Shareholders had complained to the SEC on April 3 that the company had neglected to report in various reports to shareholders on the existence and effects of the consumer boycott, as well as other material effects on the business from the PACE International Union's corporate campaign. The union's efforts are the result of the company's 1996 decision to lock out its unionized employees.

The company's new statement says that the impact of the corporate campaign is "difficult to measure." But according to Joe Drexler, PACE International Union director of the boycott campaign, "Many of the costs of the labor dispute are readily quantifiable; the company owes its shareholders a better accounting."

The company claims that its decrease in gasoline sales volumes in 1999 was a result of pricing strategies. The company reported that:

"Retail gasoline sales volumes in 1999 declined 4.6% compared to 1998. This decrease in volume is principally the result of a less competitive, margin focused pricing strategy coupled with increased competition. The Company has not been able to attribute any specific decline in retail gasoline volumes to the orchestrated corporate campaign sponsored by the union."

This could be read to imply that the company's lost sales are due to selling gasoline at higher prices than competitors. But Drexler noted that a review in March by the union indicates that at gas stations targeted by the boycott in Richmond, Virginia and Birmingham, Alabama, the company has dropped its gasoline prices below competitors. "It looks like Crown is cutting prices in an attempt to compete with neighboring gas stations that don't face boycotts, pickets, or notoriety for pollution, civil rights discrimination and union-busting. This has to be costing the company, and it is not all that difficult to measure."

What is also missing from Crown's disclosure according to Drexler, is how ending the boycott could have improved Crown's earnings and attracted investors to make bids to purchase Crown at a price which was fair to shareholders. "Crown's process was tantamount to trying to obtain fair market value for a house which is shown in filthy condition," said Drexler. Crown's board has approved a takeover of the company at $9.50 per share by Rosemore, a holding company controlled by Crown CEO Henry Rosenberg. PACE maintains that the company's refusal to "clean up its house" has resulted in losses and depressed shareholder value.

It's also misleading to shareholders to just lump all the labor related costs as "difficult to measure," said Drexler. "For instance, the company has wasted millions of dollars in lawsuits against our union -- and Crown bookkeepers and lawyers surely have those figures."

The company's shareholder reporting amendment also failed to note the full significance of recent setbacks in its environmental cases:

"The Company is not currently aware of any information that would suggest that the costs related to the air, water or solid waste compliance and clean- up matters discussed herein will have a material adverse effect on the Company."

But Drexler noted that Crown's recent enforcement setbacks could easily result in over ten million dollars in penalties or upgrade costs. "The array of renewed and reinvigorated environmental enforcement actions over air pollution violations, by federal and state officials and local citizens, contradict the company's prior statements implying that it would soon place environmental controversies behind it."

Nevertheless, according to Drexler, the company's new language in the amended annual report that "it is possible that the corporate campaign could have a material adverse impact on the company's future results of operations," is an admission Crown clearly did not want to make.

The complaint filed by shareholders on April 3 can be viewed on the Internet at: http://home.earthlink.net/~gnproject/crown.htm

PACE, based in Nashville, Tenn., represents 320,000 workers in the paper, chemical, energy and automotive supply industries. Additional information on the Crown lockout may be obtained at www.crownboycott.org