Wal-Mart Drops Bid to Sue Brain-damaged Former Shelf-stacker

Wal-Mart, the world's biggest retailer, has dropped its attempt to sue a brain-damaged, paralyzed former shelf-stacker for $400,000 (£202,000) to recoup health care costs arising from her injuries in a serious road accident.

The Arkansas-based company, which owns Britain's Asda chain, faced a public outcry over the case against Debbie Shank, a 52-year-old mother-of-three from Missouri who has been confined to a nursing home since a tractor slammed into her minivan eight years ago.

Shank lost much of her memory and has been unable to walk or communicate since. Soon after the crash, her 18-year-old son Jeremy was killed in Iraq.

As a Wal-Mart employee, Shank subscribed to company health care insurance, which initially picked up the tab for her care. But her relatives decided to sue a trucking company responsible for the accident, winning $700,000 in damages. After expenses, the Shank family received $417,000 — and Wal-Mart filed a lawsuit declaring it was entitled to the money as reimbursement for its health care fund.

The family appealed all the way to the supreme court, which refused to hear the case, leaving Wal-Mart as the victor.

The battle has proven a public relations catastrophe for the company, long pilloried for its anti-union policies, insensitive personnel management and paltry employee benefits.

Its action against the family prompted a host on national cable channel MSNBC to name Wal-Mart chief executive Lee Scott the "worst person in the world". Critics pointed out the money was a drop in the ocean for Wal-Mart, which made a profit of $12.7bn last year. After an extensive campaign, including a petition signed by hundreds of employees, Wal-Mart did an about-turn this week. In a letter to Shank's husband, Jim, the firm apologized.

"Occasionally, others help us step back and look at a situation in a different way. This is one of those times," said the letter from Wal-Mart's executive vice-president for store operations, Pat Curran. "We have all been moved by Ms Shank's extraordinary situation."

She said Wal-Mart would drop its claim and would work with the family on Shank's continuing care, adding: "We are sorry for any additional stress this uncertainty has placed on you and your family."

Shank's husband said he initially thought the letter was an April fool's joke. He told CNN: "I would like to let them know they did the right thing. I just wish it hadn't taken so long."