A New Orleans jury on Wednesday awarded $14 million to five Indian men who were lured to the United States and forced to work under inhumane conditions after Hurricane Katrina by a U.S. ship repair firm and its codefendants.
After a four-week trial, the U.S. District Court jury ruled that Alabama-based Signal International was guilty of labor trafficking, fraud, racketeering and discrimination and ordered it to pay $12 million. Its co-defendants, a New Orleans lawyer and an India-based recruiter, were also found guilty and ordered to pay an additional $915,000 each.
The trial was the first in more than a dozen related lawsuits with over 200 plaintiffs that together comprise one of the largest labor trafficking cases in U.S. history.
Signal recruited about 500 Indian men as guest workers to repair oil rigs and facilities damaged by Hurricane Katrina in 2005, according to plaintiffs.
"The workers each paid the labor recruiters and a lawyer between $10,000 and $20,000 or more in recruitment fees and other costs after recruiters promised good jobs, green cards and permanent U.S. residency for them and their families," according to the American Civil Liberties Union in a statement. "Most sold property or plunged their families deeply into debt to pay the fees."
When the men arrived at Signal shipyards in Pascagoula, Mississippi, they discovered that they would not receive promised residency documents, and Signal also charged the men $1,050 per month to live in guarded labor camps where up to 24 men lived in single 1,800-square-foot units, according to the suit.
An economist who reviewed Signal's records for the plaintiffs estimated the company saved more than $8 million by hiring the Indian workers.
"The defendants exploited our clients, put their own profits over the lives of these honorable workers, and tried to deny them their day in court," said Alan Howard, the plaintiffs' attorney who is the Southern Poverty Law Center board chairman and a partner in Crowell & Moring’s New York office in a statement. "In short, these workers were sold a bill of goods. … "They were victimized and exploited and really taken advantage of."
Signal said in a statement that it is weighing an appeal.
"Signal strongly disagrees with rulings from the court in the case which impacted its ability to present defenses and is disappointed with the verdict," the company said.
Howard said the cases of about 230 other workers are pending against Signal. An attempt to certify the Indian workers under a class-action suit was rejected by a federal judge.
Signal hired about 500 workers to work at its facilities after Katrina. The company said it was facing a shortage of skilled workers following the 2005 hurricane and that it paid the Indian workers $18 an hour, the same as American workers would have received for the same jobs.
Plaintiffs' lawyers contended that American workers, due to the shortage of skilled laborers, commanded much higher wages and that Signal profited greatly from the use of the Indian workers.
The suits are being brought under the Victims of Trafficking and Violence Protection Act, a federal law passed in 2003 to protect people from traffickers.
The U.S. Equal Employment Opportunity Commission is also suing Signal. That trial is slated to start on June 1 in New Orleans.
Howard said it was far from clear when the Indian workers might see any compensation. He said Signal has suggested it might file for bankruptcy.
A spokeswoman for the company said she could not comment on that issue.