Banana company to pay millions over human rights abuses

Banana company Chiquita Brands International has been found liable for financing a far-right Colombian paramilitary group and ordered to pay $38.3 million in damages to the families of eight men killed by the group during the country's civil war, a federal jury in Florida decided on Monday.

The landmark ruling on Monday comes after 17 years of legal proceedings, marking the first time the corporate giant has been found liable for similar lawsuits for those victimized by the United Self-Defense Forces of Colombia (AUC), the plaintiffs' attorneys said.

In 2007, Chiquita pled guilty to one count of engaging in transactions with a "specially designated global terrorist" and was ordered to pay a $25 million fine, the U.S. Department of Justice said at the time. The company was accused of making illegal payments to the AUC, a paramilitary group that was known for mass killing, kidnapping civilians, and mutilating their corpses.

The case, originally filed by the nonprofit EarthRights International in 2007, was followed by several other cases in 2008, the nonprofit said. A team of law firms across the United States have been representing over 5,000 Colombian victims in the proceeding and additional trials for other victims will follow in July, according to attorneys.

Monday's verdict, which came after a six-week trial and two days of deliberations, also marks the first time a major U.S. corporation was found liable for its role in human rights abuses abroad, attorneys said. The ruling could affect similar litigations that involve such violations.

"This verdict sends a powerful message to corporations everywhere: profiting from human rights abuses will not go unpunished. These families, victimized by armed groups and corporations, asserted their power and prevailed in the judicial process," Marco Simons, EarthRights International General Counsel and one of the plaintiff's attorneys, said in a statement.

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'Verdict does not bring back the husbands and sons who were killed'

The eight plaintiffs, which include surviving family members of eight men who were murdered by the AUC, alleged that Chiquita paid nearly $2 million to the violent militant group. The group was also accused of "facilitating shipments of arms, ammunition, and drugs, despite knowing that the AUC was an illegal organization engaged in a reign of terror," law firm Cohen Milstein Sellers & Toll said in a statement.

Attorneys for Chiquita have said the company had made those illegal payments in the late 1990s and early 2000s to protect its Colombian employees from further violence, The Palm Beach Post, part of the USA TODAY Network, reported.

The plaintiffs' attorneys said Chiquita’s support of the AUC violated both U.S. and Colombian law. During the trial, they argued that the company willingly worked with the AUC to protect its profits and to suppress employee unrest.

On Monday, a federal jury in Florida ruled that Chiquita knowingly provided substantial assistance to the militant group in the form of cash payments or other means of support, to a degree sufficient to create a foreseeable risk of harm.

The eight men were killed by the AUC and Chiquita was unable to prove that its support for the group was a result of impending harm to the company or its employees, the jury said.

"The verdict does not bring back the husbands and sons who were killed, but it sets the record straight and places accountability for funding terrorism where it belongs: at Chiquita's doorstep," Agnieszka Fryszman, a lawyer at law firm Cohen Milstein Sellers & Toll, said in a statement.

While the plaintiffs' attorneys celebrated Monday's verdict, they noted that the broader litigation against Chiquita includes hundreds of other victims — whose "cases may be resolved through additional trials, or an eventual settlement."

Chiquita's relationship with the AUC

The AUC is a paramilitary group in Colombia that was active between 1997 and 2006, according to Stanford University’s Mapping Militants Project. The group was a consolidation of multiple self-defense groups in the country that carried out brutal kidnappings and assassinations.

Though the group disbanded in 2006, small groups and individuals have committed attacks while claiming to be the AUC, the Mapping Militants Project said. The AUC was designated by the U.S. government as a foreign terrorist organization in September 2001 and then as a specially-designated global terrorist the following month, according to the Department of Justice.

"These designations made it a federal crime for Chiquita, as a U.S. corporation, to provide money to the AUC," the Justice Department said in a 2007 news release.

Under Chiquita's plea agreement, the company was ordered in 2007 to pay a $25 million criminal fine, implement a compliance and ethics program, and agree to five years probation. The Department of Justice said that for years — from sometime in 1997 to February 2004 — Chiquita paid AUC in two regions of Colombia where Chiquita had banana-producing operations: Urabá and Santa Marta.

The company made these illegal payments through its Colombian subsidiary, known as "Banadex," according to the Department of Justice. And by 2003, Banadex was the company's most profitable operation.

Through Banadex, the company paid the AUC nearly every month for about six years and made over 100 payments that amounted to over $1.7 million, the Department of Justice said. The company had begun working with the AUC in 1997 following a meeting between the then-leader of the AUC, Carlos Castaño, and a senior executive of Banadex.

"Castaño implied that failure to make the payments could result in physical harm to Banadex personnel and property," the Department of Justice added. "No later than September 2000, 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. Chiquita's payments to the AUC were reviewed and approved by senior executives of the corporation, including high-ranking officers, directors, and employees."

The company paid the AUC by check for several years until June 2002, when Chiquita began paying directly and in cash, according to the Justice Department. Some payments were documented in corporate records as "security payments" despite Chiquita never receiving actual security services from the payments.

Contributing: Hannah Phillips, Palm Beach Post; Reuters