Saipan judge certifies suit as class action Ruling in dispute over garment factories a rebuff to Gap, Levi

By Jenny Strasburg, Chronicle Staff Writer

A federal judge on Saipan has granted class-action status to a lawsuit that alleges that 30,000 factory workers endured sweatshop conditions, rejecting attempts by Gap Inc., Levi Strauss & Co. and other major retailers to have the suit dismissed. The class-certification improves the chances that a proposed $8.75 million settlement will help to resolve the issue. The three-year case chiefly involves Chinese guest workers employed at various times since 1989 on the western Pacific island, a U.S. territory that is exempt from some federal labor laws. On Friday, U.S. District Judge Alex Munson rejected defense arguments that the workers in question had experienced such widely varying conditions -- at different factories and at different times -- that their cases were too dissimilar to be combined.

Defendants opposing the settlement included more than a dozen Saipan factory owners and nine retailers: Lane Bryant, the Limited, Abercrombie & Fitch, Target, J.C. Penney, and Talbots, in addition to Gap and Levi. However, with Munson's class-action approval, attorneys seeking to represent about 30,000 factory workers can move closer toward the preliminary settlement that has already been approved by 19 retailers. They include the Gymboree Corp. of Burlingame, Sears Roebuck and Co., Tommy Hilfiger, Calvin Klein, Nordstrom, Liz Claiborne and Polo Ralph Lauren. Various settlement offers have been on the table since 1999. The retailers that have agreed to settle are not admitting any wrongdoing. The most recent settlement proposal would pay for independent monitoring of Saipan factories, a common code of conduct among retailers and manufacturers and about $4 million in payments to workers.

In a concurrent ruling issued Friday, Munson said the plaintiffs failed to demonstrate convincingly that workers had been held in a state of involuntary servitude. However, he ruled that the plaintiffs had shown a conspiracy among retailers and factories resulting in violations of workers' civil rights. And he said that workers' injuries -- ranging from unpaid overtime to unsafe working conditions -- had resulted directly from the defendants' actions. "I would hope at some point that Gap and Levi Strauss and J.C. Penney would stop fighting and would do the right thing," San Francisco labor attorney Michael Rubin, representing the plaintiffs, said Tuesday. "If they can help us figure out the best way to protect the rights of workers, we'll settle with all of them." But Gap attorney Daralyn Durie said her client, the most high-profile of the parties opposing the settlement proposal, considers the accusations in the lawsuit unfair and unrepresentative of conditions in its Saipan factories.

She and Gap spokeswoman Tamsin Randlett -- along with representatives of Levi and Target who were reached Tuesday -- said that the class- certification ruling is a disappointing development but that it will not stop them from continuing to fight the allegations. "We intend to continue to present evidence to show that different factories are different, and that different workers are treated differently," Durie said. Gap will pursue a motion to decertify the workers as a class. Of about 30 factories targeted in the lawsuit, Gap did business with fewer than 10 on Saipan, and they were monitored by the company, Randlett said.

The factory owners and retailers argued that they monitored manufacturing operations to prevent inhumane conditions and other alleged abuses. Levi Strauss, which like Gap has manufacturing contracts in about 50 countries, said it hasn't purchased clothes made on Saipan since 2000. Before that date, Levi said, the factories it contracted with complied with Levi's code of conduct for manufacturers. "We will continue to vigorously defend ourselves in court against these unfounded allegations," Levi spokesman Jeff Beckman said Tuesday.