U.S. Appeals Court Revives Slavery Suit Against Nestle\, Cargill

Nestle, Cargill Slavery Claims Revived by U.S. Appeals Court

(Bloomberg) -- A U.S. appeals court on Tuesday revived a long-shot lawsuit by 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.

The plaintiffs 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’s U.S. unit and Cargill turned a blind eye to the practice to benefit from lower prices, according to the initial lawsuit.

The appeals court panel in San Francisco overturned a ruling by a lower court judge, who dismissed the case in March 2017 on the grounds that the foreign plaintiffs had failed to show any U.S. conduct was linked the the enslavement.

Nestle and Cargill were “well aware” that child slave labor was pervasive in the country, and the companies had economic leverage that gave them control of cocoa production in the Ivory Coast, the appellate court said in its opinion. The judges said they took the ex-slaves’ “plausible allegations” as true in analyzing the case.

The companies didn’t immediately respond to requests for comment.

The appeals panel said it focused on a narrow set of conduct by the companies alleged to have taken place in the U.S., which is relevant under the Alien Tort Statute that limits the ability of foreigners to sue in American courts. Among the actions were payments to farms that were inspected by employees from their U.S. offices.

“Defendants provided personal spending money outside the ordinary business contract with the purpose to maintain ongoing relations with the farms so that the defendants could continue receiving cocoa at a price that would not be obtainable without child slave labor," the panel said.

The court said the plaintiffs will get another chance to lay out their case that the companies aided and abetted the conduct since the legal landscape around such claims shifted earlier this year, according to the ruling.

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