Names In the News

Tyson’s People Smuggling

A federal grand jury in Chattanooga, Tennessee in January returned a 36 count indictment against executives and managers of Tyson Foods, Inc., the world’s largest producer, processor and marketer of poultry-based food products, for conspiracy to smuggle undocumented workers to Tyson Foods processing facilities in the United States for profit.

The indictment is the culmination of a two-and-one-half year undercover investigation conducted by the Immigration and Naturalization Service into the business practices of Tyson Foods.

Federal officials alleged that Tyson Foods executives and managers conspired to import and transport undocumented workers from the Southwest border to Tyson plants throughout the United States. Fifteen Tyson Foods plants in nine states have been implicated in the alleged conspiracy. Federal officials alleged that Tyson Foods cultivated a corporate culture in which the hiring of undocumented workers was condoned in order to meet production goals and cut costs to maximize profits.

The indictment describes a scheme by which the defendants requested delivery of undocumented workers to work at Tyson plants in the United States and aided and abetted them in obtaining false documents so they could work at Tyson poultry processing plants “under the false pretense of being legally employable.”

Tyson strongly denies the charges. “There was no ‘corporate conspiracy’ at Tyson Foods,” says Ken Kimbro, Tyson’s senior vice president of human resources. “In fact, the evidence overwhelmingly shows that the vast majority of our plants complied strictly with all laws. The government’s allegations are unfounded, and Tyson Foods will vigorously defend itself against all charges.”

Tyson says that it has a long history of partnering with the INS to ensure corporate compliance with immigration laws, which it argues dispels the government’s allegation of a conspiracy to violate immigration laws.

BellSouth in Latin America

The Securities and Exchange Commission in January issued a cease-and-desist order against BellSouth Corporation after finding the company violated provisions of the Foreign Corrupt Practices Act.

Without admitting or denying the SEC’s allegations, BellSouth consented to the order, which requires BellSouth to cease and desist from violating the law.

The SEC found that between September 1997 and August 2000, former senior management of BellSouth’s Venezuelan subsidiary, Telcel, C.A., authorized payments totaling approximately $10.8 million to six offshore companies and improperly recorded the disbursements in Telcel’s books and records.

SEC investigators also found that, between October 1998 and June 1999, BellSouth’s Nicaraguan subsidiary, Telefonia Celular de Nicaragua, S.A., improperly recorded payments to the wife of the Nicaraguan legislator who was chair of the legislative committee that oversaw telecommunications policies in the country.

During the lobbyist’s retention, the legislator/husband drafted the text of the proposed repeal of a law restricting foreign ownership of Nicaraguan telecommunications companies and enlisted support for the proposed repeal from other legislative committee members.

In December 1999, the Nicaraguan National Assembly voted to repeal the foreign ownership restriction.

Soon thereafter, BellSouth increased its ownership interest in Telefonia to 89 percent.

Hanging Up on AT&T

Ruling that consumer rights cannot be stripped away in a form contract, a federal judge in San Francisco in January found unlawful AT&T form contract provisions that required mandatory arbitration on discriminatory terms in case of consumer disputes with the company.

“AT&T sought to shield itself from liability ... by imposing legal remedies provisions that eliminate class actions, sharply curtail damages in cases of misrepresentation, fraud, and other intentional torts, cloak the arbitration process with secrecy and place significant financial hurdles in the path of a potential litigant,” U.S. District Court Judge Bernard Zimmerman ruled.

“It is not just that AT&T wants to litigate in the forum of its choice — arbitration — it is that AT&T wants to make it very difficult for anyone to effectively vindicate her rights, even in that forum. That is illegal and unconscionable and must be enjoined.”

The suit, Ting v. AT&T, is a class action on behalf of all AT&T long distance telephone customers in California. The court held that AT&T’s mandatory arbitration provision is unlawful under California’s Consumer Legal Remedies Act and Unfair Competition Law.

The “ban on class actions is substantively unconscionable,” the court held, and would “shield AT&T from liability even in cases where it has violated the law.”

The court also held unlawful provisions in the AT&T contract barring arbitrators from awarding punitive and other damages, and imposing a two-year limitations period for customers to file any claim in arbitration, even though nearly all California consumer protection laws allow consumers to file claims for at least three or four years from the time of injury.

Noting that the average daily rate of arbitrator compensation in Northern California is $1,899, the court held the required resort to arbitration would effectively prevent consumers from vindicating their rights.

— Russell Mokhiber