Case 35: Kodak Reverse Discrimination
Part (2) - $13 million settlement with minorities

Payout to 2,000 Minorities and Women

          It started in 1999 with the veiled threat of a discrimination lawsuit by a well-organized group of 2,000 preferred minorities from within Kodak's ranks. Officially, the word "lawsuit" was never mentioned.

          In February 1999 the NAACP came knocking on the door of Kodak CEO George Fisher. Kodak's visitor was the Reverend Norvel Goff, president of the Greater Rochester chapter of the NAACP.

Kodak Breaks Speed Record!  In the span of just under three months - between Feb. 1999 and May 1999 - Kodak "voluntarily" conducted an internal race-based and gender-based review of the pay records of 31,000 of its U.S. workers. 

Kodak Park, Kodak's Rochester, NY manufacturing facility.

In the annals of racial corporate shakedowns, Kodak's review and determination set a speed record.           By contrast, Boeing, which initially fought the discrimination charges lodged against it, had to be forced by the U.S. Dept. of Labor to submit to an external review.  The Dept. of Labor had to threaten Boeing with a lawsuit in federal court and threatened withholding of billions of dollars in government contracts before Boeing finally submitted to the Labor Dept. review.

          After Kodak's "voluntary" review of pay grades, they predictably found that a lot of their low-level clerical and trade workers who happened to be mostly black, Hispanic or female were earning less than a lot of other workers who were not black, Hispanic or female but many of whom happened to hold more skilled jobs and had higher levels of education.

          By May 4, 1999 Kodak announced an award of $13 million in "retroactive and current pay raises" to the 2,000 female and minority workers who had complained.  Kodak also publicly fired or disciplined a "handful" of managers who had some responsibility for allowing this state of affairs.

Kodak Never Admitted Racism:  According to the Wall Street Journal, Kodak spokesman Charles S. Smith is quoted as making the following carefully crafted, and carefully ambiguous, statement:

"Clearly racism is inconsistent with our values. But there was a discrepancy that appears to be on a basis of gender and race."

          Mr. Smith did not say anything about Kodak having been guilty of racism.  He merely said racism was inconsistent with Kodak's values.

          There had never been a threat of a lawsuit against Kodak, the Times reported, and Kodak's $13 million in race-based generosity was "voluntary". Kodak spokesman Mr. Smith added that the company intends to increase its promotions of women and minorities.

          According to Kodak, most of the 2,000 minorities and women involved in this "voluntary non-settlement" are clerical staff, skilled-trade employees, including electricians, and factory workers. Not what you would consider material for middle- or upper-management positions. Yet Kodak also said that while in 1998 only 37% of the openings in mid- and senior-level management went to women and minorities, they expected to dramatically increase that proportion in the coming years.

Kodak Rewards the NAACP Shakedown Artist:  And what of the good Reverend Norvel Goff of the Rochester NAACP who brokered Kodak's $13 million quota payout? 

          Rev. Goff's intervention bought him a seat at the table, and he now serves on Kodak's Diversity Panel helping to oversee Kodak's quota performance.  The panel is chaired by Bill Clinton's black, former U.S. Attorney, Eric Holder.

Compare Kodak's Quota Settlement to
Boeing, Coca Cola, and Texaco

          In the past few years three other corporate giants - Boeing, Coca Cola, and Texaco - also have been shaken down for billions of dollars for race-based employee programs and benefits. Yes, that's correct: billions as in a number followed by 9 zeros. As in thousands of millions of dollars.

          One significant similarity among all of these cases, including the Kodak case, is that the charges of racism and sexism were based primarily upon statistical disparities in pay levels between races and genders. Most often these pay grade analyses did not take into account years of service and employee performance evaluations, especially if the U.S. Dept. of Labor was performing the pay grade audits.

Unlike Kodak, however, Boeing, Coke and Texaco made the initial mistake of trying to defend themselves against charges of racism in a court of law.

