The Coke Machine (30 page)

With that view in mind, he traveled to Barrancabermeja that first trip to gather stories of union officials, including the local president of SINALTRAINAL, William Mendoza. On his second trip, in March 2001, he heard about the case of Isidro Gil, which immediately struck him as a flagrant use of paramilitaries to rub out union organizing. “Here you have a guy killed within the walls of the plant by paramilitaries,” he says. “He was killed after the manager threatened to wipe out the union. The paramilitaries returned, gathered all the workers within the plant, told them to resign from the union or they would be killed.” In his mind, the finger pointed all the way up to the top.

“I don’t think necessarily someone from Atlanta said do this,” he says, “but it seemed like a combination of complicity and turning the other way and allowing things to happen.” Whether it was a sin of commission by giving tacit approval for violent tactics to its bottlers, or a sin of omission by not taking stronger action to condemn the violence with the full weight of Coke’s corporate power, it amounted to the same thing in Kovalik’s mind. What was less clear to him was how the Coca-Cola Company could be held accountable for actions that were at best taken by a foreign bottler, if not the managers of a foreign bottler, in a foreign country, with its own set of laws and system of justice. Only months before, the Fiscalía had officially ended its own investigation into Gil’s murder without even staging a trial.

Talking it over with SINALTRAINAL leadership, Kovalik hatched a new idea. If the union couldn’t get a fair trial in Colombia, he would try Coca-Cola in the United States. And Kovalik knew just the person to talk to—a Washington, D.C.-based lawyer named Terry Collingsworth, who had made a career out of holding corporations accountable for not just freedom of association, but also things like murder, slavery, torture, and imprisonment in far-flung places around the world—the exact kinds of crimes that Coke had been accused of by SINALTRAINAL.

Together Kovalik and Collingsworth crafted a case in order to determine exactly how much Coke knew about the violent activities at its bottling plants in Colombia—and hold it responsible for any actions it had played in profiting from that violence. Just a few months after Kovalik’s first trip to Colombia, in July 2001, the lawyers filed suit in U.S. District Court in Miami on the basis of a little-used law dating from the eighteenth century called the Alien Tort Claims Act. That law, they contended, gave them the right to sue Coke for crimes committed in a completely different country.

 

 

 

The road
that took Collingsworth to court that month began in Malaysia nearly two decades before. After graduating from Duke Law School in 1982 and paying off his law school debts, Collingsworth set off on a back-packing trip across Asia. Arriving in Kuala Lumpur, he ran upon a protest of workers fighting for their right to unionize at their company, U.S.-based Harris Semiconductor, which had been exempted from collective bargaining by the Malaysian government. Impulsively, he offered to help them when he returned to the United States, even though it had little to do with his own dreams of becoming a lawyer who, like Kovalik, would defend the rights of American workers to unionize.

Although he now looks like the very picture of a buttoned-up lawyer, Collingsworth grew up in unions himself, following his father and uncle into a copper plant near his hometown of Cleveland. His job was to operate a crane dumping copper ore into a molten furnace, and he admits the union made it a cushy one. “My total collective work time was probably like an hour and a half a night,” he says. “Looking back it’s almost outrageous.” He used his free time to get a college degree, attending Cleveland State by day and studying books in the crane cab by night with the goal of helping people like his father and his uncle who were getting increasingly squeezed.

By the early 1980s, it was clear that manufacturing was in trouble. The same shareholder value movement pushed by Jack Welch and Robert Goizueta was leading to massive downsizing of employee rolls and reliance on temporary workers or relocation of plants overseas in search of cheap labor. (Collingsworth’s own plant eventually was moved to South Korea.) The protest he saw in Malaysia was the flipside of the equation—whereby developing countries were easing up on human rights and environmental standards in order to attract companies from the United States and Europe.

