Haynes et al. v. Shoney's, Inc. Papers

On April 4, 1989, Tallahassee (FL) attorney Tommy Warren and nine named plaintiffs, all former Shoneys and Captain Ds employees or job applicants, served Shoneys CEO, Ray Danner, and Shoneys, Inc. with a class-action suit alleging racial discrimination. The plaintiffs, represented by Warren and his co-counsel, civil rights attorney Barry Goldstein, sought more than half a billion dollars in back pay and punitive damages, in addition to a court-ordered affirmative action plan, to counteract claims of years of racially discriminatory company policy. Witnesses, such as Josephine Haynes, included tens of thousands of workers, former workers, and frustrated job applicants, who said they lost jobs, were denied jobs, or were not given opportunities at Shoneys for even the lowest-paying jobs because they were African-Americans. Other witnesses included lower level white managers, who testified that they were fired because they wouldnt follow company orders to reduce the number of African-Americans. Many said they were instructed to carry out a corporate strategy that was directed by the Companys founder and CEO, Ray Danner, not found in any Shoneys procedure manuals. During the course of the litigation, which lasted from 1989-1993, many allegations were made under oath, and entered into the court record that race discrimination at Shoneys was standard operating procedure and had existed during the entire time Ray Danner ran the company. Danner continually denied these allegations throughout the case. By the time the case concluded in 1993, the total cost of the Shoneys settlement was $132.5 million, which was the plaintiffs final compromise figure and the largest ever in a racial discrimination case. In addition, Ray Danner personally contributed approximately $65 million to the settlement. This payment by an individual defendant was unprecedented in U.S. race discrimination cases. According to Steve Watkins The Black O, a book that documents the entire case, 28, 994 claims were submitted in the settlement. At Warren and Goldsteins insistence, that number was expanded beyond the scope of the class of discriminated individuals to include all of Shoneys divisions, except for the franchise stores, for the period from 1985 through November 3, 1992. Based on a complex formula approved by Judge Roger Vinson to determine the validity of those claims and the amount due each legitimate claimant, 20,909 people ultimately received money from the $105 million settlement pool. The plaintiffs attorneys spent nearly $2 million to notify these claimants about the settlement, an effort that the judge said was unmatched by any he had ever seen in a class-action case. Approximately $5 million from the settlement pool was designated for a special class of claimants, those who had been witnesses and named plaintiffs in the case. $10 million was earmarked for African-American former job applicants, and the bulk of the settlement, $90 million, went to incumbent African-American employees. Money left over when the settlement was completed, and after Shoneys final payment in 1998, was divided among five organizations: the United Negro College Fund, the Southern Poverty Law Center, the Lawyers Committee for Civil Rights Under Law, the Washington Lawyers Committee for Civil Rights Under Law, and Inroads, a group that works to increase management opportunities for minorities. In the aftermath of the case, Shoneys complied with the affirmative action plan and significantly increased its minority hiring of restaurant managers, dining room supervisors, and servers. In 1995, the company brought in a new management team which greatly improved its position financially, and in hiring, promotion, and business opportunities for minorities.

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