Sunday, June 22, 2008

Corporate Spies Targeted Activists

t r u t h o u t | 06.22

Corporate Espionage Detailed in Documents

Sunday 22 June 2008


by: Jenna Johnson, The Washington Post

Greenpeace activists protest at Philips annual general meeting. The group targets companies for their environmentally damaging business practices. Greenpeace was among the actvist groups who were spied on at the behest of corporations. (Photo: Greenpeace)

They scavenged through trash and tailed people for hours. They used undercover operatives to infiltrate private meetings. The targets were not agents of foreign powers but advocacy groups that had been critical of corporations.

In the 1990s, a Maryland-based private detective agency composed of former CIA agents and law enforcement officers spied on such activist groups as Greenpeace, the firm's records show.

The agency, Beckett Brown International, had an operative at meetings of a group in Rockville that accused a nursing home of substandard care. In Louisiana , it kept tabs on environmental activists after a chemical spill. In Washington , it spied on food safety activists who had found taco shells made with genetically modified corn not approved for human consumption.

BBI, which was founded in 1995, disbanded in 2000, and the activists might never have learned they were spied on. But a disgruntled BBI investor began digging through company records two years ago and has been contacting the former targets. He also gave The Washington Post access to the records, which provide an unusually detailed look into the secretive world of corporate spying.

"These people were victims," investor John C. Dodd III said. "They were trying to make things better or just do their jobs, and these guys were spying on them."

Although the targets were surprised when Dodd called, many said they had suspected they were being watched. Elder-care activists in Rockville had long wondered how Hebrew Home nursing facility officials seemed to predict their every move, former activist Ilene Henshaw said.

"They were absolutely one step ahead of us," she said. "I never knew why."

Not all of BBI's work targeted activists: Lysol wanted details of a New Jersey high school student's science fair project about cleaning products. Mary Kay executives sought a secret "psychological assessment" of a fellow executive. A consultant working for Nestle wanted information about rivals Mars and Whetstone Candy.

"I always thought they were trying to sabotage me," said Henry M. Whetstone Jr., who recently reviewed the BBI records. "Everyone thinks that the candy industry is this happy world. It's not. It has a really dark side."

BBI was renamed in 1999, and it dissolved the next year. Dodd, who said he invested $700,000 in BBI, sued his former partners for breach of contract. He lost, but he kept more than 100 boxes of records from the firm's office in Severna Park .

Former targets have paid Dodd or a lawyer working with him, in some cases as much as several thousand dollars, for access to and assistance with the material, he said. At least one plans to sue.

In an interview, BBI founding partner Richard M. Beckett said his work focused on executive recruitment, a service for which The Washington Post Co. paid the firm $27,000 in 1998. Beckett said he knew little about the investigative work and left in 1999.

Former BBI investigator Timothy S. Ward, a retired Maryland State Police officer, said BBI did nothing illegal. He declined to comment on methods or specific investigations, citing what he said were confidentiality requirements under Maryland law.

The legality and ethics of such methods as dumpster diving and infiltration are widely debated and vary from state to state. Many private investigators and corporations have abandoned the practices since 2006, when it became known that Hewlett-Packard's chairwoman used investigators to spy on board members and reporters.

Experts said corporations are typically insulated from such investigations by confidentiality agreements and multiple layers of subcontractors, making the BBI documents rare for more than the methods they reveal.

"I don't know of many cases where you get to see the whole chain of people involved," said Ari Schwartz of the Center for Democracy and Technology, which researches privacy issues.

That chain included Jim Daron, a D.C. police officer who helped seize trash from outside activists' offices. "If he can't get it with the shield, it will be difficult," Ward wrote in an e-mail about dumpsters in a gated alley.

In an interview, Daron said he was present during trash pulls but served only as a driver. He said he stopped even that after BBI asked him to use his badge to gain access to restricted areas. "I said, 'No, it's over,' " he said.

D.C. police officers must obtain permission to have outside jobs; Daron, who still works for the department, said he did not do so.

The chain often included public relations consultants who hired BBI or urged clients to do so. The documents show that many of BBI's clients were referred by Nichols-Dezenhall Communications Management Group, a D.C. crisis management firm.

Before Nichols-Dezenhall disbanded in 2003, founding partner Eric Dezenhall promoted his firm's willingness to aggressively respond to what he called "the culture of the attack."

