BY The Associated Press
Chiquita Brands International Inc. is still dogged by The Cincinnati Enquirer's May 3 stories questioning the banana exporter's business practices, even though the newspaper has repudiated the stories, fired the lead reporter and paid Chiquita more than $10 million.
The stories -- and the unanswered questions about whether they were accurate -- remain a national focus of press attention. The New York Times and The Wall Street Journal ran stories Friday about the confrontation between Cincinnati-based Chiquita and the Enquirer.
The Times said the Securities and Exchange Commission is investigating allegations in the Enquirer's stories that Chiquita employees may have been involved in a bribery scheme in Colombia. Chiquita executives told the Times that the company's policy prohibits illegal payments to government officials and that the issue is closely monitored by management.
The Foreign Corrupt Practices Act bars a company based in the United States, or an agent or officer of such a company, from bribing foreign officials.
Robert Olson, general counsel of Chiquita, declined to address the article Friday. Steven G. Warshaw, Chiquita's president and chief operating officer, was away from his office traveling and could not be reached to comment.
The Enquirer has said it fired Mike Gallagher on June 26 on the belief that he may have been involved in stealing messages of Chiquita executives from the company's voice-mail system for his stories.
The Enquirer's management has repeatedly declined to discuss the accuracy of its stories on Chiquita, which also were based on Chiquita documents. But that issue has been a focus of the interest by other news organizations, including the Times and the Journal.
In May, the Enquirer reported that copies of the voice-mail tapes had been provided to the Securities and Exchange Commission and that the SEC is investigating Chiquita. The SEC has declined repeatedly, including this week, to say whether it has the tapes or what it is doing with them. Chiquita management has said it is cooperating with an SEC inquiry.
Chiquita on July 2 filed a defamation lawsuit accusing Mr. Gallagher of illegally and repeatedly tapping into the company's voice mail system and listening to messages of Chiquita executives, sometimes even before the recipients heard them. Chiquita's lawsuit alleges that Mr. Gallagher eavesdropped on those messages to learn what Chiquita executives discussed as they prepared responses to questions he had posed to them.
Mr. Gallagher, 40, who had been with the Enquirer since 1995, did not return a call Friday to his home. He has placed his suburban Milford home for sale. His lawyer also did not return a call.
The Wall Street Journal reported Friday that in October 1997, more than six months before the Enquirer published its Chiquita stories, Mr. Gallagher told Enquirer Editor Lawrence K. Beaupre that Mr. Gallagher had tapped into Chiquita's voice-mail system in order to verify authenticity of voice-mail messages he was receiving from a Chiquita source.
Mr. Beaupre reprimanded Mr. Gallagher, telling him not to use that method of verification again, the Journal reported, quoting unidentified sources it said knew of the episode.
Mr. Beaupre declined Friday to comment about the report, as did Harry M. Whipple, the Enquirer's president and publisher. Mr. Whipple said he would not comment because of a continuing investigation by a state special prosecutor looking into whether property was stolen from Chiquita.
The Enquirer's settlement spared the Gannett Co.-owned newspaper from a lawsuit Chiquita had prepared against the Enquirer, Mr. Olson said. Mr. Gallagher was not a party to the settlement.
Previous stories
Ex-reporter faced questions before July 11, 1998
Judge got contributions from Chiquita execs, special prosecutor July 10, 1998
Ex-reporter tries to avoid testifying to grand jury July 9, 1998
Chiquita sues former Enquirer reporter July 3, 1998
Reporter fights subpoena July 1, 1998
Enquirer employees subpoenaed in probe June 30, 1998
Chiquita accepts apology, $10M from Enquirer June 29, 1998
An apology to Chiquita June 28, 1998
