Gibson’s, a small family store and bakery, has been part of this small community since 1885. Despite that long association, the store became the focus of a campaign of destruction led by college officials after three African American students were arrested for shoplifting in 2016.
The arrests sparked an immediate campaign calling the store racist. Undeterred, the police found clear evidence of shoplifting and noted that, over a period of five years, 40 adults were arrested for shoplifting at Gibson’s Bakery, but only six were African American.
Nevertheless, the local prosecutors appeared to cave to the pressure and cut a plea deal to reduce the charge to attempted theft. But a local judge refused to accept the deal and said that the plea was the result of a punishing series of protests and a “permanent economic sanction.” Ultimately, all three students pleaded guilty.
Dean of Students Meredith Raimondo reportedly joined the massive protests and even handed out a flier denouncing the bakery as a racist business. When some pointed out that the students admitted they were guilty, special assistant to the president for community and government relations Tita Reed (who also reportedly participated in the protests) wrote that it did not change a “damn thing.”
The jury in June 2019 awarded the Gibsons $44 million in compensatory and punitive damages. A judge later reduced the award to $25 million. But the college continued to drag out the appeal in what seemed like a revenge litigation against a store that refused to give up simply because it was innocent. That pushed the costs back up to more than $36 million for just the damages and interest to the grocery. That does not include the millions for the college’s own legal costs, which will now increase further with the lawsuit against the insurance companies.
As reported in the Chronicle Telegram, Oberlin is suing Lexington Insurance Company of New York; United Educators Insurance of Bethesda, Maryland; Mount Hawley Insurance Company of Peoria, Illinois; and StarStone Specialty Insurance Company of Cincinnati. It reported that it received a million dollars but incurred millions more in litigation costs alone. However, Cornell Professor William Jacobson has speculated that the companies will continue to decline on the basis of the college engaging in intentional torts.
There is, of course, an element of poetic justice in all of this for a College President and board that cared less about the plight of this family or the costs to its alumni and students.
It may also serve an important deterrent value for the college to have to bear the costs of its conduct. The college apparently treated its $75 million in coverage as a license to continue endless appeals while refusing to accept responsibility for its own conduct. This sense of entitlement was apparently shared by the students. When the college brought in a risk management expert, students were alarmed and objected.
Ambar and her board may have assumed that they could just treat this as someone else’s costs — the insurance companies, the alumni, the students. A denial of coverage could force the school to internalize the costs of this colossal failure of leadership. Since the leadership was unmoved by appeals to decency and fairness for years, a financial deterrent may be just what the college needs to change its conduct.