Price-fixed Shoes?

Women’s groups nationwide are the proposed beneficiaries of a $34 million settlement of a federal price-fixing lawsuit involving a leading retailer of women’s shoes. But the distribution has been left virtually to the discretion of each state’s attorney general, resulting in proposed disbursements not only to many domestic violence programs but also to some “right to life” counseling centers.

The deadline is Oct. 16 for filing objections to the distribution plan. A public hearing, considered a formality, will be held on Dec. 14 and a federal district court judge will make a final ruling on the settlement plan possibly within three to six months.

Proposed beneficiaries range from an alcoholism treatment center for women in Utah to a well-funded Texas breast cancer foundation whose chair raised money for the presidential campaign of Gov. George W. Bush. And they range from programs to train nurses to perform sexual abuse examinations to the United Phoenix Firefighters for a statewide education program for Spanish-speaking women.


Good News for Many Programs Throughout Nation

The good news: In more than 30 states, funds have been earmarked for domestic violence shelters, prevention and education programs, as well as rape crisis hotlines and assault treatment centers.

Attorneys general have used different methods, or apparently no system at all in many cases, to decide who will get funding. Which groups may apply, which groups will benefit and the eligibility criteria vary widely from state to state. Some states have no discernable, publicized procedure and some state attorneys general decline to comment about how they reached their decisions. Notices of the settlement and possible funding appeared in national publications, including Glamour, Parade and Reader’s Digest.

The $34 million will settle an anti-trust case known as State of Florida, et al., v. Nine West Group Inc., brought by all 50 states and U.S. territories, which is being heard in New York federal court.

The price-fixing lawsuit against shoe retailer Nine West alleged that Nine West and divisions, including Enzo Angiolini, Amalfi, Evan Picone and Pappagallo, entered into illegal agreements between 1988 and 1999 to fix the price of shoes by preventing retailers from offering discounts. Price-fixing is illegal under state and federal laws.

Federal Judge Barrington D. Parker, Jr., ordered that the funds are to be distributed to “programs relating to women’s health, educational, vocational and safety programs.” Only nonprofit organizations and government agencies are eligible and the money must be used for activities that do not have other funding. Amounts are allocated to each state based on its population.

Attorneys general have submitted distribution plans to Judge Parker. Some states have laws or rules that they must follow in distributing funds, but no uniform guidelines exist for procedures or monitoring of the process in federal rules, other than the federal court’s final approval, according to attorneys familiar with such disbursements.


Each State Devised Its Own Plan–If It Had a Plan

“Every state will be different,” said Trish Connors, chief of the antitrust division for the state’s attorney general. “The judge can review and ask for more information. The judge is the ultimate one, if he really feels a proposal is inadequate. Everybody has due process and can go to court and object,” Connors said.

Attorneys general in at least three states–South Carolina, Virginia, and Nebraska–propose granting hundreds of thousands of dollars to crisis pregnancy centers associated with “right-to-life” organizations. These are generally unregulated organizations which offer free pregnancy testing and try to persuade women not to have legal abortions.

South Carolina’s attorney general, Charles M. Condon, proposes giving $262,500 to 14 crisis pregnancy centers, although he does not describe funding needs or new activities needing funds. Condon’s office did not return phone calls seeking further information. He proposes giving $126,000 to the South Carolina Coalition Against Domestic Violence.

Proposals from other states contain puzzling requests. Wisconsin suggests that $250,000 be donated to the Boys and Girls Clubs in an effort to encourage girls to participate and $35,000 be awarded to Badger State Games. Arizona wants $120,000 for the United Phoenix Fire Fighters, $45,000 of which is for a vaguely described statewide educational program for Spanish-speaking women.

Minnesota, with almost $600,000 to disburse, proposes that $150,000 be granted to Catholic Charities for housing for young women seeking to escape prostitution. Another $85,000 would be given to Life House, Inc., for transitional housing shelters for young women. Lutheran Social Services would be given $280,000 for assistance to low-income women.

