January 14, 1999
The San Francisco Chronicle
William Carlsen, Staff Writer
profits, according to a sweeping lawsuit filed yesterday in San Francisco.
Lawyers filing the suits yesterday described inhumane working and living conditions on the
conditions, complete with guarded barb-wire compounds.
The three suits, filed in San Francisco, Los Angeles and Saipan, name as defendants the Gap,
Nordstrom, Tommy Hilfiger, May Co., Sears, Wal-Mart and most of the big names in clothing
and retail, as well as a number of apparel manufacturers and contractors.
The class-action suits, which seek $1 billion in lost wages and damages, were brought on behalf
racketeering, human rights and business laws.
”To allow such squalid conditions to persist on American soil is both patently unlawful and
morally reprehensible,” said Al Meyerhoff, one of the lead attorneys.
Apparel companies and retailers contacted yesterday denied that their subcontractors violate any
laws. They said they have conducted inspections and would stop doing business with vendors
they believed were in violation of the law.
Nordstrom, for example, said it inspected two facilities in Saipan in October and did not find
company. ”We make announced and unannounced inspections and look at working conditions,
wages, the ages and numbers of workers and the safety of the facilities and operations.”
copy of the suits so we can continue our investigation.”
Rhonda West, a spokeswoman for the May Department Store Co., said the company takes the
allegations ”very seriously, and we’ll investigate fully to ascertain the facts.” But, she added, the
company insists that its suppliers and vendors fully comply with applicable wage and labor laws.
The Gap, which is based in San Francisco, issued a statement saying the company was ”deeply
concerned about the allegations.”
company said, noting that it monitors ”conditions to ensure that workers are treated with dignity
Saipan, one of chain of western Pacific islands known as the Northern Marianas, came under
In recent years, aware of lax laws and regulations, Asian-based companies have flocked to
Saipan, the commonwealth’s main island, to set up dozens of apparel factories.
Because of their commonwealth status, the islands enjoy favorable U.S. tariff and duty
This has permitted companies in Saipan to ship their products to the mainland without paying
duties, according to yesterday’s suits, and allows them to label the goods ”Made in the USA,” or
”Made in the Northern Mariana Islands, USA.”
Lawyers representing the island’s garment workers called Saipan ”America’s worst sweatshop”
Bangladesh and Thailand, work and live like indentured slaves.
Lured with the promise of high wages and U.S. working conditions, they are instead often forced
to work seven-day weeks, 12 hours a day, with no overtime, sometimes without pay or at pay
below the U.S. minimum wage, the attorneys said.
”Many live in a room with up to seven other people in inward-pointing barbed wire-enclosed
barracks, their movements strictly supervised by guards and subject to lockdowns or curfews,”
said a statement released with the lawsuits.
of up to $7,000, the suits allege.
(UNITE), and three local nonprofits, Global Exchange and the Asian Law Caucus, both in San
Francisco, and Sweatshop Watch of Oakland.
Sweatshop Watch Press Release
January 13, 1999
15,000 Workers Living in Indentured Servitude While Producing Goods “Made in the USA”
More Than $1 Billion Sought — Defendants Include The Gap, Tommy Hilfiger, May Company, Sears
In the first-ever attempt to hold U.S. retailers and manufacturers accountable for mistreatment of
workers in foreign-owned factories operating on U.S. soil, litigation was filed today in California
and Saipan against 18 high-profile U.S. clothing manufacturers and retailers, including The Gap,
Tommy Hilfiger, The Limited, J.C. Penny, May Company, Sears and Wal-Mart.
