U.S. court says Supervalu violated terms of disability settlement

  • Article by: STEVE ALEXANDER , Star Tribune
  • Updated: March 22, 2013 - 9:01 PM

But recent sale muddies impact of ruling involving workers at Jewel-Osco chain in Chicago.

 

Supervalu Inc. may be a much different company after Thursday’s $3.3 billion sale of its largest grocery properties, but it continues to be haunted by discrimination issues in its past.

On Thursday, Supervalu was found by a U.S. District Court in Chicago to have violated a 2011 federal disability lawsuit settlement involving the Eden Prairie firm’s Jewel-Osco grocery store chain in Chicago, a business that was part of Thursday’s sale to Cerberus Capital Management.

The court action requires Supervalu to make job offers to Jewel-Osco workers who, as of Friday, are no longer Supervalu employees.

Neither Supervalu officials nor federal court spokesmen could be reached for comment Friday. Jewel-Osco declined to comment.

“Because this is pending litigation, we’re not in a position right now to comment on whose responsibility it is,” said Miguel Alba, a spokesman for Jewel-Osco, which operates 176 grocery stores in Illinois, Indiana and Iowa.

However, the legal issue is not a new one, said attorney Marshall Tanick of Twin Cities law firm Hellmuth & Johnson. To some degree, whether Supervalu or the Cerberus is responsible for obeying the 2011 lawsuit settlement will depend on what was negotiated in the sales agreement, said Tanick, an employment law attorney who is not connected to the case. But regardless of what was negotiated, the courts lean toward requiring the buyer to carry out the responsibilities of a settlement, provided the buyer operates the business in the same way the seller did, Tanick said.

The 2011 settlement was intended to end a 2009 lawsuit filed by the federal Equal Employment Opportunity Commission that accused Supervalu of dumping 110 disabled Chicago-area employees of Jewel-Osco at the end of their medical leaves. At the time, the $3.2 million settlement was one of the largest ever recorded under the federal Americans With Disabilities Act, which says that employees with disabilities should, at the end of the medical leaves, be brought back to work with reasonable accommodations.

On Thursday, U.S. District Judge Ronald Guzman held Supervalu in contempt for violating the settlement terms by failing to send written job offers to three employees on disability leave who were able to return to work. The judge ordered Supervalu to send written return-to-work offers to all disabled workers who were capable of returning to work between January 2011 and April 2012.

Also on Thursday, Supervalu made its anticipated announcement that it had closed the $3.3 billion sale of its four largest grocery store chains to an affiliate of Cerberus and other investors, driving up the price of its stock up 11.7 percent.

 

Steve Alexander • 612-673-4553

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