Setting the Record Straight: Response to Co-op Board's May 31 email

Setting the Record Straight

On May 31, 2011, the Sacramento Natural Foods Co-op Board of Directors sent out an email to Members attempting to justify the Board’s refusal to follow the Co-op Bylaws and put the Human Rights and Restore Co-op Democracy Initiatives on the upcoming September ballot. Copies of these initiatives are available at http://www.coopdemocracy.org. Below are the statements from the Board’s email followed by a description of what actually has occurred. Note that the Board’s statements are not necessarily in the same order as in their email. Applicable Bylaws sections are included at the end; the complete Bylaws are on the Co-op’s website.

In summary, the Board’s May 31 email misinforms and misleads Co-op Members about the effort of their fellow Members to first follow the Co-op’s long standing Boycott Policy and then to follow the Co-op’s Bylaws by qualifying measures for the ballot. These efforts have been repeatedly opposed and thwarted by the Co-op Board in clear violation of the Co-op’s democracy and its Bylaws. Further, the Co-op is openly censoring these Members by prohibiting them from tabling in front of the store, while it allows the opposition to do so.

Issue: “Targeting” of the Co-op by a “national campaign”

Co-op Board email: “As you may know, our Co-op has been targeted as part of a national campaign by members of a political group that advocates the boycott, divestment, and sanction of products made in Israel or made by Israelis or Israeli-owned companies – even though our Co-op sells only a handful of such products, such as bath salts from the Dead Sea.”

The Facts: In June, 2010, Members of the Co-op followed the long-standing Boycott Policy and went to the Co-op’s Policy Committee to ask them to join in an investigation of Israeli products. These Members, many of whom have belonged to the Co-op for many years, were doing what millions of people of conscience have done through history to address civil, human, and labor rights issues: used the tool of boycott as a way to stop an egregious injustice. Boycotts are not new. They have been used successfully on behalf of farmworkers (grapes), gay rights (Coors), animal rights (companies using animal testing) and to end apartheid in South Africa. In all these cases, local people joined with others around the region, country, or world to take a stand for justice.

That the Co-op had a long-standing Boycott Policy clearly indicates that boycotts have been viewed as a legitimate tool for Members to use. The number of products the Co-op carries from Israel is irrelevant – the Co-op purports to carry NO products that are tested on animals.

The Facts: The Board’s email attempts to portray these Co-op Members as outsiders, who have “targeted” the Co-op. At the same time, the Board’s email fails to mention that the opposition to the proposed boycott has been led by the Jewish Community Relations Council (JCRC), whose mission includes protecting Israel. Interestingly, the above wording from the Board’s email is virtually the same language as the remarks made at the May 3 Board meeting by the new JCRC director, John Boisa. Boisa recently joined the Co-op.

The JCRC is an unelected body which purports to speak for the “Jewish community” on various issues, including uncritical support of Israeli government policies. It has excluded members of Jewish groups that criticize Israeli policy. The national level of this organization, the Jewish Federation, has allocated $6 million to “combat” any attempts to utilize the strategy of boycott and divestment to pressure Israel to end its human rights violations.

Issue: Board’s failure to put qualified member initiatives on the Co-op ballot

Co-op Board email: "At a recent meeting, your Board followed the unanimous recommendation of its Policy Committee not to certify an initiative that would have allowed a vote on the boycott. This decision was made in strict accordance with our Bylaws and Election Code, and on the advice of the Co-op’s legal counsel." (For more information on the decision, please click http://www.sacramentopress.com/headline/50827/Democracy_at_the_Sacramento_Natural_Foods_Coop_You_Bet)

The Facts: In January, several Co-op Members followed Bylaws Section 10.06 (see below) which allows for members to qualify measures for a vote of the full membership if they meet two procedural requirements. These requirements are: 1) submitting at least 100 Member signatures and 2) proposing the action included in the measure at a Board or member meeting. On January 26, signatures were submitted in excess of the number required and, on February 1, the action was proposed at the Board meeting. At this point, the Bylaws mandate that the Board put the Human Rights Initiative before a vote of the members; this would be on the annual September ballot. In clear violation of the Bylaws, the Board refused to do this.

