Chiquita may yet lose a class action lawsuit related to its former operations in Colombia
The long-running saga surrounding Chiquita’s former operations in Colombia has taken a new turn. In early June a Florida judge ruled that class action lawsuits against the fruits giant will be allowed to proceed.
The action has been brought by family members of Colombians who were killed or tortured by terrorist groups. The plaintiffs allege that payments Chiquita made to paramilitary groups in Colombia mean that the company has responsibility for the atrocities committed by these groups.
Chiquita had asked the court to dismiss the claims, stating that it had been the victim of extortion. While the judge granted the company’s motion to dismiss claims for damages related to terrorism, the plaintiffs can continue with claims for damages against Chiquita for torture, war crimes and crimes against humanity.
One thing is not in dispute: the company did make payments to Colombian paramilitary groups. But Chiquita spokesman Ed Loyd says these were made purely to protect the company’s staff. “Throughout the 1990s our employees were massacred. On one occasion, four were butchered in front of their colleagues; on another 28 were murdered as they travelled to work on a bus.”
A price worth paying?
Faced with such violence, Loyd says, the company took the view that making payments demanded by paramilitary groups was a price it had to pay to protect employees, and began to do so in the mid-1990s.
A change in the law in 2001 meant that these payments became illegal in the US, and in 2003 Chiquita realised, Loyd says, that it was not able to protect its employees legally and voluntarily disclosed the details of the payments to the US Department of Justice. “We are the only company ever to do so,” Loyd says.
In 2004 Chiquita sold its Colombian operations at a loss. Then in 2007 the company agreed to pay a fine of $25m for violating US anti-terrorism laws.
Marco Simons, legal director for EarthRights International, a human rights and environmental NGO that has been closely involved with the Colombians bringing the action against Chiquita, says “Chiquita’s extortion argument appears to be factually untrue” and that the company “sought out and paid the paramilitaries in exchange for security”.
Simons argues that if Chiquita had indeed been subject to extortion then it should have immediately informed the authorities and then, if it were impossible to operate without paying terrorists, take steps to wind down its Colombian operations. “Duress is not a defence to complicity in murder,” he says.
Loyd counters that the company didn’t want to abandon its “people and commitments”, that Chiquita had wanted to work within the law and protect its employees. When the law changed, “it became apparent that there was not a solution”.
The Rainforest Alliance had been working with Chiquita in Colombia and had certified a number of the company’s farms. Chris Wille, Rainforest Alliance’s chief of sustainable agriculture, says that Chiquita’s farms “were paragons of good management, both environmentally and socially”. He says that the farms were models of ethical harmony and “islands in a sea of violence”. Wille admits that Rainforest Alliance would not have certified Chiquita’s farms if it had been aware that the company been breaking any Colombian laws.
So what’s next? Chiquita says it will robustly defend the class action. “We have faith in the justice system,” Ed Loyd says.
Simons argues that “despite Chiquita’s $25m payment to the US government, the victims of its conduct have received nothing”.
The real losers seem to be Chiquita’s former employees. Whatever the rights or wrongs of any “protection”, they had certainly been benefitting from the company’s progressive labour code. The local labour unions had strongly lobbied the company to retain its Colombian operations in 2004.