These companies are accused of violating federal law by engaging in a “racketeering conspiracy”
using indentured labor — predominantly young women from Asia — to produce clothing on the
island of Saipan. (Saipan is part of the Northern Mariana Islands, a U.S. Commonwealth in the
Their foreign-owned garment contractors in Saipan are also charged with failing to pay overtime
and ongoing intolerable work and living conditions. In the last five years, contractors in Saipan
have received more than 1,000 citations for violating U.S. Occupational Safety and Health
Two federal class action lawsuits were filed on behalf of more than 50,000 workers from China,
the Philippines, Bangladesh and Thailand. The workers were allegedly drawn to Saipan with the
promises of high pay and quality work in the United States. Instead, they found themselves
working up to 12-hour days, seven days a week, often “off the clock” without receiving any pay or
groups (Sweatshop Watch, Global Exchange, Asian Law Caucus, and UNITE). The lawsuit
accuses the retailers and manufacturers of using misleading advertising and trafficking in “hot
goods” manufactured in violation of U.S. labor laws.
Together, the three lawsuits are seeking more than a billion dollars in damages, disgorgement of
profits and unpaid wages.
“To allow such squalid conditions to persist on American soil is both patently unlawful and
morally reprehensible,” said Al Meyerhoff, one of the lead attorneys. “Saipan is America’s worst
According to the lawsuits:
* Garments made in Saipan’s sweatshops may carry a “Made in the USA” of “Made in the
Northern Marianas, USA” label. American consumers are deceived into believing they have
purchased a product made by American workers protected by U.S. labor laws, that guarantee a
decent wage and a clean, safe work place.
* Last year alone, the federal government estimated that contractors and U.S. retailers avoided
more than $200 million in duties for $1 billion worth of garments shipped from Saipan, that
would otherwise have been paid for the same clothing if it were manufactured in China or the
Philippines. Some Chinese garment interests have moved their textile operations to Saipan
virtually “lock, stock and barrel,” in large part, to avoid U.S. duties and quota restrictions. The
federal government estimates that this increase in Chinese apparel production in Saipan has
allowed China to exceed its import quota by 250% in 1997 alone.
* Although Saipan’s garment factories are owned predominantly by Chinese and Korean
companies, quality-control inspectors from The Gap, The Limited, and other U.S. retailers
mitigate the intolerable working and living conditions.
* Over 90% of garment industry jobs in the Marianas are held by foreign “guest workers.” These
and other foreign workers make up more than half of the estimated total Marianas population of
70,000. This is largely due to the Island’s exemption from U.S. minimum wage and immigration
laws instituted to encourage local economic development. Since 1996, over 200,000 apparel
industry jobs were lost in the continental United States.
$2,000 to $7,000. They often must sign “shadow contracts” waiving basic human rights, including
the freedom to date or marry.
* The crowded, unsanitary factories and shanty-like housing compounds are in flagrant violation
of federal law. The heat in some factories is so extreme it can cause workers to faint. Many live
in a room with up to seven other people in inward-pointing barbed wire-enclosed barracks. Their
movements are strictly supervised by guards, and are subject to lockdowns or curfews.
including the United States,” said another lead attorney, William S. Lerach. “Companies like The
Gap and Wal-Mart have reaped millions in profits from this scheme — now they will be held
and Congressional oversight. One recent report on the Marianas from the U.S. Department of the
program and on trade loopholes to expand its economy.”
Garment production in Saipan continues to increase, already exceeding that of Malaysia and
Jamaica. Although the legal limit on foreign garment workers is 11,000 recent estimates exceed
15,000, and more factories are being built.
The plaintiffs are represented by a coalition of law firms, including Milberg Weiss Bershad
Hynes & Lerach LLP — class action specialists with principal offices in New York and San
Diego. The firm has successfully litigated numerous consumer lawsuits against such companies
Lincoln Savings (for defrauding depositors).
Most recently, the firm negotiated a $1.2 billion settlement from Swiss banks as reimbursement
Holocaust victims forced to work as slave laborers in factories.
Ogoni Refugees in Benin
Average cost in U.S. dollars to the United Nations of caring for a refugee: 11 cents per day
Royal Dutch Shell’s projected cost savings from 1998 restructuring: 2.5 billion dollars
“It is a strain to be a refugee. Nobody would like to be a refugee. Myself, it is until I came to this
place that I knew the proper definition of refugee. Before when I heard about refugees, I thought
did not know that circumstances could reduce you to be a beggar. I did not know. Now I do.”
Gaston, Ogoni refugee, age 29