News Article

Bias Case Costs Coke Record $192.5 million 'There's going to be fundamental change,' says former worker

Chicago Tribune

Published: November 17, 2000

Coca-Cola Co. , saying it was "closing a painful chapter in our company's history," agreed to pay $192.5 million to settle a high-profile race discrimination lawsuit filed by black workers.

The soft drink giant's big payout represents "perhaps the largest and most sweeping settlement in a race discrimination class-action in U.S. history," said Cyrus Mehri, the attorney who pressed the suit on behalf of about 2,000 current and former black Coke employees.

The agreement Coke disclosed Thursday tops the $176 million settlement Texaco Inc. agreed to pay in a 1996 race discrimination case. The latest settlement means that "Corporate America should much more aggressively monitor" its employment practices, said Mehri, who also represented the Texaco employee plaintiffs.

The Coke workers' lawsuit, filed in April 1999, alleged that the Atlanta-based company had discriminated against its black employees by providing them with inferior pay and promotion opportunities. Like Texaco, Coke admits no wrongdoing in settling the suit. But the Atlanta-based company will pay $113 million in cash--or roughly $40,000 per plaintiff--under the settlement. Coke also will provide $43.5 million in salary adjustments and spend $36 million to fund an outside oversight program to monitor the company's performance.

The centerpiece of the program is a seven-person task force that will review the soft drink-maker's diversity efforts and some human resources operations.

Because of the settlement, Mehri said bluntly, Coca-Cola "has no choice but to become the gold standard, the top of the field" in terms of its employment practices.

For more information or the full story, contact Mehri & Skalet, PLLC.