          Kodak was smart enough to pay the racial extortion quietly and quickly. This move didn't necessarily save Kodak any money, but it did avoid lots of bad publicity.

          In each of the Boeing, Coke and Texaco cases their initial efforts to defend themselves against charges of racism brought a swift and massive response:

• Racial special interest groups swamped the media with negative stories about these companies' treatment of people of color. Various chapters of the NAACP and the ubiquitous Jesse Jackson all publicly castigated these companies for their statistical racism.

• A swarm of taxpayer-supported attorneys descended upon these companies, including attorneys from the U.S. Dept. of Justice, the U.S. Dept. of Labor, and the U.S. EEOC. Federal lawsuits were filed or threatened.

• The federal government threatened to withhold billions of dollars in federal contracts from Boeing unless they stopped trying to defend themselves.

• Texaco was directly threatened with years of federal litigation if they didn't stop trying to defend themselves. The U.S. EEOC still monitors Texaco's racial quota performance and will step in if Texaco fails to hire and promote the right numbers of people of color.

• Coke was threatened with economic boycotts of their products by the racial special interests (most notably Jesse Jackson, Inc.) if they didn't stop trying to defend themselves.

          Kodak managed to avoid all of that.

          But in the end Kodak ended up spending as much or more on race-based employee benefits, racial special interest causes, and race-based subcontracting and purchasing commitments.   [See part 3 of our Kodak story:  Kodak's Funding and Involvement with Minority Causes.]

Billions in Race-Based Payments:  To be sure, over the years Kodak has weathered its share of smaller "traditional" race and sex discrimination lawsuits. It successfully defended itself against most of these because they had been lodged by individual employees instead of by a large, well organized class of disgruntled minorities.

          Following Kodak's announcement of the $13 million non-settlement, NAACP bestowed a "good corporate diversity citizen" award on Kodak which it added to its other accolades from racial special interest groups.  DiversityInc, a pro-quota cheerleading group, listed Kodak as one of the top U.S. companies for minorities to work for.

• Boeing initially paid out over $1.3 billion in race-based settlements and programs. That's $1,305.4 million, or $1,305,400,000!

• Coca Cola has publicly acknowledged spending at least $475 million in race-based settlements and programs before they learned Kodak's lesson: keep it quiet.

• Similarly, Texaco also spent over $1.1 billion for racial special interest programs, only $176 million of which was publicly disclosed as a settlement. But Texaco also pledged an additional $865 million to business from minority-owned suppliers and contractors as well as $150 million in business to a black owned investment banking firm.

[Links to the Boeing, Coke and Texaco cases appear at the bottom of this page.]

          The data that we've compiled all are a matter of public record.  But the actual total cost of the racial extortion paid by these corporate giants may never be publicly known.

          Of Kodak's racial extortion payments we can only say this:  Kodak has publicly admitted paying only $13 million to settle the 1999 non-lawsuit.  They also give away hundreds of thousands of their shareholder's dollars every year to race-based scholarships and race-based "charitable" organizations, and they've publicly committed millions of dollars to race-based contracting and supplier arrangements. [See part 5 of our Kodak story:  Kodak's Supplier Diversity Program.]  They have repeatedly announced their intention to purge non-minorities from upper management and director positions and to aggressively increase the percentage of their workforce which is comprised of preferred races.

          In other words, Kodak has implemented many of the same programs as Boeing, Coke, and Texaco.

          Therefore, it is not unreasonable to assume that the true cost of Kodak's racial preferences at least equals Boeing's massive $1.3 billion payout.

Below are a few of the news sources Adversity.Net used in compiling this report. 

          This story is under development.   Additional information and links may be provided at a future date.

Send Us Your Comments:

          If you have specific, additional information about Kodak's racial preferences programs, please send your confidential comments to editor@adversity.net

END Kodak Case 35: (2) $13 Million Settlement