The Chiquita Mess Gets Messier Still

Last month, I noted that Chiquita Brands International had been fined $25 million for paying terrorist groups in Colombia not to attack its workers. Julian then pointed out that the families of individuals killed by the right-wing United Self-Defense Forces of Colombia (AUC) had filed a class-action lawsuit against Chiquita in D.C. federal court, alleging violations of the Alien Tort Claims Act (ATCA) and customary international law.

Now another ATCA class-action lawsuit has been filed against Chiquita, this time in a New Jersey federal court. Here is how EarthRights International, a non-profit human rights NGO representing the plaintiffs, describes the lawsuit:

Today, Colombian families represented by EarthRights International (ERI), together with the Colombian Institute of International Law (CIIL), Judith Brown Chomsky, and Schonbrun DeSimone Seplow Harris & Hoffman LLP (SDSHH), filed a federal class-action lawsuit charging Chiquita Brands International, Inc., the multi-national produce company, with funding and arming known terrorist organizations in Colombia in order to maintain its profitable control of Colombia’s banana growing regions starting in the mid-1990s. Chiquita’s payments to these paramilitary groups, including the United Self-Defense Committees of Colombia (Autodefensorias Unidas de Colombia, or AUC) and its predecessors, were reviewed and approved by senior executives of the corporation, and resulted in the targeted killings of hundreds or thousands of individuals, including trade unionists, banana workers, and political organizers. The case is brought on behalf of relatives of the deceased and has been filed in the United States District Court for the District of New Jersey.

“To promote its business operations, Chiquita funneled money and guns to a terrorist group that murdered thousands of people and shipped untold amounts of cocaine to the United States,” said Marco Simons, ERI’s Legal Director. “Now, the victims are demanding some measure of accountability from Chiquita for its egregious behavior.”

[snip]

The complaint, brought under the Alien Tort Claims Act, asserts that Chiquita’s involvement violates not only Colombian law and U.S. law, but also international law prohibiting crimes against humanity, extrajudicial killing, torture, war crimes, and other abuses. The case seeks unspecified damages; because it is being brought as a class action, damages could be awarded to each victim of the paramilitaries supported by Chiquita, which is likely to amount to millions of dollars each to hundreds or thousands of families.

Among the plaintiffs, who must remain anonymous for fear of reprisals, is Jane Doe 1, the daughter of a community activist, Jane Doe 2, who was involved in a range of civic and social activities in Uraba region of Colombia where she lived with her family. Jane Doe 2 indicated that she was afraid she would be killed for her activities. Approximately one week later, AUC paramilitaries arrived at Jane Doe 2’s house and executed her in front of her family. Subsequently, the family of Jane Doe 2, including Jane Doe 1, fled their community in fear.

And here are the relevant paragraphs in the complaint concerning the links between Chiquita and the AUC:

33. Chiquita paid the AUC, directly or indirectly, nearly every month during the period 1997–2004, making over one hundred payments to the AUC totaling over $1.7 million. Chiquita’s payments to the AUC were reviewed and approved by senior executives of the corporation, including high-ranking officers, directors, and employees. Chiquita’s senior executives knew that the corporation was paying the AUC and that the AUC was a violent, paramilitary organization led by Carlos Castaño. Payments made to the AUC or to front organizations were recorded in Chiquita’s corporate books and records as “security payments” or payments for “security” or “security services.” Other payments, made to Banadex executives with the intent that they would be withdrawn as cash and handed directly to the AUC, were recorded as income contributions.

34. At all relevant times, Chiquita knew that the AUC was a violent, terrorist paramilitary organization. On September 10, 2001, the United States government designated the AUC as a Foreign Terrorist Organization (“FTO”), and that designation was well-publicized in the American public media, including in the Cincinnati Post on October 6, 2001, and in the Cincinnati Enquirer on October 17, 2001, as well as in the Colombian media.

35. In 2003, Chiquita consulted with attorneys from the District of Columbia office of a national law firm (“outside counsel”) about Chiquita’s ongoing payments to the AUC. Outside counsel advised Chiquita that the payments were illegal under United States law and that Chiquita should immediately stop paying the AUC directly or indirectly. Among other things, outside counsel advised Chiquita:

• “Must stop payments.”
• “Bottom Line: CANNOT MAKE THE PAYMENT”
• “General Rule: Cannot do indirectly what you cannot do directly”
• “Concluded with: CANNOT MAKE THE PAYMENT”
• “You voluntarily put yourself in this position. Duress defense can wear out through repetition. Buz [business] decision to stay in harm’s way. Chiquita should leave Colombia.”
• “[T]he company should not continue to make the Santa Marta payments, given the
AUC’s designation as a foreign terrorist organization[.]”
• “[T]he company should not make the payment.”

36. Although CBI’s Board of Directors agreed to disclose its payments to the AUC to the U.S. Department of Justice on or about April 3, 2003, on April 8, 2003, CBI instructed Banadex to continue making the payments to the AUC. On April 24, 2003, CBI met with Justice Department officials, who told CBI the payments were illegal. Nonetheless, Chiquita continued to make the payments until at least February 2004.

37. On March 19, 2007, Chiquita pled guilty in U.S. District Court for the District of Colombia to one count of engaging in transactions with a specially designated global terrorist. The company’s sentence will include a $25 million criminal fine, the requirement to implement and maintain an effective compliance and ethics program, and five years’ probation.

38. In 2001, Chiquita facilitated the clandestine and illegal transfer of arms and ammunition from Nicaragua to the AUC.

39. The Nicaraguan National Police provided 3,000 AK-47 assault rifles and 2.5 million rounds of ammunition to a private Guatemalan arms dealership, Grupo de Representaciones Internationales S.A. (“GIR S.A.”), in exchange for weapons more suited to police work. GIR S.A., in turn, arranged to sell the AK-47s and ammunition for $575,000 to Shimon Yelinek, an arms merchant based in Panama. In November 2001, Yelinek loaded the arms onto a Panamanian-registered ship with Panama as its declared destination, but the ship instead went to Turbo, Colombia.

40. Chiquita, through Banadex, operates a private port facility at the Colombian municipality of Turbo, used for the transport of bananas and other cargo. The arms ship docked at the Chiquita port, and Banadex employees unloaded the 3,000 assault rifles and 2.5 millions rounds of ammunition. These arms and ammunition were then transferred to the AUC.

41. On information and belief, Chiquita facilitated at least four other arms shipments to the AUC. In an interview with the Colombian newspaper El Tiempo, AUC leader Carlos Castaño subsequently boasted, “This is the greatest achievement by the AUC so far. Through Central America, five shipments, 13 thousand rifles.”

42. On information and belief, Chiquita was aware of the use of its facilities for the illegal transshipment of arms to the AUC, and intended to provide such support and assistance to the AUC.

I am not an expert on ATCA litigation, so I cannot offer an opinion on the merits of the lawsuit. The allegations, however, certainly cast the payments to the AUC in a far more negative light than I suggested in my original post. If the allegations are true — and we have yet to see Chiquita’s reply — the payments were, as ERI claims, intended to maintain control of the very profitable banana industry, not to protect Chiquita’s workers from harm.