001030 CEO Asks Rethink of Burger King BoycottOctober 8, 2000Miami, FL - Burger King's chief executive has asked black activists to back away from a threatened boycott, saying such an action against the world's No. 2 fast food group would help only a single businessman already fighting Burger King in court. Burger King CEO Colin Storm said in a letter to a civil rights leader, the Rev. Al Sharpton, released on Friday, that a boycott was unjustified, given the company's record of minority dealings, and already had been denounced by the black owners of 1,173 Burger King outlets. But Sharpton, who has been pressing Miami-based Burger King, a unit of Diageo Plc of Britain, to step up business with U.S. blacks, had not seen Storm's letter and had not yet called for a boycott by blacks, according to a spokeswoman. La-Van Hawkins, a black entrepreneur who operates dozens of Burger King restaurants, sued Burger King for $1.9 billion last April, claiming that the company had reneged on a deal to help him open as many as 225 restaurants in inner-city neighbourhoods. Burger King countersued for $8 million it said it was owed in various fees. News reports had indicated that a call for a boycott against Burger King, the operator of 7,830 restaurants in the United States, was imminent. But a food industry source said Sharpton, who has his headquarters in New York, had signalled in a letter to Storm earlier this week that such a call might not come for weeks. Storm defended Burger King's minority-business practices in his letter, saying the company spent 24% of its annual advertising budget with minority media and had worked with a black-owned advertising agency for 17 years. He also promised to consider hiring black investment bankers for a planned partial stock flotation of Burger King, though the timing of an offering by parent Diageo was unclear. Burger King's minority-owned restaurants employ 58,650 people and the company had increased transactions with 32 minority-owned suppliers by 239% over the last five years, Storm said. “Given the above, we believe we have addressed the diversity issues you have raised,” Storm said. “Therefore, we can only conclude that your actions are solely an attempt to pressure Burger King Corp. into making a settlement with Mr. Hawkins that has no commercial or legal basis.” Burger King has claimed that Hawkins owes the company $8 million in rents, royalties and ad fees. The company also wants Hawkins, who appears in television commercials for his Detroit restaurants, to drop the Burger King name from his properties.
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