The 10 Worst Corporations of 2003
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2003 was not a year of garden variety corporate wrongdoing. No, the sheer variety, reach and intricacy of corporate schemes, scandal and crimes were spellbinding. Not an easy year to pick the 10 worst companies, for sure.
But Multinational Monitor magazine cannot be deterred by such complications. And so, here follows, in alphabetical order, our list for Multinational Monitor of the 10 worst corporations of 2003.
Bayer: 2003 may be remembered as the year of the headache at Bayer. In May, the company agreed to plead guilty to a criminal count and pay more than $250 million to resolve allegations that it denied Medicaid discounts to which it was entitled. The company was beleaguered with litigation related to its anti-cholesterol drug Baycol. Bayer pulled the drug – which has been linked to a sometimes fatal muscle disorder – from the market, but is facing thousands of suits from patients who allege they were harmed by the drug. In June, the New York Times reported on internal company memos which appear to show that the company continued to promote the drug even as its own analysis had revealed the dangers of the product. Bayer denies the allegations.
Boeing: In one of the grandest schemes of corporate welfare in recent memory, Boeing engineered a deal whereby the Pentagon would lease tanker planes – 767s that refuel fighter planes in the air – from Boeing. The pricetag of $27.6 billion was billions more than the cost of simply buying the planes. The deal may unravel, though, because the company in November fired for wrongdoing both the employee that negotiated the contract for Boeing (the company's chief financial officer), and the employee that negotiated the contract for the government. How could Boeing fire a Pentagon employee? Simple. She was no longer a Pentagon employee. Boeing had hired her shortly after the company clinched the deal.
Brighthouse: A new-agey advertising/consulting/ strategic advice company, Brighthouse's claim to infamy is its Neurostrategies Institute, which undertakes research to see how the brain responds to advertising campaigns. In a cutting-edge effort to extend and sharpen the commercial reach in ways never previously before possible, the institute is using MRIs to monitor activity in people's brains triggered by advertisements.
Clear Channel: The radio behemoth Clear Channel specializes in consuming or squashing locally owned radio stations, imposing a homogenized music play list on once interesting stations, and offering cultural support for U.S. imperial adventures. It has also compiled a record of "repeated law-breaking," according to our colleage Jim Donahue, violating the law – including prohibitions on deceptive advertising and on broadcasting conversations without obtaining permission of the second party to the conversation – on 36 separate occasions over the previous three years.
Diebold: A North Canton, Ohio-based company that is one of the largest U.S. voting machine manufacturers, and an aggressive peddler of its electronic voting machines, Diebold has managed to demonstrate that it fails any reasonable test of qualifications for involvement with the voting process. Its CEO has worked as a major fundraiser for President George Bush. Computer experts revealed serious flaws in its voting technology, and activists showed how careless it was with confidential information. And it threatened lawsuits against activists who published on the Internet documents from the company showing its failures.
Halliburton: Now the owner of the company which initially drafted plans for privatization of U.S. military functions – plans drafted during the Bush I administration when current Vice President and former Halliburton CEO Dick Cheney was Secretary of Defense – Halliburton is pulling in billions in revenues for contract work – providing logistical support ranging from oil to food – in Iraq. Tens of millions, at least, appear to be overcharges. Some analysts say the charges for oil provision amount to "highway robbery."
HealthSouth: Fifteen of its top executives have pled guilty in connection with a multi-billion dollar scheme to defraud investors, the public and the U.S. government about the company's financial condition. The founder and CEO of the company that runs a network of outpatient surgery, diagnostic imagery and rehabilitative healthcare centers, Richard Scrushy, is fighting the charges. But thanks to the slick maneuvering of attorney Bob Bennett, it appears the company itself will get off scot free – no indictments, no pleas, no fines, no probation.
Inamed: The California-based company sought Food and Drug Administration approval for silicone breast implants, even though it was not able to present long-term safety data – the very thing that led the FDA to restrict sales of silicone implants a decade ago. In light of what remains unknown and what is known about the implants' effects – including painful breast hardening which can lead to deformity, and very high rupture rates – the FDA in January 2004 denied Inamed's application for marketing approval.
Merrill Lynch: This company keeps messing up. Fresh off of a $100 million fine levied because analysts were recommending stocks that they trashed in private e-mails, the company saw three former execs indicted for shady dealings with Enron. The company itself managed to escape with something less than a slap on the wrist – no prosecution in exchange for "oversight."
Safeway: One of the largest U.S. grocery chains, Safeway is leading the charge to demand givebacks from striking and locked out grocery workers in Southern California. Along with Albertsons and Ralphs (Kroger's), Safeway's Vons and Pavilion stores are asking employees to start paying for a major chunk of their health insurance. Under the company's proposals, workers and their families will lose $4,000 to $6,000 a year in health insurance benefits.
Russell Mokhiber is editor of the Washington, D.C.-based Corporate Crime Reporter. Robert Weissman is editor of the Washington, D.C.-based Multinational Monitor.