Mohawk Industries Settles RICO Illegal Aliens Class Action, Must Pay $18 Million To American Workers!
By Joe Guzzardi, VDARE, April 9, 2010
In a victory for all American workers who have been displaced by illegal aliens or who have had their wages depressed by cheap labor, a class of plaintiffs have reached a settlement agreement in a six-year old lawsuit that was filed in federal district court in Rome, Georgia in 2004 and heard by the U.S. Supreme Court in 2006.
The plaintiffs, represented by co-lead council Howard Foster of Chicago, IL-based Foster PC, are legally-authorized, hourly-paid workers who alleged that their wages at Mohawk Industries, Inc. facilities in Northwest Georgia were depressed by the hiring of illegal aliens.
Mohawk, the leading worldwide producer of flooring, recorded annual 2008 net sales of $6.8 billion.
The settlement, which is also a major win for the patriotic immigration reform movement, entitles approximately 50,000 former and current hourly-paid Mohawk employees to claim awards from an $18 million settlement fund, the largest payout ever in this type of litigation.
Mohawk is responsible for paying out a portion of the funds. But the majority will be contributed by Zurich American Insurance Company, Mohawk's insurance carrier.
Also, Mohawk has agreed to conduct much needed and long-overdue training regarding immigration laws that make it illegal to knowingly hire workers who are not authorized to be employed in the U.S.
A short history of the case: Norman Carpenter, a Mohawk production employee and shift manager, went to his supervisor to complain about the numerous illegal workers in his midst.
Concerned by Carpenter's complaints, Mohawk management eventually contacted company lawyers as well as its lead lawyer, Juan Morillo, of the prestigious UK law firm Clifford Chance's DC office, who was ultimately dispatched to Georgia to meet with Carpenter.
What transpired at that fateful meeting is now the subject of a federal civil rights lawsuit that is still pending.
Carpenter alleges that Morillo threatened to have him fired if he said another word about illegal workers to anyone, particularly to Foster and his colleagues prosecuting the RICO (Racketeer Influenced Corrupt Organization Act) case.
Nevertheless, Carpenter did complain to others. He was fired, and sued Mohawk for violating his civil rights by terminating his employment and violating the federal whistleblower protection law.
Along with his Mohawk co-worker Christina Martinez, Carpenter filed sworn statements about Mohawk's hiring of illegal workers and Morillo's intimidation.
According to court documents, Martinez had the following exchange with Mohawk Human Resources representative Becky Hale.
In her declaration, Martinez said:
"Ms Hale informed me that she was aware that many Mohawk employees are not legally authorized to work in the U.S.
"She [Hale] informed me however that if these employees come to Mohawk with social security numbers and false identification she could and would hire them and that Mohawk would employ them."
To bolster his case of wrongful termination, Carpenter subpoenaed Morillo for his deposition. Morillo asserted the attorney-client privilege, contending that anything he said to Carpenter was in his capacity as Mohawk's lawyer.
U.S. District Court Judge Harold Murphy of the Northern District of Georgia rejected Morillo's claim and ordered him to be deposed, but allowed Mohawk to seek appeal of the order.
The case went all the way to the Supreme Court which, on December 8, 2009 in a unanimous opinion, ironically written by Justice Sonia Sotomayor (her first), ruled for Carpenter.
This means, Morillo will now have to be deposed by Carpenter's lawyers and the truth surrounding the company's efforts to conceal its illegal hiring may come to light.
Commenting on the class action settlement, Mohawk's attorney Morillo said:
"Mohawk is pleased to have reached a settlement that allows the company to put behind it the expense and distraction associated with this case." In settling the case, Mohawk does not admit any of the plaintiffs' allegations of wrongdoing."Mohawk has always trained its employees to comply with the immigration and workplace laws, and this settlement affirms the company's commitment to a continued culture of compliance," Morillo commented. "Mohawk has provided and continues to provide good jobs with great benefits to tens of thousands of workers in Georgia and elsewhere."
Foster, however, noted the lengthy procedural history of the case, which included three years of litigation to resolve Mohawk's appeal of Judge Murphy's 2004 ruling that the plaintiffs stated a claim under the federal and Georgia RICO laws.
After the U.S. Court of Appeals for the Eleventh Circuit affirmed that ruling, Mohawk convinced the U.S. Supreme Court to hear the case in 2006.
The Supreme Court ultimately ruled that it had "improvidently" accepted the case and sent it back to the Eleventh Circuit which again ruled that the plaintiffs could proceed in 2007.
The parties then undertook discovery on whether the case should be granted class action status. In 2008, Judge Murphy denied the plaintiffs' Motion for Class Certification, precluding the proposed class of employees from obtaining relief in this case.
But the Eleventh Circuit accepted the plaintiffs' request to review that decision, and in May 2009, reversed the denial of class certification and sent the case back to Judge Murphy to reconsider the question of class certification.
Settlement discussions occurred after the two sides agreed on a mediator. A final resolution was reached in December 2009 at the federal courthouse in Rome, Georgia and then documented by the parties.
Foster, who argued the employees' case in the Supreme Court, said:
"We consider this a hard-fought case and are pleased with the settlement for the class. The class will receive significant monetary relief and the company has agreed to train its personnel regarding the verification of employment eligibility."
Judge Murphy will now be asked to preliminarily approve the settlement between Mohawk and the employees. Upon Judge Murphy's approval, notice of the settlement will be mailed to the class members, and the Court will then hold a hearing to consider final approval of the settlement.
Foster's class action triumph over Mohawk is his second on behalf of betrayed American workers. In 2006, Foster negotiated a $1.3 million settlement against the Washington-based Zirkle Fruit Company, which by some estimates had at one time only 30 percent of its employees legally authorized workers.
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