$1.25 M settlement forged

Four retailers included in the $1 billion class action suit filed in California announced Monday their decision to sign a $1.25 million settlement agreement with human rights groups and the law firm that represents garment workers.

Nordstrom, J. Crew, Cutter & Buck and Gymboree were the first retailers to settle the lawsuit contesting alleged sweatshop conditions in the garment industry on Saipan.

Under the settlement, U.S. retailers have agreed in their future contracts to require independent monitoring of their Saipan contractors.

According to the agreement, the settlement money would go to payment of partial damages to the workers, as well as to fund an independent monitoring program, public education and costs of attorneys’ fees.

The case was filed by the law firm Milberg Weiss Bershad Hynes & Lerach LLP on behalf of 10 alien workers and 50,000 other potential class members.

“Nordstrom, J. Crew, Cutter & Buck and Gymboree should be commended for their commitment to human rights,” said Al Meyerhoff, one of the lawyers for plaintiffs.

Also named defendants in the case are The Gap, JC Penny, Sear, Tommy Hillfigger, Wal-Mart and the garment companies on Saipan.

The California case is one the three class actions filed by the alien workers from China, the Philippines, Thailand, and Bangladesh.

Milberg Weiss said the case filed in San Francisco will also be settled. Another case is pending in the Saipan district court.

The lawsuits alleged violations of the anti-peonage and indentured servitude laws of the U.S. and international human rights law.

Saipan-based attorneys who represent the garment companies were unfazed by the four companies’ move to settle the case.

They said the settlement was not a matter of admission of guilt, but merely a matter of practicality.

“As far as the defendants were concerned, the case could be defended, but the cost of settlement is a lot smaller than the cost of defending the case,” said lawyer Steven Pixley.

“It was a fairly small settlement. I don’t think it would have any impact on the Saipan case,” said lawyer Joseph Horey.

Lawyer Eric Smith said the timing of the settlement was suspect as it was announced on the day California Judge Christina Snyder heard the defendants’ motion to transfer the case to Saipan. (See related story)

“I was aware that Milberg Weiss was contacting the buyers and retailers to offer settlement,” Smith said in a telephone interview.

He also agreed that the settlement in California would not directly affect the local case.

The settlement also prohibits the use of unlawful “recruitment fees” in Saipan factories making apparel for U.S. retailers.

It also codifies detailed and strict employment standards for Saipan-based contractors with whom the settling companies do business, such as Global Manufacturing, Inc., Diorva Saipan, Ltd., Concorde Garment Manufacturing Corp., Jin Apparel, Inc., among others.

Such move is viewed to boost efforts by the Saipan Garment Manufacturers Association to enforce its Code of Conduct put in place to police its ranks.

“Today’s agreement is an important breakthrough in the struggle for human rights,” said Medea Benjamin, president of Global Exchange, one of the organizational plaintiffs.

“This is the beginning of long overdue changes in Saipan,” Meyerhoff said. “We sincerely hope the other defendants will see the wisdom of this important and unprecedented settlement.” (MCM)