WINN-DIXIE WILL PAY $33 MILLION TO SETTLE SUIT

DAVID GHITELMAN

JACKSONVILLE, Fla. -- Winn-Dixie Stores here said it had agreed to a $33 million settlement in a discrimination class-action lawsuit filed by 13 present and former employees on behalf of female and African-American workers.

The suit was filed in U.S. District Court here the same day the settlement was announced. The settlement could apply to more than 50,000 African-Americans and women who worked for the chain since June 1993, according to the company.

Legal experts told SN last week they expected class-action discrimination suits would continue to plague the supermarket industry, even though many larger companies have created programs to educate managers and other employees about discrimination and to advance more women and minorities into management positions.

A lawyer who has defended several supermarket companies against discrimination suits, Donna Sandoval, partner of Bullivant Houser Bailey, Portland, Ore., told SN the industry could expect to see more suits in the future. "I think there is a growing amount of litigation," she said.

Having training programs in place is not enough, she added. "You can train a manager or supervisor all you want. The moment he commits some indiscretion, you can be sued. Managers need to learn they are never, never, never off the record."

Other supermarkets companies that have settled discrimination cases for multimillion-dollar sums are Lucky Stores, Dublin, Calif,, which agreed to a $107.25 million settlement in 1993; Albertson's, Boise, Idaho, which settled for $29.5 million in 1994, and Publix Super Markets, Lakeland, Fla., settled for $81.5 million in 1997. All these companies were sued for discriminating against female employees.

Publix is also the focus of a pending discrimination suit. The complaint, filed in April 1997, said the company denied African-American retail employees promotions and transfers because of their race.

Winn Dixie said the $33 million would be distributed over the next seven years. The agreement specified it would be spent as follows:

Thirteen million dollars to pay present and former employees who file verified discrimination claims.

Eleven million dollars as incentive bonuses to African-Americans and women who advance into and perform successfully in management jobs where they are currently under-represented. Part of this money for discrimination claims and incentive bonuses will be paid as discount or cash cards that can be used for purchases at Winn-Dixie.

Four million dollars for extra training and administrative expenses to implement the settlement.

One million dollars for awards to manager and supervisors who have, in the company's words, "notable success in advancing qualified female and/or African-American associates into management jobs while achieving economic goals."

One hundred and twenty thousand dollars to be divided among the 13 plaintiffs.

Three million, nine hundred thousand dollars for plaintiffs' attorneys' fees and other expenses associated with the case, as well as for monitoring compliance with the settlement.

These payments "will not materially affect future earnings" of Winn-Dixie, according to the company.

A joint statement released when the settlement was announced by Winn-Dixie and the plaintiffs' attorneys said: "This settlement will promote a positive atmosphere of good will and equal opportunity in which all Winn-Dixie associates will be encouraged to seek advancement based on performance , ability and available openings.

"The parties believe this settlement is in the best interests of the female and African-American class members and Winn-Dixie associates, customers and stockholders. It will enable the company to move ahead and focus on its mission to provide equal employment opportunities for all its associates; quality products, value and services to its customers, and a good return to its shareholders."

When the settlement was announced, Winn-Dixie, the plaintiffs and the lawyers for both parties said they would make no more statements about the case until the court had reviewed and approved the settlement. Winn-Dixie declined comment.

The company's principal attorney, John DeVault, based here, a recent president of the Florida Bar Association, declined comment pending the approval of the settlement, and also declined to speculate on when that approval might be granted. None of the four firms that represented the plaintiffs could be reached for comment.

However, experts on class-action discrimination suits who were not involved in the Winn-Dixie case or familiar with its details were more than willing to comment on the overall legal climate that produced the suit.

Defense attorney Sandoval said the current atmosphere is strongly anti-corporate.

"The problem right now with defending these cases is that juries don't like employers," she said. Another problem, she added, was that plaintiffs' attorneys "have hit upon a formula in several industries -- car dealers, law firms" as well as supermarkets -- that help them litigate successful discrimination suits .

"This is an area of law where people can make quick money with little risk," she added.

Joseph M. Sellers, partner and director of the civil rights and employment practice group at Cohen, Milstein, Hausfeld & Toll, Washington, said companies were rarely quick to settle when plaintiffs have little evidence of discrimination. "I find it hard to believe a company of this size, which undoubtedly had capable counsel, capitulated without any evidence of discrimination," he said.

Sellers also said insubstantial cases rarely get to a jury verdict. "There's a growing body of law that authorizes trial courts to dismiss cases where the plaintiffs are unable to put together enough evidence," he said. "Increasingly, lawyers are using that to get rid of marginal cases."

He added that few class-action discrimination cases are brought against employers and very few of them succeed. "The number of cases brought each year is very small, maybe 20," he said. "Less than 10 percent of these cases that get filed prevail. These cases require a great deal of resources, and they pose considerable risk to the employees who bring them. The cases can continue for years, and the people that brought them are viewed by their supervisors and co-workers as traitors and troublemakers."