The Co-op attorney’s letter fails to provide legal justification for the Board’s actions.

The Facts: At its March 1 meeting, the Board added a provision to the Election Code not specified in the Bylaws, that the Policy Committee would review member initiatives. In effect, the Board was attempting to change the Bylaws by changing the Election Code. Since the Bylaws define what is included in the Election Code, the Board was again in violation of its Bylaws. The March 1 Board meeting was followed by a Member meeting, at the end of which there was a non-Board member who called on those wanting to comment for or against the Human Rights Initiative. However this took place AFTER the Board had already voted to tamper with the Election Code as noted above.

The Facts: In April, Co-op Members submitted the required signatures for the Restore Co-op Democracy Initiative and on May 3 proposed it at the Board meeting. Under the Bylaws, the Board should have put this on the ballot but instead referred it to the Policy Committee which on May 17 recommended that it not be placed on the ballot.

Issue: Non-discrimination Co-op Membership policy

Co-op Board email: "For nearly 40 years, the Sacramento Natural Foods Co-op has been a strong asset to our community. We take great pride in our values including the fundamental principle that anyone in our community can join without gender, social, racial, political or religious discrimination."

The Facts: The Human Rights Initiative is about product purchasing decisions; it has nothing to do with who joins the Co-op. It should be noted that the use of boycott and divestment as a strategy to get Israel to stop violating international law and Palestinian human rights is supported by a wide diversity of gender, social, racial, political and religious groups.

Issue: Democratic Member Control

Co-op Board email: "Your Board of Directors is committed to democratic member control of our business, respecting the cooperative principles, and ensuring that no matter what your political or religious views, the Sacramento Natural Foods Co-op will continue to provide the benefits of natural foods and products, economic cooperation, and sustainable practices to as many people as possible in the communities we serve."

The Facts: The Board’s actions are anathema to the Cooperative Principle of Democratic Member Control, which states: “Co-ops are democratic organizations controlled by their members, who actively participate in setting their policies and making decisions.” The Board’s actions deny Members their right under the Bylaws to bring initiatives before a vote of the Members and the Memberships right to vote on such initiatives.

By allowing only one viewpoint about an important social and political issue to be expressed in front of the Co-op, the Board is discriminating against those who do not share that view.

The Board’s actions are also contrary to the Values & Goals stated on the Co-op’s website: “We encourage …healthy debate [and] owner involvement in decision making and governance.”

The Facts: If the current Board of our Co-op is truly committed to democratic Member control and the Cooperative Principles, it would follow its Bylaws and put the Human Rights and the Restore Co-op Democracy Initiatives on the ballot as those Bylaws require.

Issue: Bias and allegations of inappropriate behavior.

Co-op Board email: “Recently, several members of this group have harassed owners and shoppers outside our store, prompting complaints to the Sacramento Police Department. They have disrupted our Board meetings, requiring security to twice expel a member of this group from the discussions as well as an opponent of their actions. They have launched a misinformation campaign online and in the news media. Some have said they will urge shoppers to boycott our store. And now they are threatening legal action – which would require us to divert funds that would otherwise have been going to saving farmland, promoting sustainable agriculture, and improving our store.”

The Facts: Proponents of the initiatives have not harassed Members or shoppers and the store management has failed to provide documentation of these allegations. A week after the necessary signatures for Human Rights Initiative (see below), had been submitted, the Co-op’ General Manager, Paul Cultrera, prohibited its supporters from tabling in front of the store. He alleged two infractions, which the tablers disputed. He was asked to provide documentation of his allegations and has yet to do so. On March 29, Mr. Cultrera issued a memo to management and staff in which he stated that the suspension of tabling privileges on the Israeli/Palestinian issue or Palestinian human rights would affect not only the Initiatives’ proponents but would “apply to any other organization that wishes to table on those issues.” He subsequently prohibited Veterans for Peace and the Sacramento Coalition for Palestinian Rights from tabling on the issue.

