“Chiquita’s money helped buy weapons and ammunition
used to kill innocent victims.”
— US Government sentencing memo, 2008

Chiquita Ordered to Pay $38M for Financing
Violent Paramilitary Forces in Colombia
Ingrid Burke Friedman / JURIST & CounterVortex

(June 14, 2024) — In 2007, Chiquita — one of the world’s largest banana producers — admitted that for years it had been knowingly paying a Colombian terrorist organization to protect its operations in the country. The consequence was predictably violent, allegedly resulting in thousands of murders, disappearances, and acts of torture.

This week, nearly two decades later, a federal jury in South Florida ordered the company to pay upwards of $38 million in damages in the first of multiple waves of wrongful death and disappearance lawsuits.

This explainer explores the factors that drove the multinational to make these payments, the consequences, and the legal impact.

How Does a Banana Company
Find Itself Bankrolling
Paramilitary Forces? 

Chiquita has operated banana plantations in Colombia since the 1960s — a decade that saw guerrilla forces taking up arms against the country’s government amidst a backdrop of political instability and violence. This period witnessed the formation of such militant leftist groups as the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN). In response, right-wing paramilitary groups like the United Self-Defense Forces of Colombia (AUC) emerged, fueled by the support of landowners and corporations wishing to counter what they perceived as rebel threats.

In a 2020 complaint, relatives and victims of paramilitary violence described the dynamic as follows:
In order to undermine communities’ and individuals’ support for the guerillas, the AUC and its constituent groups, including the ACCU [Peasant Self-Defense of Córdoba y Urabá], adopted a strategy of terrorism, routinely engaging in death threats, extrajudicial killings, attacks on civilian populations, torture, rape, kidnapping, forced disappearances, and looting. The AUC purposely used killings and cruelty to terrorize the civilian population into ceasing support for guerrilla groups.

According to court documents, AUC leader Carlos Castaño informed Colombian Chiquita subsidiary Banadex in 1997 that his forces would soon drive FARC out of the region of Urabá, where Banadex grew bananas, and that Banadex would be expected to start making regular payments to an intermediary firm.

In a 2007 factual proffer, Chiquita claimed, “Castaño sent an unspoken but clear message that failure to make the payments could result in physical harm to Banadex personnel and property.”

AUC’s tactics appear to have mirrored the protection-racket methods of other global organized crime syndicates, who have historically demanded protection payments or “krysha” from businesses, their demands backed by implicit threats of violence for failure to comply. Chiquita had been making similar payments to FARC and ELN forces between 1989 and 1997 before they were driven out by the AUC, prosecutors wrote in a sentencing memo accompanying Chiquita’s initial guilty plea in a separate case brought by the US government.

In September 2001, the US government designated the AUC as a terrorist organization. Chiquita continued its payments for another three years, before selling off its Colombian holdings in 2004.

In 2007, the company pleaded guilty to issuing more than 100 payments to the AUC between 1997 and 2004, amounting to more than $1.7 million. Following its admission, Chiquita agreed with federal prosecutors to pay $25 million in damages. The company’s executives were spared criminal prosecution in both the US and Colombia.

Were these payments motivated by
workplace safety or profit margins?

In 2007, Fernando Aguirre, then-chairman and CEO of Chiquita Brands International, Inc., claimed the company’s goal was to “safeguard our workforce,” saying:

As the security situation in the countryside continued to deteriorate–under a central government and military that, despite its best efforts, could not protect Colombia’s citizens from these paramilitary groups–our company had been forced to make protection payments to safeguard our workforce.

But prosecutors and plaintiffs were unconvinced the payments were motivated by anything other than profit margins. In the entencing memo following Chiquita’s 2007 guilty plea, US prosecutors wrote:

Defendant Chiqita’s reason for being in Colombia was, of course, to produce bananas profitably. And there is no question that defendant Chiquita profited from its Colombian operations during the period that the Company paid the AUC. According to defendant Chiquita’s records, from September 10, 2001 (the date of the AUC’s designation as a Foreign Terrorist Organization), through January 2004, the Company earned approximately $49.4 million in profits from its Colombian banana-producing operations. Indeed, by 2003 the Company’s Colombian operations were its most profitable.

