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8 indicted over hiring during Ralphs lockout

September 20, 2008|Jerry Hirsch and Andrea Chang | Times Staff Writers

A federal grand jury has indicted eight former and current Ralphs Grocery Co. executives and managers on 23 counts arising from a bitter Southern California supermarket labor dispute five years ago when the chain illegally rehired hundreds of locked-out workers.

The indictment said that five of those indicted, along with unnamed co-conspirators "engaged in a course of criminal conduct" that included hiring "employees under false names, Social Security numbers and documentation, which was intended to, and did, undermine the labor action."

Assistant U.S. Atty. Beong-Soo Kim said the investigation was still ongoing but declined to say whether there would be more indictments.

Ralphs, which has 261 stores from San Diego to San Luis Obispo, pleaded guilty to similar charges two years ago and paid $20 million in fines and $50 million into a fund to reimburse workers and their union. But federal investigators didn't stop there.

Attorneys for two of the defendants said their clients were innocent. The rest could not be reached for comment.

Workers who lived through the labor dispute said they were pleased the government had pursued the case. Keith Taylor, a frozen foods merchandiser who has worked for Ralphs for 12 years, said he had waited years for the indictments, but "nothing ever came of it -- until now."

"I'm absolutely ecstatic and I hope they throw the book at all of them," Taylor, 55, said. "We were put out on the street for 4 1/2 months and these people were secretly, behind our backs, hiring people and . . . doing all this stuff to make it look like they could work without us. These people violated the law."

Compton-based Ralphs said Friday that it was cooperating with the U.S. attorney's office. "Ralphs is working very hard to put this difficult chapter in our company history behind us and to win back the trust of our customers and associates and build our business," spokesman Terry O'Neil said.

This latest indictment, which was issued late Thursday and made public Friday, said the employees were sent to stores where they didn't normally work to avoid being recognized by customers and picketing colleagues.

According to the indictment, the indicted executives even circulated copies of a confidential strike manual that outlined the strategy of attracting experienced workers that store managers "could plausibly deny knowing" were actually locked-out employees.

The indicted executives are Scott Drew, 47, of Carmel, Ind., now a vice president of Kroger Co., Ralphs' parent; former Ralphs Vice President Patrick McGowan, 49, of Menifee in Riverside County; Charles Vance, 56, of Norco, a former Ralphs zone manager; Randall Kruska, 55, of Leucadia, Calif., a former Ralphs zone manager; and Karen Montoya, 48, of Peoria, Ariz., a former Ralphs district manager.

If convicted on all charges, Drew, McGowan, Vance, Kruska and Montoya face maximum sentences of at least 30 years in federal prison as well as the payment of restitution to victims of the alleged crimes.

The defendants are expected to appear next month in U.S. District Court in Los Angeles to enter pleas.

The grand jury also indicted three lower-level Ralphs managers -- Craig Totman, 55, of Paso Robles, Calif., a former Ralphs store director; Kelly Clark, 40, of Carmel, Ind., a former Ralphs store director; and current district manager Allen Moorman, 43, of Yorba Linda -- on charges that they lied to investigators.

The indictments caught at least one defendant off guard. Clark's attorney, David Scheper, said law enforcement officials interviewed Clark in February 2005 and "not ever did she nor her attorney receive a consonant, vowel, much less a syllable of complaint about her statements."

Gary Lincenberg, an attorney who is representing McGowan, said his client "will plead innocent and looks forward to answering the charges in court."

Labor leaders viewed the indictments as vindication of their claim that Ralphs had used underhanded tactics to force the United Food and Commercial Workers union into painful contract concessions.

"Justice has been served and now eight people will have to pay the price for what they did," said Greg Conger, president of UFCW Local 324 in Buena Park.

The work stoppage lasted from October 2003 to February 2004 and involved Ralphs, a division of Cincinnati-based Kroger, and rival Southern California supermarket chains Vons, owned by Pleasanton, Calif.-based Safeway Inc., and Albertsons, now owned by SuperValu Inc. of Eden Prairie, Minn.

Labor leaders contend that Ralphs' ability to get trained workers back into its stores prolonged the 141-day work stoppage and forced union workers into massive contract concessions.

That's because the big three grocery chains had a secret mutual-aid pact to support one another financially in the event of a job action. Under the pact, Ralphs, which was the target of picket lines for only a portion of the dispute, paid a combined $146 million to Albertsons and Vons. Those payments are the subject of an ongoing lawsuit by California Atty. Gen. Jerry Brown, which alleges that the agreement violated federal antitrust laws.

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jerry.hirsch@latimes.com

andrea.chang@latimes.com

Times staff writer Scott Glover contributed to this report.

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