Civil rights group withdraws allegations against Kozmo.com

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Three months after its discrimination suit against online delivery service
Kozmo.com Inc. was dismissed in federal court, a Washington-based civil rights group
today dropped the matter altogether and said the alleged discrimination didn't actually
occur.

In a statement issued today as part of a joint href="http://www.businesswire.com/webbox/bw.120500/203402484.htm"
target=NEW>announcement with Kozmo.com, David Berenbaum, the former executive
director of the Equal Rights Center (ERC), said the civil rights group has decided that
the New York-based company didn't use racial redlining practices in initially avoiding
some predominantly African-American neighborhoods in Washington.

"Based on our discussions with Kozmo executives and our review of the evidence, we
concluded that the definition of Kozmo's initial service area was not motivated by
racial discrimination," said Berenbaum, who left the ERC about a month ago. He couldn't
be reached for additional comment today.

The ERC filed suit against Kozmo.com in April, charging that the company used racial
redlining to avoid making deliveries in some parts of Washington. The suit was
dismissed by a federal court judge in September, but ERC officials insisted that it
would be refiled later in a local District of Columbia court. That never occurred
and is no longer planned, according to Berenbaum.

A Kozmo.com spokeswoman said today that the company continued to have discussions
with the ERC after the federal suit was dismissed. "We're pleased by the statements
that they have made because we have maintained all along that race was never a factor
in determining our service areas," she said.

Just days after the ERC's suit against Kozmo.com was dismissed in U.S. District
Court, the company target=NEW>announced plans to broaden its delivery range in Washington and several
other cities. Included in the expanded areas were neighborhoods that are racially mixed
or have predominantly African-American or Hispanic populations.

Kozmo.com said at the time that the service area additions "represent the natural
progression of our business model" and weren't related to the discrimination suit. In
his statement today, Berenbaum said furthering civil rights goals would be easier "if
every company reacted as swiftly as Kozmo to eliminate the appearance of
discrimination."

Kozmo.com and the ERC also announced a joint initiative to help increase Internet
access in underserved neighborhoods in and around Washington. Funding for the
initiative will come from a $125,000 donation that Kozmo.com is making, they said.

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