In 2020, plaintiffs likewise accused Chiquita of:
…funding, arming, and otherwise supporting terrorist organizations in Colombia in their campaign of terror against the civilian population of the Urabá region, in order to maintain its profitable control of Colombia’s banana growing regions.

The last payments were made 20 years ago,
So why is this verdict being handed down now? 

Following Chiquita’s disclosure and plea deal in 2007, hundreds of families joined class-action lawsuits in US courts seeking damages for the deaths and disappearances of their loved ones.

In June 2007, an initial group of plaintiffs filed suit against Chiquita Brands International in a US federal court in New Jersey under the Alien Tort Claims Act and Torture Victims Protection Act. The plaintiffs accused Chiquita of complicity in extrajudicial killings, torture, and other crimes. They alleged that Chiquita’s payments to paramilitary organizations during this period facilitated these human rights abuses. Similar lawsuits were filed in other US federal courts. The ensuing years saw a complex web of motions to dismiss, rulings, appeals, and new lawsuits.

Ultimately, several claims were consolidated by a multidistrict litigation panel and directed to the US District Court in West Palm Beach, Florida, where multiple waves of bellwether plaintiffs (a term used to describe representative plaintiffs in a group of similar cases, often used to test the waters for broader litigation outcomes) will be heard in the coming months.

What Exactly Did the Jury Decide?
According to the verdict, the jury was satisfied plaintiffs had shown by a preponderance of the evidence that the AUC “in fact killed” eight of nine victims included in the case and that Chiquita failed to act reasonably as a business entity under the circumstances of the case.

The jury was unconvinced that Chiquita lacked a viable alternative to supporting the AUC. It ordered the company to pay more than $38 million in damages.

How Did the Parties React?
The plaintiffs and their representatives expressed relief about the jury verdict following nearly two decades of court battles.

A plaintiff said in a statement released by Earth Rights International:

“It’s a triumph of a process that has been going on for almost 17 years, for all of us who have suffered so much during these years. There’s a debate about justice and reparation; we’ve been fighting since 2007. We’re not in this process because we want to be; it was Chiquita, with its actions, that dragged us into it. We have a responsibility to our families, and we must fight for them.”

Leslie Kroeger, a partner at Cohen Milstein and a member of the plaintiffs’ trial team, said: “After a long 17 years against a well-funded defense, justice was finally served.”

What’s Next?
On the micro level, the next tranche of bellwether plaintiffs in the case is set to appear before a jury next month, on July 15.

On a macro level, the case can be expected to have an impact in a world where corporations are increasingly finding themselves in the position of navigating complex and rapidly changing geopolitical realities. It shines a light on broader concerns about corporate accountability and the ethical issues companies face when operating in conflict-torn regions and countries with precarious human rights situations.

Related News from the CounterVortex Daily Report:
Chiquita Brands found liable for paramilitary terror in Colombia
CounterVortex, June 15, 2024

US judge allows Colombian paramilitary victims to sue Chiquita, in landmark ruling
CounterVortex, June 5, 2011

Colombia: rebels and paras provided security for Chiquita
CounterVortex, April 12, 2011

Chiquita fined $25 million in Colombia terror case
CounterVortex, Sept. 19, 2007

Colombia: official apology for ‘political genocide’
CounterVortex, Sept. 17, 2016

See Also:
COLOMBIA’S PARAMILITARY PARADOX
Far-Right Militias Survive “Peace Process” and “Para-Politics” Scandal
by Memo Montevino, CounterVortex
CounterVortex, July 2007

COLOMBIA: PARAS, ARMY STILL KILLING PEASANTS
from Weekly News Update on the Americas
CounterVortex, October 2007

COLOMBIA: PARAMILITARY SCANDAL AND CORPORATE POWER
from Weekly News Update on the Americas
CounterVortex, March 2007

HONDURAS: THE BANANA CONNECTION — AGAIN
by Nikolas Kozloff, Señor Chichero
CounterVortex, August 2009

Posted in accordance with Title 17, Section 107, US Code, for noncommercial, educational purposes.