New Jersey proposes granting $550,000 to the department of health for cardiovascular health and for alcohol and substance abuse treatment for women. It would give $210,000 for child care and transportation services for low-income women. It also would pay the undefined start-up costs for an office of research recently announced by Gov. Christine Todd Whitman.

Oklahoma proposes to keep $100,000 for a program in the Office of the Attorney General, which will be used to train law enforcement personnel about domestic violence, said spokesperson Charlie Pride.

Texas, which asked for an extension in order to get approval from its legislature, proposes giving $1 million to the well-funded Susan B. Komen Foundation, which is dedicated to breast cancer treatment and research. It does not specify how the funds would be used. Komen’s founding chair, Nancy Brinker, has raised more than $100,000 for Texas Gov. George W. Bush’s presidential campaign, according to Common Cause.

A review of settlement documents shows that few states explained how they came to their decisions.

Scott Brown, spokesperson for New York Attorney General Eliot Spitzer, could not describe the process for distributing over $2 million, one of the largest disbursements. He did say that two dozen applications were received after a press release was issued and other groups were solicited. He declined to provide a copy of a letter sent to potential applicants, outlining conditions for eligibility.


Washington Devised an Elaborate, Inclusive Process

Only one state, Washington, describes an elaborate grant application process for disbursement of nearly $700,000. It notified a wide range of women’s organizations and set up a committee representing diverse interests to review 375 grant applications. It proposes giving funds to 22 organizations and states how each of them would use its funds in court filings.

Conners, Florida’s anti-trust chief, said her office’s staff members went into the community to find geographically, culturally and socially diverse organizations and urged them to apply for the $1.6 million.

“We had a lot of people in the office willing to devote their time,” she said.

Florida proposes funding 53 organizations, including an early childhood development foundation, the Florida Council Against Sexual Violence and the Consortium of Haitian-American Agencies of Miami-Dade County.

Disbursing court settlement funds in antitrust cases of this type is relatively new to attorneys general, said Conners, noting there were four to five similar settlements in the last six years, several of them concerning shoes.

Because it is too difficult to identify every consumer who lost money, courts use a concept called “cy pres,” which means doing the next best thing. This has meant courts order the funds to be distributed to organizations that represent the class of consumers who suffered.

After Oct. 16, the deadline for filing objections, Judge Parker will review the proposals. Objections and requests must be made in writing, postmarked by Oct.16, to the Clerk of the Court, 300 Quarropas St., White Plains, N.Y. 10601, and to Nine West Antitrust Litigation Administrator, P.O. Box 1582, Faribault, Minn. 55021.

Citizens may also be heard at the settlement hearing on Dec.14, by filing and serving a notice of intention to appear by Oct. 16 with the court clerk, antitrust litigation administrator, and Ronald D. Rolfe, c/o Cravath, Swaine & Moore, Worldwide Plaza, 825 Eighth Ave., New York, N.Y. 10019.

According to the court order, copies of documents and answers to questions are to be provided by Liaison Counsel for the Plaintiff States, Eliot Spitzer, New York Attorney General, or Assistant Attorney General, Linda Garguilo, (212) 416-8274.

Cynthia L. Cooper is a free-lance writer based in New York and specializing in reproductive health and other women’s issues.

For a complete list of organizations designated to receive funds and the amounts to be received, click on the following link:



Congress OKs Anti-Violence, Anti-Trafficking Laws

The Senate on Wednesday unanimously reauthorized the Violence Against Women Act and increased its funding to $3.3 billion for five years. The bill already passed the House and is expected to be signed into law by President Clinton. The anti-violence legislation, passed 95-0, was attached to a landmark Trafficking Victims Protection Act that aids victims, male and female, forced into prostitution and slave labor. It provides stiff punishment for criminals and outreach and education for potential victims. The CIA estimates 1 million women a year are sexually exploited worldwide, and 50,000 of them are taken into the United States.