Thursday, July 08, 2010

Dying to Shop There

The other day the NY Times reported on the efforts of Wal-Mart to resist paying the fine for the homicidal stampede outside of one of its Long Island stores two years ago: "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."

So why is it? "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."

Now we have always contained that working at Wal-Mart is not good for your health-or, particularly for your health insurance, but what happened in December of 2008 was even beyond our low expectations: "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.”

Wal-Mart has been accused in the past of locking its employees in the store over night, and in the case of poor Mr. Damour, wouldn't that have been the better alternative? But the issue of resisting the occupational hazard designation for crowd control is all about limiting present and future liability: "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.”

Such legal damage control was evident in how Wal-Mart quickly plead out with the Nassau DA over any potential criminal charges: "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.”

But what this case underscores is how difficult it is to control the Walmonster. We remember a story about a potential anti-trust case against one of the big three oil companies over thirty years ago. One justice department insider commented that in order to prosecute the case the department would have had to send all of its lawyers down to Texas, "And we'll never hear from them again"-so huge was the undertaking.

The same mismatch exists between Wal-Mart and the NYS Department of Labor: "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." Pretty soon Labor is gonna cry, "No Mas!"

But the government's battle against the Walmonster epitomizes just what a struggle it is for small businesses that are forced to  go up against the retail giant-and there are stories that document how the Walmonster enters a market low balling the competition into extinction-only to, months later when the competitors have closed their doors, raise their prices back in order to restore its margins. It has the power to crush-and NYC is better off in resisting Wal-Mart's low price allure for the fool's gold that it is.

New York's uniqueness is built on its neighborhood diversity; and local shops provide a great deal of this. That is why we are fighting so hard against the malling of Flushing that is represented by the Flushing Commons development. Nowhere in the country will you find the rich variety of Asian cuisine and shopping goods as you will in this unique Queens community.

And that's why we are once again fighting to keep the retail giant out of Gateway in East New York-and applaud Speaker Quinn and Council member Barron for standing on principle in this fight. Make no mistake about it. If Wal-Mart gets a foothold in Brooklyn, it will open up the floodgates to a metastasizing of these stores all over the city-and we will see the death of New York's neighborhoods and the collapse of the immigrant entrepreneurism that makes Flushing and other city neighborhoods so attractive and unique.

So while OSHA and the NY S Department of Labor fight against crowd trampling, the Neighborhood Retail Alliance will continue to fight against Wal-Mart's store trampling-a more pervasive and lethal phenomenon that happens everywhere the competition killer decides to locate. In effect, where Wal-Mart builds, there is an oasis in that area-and dessert everywhere else. We'll give Speaker Quinn the last word: "New York City, like many urban areas, hopes to attract new retailers, so that New Yorkers can have access to more choices when they shop. However, City Council Speaker Christine Quinn draws the line at Wal-Mart. “Wal-Mart’s business plan is a business plan that runs counter to the core values of New York City,” said Quinn. “Until they change their ways they are not welcome."