One interesting result of global trade agreements (and disturbing for multinational corporations) is that foreign workers are increasingly being able to gain jurisdictional access to US courts to pursue tort claims. The following case gives one example and more farreaching cases under what is called the Alien Torts Claims Act are being conducted on behalf of whole classes of workers in third world countries.
This is emerging as a key realm of global legal struggle. As you can imagine, the multinationals are starting to fight hard to end this trend, but so far it is actually an expanding area of lawsuits against multinationals.
--Nathan newman ========
NAFTA's Influence Unfolds in Mexican Bus Crash Lawsuit
Courts: New York-based firm agrees to pay $30 million to families of victims employed in its maquiladora.
By CHRIS KRAUL, CLAUDIA KOLKER, Times Staff Writers
In a case that illustrates the long reach of the North American Free Trade Agreement, the families of victims of a bus crash that killed 14 maquiladora workers in northern Mexico won $30 million in damages Monday from their U.S.-based employer.
The settlement with Salant Corp., a New York-based apparel manufacturer, in an Eagle Pass, Texas, state courtroom sent the message that an employer can be held responsible in U.S. courts for injuries to workers in another country.
As such, the case could have major repercussions for 3,000 foreign-owned factories in Mexico. But the case fell short of setting a legal precedent because the two sides reached a settlement during the trial and before the court resolved the issue.
The case echoes the fatal crash last week in California's Central Valley in which a farm-owned van crashed, killing 13 workers, a tragedy that also raised questions of employer liability.
At the very least, the successful claim by maquiladora workers shows that the enactment of NAFTA in 1994 is helping create a "new body of law linking employee and employer relationships across the border," said University of Texas professor Rodolfo de la Garza.
The case is the latest in a series of claims brought in U.S. courts by workers in maquiladoras, as foreign-owned factories are called, for damages incurred in U.S.-owned plants in Mexico. Recent cases have included charges of sexual harassment, negligence leading to the murder of payroll couriers and hazardous working conditions. Most cases are settled out of court with terms kept confidential.
What distinguishes the Salant case is the size of the settlement and the fact that terms have been made public, said Jose M. Larroque, an attorney specializing in maquiladora law at the Tijuana office of Baker & McKenzie.
The settlements available to workers in U.S. courts far exceed the liability the companies face when a Mexican court is deciding damages. In Baja California, for example, the maximum liability a company faces for a worker's wrongful death is about $3,500, Larroque said.
The lawsuit stemmed from a June 1997 accident involving a bus jammed with workers headed for work at the Salant maquiladora near Valle Hermosa, 20 miles south of Brownsville, Texas. The bus rolled over into a sewage ditch before catching fire. In addition to the 14 who burned to death or drowned, 12 workers were injured.
"No one would have sued the U.S. parent firm of these [maquiladoras] prior to the provisions of NAFTA," said Juan Zuniga, a specialist in cross-border law at Baker & McKenzie in San Diego. "People are bolder in doing so, and NAFTA might have made it easier to do so."
The plaintiffs alleged the "run-down" bus lacked adequate safety features, including a roof exit, pop-out windows and less flammable seats, and that the driver was inadequately trained.
Cynthia Chapman, the attorney whose Houston firm, Caddell & Chapman, represented the survivors and victims' families, said Salant purchased the used school bus for $6,000 in Texas and took it to Valle Hermosa to transport employees.
The plaintiffs argued successfully that although the 1997 accident occurred on Mexican land, U.S. jurisdiction was appropriate because Salant's Texas-based subsidiary made operating decisions, including the purchase of the bus and hiring of the driver.
A spokesman for Salant confirmed the settlement terms but declined to comment on the rationale for the settlement. In May, Salant emerged from Chapter 11 bankruptcy proceedings, but the spokesman said the bankruptcy filing had nothing to do with the claims stemming from the bus accident.
Victor Alfaro Clark, director of the Binational Center on Human Rights in Tijuana, a public interest group, said employee actions against the maquiladoras still are relatively rare because of weak labor unions and fears among workers that complaints will get them blacklisted.
Sister Susan Mika, president of the Coalition for Justice in the Maquiladoras, a San Antonio-based worker advocacy group, said the settlement is good in that "the workers and their families have gotten some kind of compensation for the horrible things that have happened to their families.
"We keep hoping more of these cases come forward so these kinds of things can be worked [out] in the country where many of the corporations are located," Mika said.
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