July 6, 2010 Wal-Mart Fighting $7,000 Fine in Trampling Case By STEVEN GREENHOUSE NY Times
http://www.nytimes.com/2010/07/07/business/07walmart.html?ref=business&pagewanted=print Wal-Mart Stores has spent a year and more than a million dollars in legal fees battling a $7,000 fine that federal safety officials assessed after shoppers trampled a Wal-Mart employee to death at a store on Long Island on the day after Thanksgiving in 2008. The mystery, federal officials say, is why Wal-Mart is fighting so hard against such a modest fine. It is not as if Wal-Mart has not already taken action to address any missteps and prevent another such accident. Three weeks before the federal Occupational Safety and Health Administration ordered the fine, Wal-Mart, seeking to avoid criminal charges, reached a settlement with the Nassau County, N.Y., district attorney that called for the company to adopt new crowd management techniques in all 92 of its stores in New York State. At the time, Wal-Mart also agreed to create a $400,000 fund for customers injured in the stampede and to donate $1.5 million to various community programs in Nassau County. More recently, the company announced improved crowd-control policies for all its United States stores to try to prevent such an accident from happening again. But in fighting the federal fine, Wal-Mart is arguing that the government is improperly trying to define “crowd trampling” as an occupational hazard that retailers must take action to prevent. Wal-Mart’s all-out battle against the relatively minor penalty has mystified and even angered some federal officials. In contesting the penalty, Wal-Mart has filed 20 motions and responses totaling nearly 400 pages and has spent at least $2 million on legal fees, according to OSHA’s calculations. The dispute has become so heated — and Wal-Mart’s defense so vigorous — that officials at OSHA, an arm of the Labor Department, complain that they have had to devote huge numbers of staff time to the case, including 4,725 hours of work by employees in the legal office. The company has made so many demands that Labor Department officials said they would not discuss the case except on condition of anonymity because they feared being subpoenaed about their discussions with a reporter. On Wednesday, the dispute will reach a climax of sorts: Wal-Mart’s lawyers are scheduled to contest the fine before a federal appeals commission. OSHA levied the $7,000 fine in response to the death of Jdimytai Damour, a 34-year-old temporary employee, who died from asphyxiation when a stampede of post-Thanksgiving shoppers at a Wal-Mart store in Valley Stream, N.Y., busted through the doors and trampled him just before the store’s 5 a.m. scheduled opening. The crowd, estimated at 2,000 people, had been lined up for hours near a handwritten sign that said “Blitz Line Starts Here.” In May 2009, OSHA accused Wal-Mart of failing to provide a place of employment that was “free from recognized hazards.” Specifically, the agency said the company violated its “general duty” to employees by failing to take adequate steps to protect them from a situation that was “likely to cause death or serious physical harm” because of “crowd surge or crowd trampling.” Wal-Mart, the world’s largest retailer, says that regulators are trying to enforce a vague standard of protection when there was no previous OSHA or retail industry guidance on how to prevent what it views as an “unforeseeable incident.” “OSHA wants to hold Wal-Mart accountable for a standard that was neither proposed nor issued at the time of the incident,” said David Tovar, a Wal-Mart spokesman. “The citation has far-reaching implications for the retail industry that could subject retailers to unfairly harsh penalties and restrictions on future sales promotions.” Saying the company remains saddened by Mr. Damour’s death, Mr. Tovar added, “We have never had a tragedy like that in our stores, and we never want it to happen again. We are committed to learning from the incident and making our stores even safer for our customers and our associates. And we have done so.” OSHA officials acknowledge that the agency is seeking to establish for the first time that an unruly crowd is an occupational hazard that can cause death or serious injury — and that employers must therefore develop plans to protect workers against such a hazard. But federal officials say that in its settlement with Nassau County prosecutors, Wal-Mart had in effect already admitted that it had that responsibility and agreed to three years of monitoring. So OSHA officials question why the retailer is putting up such a fight. OSHA officials also note that the National Retail Federation issued detailed new guidelines last fall called, “Effective Crowd Management: Guidelines on how to maintain the safety and security of your customers, employees and store.” In its settlement with Nassau County prosecutors, Wal-Mart did not admit any wrongdoing. “They don’t want to take responsibility realistically for what they did,” said Kenneth M. Mollins, a lawyer who represented an injured Valley Stream customer who sued Wal-Mart. “They paid all the money to settle with the district attorney to prevent a potential indictment.” Wal-Mart officials worry that if the OSHA Review Commission upholds the $7,000 penalty and concludes that surging crowds are an occupational hazard, then OSHA will then be free to look over Wal-Mart’s shoulder whenever it has a big sale to make sure that it has taken adequate steps to control crowds. The company is also concerned that it could face far larger fines if OSHA ever concluded that it again violated its crowd-control responsibilities. Under OSHA rules, $7,000 is the maximum fine for a serious violation, but it can impose a $70,000 fine for a willful violation. Labor Department officials complain that over the last five months 17 percent of the available attorney hours in the department’s New York office have been devoted to the case, consuming the equivalent of five full-time lawyers. OSHA officials say they have rarely seen a company mount such a huge and expensive defense to a fine of less than $10,000. Wal-Mart has filed motions that sought to block the penalty by claiming inconsistent enforcement by OSHA and by questioning the constitutionality of using the “general duty” clause in this case. Wal-Mart also sought to subpoena witnesses to explore the exact cause of Mr. Damour’s death when OSHA said the main issue was the unmanageable crowd. -- ================================ George Antunes, Political Science Dept University of Houston; Houston, TX 77204 Voice: 713-743-3923 Fax: 713-743-3927 Mail: antunes at uh dot edu _______________________________________________ Medianews mailing list Medianews@etskywarn.net http://lists.etskywarn.net/mailman/listinfo/medianews