The Facts: Proponents of the Human Rights Initiative continued to reach out to their fellow Co-op members from the public sidewalk. Co-op staff called police on at least two occasions; the police found no wrongdoing on the part of proponents.

The Facts: Only once was an initiative proponent expelled and it was for trying to speak to the Board. On April 4, Members filed a grievance with the Board appealing the tabling ban on the grounds that it was content-based and also discriminated against one group of people, the Palestinians, by prohibiting any discussion of their human rights. At its April 5 meeting the Board refused to consider the grievance. They also refused to let those who filed the grievance speak about it before the Board took action, as had been the practice at previous Board meetings. When one Member spoke anyway, she was kicked out of the meeting by then Board vice-president Steve Maviglio, who was presiding over the meeting. At the May 3 meeting, Maviglio, who is now President of the Board, revised the Comment rules and allowed Members to address agenda items as they came up (had this rule been in place on April 5, the Member would not have been expelled). April 5 is the only incident in which an initiative proponent has been expelled from a meeting. Supporters do not recall that any opponents were ever expelled, but have contacted the Board for the details of when and if this occurred.

The Facts: In May, the Co-op GM Paul Cultrera allowed a group to table in opposition to the Human Rights initiative. The General Manager did ban one male tabler after a written report was filed with the Co-op from a woman who reported being grabbed forcefully on the wrist by this tabler. The incident occurred when the woman was trying to get a piece of the group’s literature; she also filed a police report. Applying a double standard, Cultrera allowed the anti-initiative group to table despite a documented behavioral problem while continuing to ban the all proponents against whom no documentation has been provided.

The Facts: In May, Co-op Members filed a formal complaint requesting that the Co-op management end its content-based discriminatory tabling ban and that it cease making slanderous allegations about the content of the initiative proponents when it had failed over the past nearly four months to provide any documentation of the alleged complaints. Neither the Co-op management nor Board have responded to this complaint.

The Facts: On May 17, Policy Committee Chair Michelle Reynolds accused proponents of the Human Rights and Restore Co-op Democracy initiatives of putting out misinformation. On May 18, one of the proponents emailed Ms. Reynolds expressing that the group has no intention or need to distort what the Co-op Board or Co-op management say or do. The proponent asked Reynolds to let them know about inaccuracies in their literature, website or other communications, so that those could be corrected. Reynolds did not respond.

The Facts: Initiative supporters are Members of and shop at the Co-op; they are not calling for people to boycott the Co-op or turn in their memberships. In March, two initiatives supporters were told by a Co-op staff that those supporting the initiative were calling for a boycott of the Co-op and for people to drop their Memberships. At least one of supporters spoke directly with the staff person and told her this was not true and also communicated that to the General Manager.

The Facts: Any Board that violates its Bylaws opens itself up to legal action by its shareholders, Members or others. It is very irresponsible on the part of the Board of our Co-op to put itself in the position where it could be sued, even though most Boards carry Directors and Officers liability insurance in the event they are sued in conjunction with the performance of their duties as they relate to the organization. The Board still can follow the Bylaws and put these initiatives on the ballot. The Board would then have upheld its responsibility under the Bylaws and of course, would be free to campaign against the measures.

Issue: Sharing of Views about Proposed Boycott & Board Responsibility

Co-op Board email: “For more than six months, your Board and the Co-op Policy Committee … has listened to requests for a boycott. More than a dozen meetings were held where both proponents and opponents of the boycott shared their views. We featured a discussion of this issue on our Facebook page. We ran letters to the editor in the Co-op newsletter. And we featured a discussion with an independent facilitator on the issue at our last Quarterly Members meeting.”

