Microsoft decision does not compute: after making meager contributions to Jesse Jackson's nonprofit empire in the past, Microsoft now is anteing up in what many suspect is a Silicon Valley shakedown

0 Comments | Insight on the News, May 13, 2002 | by Kenneth R. Timmerman

"If you're black," Cochran mocked, "they'll give you a loan. But if you're white, they'll give you a jumbo loan."

In fact, many corporations reply, pay differences are not determined by race (which is illegal) but by education and skills. Silicon Valley executives such as Rodgers of Cypress Semiconductor have complained for years that government schools are not graduating enough minority students with science and technology skills for the job opportunities available. Rodgers says this leaves many positions to be filled by skilled foreign workers.

Even Microsoft admits there is a problem stemming from the small numbers of blacks entering the workforce with science and technology skills, while boasting that minorities (including foreign workers) accounted for 31 percent of its new hires last year.

But like Jackson, Cochran had his eyes on the prize, not the facts. He told Jackson's audience the booty from his lawsuit against Microsoft could be in the

billions. In the end, the trial court in Seattle denied class-action status to Cochran's four plaintiffs and tossed out the case on Nov. 16, 2001. But it forced Microsoft into "mediation" with Cochran to settle the individual claims of his clients. (The terms of those settlements remain confidential, Microsoft says.)

The flamboyant Gary didn't fare as well. The $5 billion lawsuit he filed on behalf of former Microsoft employee Rahn Jackson alleging corporatewide discriminatory practices virtually has evaporated. Like Cochran, Gary was unable to attract large numbers of plaintiffs, and two of his seven clients for the lawsuit fired him "for alleged unethical and unprofessional conduct," Microsoft says.

The court dismissed the claims of a third client and ordered her to pay costs to Microsoft. Even lead plaintiff Rahn Jackson's case was tossed out by the court during pretrial hearings and now is on appeal.

Tricia Hoffler, a lead attorney with the Gary firm, disputes Microsoft claims of victory and tells INSIGHT the firm has several individual cases still under litigation, but no class-action lawsuit. "Gates attempts to buy off the community by donating to African-American causes," she says. "Simply because Mr. J. has good relations with us doesn't mean Jesse Jackson condones the horrific work practices at Microsoft. This litigation is not going to go away."

Perhaps. But once the original class-action lawsuit was denied, Microsoft turned around and, in a marked departure from past practice, offered to sponsor Jackson's Silicon Valley conference.

At best, critics say, Gates is trying to buy protection from future claims against Microsoft, a standard tactic of major corporations that hire top-gun lawyers and retired government officials to lobby their former colleagues in Washington. (Gates hired former Clinton White House spokesperson Ginny Terzano and former Republican Party chairman Haley Barbour in early 2001 to work their respective political friends in Congress on his behalf.)

At worst, Gates could have worked out a private deal with Jackson in hopes of scuttling the Cochran and Gary lawsuits. At least one major U.S. corporation is paying Jackson, Cochran and the Rev. Al Sharpton fat retainers, INSIGHT has learned, to supposedly protect them from lawsuits and potential charges of racism.