Nestle, Cargill Again Face Suit by Ex-Slaves in Cocoa Fields
(Bloomberg) -- Six former child slaves from Mali who accused food producers Nestle SA and Cargill Inc. of aiding and abetting their forced labor in African cocoa fields won a fresh chance at making their case in a U.S. court.
A federal appeals panel in San Francisco on Tuesday overturned a ruling that dismissed the case last year because the foreign plaintiffs had failed to show any U.S. conduct was linked the alleged enslavement. The appeals court pointed to claims that employees based at the companies’ U.S. offices approved off-contract payments of personal spending money to farmers to ensure the low prices made possible by slave labor.
The plaintiffs, who sued over a decade ago, seek to hold the cocoa-buying companies liable for their captivity and mistreatment on farms in neighboring Ivory Coast, the world’s largest producer of the commodity. Nestle and Cargill allegedly turned a blind eye to the practice to benefit from lower prices.
The companies were “well aware” that child slave labor was pervasive in the Ivory Coast, and they had economic leverage that gave them control of cocoa production in the country, the court said. The judges said they took the ex-slaves’ “plausible allegations” as true in analyzing the case; the court didn’t rule on the merits.
After the ruling, the U.S. unit of Vevey, Switzerland-based Nestle said forced child labor is unacceptable and has no place in the company’s supply chain.
“We have explicit policies against it and are working with other stakeholders to combat this global social problem,” the unit said in a statement.
Minneapolis-based Cargill said in a statement that the allegations are false and it’s considering an appeal.
"We will not let these legal proceedings deter us from working actively every day to protect human rights, with an unwavering commitment to treating people with dignity and respect in the workplace and the communities where we do business," Cargill said.
The appeals court said it focused on the conduct alleged to have taken place in the U.S., to comply with the Alien Tort Statute that limits the ability of foreigners to sue in American courts.
Among the alleged actions scrutinized by the court were the companies’ payments of personal spending money to farms that were inspected by employees from their U.S. offices. The alleged purpose of the payments was to ensure the companies could continue receiving cocoa "at a price that would not be obtainable without child slave labor," the panel said.
"Providing personal spending money to maintain relationship above the contract price for cocoa is not ordinary business conduct, and is more akin to ‘kickbacks,’" the appeals court said. "The allegations paint a picture of overseas slave labor that defendants perpetuated from headquarters in the United States."
The ruling described the plaintiffs as former child slaves who were kidnapped and forced to work on cocoa farms for as long as 14 hours a day without pay.
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