Court Closes L.A. Employment Firm Over Bias Probe

A federal judge has temporarily shut down an employment agency partly owned by Japan’s Recruit Co., saying that the firm destroyed records relating to a federal discrimination probe.

U.S. District Judge Stanley Weigel in San Francisco issued a restraining order Friday halting business at the five offices of Interplace/Transworld Recruit Inc.

Weigel issued the shutdown order, highly unusual in a discrimination case, at the request of the U.S. Equal Employment Opportunity Commission.

The EEOC, in court documents filed last May, charged that Interplace used a secret code in internal documents to specify employers’ preferences for workers of a particular race, sex, national origin or age.

For example, if an employer only wanted to hire whites between the ages of 30 and 40, a notation would be placed on a job order that read “Talk to Mary; Suite 30-40,” according to documents filed in court by the EEOC. If the employer sought a black, the code read, “Talk to Maryanne,” the EEOC said.

Interplace has two Los Angeles offices, including its headquarters, plus offices in Gardena, San Francisco and New York City. The agency is partly owned by Recruit Co., the firm at the center of the 1989 bribery scandal that led to the resignation of Japanese Prime Minister Noboru Takeshita.

Court marshals evacuated Interplace’s offices on Friday and sealed the doors with tape. As of Tuesday afternoon, an office in the Mid-Wilshire district had a copy of the judge’s order posted on the door.

The shutdown order will be effective pending a hearing in San Francisco federal court on Thursday.

The EEOC and Interplace declined to discuss the shutdown, saying Weigel also issued an order prohibiting them from discussing the order.

Normally, EEOC charges and investigations are confidential until action is taken against an employer. The charges against Interplace surfaced last June when EEOC lawyers--fearful that the company would destroy documents critical to the inquiry--obtained a preliminary injunction from Weigel directing Interplace not to alter records or remove them from the country.

On Friday, acting on unspecified evidence, Weigel ruled that Interplace “has violated the terms of the (June) injunction and has altered and destroyed documents and computerized records protected by the preliminary injunction.” He ordered the Interplace offices closed and its personnel banned from the sites.

The order said some records pertinent to the discrimination charges probably still existed in Interplace offices. Without a shutdown the “defendant . . . is likely to alter, destroy or otherwise dispose of those documents and records” before the EEOC inspects them, the order said.

At the Thursday hearing, Interplace will have an opportunity to contest the shutdown and to respond to a court proposal for a supervised document search involving the EEOC, the order said. The order proposes an EEOC search of Interplace offices Friday through Monday.

The shutdown surprised some experts on discrimination law. Joel P. Kelly, a Los Angeles lawyer who represents employers in discrimination cases, said a business shutdown in an EEOC dispute may be unprecedented.

Kelly said the developments could be a sign that the EEOC, chartered to enforce federal laws prohibiting discrimination, will be more aggressive.

“It’s an incredible decision by the court,” Kelly said. “The EEOC can no longer be viewed as a patsy agency. They have teeth and they’re showing them.”

John Shiner, an attorney for Interplace, would not comment on the Weigel order. However, he said Interplace has denied the EEOC’s charges of discriminatory practices.