Wal-Mart Pays $2M to Avoid Charges in Death Probe

May 8, 2009

Wal-Mart agreed Wednesday to pay nearly $2 million and improve safety at its 92 New York stores as part of a deal with prosecutors that avoids criminal charges in the trampling death of a temporary worker last year.

Nassau County District Attorney Kathleen Rice said that if she had brought criminal charges against the retailer in the worker’s death, the company would have been subject to only a $10,000 fine if convicted. Rice declined to say what charges were considered against Wal-Mart, citing the secrecy of grand jury proceedings.

Instead, she said, the company has agreed to implement an improved crowd-management plan for sales the day after the U.S. Thanksgiving holiday, traditionally a major shopping day. The company will also set up a $400,000 victims’ compensation and remuneration fund, and give $1.5 million to local social services programs and nonprofit groups.

The agreement included no admission of guilt by Wal-Mart.

“Rather than bringing the world’s largest retailer to court and imposing a small fine against them, I felt it was important to require significant safety changes that will affect the whole state,” Rice said. “Our goal is for the protocols that are set up to be the gold standard for crowd management in this industry.”

Details of Wal-Mart’s crowd-management plan for its New York stores have yet to be worked out. The retailer will work with two independent safety experts on the plan, and the experts will review it over the next three years. Wal-Mart will be responsible for complying with the recommendations.

“The crowd management plan we are announcing today was developed by a team of experts whose experience includes NFL Super Bowls, Olympic games, concerts and national political conventions,” Wal-Mart vice president Hank Mullany said.

The company said it will consider expanding the safety plan to all of its stores.

Rice’s office began a criminal investigation shortly after last November’s customer stampede.

Jdimytai Damour, a temporary employee, had been on the job for about a week and had no training in security or crowd control when a crowd estimated at 2,000 broke down the Valley Stream store’s doors, trapping him in a vestibule.

The 34-year-old man died of asphyxiation. Eleven others, including a pregnant woman, were injured.

Edward H. Gersowitz, an attorney representing Damour’s family in a civil lawsuit, blasted the settlement and said the family was never consulted before the deal was announced. He called for a special prosecutor.

“The ability of Wal-Mart to, in effect, buy off this criminal investigation demonstrates the epitome of corporate arrogance that has become all too familiar in this day and age, and shows how Wal-Mart has nothing but contempt for the victims of such corporate malfeasance,” he said in a statement.

Any victims who accept payment from the Wal-Mart compensation fund will be required to waive their right to a separate civil suit against Wal-Mart, Rice said.

“Facilitating the compensation is one of the main goals of this settlement,” she said.

The company also agreed to an independent review of its procedures for post-Thanksgiving Day sales. The prosecutor said her office will oversee compliance.

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