The Facts: The Co-op Board has not been evenhanded on this issue; moreover, its responsibility goes beyond “listening to requests”. After initially refusing to follow the Boycott Policy, the Policy Committee reversed itself at its August 17, 2010 meeting and agreed to join in the investigation as it was mandated to do in the Boycott Policy, including running an article from the boycott proponents in the next Co-op reporter, (Oct-Nov-Dec 2010). The article was submitted by the deadline but the Committee refused to print it. Instead, the Co-op Reporter ran a 500+ word anti-boycott article by then-Board member Steve Brancamp. Over a half a dozen letters were submitted for the Jan-Feb- March Reporter in support of the proposed boycott, the Reporter ran 2 of these and one letter asking the Co-op Reporter to provide balanced coverage, which it has failed to do. The Co-op Board has received hundreds of letters and emails in support of the proposed Boycott and/or following the Boycott Policy; these are not reflected on the website or in the Co-op Reporter. Many people do not use Facebook; also some posts by boycott proponents have been removed from the Co-op’s Facebook page.

The Facts: Under the Boycott Policy, an informational binder was to be placed at the front desk in the store for three months. In both the Sacramento News and Review (9-30-10) and in the Co-op Reporter, the Policy Committee also stated that the information would also be available on the Co-op’s website and Facebook page. (Note: none of the information material was put on either the website or Facebook.)

The binder went into the store on October 1. On October 4, the Co-op Board received a grievance from Barry Broad, chair of the JCRC, objecting to the binder and the Boycott Policy. At its October 5 meeting, the Board pulled the binder and suspended the Boycott Policy. On October 20, nearly three dozen Members filed a grievance appealing these decisions. Their grievance was denied by the Board at its November 9 meeting. At its December 7 meeting, the Board eliminated the Boycott Policy.

The Facts: At its January 3 meeting, the Board removed the open comment period from the beginning of the meetings and only allowed Members to comment on previously discussed items at the very end of the meeting. During the meeting, no Members were allowed to address agenda items unless specifically asked by the Board. At the discretion of the Board, this was changed starting with the May meeting to allow Members to address agenda items; open comment is allowed at the very end of meetings about items not on the agenda.

Issue: Action taken by other Co-ops

Co-op Board email: "This action follows similar recent rejections of Israeli boycott initiatives by the Boards of Directors of co-ops in Davis, California and Port Townsend, Washington. As the Davis Co-op put it in their resolution: "...modern cooperatives, particularly food cooperatives, that have failed to abide by [the] essential principle of political neutrality have been harmed by the divisiveness that such issues cause among members and shoppers, including: an unwelcoming atmosphere for all, reduction in shoppers and sales, member resignations and return of capital, staff layoffs, disrupted operations, distraction from priorities.
We agree. Never in our Co-op’s long history have we boycotted products based on the politics of the government in which they were produced. We believe each of our owners can make their own decisions about which products they want to buy, and if they want international political disputes to figure in their buying decision."

The Facts: Co-ops are not politically neutral. Our Co-op makes purchasing decisions all the time based on political considerations, including animal rights, fair trade, effects on the environment. The international Cooperative Principles do not call for political neutrality; to the contrary, they call for democracy, autonomy, and member participation, and state that “co-ops work for the sustainable development of their communities through policies accepted by their members.” Policies related to sustainability are clearly political.

The Facts: Different Co-ops have different Bylaws and approaches to the effort to use boycott and divestment to pressure Israel to respect human rights. The thriving two-store Olympia Washington Co-op Board voted to support the effort by removing Israeli products the shelves in July 2010. Members of the Ann Arbor, Michigan Co-op put a similar referendum on their Co-op’s ballot in 2007; it did not pass, but Members were allowed to vote on it. As one Ann Arbor member put it: “Our pro-boycott group lost the tally, but the co-op certainly was in no way harmed by honoring its by laws. The co-op thrives to this day, and I am so proud to be a longtime member.”

Issue: Board concern about what has occurred

Co-op Board email: “We are saddened and disappointed by these actions and tactics.”

The Facts: It is more than sad and disappointing that the Co-op Board is choosing to violate the Co-op’s Bylaws and thwart Members rights to put initiatives before the Co-op Membership. The Co-op has received hundreds of letters from Members and shoppers in support of the proposed Boycott, following the Boycott Policy and/or the Human Rights Initiative.

