Suit Accuses Denny’s of Racial Bias : Discrimination: Blacks say the restaurant imposed cover charges and made them pay in advance. Denying allegations, company says security reasons were behind the policies.

Denny’s restaurants were accused Wednesday in a federal class-action lawsuit of imposing cover charges on black patrons, forcing them to pay in advance and other acts of discrimination.

The suit charged that Denny’s also had refused service to some African-Americans, subjected them to derogatory remarks and refused to honor their requests for its free “birthday meal” offer.

Attorneys representing black patrons who brought the suit said the charges, if upheld, could result in substantial damage awards to up to 100,000 potential victims of discrimination in the state.

The law firm that helped prepare the suit recently obtained $132 million in a settlement with Shoney’s, a Southern restaurant chain, in the largest civil recovery to date in a race bias case.

Coleman Sullivan, a spokesman for Denny’s, denied that restaurant policies were discriminatory. He said that for security reasons, some restaurants had imposed a cover charge and required prepayment for groups of 10 or more after 10 p.m.

Sullivan said the policy was “not enforced in a discriminatory fashion” but was eliminated last year because of customer concerns.

In a statement, Denny’s said also it had initiated a program to improve job opportunities for minorities and had begun “cultural diversity” training for employees.

At a news conference Wednesday, several plaintiffs, some in tears, described incidents in which they said they were treated differently from white customers.

African-American students said that after attending a college forum in December, 1991, a group of 18 had gone to a Denny’s in San Jose but were refused seating until they agreed to pay a $2 cover charge and to pay in advance for the meal.

White teen-agers seated nearby said they had not been required to pay the cover charge or to pay in advance, the students said.

“How do I explain to my son when he asks, ‘Dad, how can they do that?’ ” said James Coleman, whose 18-year old son, Chad, was in the group. “We’re not interested in money in this case. We’re interested in being able to go to a restaurant and be served.”

Danny and Susan Thompson said they had taken their 13-year-old daughter, Rachel, to a Denny’s in Vallejo. Even though they presented the girl’s baptismal certificate and school identification, they said, they were refused the chain’s widely advertised free birthday dinner.

“This was her first day as a teen-ager,” said Susan Thompson. “I was angry and outraged at what happened. . . . It still hurts.”

The suit, filed in U.S. District Court in San Jose, accused the chain of employing a “general policy of limiting black customers.” The suit quoted an unnamed former regional manager as saying supervisors wanted to “get rid of” so-called “blackouts,” a term describing large numbers of black customers.

The suit seeks an injunction barring the chain from acts of racial discrimination or intimidation, as well as unspecified damages.

In a separate action, a complaint against Denny’s was filed with the U.S. Equal Employment Opportunity Commission, charging that black employees were denied jobs and promotions and were forced to work in a hostile environment.