On March 1, 2016, Simon & Schuster will publish an epic biography of the Bechtel family, written by investigative journalist and bestselling author, Sally Denton. The Profiteers: Bechtel and the Men Who Built the World pulls back the curtain on the secretive family’s global empire, the Bechtel Corporation, exposing its rampant abuse of corporate and political power.
From its early work leading a consortium that constructed the Hoover Dam, Bechtel grew to become one of the largest privately-owned companies in the United States, enriching itself through government contracts, the privatization of public works, and a revolving door between its corporate offices and high-level positions with the U.S. government.
The Profiteers is a cautionary tale, showing how one family’s blind ambition can have disastrous consequences for our democracy. It prominently features Gary Gwilliam and his law firm’s seven-year legal battle over Bechtel’s mismanagement of a national security lab.
A case study in corporate abuse: Bechtel’s takeover of Lawrence Livermore lab
The Bechtel family’s multi-billion dollar fortune can be traced to one source: the U.S. Government. From government contracts to government subsidies, the family has relied on taxpayers to build their empire.
A chief example of this is the nuclear power and weaponry industry. In addition to its work building nuclear power plants, Bechtel played a central role in President George W. Bush’s privatization of the nuclear weapons complex, when a Bechtel-led partnership was awarded contracts to manage Los Alamos National Laboratory in New Mexico and Lawrence Livermore National Laboratory in California.
Bechtel’s takeover of Livermore lab was privatization at its worst. Bechtel promised the government $50 million in annual costs savings, nearly all of which was transferred directly to the corporation and its partners as a “management fee.”
Things played out predictably. Almost immediately after taking over the lab in October 2007, Bechtel announced the first layoff in more than 30 years. Cronyism, a hallmark of the Bechtel family, was rampant, as more than 40 percent of the lab’s workforce was protected from the layoff. The remaining workers, who were disproportionately older and had more seniority, were then targeted for layoff.
In the end, 430 employees lost their jobs on May 22-23, 2008. These loyal workers were marched off the lab under armed guard.
The Andrews litigation
Within days of the layoff, Gary Gwilliam was contacted by former lab employees seeking representation. What began as a few calls soon turned into a deluge, with nearly 200 people contacting the firm.
Through his earlier lawsuits against Livermore lab, Gwilliam had shown that he was one of the few attorneys willing to take on the lab. He did so again here, ultimately agreeing to represent 130 plaintiffs in a consolidated action filed in Alameda County Superior Court in May 2009.
What followed was a titanic legal struggle that is chronicled in The Profiteers. Through years of discovery, Gwilliam and his partners, Randy Strauss and Rob Schwartz, uncovered evidence proving that Bechtel fabricated a “$280 million budget shortfall” to justify the layoff. They also showed that older workers bore the brunt of the layoff.
After five long years, the claims of five “test” plaintiffs went to trial in 2013. The plaintiffs prevailed in the first trial and were awarded more than $3.3 million for their breach of contract claims. They lost a second trial of their age discrimination claims.
Rather than pay the plaintiffs, Bechtel chose further delay, filing an appeal and repeatedly trying to stop further action in the trial court. Meanwhile, the plaintiffs, whose average age was 54 at the time of the layoff, lost homes, marriages, and even their health.
The case finally settled on September 30, 2015, for $37.25 million. It ended up being the most expensive and complicated case ever litigated by Gwilliam’s firm.
Despite its repeated failures, Bechtel is still entrusted with management of Los Alamos and Livermore labs.
About the author
Sally Denton is an investigative reporter, author, and historian. She is the author of The Money and the Power, American Massacre, and The Bluegrass Conspiracy, among others.
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