It is also very disturbing that the Co-op is allowing only one viewpoint about an important issue to be shared in front of the store, while it censors Co-op Members who wish to share another view.

For more information: http://dailycensored.com/2011/03/23/sacramento-co-op-board-abandons-democratic-principles-wont-let-members-vote-on-proposed-israel-products-boycott/ and http://www.coopdemocracy.org

SNFC Bylaws excerpts Related to Member Initiatives:

The complete Bylaws are available on the Co-op Website.

[The requirements for putting measures on the ballot are spelled out in Section 10.06. This section refers to the quorum requirements of Section 7.05 and to the Election Code in Section 10.02]

SNFC Bylaws Section 10.06. Referendums and Initiatives
a) Any official act, either proposed or taken, at a membership meeting or a Board of Directors meeting, shall be submitted to a referendum or initiative of the Membership under the procedures outlined in the Election Code in any of the following situations:
1) A petition stating the action requested, signed by at least that number of Members which constitutes a quorum for the transaction of business as set forth in Section 7.05.a is received by the secretary of the Board.
2) The majority of the Members present and voting at a duly called regular or special Membership meeting deem it necessary.
3) The Board so directs.
b) The results of any referendum and/or initiative shall be binding on the Board and the Membership.

Section 7.05. Quorum
a) At any membership meeting, the presence, in person, of two percent (2%) of all Members having voting rights or one hundred (100) Members, whichever is less, constitutes a quorum for the transaction of business. If a quorum is present, motions shall be passed by a majority vote of those present and voting on the matter, unless the vote of a greater number is required by statute, the Articles of Incorporation, or the Bylaws. There shall be no voting by proxy.

[It is instructive to compare the requirements for Bylaws Amendments to those for ballot measures. These are addressed in two separate sections of the Bylaws and have two separate requirements. The Board has attempted to apply some of the requirements for Bylaws Amendments to ballot measures – this is clearly a violation of the Bylaws. In order to change the requirements for ballot measures, the Board would need to AMEND the BYLAWS, which calls for a vote of Members.]

Section 10.05. Bylaws Amendments
a) Amendments to these Bylaws may be proposed by :
1) A two-thirds (2/3) vote of the Board of Directors.
2) A petition signed by fifty (50) Members or five percent (5%) of the Membership, whichever is greater.
b) Proposed Bylaws changes shall be submitted to a committee assigned by the Board. This committee shall:
1) Check the proposed amendment for legality, for conflict with other Sections of the Bylaws, and for proper language.
2) Notify the Membership, in writing, of the proposed amendment.
3) Hold a publicized meeting to discuss the proposed amendment.
c) Amendments to these Bylaws shall be adopted by a two thirds (2/3) majority of those voting as prescribed in the Election Code.

[The contents of the Election Code are specified in the Bylaws, they are clearly procedural and do not give the Board authority that is not otherwise granted to it in the Bylaws.]

SNFC Bylaws Section 10.02. Election Code
Voting by mailed ballot shall be conducted in accordance with the Election Code. The Election Code shall be established by the Board of Directors and shall be in compliance with the following guidelines:
a) It is in accordance with the Bylaws and Articles of Incorporation.
b) It provides for a secret ballot.
c) It is even handed in its rules in respect to all candidates and subjects.
d) It forbids the use of money of the Cooperative for campaigning beyond the distribution of candidates' statements and pro and con analyses.
e) It mandates that the ballot shall set forth the proposed action, provides opportunity to specify approval, disapproval, or abstention. The ballot package must specify the time by which the ballot must be received in order to be counted.
f) All ballot packages shall indicate the number of responses needed to meet the quorum requirement and, for ballots other than the election of Directors or for advisory surveys, shall state the percentage necessary to pass the measure submitted.
g) Upon adoption of any amendment to the Bylaws, or any other matter by a mailed ballot, a revised copy of such shall be conspicuously posted at the Cooperative, not later than seven (7) days thereafter, and copies shall be made available upon request.
h) All mailed ballots under this Article may be sent to the Members and returned from the Members in a single envelope. No proxies are allowed.