponents included the big six accounting firms, insurance companies, and huge Wall Street brokerage houses that spent tens of millions of dollars successfully lobbying Congress to severely limit federal laws against fraud.

Peddling Arms

The top 25 U.S. arms exporters gave more than $6.5 million in political action committee (PAC) contributions and "soft money" donations during the 1995-1996 election cycle, according to a recent report from the New York City-based World Policy Institute.

More than 23 percent -- $1.6 million in all -- was contributed by just one company -- Lockheed Martin, the Pentagon's top contractor, the nation's top weapons exporting firm and a recipient of merger subsidies from the Pentagon.

The World Policy Institute report, "Peddling Arms, Peddling Influence: Exposing the Arms Export Lobby," found that arms exporting firms have dramatically accelerated their soft money contributions, which rose 46 percent from the 1993-1994 cycle to the most recent one.

"The 104th Congress was a gold mine for weapons exporting companies, so the arms industry lobby is spending at near record levels to keep current incumbents in office," says William Hartung, a senior fellow at the World Policy Institute. "At a time when many domestic programs are on the chopping block, government subsidies for arms exporting corporations actually increased by 8.5 percent, from $7 billion in 1994 to $7.6 billion in 1995. And for the past two years running, Congress has approved billions more in weapons spending than the Pentagon even asked for."

-- Russell Mokhiber

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