"We are the last resort, the Navy SEALs of the communications business," he told The Post in 1999. "Our only objective is to make the problem go away."

In a statement, Dezenhall said neither he nor anyone else at his former firm authorized or condoned unethical activity. "Although at times we have recommended that our clients protect themselves by retaining security and investigative experts, we have not supervised or directed those activities because that has never been our area of expertise," he wrote.

Dezenhall said his current firm, Dezenhall Resources, does not share Nichols-Dezenhall's "strategic focus." Managers, employees, clients and vendors "have turned over almost entirely since that time," he wrote.

Nick Nichols, Dezenhall's former partner, was traveling and unavailable, an associate said recently. In his book "Rules for Corporate Warfare," Nichols wrote that he hired former law enforcement officials to investigate when clients were "the target of shakedown artists and other lowlifes. And, we're proud of it."

'It's a Little Scary'

In 1997, at a community center in Montgomery County , activists held meetings to discuss Hebrew Home. The group, made up largely of residents' relatives, alleged poor medication controls and rough treatment of residents. As they strategized, an undercover operative was paying close attention.

Her reports - along with meeting agendas, license plate numbers and descriptions of advocates - were relayed to Hebrew Home officials, the records show.

"It's a little scary they were doing this," said Henshaw, whose father lived in the home in 1997.

Over a year, the nursing home paid BBI about $50,000 for investigative work, according to invoices addressed to chief executive Warren Slavin, who still directs the home.

Hebrew Home said in a statement that it hired BBI on a recommendation from its public relations consultant because the activists were "threatening staff, interfering with care, and putting the health and well-being of our elderly residents at risk."

"We are not aware of anyone on behalf of Hebrew Home having approved or directed, nor would we condone, any unethical activity that may have been undertaken by Beckett Brown," the facility said.

In an interview, the operative identified in the documents, Madeline "Maddie" Cole, denied that she had worked for BBI. She said she attended activists' meetings about Hebrew Home but did not recall whether she had relayed information to anyone else.

Hebrew Home made changes after state health officials found deficiencies, but Henshaw said she is certain her group would have been more effective if it had not been compromised.

Getting to the ' Inner Circle '

In 1998, at the urging of Nichols-Dezenhall, chemical company Condea Vista hired BBI to help with the fallout from an ethylene dichloride spill in Louisiana , Peter Markey, who oversaw public affairs for Condea Vista, said in sworn testimony. Thousands of workers said they were sickened in one of the largest spills in U.S. history.

Markey said in a videotaped deposition last year that he, the company's president and its general counsel were aware that BBI was sifting through trash and infiltrating meetings but did not question the practices.

Contacted recently, Sasol North America , which bought Condea Vista in 2001, said it could not comment on events that took place before it acquired the company.

According to BBI documents, investigative targets included the law firm that represented many of the workers; lawyer Tom Filo and his activist wife; Beth Zilbert, who led a Louisiana advocacy group called CLEAN; and Greenpeace's Washington offices. Mother Jones magazine has reported on aspects of BBI's work.

Ward, the former investigator, hired Jay A. Bly, a former Secret Service agent, to follow Zilbert and do weekly trash pickups. Bly wrote that he found little of value in the activist's trash: "no newspapers, magazines, flyers, envelopes... . It appears that they may be recycling all their trash."

Reached by phone, Bly referred questions to Ward. Zilbert said: "See? Recycling pays."

BBI obtained law firm documents, including one lawyer's tax returns, medical assessments and financial information about the firm's clients. "This stuff is stuff we never, ever would have thrown away," Filo said.

An undercover operative not identified in the documents was named to the governing board of CLEAN. "I will be in the 'inner circle' and included in all the planning meetings," he wrote in an e-mail.

The operative reported on meetings held at the law office after business hours and on private conversations about lawsuits, one of which took place in a parking lot because of concern that meeting rooms were bugged.

In the years since, several class action lawsuits stemming from the spill have been settled. One remains, and lead lawyer Perry R. Sanders Jr. said he intends to use the information about BBI's intelligence gathering to press his claim.

"It's just not okay this happened," Sanders said.


Staff researchers Madonna A. Lebling and Meg Smith contributed to this report.

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