Civil rights group sued Avis and
franchisee, charging racial bias

November 12, 1996: 9:08 p.m. ET

N. Carolina Avis Franchise Owner Settles Bias Suit

Reuters
01-MAY-98

Xinhua
01-MAY-98

Avis corporate communications representative Demetria Mudar told CNN that Avis does not tolerate any discrimination and is proud of the company's "good record." She said the company just learned today of the lawsuit by reading this morning's USA Today front page article. A class©action lawsuit was filed in federal court last week by the Washington Lawyers' Committee for Civil Rights and Urban Affairs. It claims that John Dalton, owner of five franchises, told employees to make it difficult for blacks to rent cars. It also alleges that Avis executives were aware of the practice but did not stop it. Mudar said the company could not comment any further now that a lawsuit is pending, but Avis did issue a statement that the company does not tolerate discriminatory practices of any kind.

"As a franchiser, Avis Inc. is not responsible for any discriminatory practices that may have been carried out by a franchisee or his/her employees," the statement said. So far 85 people were named plaintiffs in the case that dates back to 1986 and seeks an unspecified amount of damages, according to lead attorney John Relman. Relman said the act was "a vicious, offensive pattern of discrimination over the last 10 years" and "a corporate culture of indifference among Avis executives who were made aware of the problem and did nothing about it." Franchise owner John Dalton was unavailable for comment.

WILMINGTON, N.C. (Reuters) - An independent North Carolina Avis Rent A Car Inc. franchise owner has settled a discrimination suit filed by several black customers for $2.1 million, Avis and a franchise attorney said Friday. The customers filed suit in 1996 alleging that New Hanover Rent-A-Car, a Wilmington, N.C., Avis franchise that is independently owned and operated, refused to rent cars to some blacks and made it difficult for others to rent cars.

The franchisee and its attorney declined comment on the settlement, which was filed with the court on April 17. The plaintiffs will receive $1.125 million, while $825,000 will be paid to attorneys and $150,000 will cover court costs.

Garden City, N.Y.-based Avis, which in December settled with the plaintiffs for $1.85 million, said it has a ``zero tolerance'' policy on discrimination and expectsfranchise owners to operate under those guidelines.

``We will continue our vigorous efforts to enforce this policy of zero-tolerance for discrimination at Avis corporate-owned locations and continue working with all our licensees to promote this same standard of fairness and equality,'' the company said.

New Hanover Rent-A-Car also agreed to provide sensitivity training for its employees and allow a civil rights monitor to observe its activities for five years, The Associated Press reported.

In a class-action lawsuit filed in 1996, black customers claimed they were repeatedly denied rentals at New Hanover locations in Wilmington, Greenville, New Bern and Jacksonville in North Carolina and in Florence, S.C.

Former employees said the owner, John Dalton III, trained his staff to avoid renting to blacks by requiring them to show proof of employment and higher credit-card limits.

In December, Avis Inc. agreed to pay nearly 3.3 million dollars to settle allegations that it failed to do anything about Dalton's practices.

New Hanover admitted no wrongdoing in the settlement agreement, which was reached earlier this month. The agreement is subject to approval by a federal judge.

John Relman, a lawyer for the plaintiffs, said Friday that the total number of people entitled to share in the settlement isn't yet known. Fourteen plaintiffs are named in the lawsuit.