The question Collingsworth faced then—and the one that he and Kovalik would face two decades later—was how to impose morality on multinational corporations driven by economic factors that were inherently amoral. As long as competitors were doing everything they could to increase their own profits, taking moral questions into account in their business plans was a sure way of going out of business. At the same time, developing countries were in effect competing against one another to attract foreign investment to lift themselves out of poverty, giving them even less incentive on their side to push for more stringent labor requirements.

As it happened, when Collingsworth returned from his Asia trip he found a representative from his home state of Ohio, Don Pease, who was working on legislation to deal with this very issue. Pease’s idea was to give those incentives in the form of preferential trading status to countries “taking steps to afford internationally recognized workers’ rights” such as collective bargaining and a minimum wage. After it was passed, Collingsworth partnered with one of Pease’s staffers, William Gould, to form the International Labor Rights Fund (ILRF) in an attempt to enforce the new law by filing petitions on behalf of workers around the world. Their very first petition dealt with the computer workers in Malaysia. Unfortunately for them, however, the law’s language that a country could retain benefits as long as it was “taking steps” to change provided enormous wiggle room to companies and to the panel appointed by the Reagan administration to interpret the new law.

After years of getting nowhere with the countries, Collingsworth and his colleagues eventually gave up, and began to work on companies instead. With the second wave of corporate social responsibility rolling over corporate America in the mid-1990s, companies were eager to present themselves as responsible to the needs of the less fortunate around the world—as long as it didn’t cut into their profits by disadvantaging them against their competitors. Collingsworth and other labor and environmental activists reasoned that if everyone could agree to the same standards, then companies could “do the right thing” without worrying about losing ground to competitors. At the same time, they could earn that much-sought-after boost to their brands by showing sensitivity to the social concerns their consumers cared about.

The idea emerged as a voluntary “code of conduct” that companies would commit to following for their factories and suppliers overseas. The idea especially caught on after university students began criticizing apparel companies such as Nike for using sweatshop labor to create campus athletic gear. In a short time, the issue was national news, shaming everyone from Liz Claiborne to Kathy Lee Gifford. As he would several years later with the soda companies over obesity, Bill Clinton mediated a compromise in 1999. Then president, Clinton brought apparel companies and unions together to agree on a new voluntary set of standards similar to those of Pease’s law a decade before, along with a new nonprofit organization called the Fair Labor Association, to monitor them.

While Coke was not a signer to that agreement, it did participate more broadly in the “code of conduct” movement of which it was a part through other means, including the Sullivan Principles, a set of standards first established by a Pennsylvania minister in the 1970s in an effort to commit companies to racial equality in their doing business with apartheid-era South Africa. After the principles were ineffective in dealing with the issue (and, according to some critics, even counterproductive since they stalled the more powerful divestment campaign), their creator abandoned the principles. But in the midst of the Nike debate, they were reconstituted in 1999 through the United Nations as the brand-new Global Sullivan Principles, which committed companies to respecting freedom of association, paying workers enough to at least make basic needs, and providing a “safe and healthy workplace.”

Around the same time, Coke took the lead in working with the United Nation’s International Labour Organization (ILO) to create a set of principles against the use of child labor overseas and established its own “code of conduct” for bottlers that went further than either of the United Nations codes that it had signed. But these codes had problems. In addition to the fact that they were completely voluntary, Coke also interpreted them to apply only to companies in which it held a majority ownership. And thanks to Ivester’s “49 percent” solution, Coke intentionally held minority owner-ships in nearly all of its “anchor bottlers,” which made up most of the Coca-Cola system overseas, and certainly most of the employees in places like Colombia who might benefit from those worker protections. With the increasing use of contract workers, many of those employees weren’t even employed by companies in which Coke had a
minority
share.

Similarly, Collingsworth found the Fair Labor Association to be a bust. Whatever good intentions those signing the agreement might have had, the mechanism to enforce it was underfunded and weak. Nike reaped gobs of positive publicity, yet a 2005 report by the company found that workers in up to half of its factories were still forced to work sixty-hour weeks, made less than minimum wage, or were denied use of bathrooms and drinking water. “At the end of the day, it turned out to be a real whitewash,” sighs Collingsworth, who admits to being at a loose end in the late 1990s, no closer to holding corporations accountable for their sins overseas than he had been during that trip through Asia.

That’s when a man with the felicitous name of U Maung Maung walked into his life. General secretary of trade unions in Burma—a country taken over by a military junta in 1962, and known also as Myanmar since 1989—he told Collingsworth about an alarming new trend. Refugees crossing over into Thailand told horrific stories about being forced by the army to clear the jungle with machetes or search for land mines; those who refused were tortured, raped, or murdered. More shockingly, the work was being done for the benefit of two foreign companies—French-based Total and California-based Unocal. Maung appealed for help. “You’re a smart lawyer,” he told Collingsworth. “Here’s a case where you can show there’s slave labor, there’s brutality, and it’s being done on behalf of a U.S. multinational company.”

However much he wanted to help, Collingsworth was stymied. The favored-nation legislation created by Pease had failed to create any meaningful changes in company operations, and the code of conduct movement had turned out to be a weak Band-Aid on the problem. And here Maung wasn’t talking just about poor working conditions or subsistence wages, but about rape, torture, and murder. Obviously, the ILRF couldn’t file suit in Burma. And ironically, given that Unocal was just six miles away from his office at Loyola Law School in Los Angeles, he didn’t see any way he could sue in the United States either.
⁶
The problem was discussed with other lawyers for months, and it was finally a summer associate named Doug Steele who came up with the solution: the Alien Tort Claims Act.

The law is ancient to say the least, going back to the 1789 Judiciary Act that set up the U.S. federal justice system. In its entirety, it reads: “The district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” Translated into common speech, that essentially means a foreigner can sue in U.S. courts providing it is over a violation of international law. The law’s history is murky; apparently passed to protect American diplomats or possibly American ships from piracy on the high seas, it had been used exactly twice before 1980.

That’s when a Paraguayan by the name of Joel Filártiga used it to sue the policeman who had tortured and murdered his son after the policeman had moved to Brooklyn, eventually winning $10 million in a wrongful death suit. Filártiga was never able to collect, and the policeman was shortly deported back to Paraguay. But the floodgate had been opened. Soon Ethiopian prisoners were using it to sue their torturers, Guatemalan peasants to sue their foreign defense minister, and a group of Bosnian rape victims to sue Bosnian Serb leader Radovan Karadžić, in the last case leading to $4.5 billion in damages in 2000.

While no one had ever used the law against a corporation, there was nothing in theory stopping them. The same legal precedent that established a corporation as a “person” for the purposes of owning property more than a hundred years ago in the Southern Pacific Railroad case could also be used against them to drag them into court like any other person who committed human rights abuses.

Not that it wasn’t a stretch. To sue Unocal under the ATCA statute, the lawyers with the ILRF had to prove that the actions rose to a violation of international law, and that the Burmese villagers couldn’t get adequate relief in their own country. Furthermore, no one was saying that Unocal directly raped and tortured anyone—only that they willingly aided and abetted the military in performing those acts. First filed in 1996 in California, the case was thrown out of court by a judge who argued that the company had no control over the Burmese military. That decision was overturned in 2002 by an appeals court that ruled it could go forward. Rather than proceed with a trial, Unocal settled for an undisclosed amount, without admitting any wrongdoing.

Nevertheless, the case was a huge victory for the human rights lawyers, giving them a new tool in their arsenal to hold corporations accountable. Collingsworth was elated. “We had tried negotiating with companies, but now we finally had a real tool to get their attention,” he says. “Believe me, this is what got them to care about this stuff.” The group giddily went about bringing cases against corporations for a grab bag of injustices around the world—among other cases, suing ExxonMobil for funneling money to brutal Indonesian dictator Suharto to protect its oil pipeline and a Del Monte subsidiary in Guatemala for meeting with paramilitaries before beginning a campaign of torture and intimidation of union members.