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ILRF Director Terry Collingworth Responds to Coke's Denials

July 8, 2004

Coke has not allowed any investigation of the Colombia claims.

First and foremost, since the lack of investigation colors every other claim Coke makes about the "truth," Coke is flat out lying when it claims, as it has in public documents, "When we learned of the plaintiffs' lawsuit and of what was being alleged about our Company, we promptly launched a thorough investigation of the facts of this case. This is in keeping with our policy to promptly investigate serious accusations against our Company and, when appropriate, against our bottler partners."

This is simply not true. Early this year, New York City Council Member Hiram Monserrate led a 10-day investigation to Colombia specifically to investigate the charges against Coke. His complete report is attached hereto (Final Report). Coke refused to cooperate in providing access to its bottling plants, but Council Member Monserrate was able to get help from the union I represent, SINALTRAINAL, in getting access to workers and other witnesses. Relevant to this point, Coke officials ultimately conceded to Council Member Monserrate that it had not conducted an investigation. Despite employees' deaths and repeated allegations of violence and the potential for cooperation with paramilitaries, company officials "acknowledged that Coke officials had never undertaken any internal or external investigations into these assertions, nor into any of the hundreds of human rights violations suffered by the company's workers." (Report at p. 9, emphasis added).

Indeed, as the Washington Post recently reported, the lack of a proper investigation "has also been a point of frustration for Coca-Cola's recently resigned general counsel, Deval L. Patrick, according to sources close to the situation, since he promised publicly last fall to mount an independent investigation of the charges. After early encouragement about the idea internally, one of the sources said, Daft recently changed his mind and turned down Patrick's idea. That frustration played a role in Patrick's decision this month to resign, that source said." Obviously, if Coke had done an investigation that exonerated the company, we would all have copies of It. Because it is clear that Coke has not allowed such an investigation, its claims about the facts on the ground in Colombia are simply incredible.

Coke Has Not Been Legally Exonerated from he Human Rights Lawsuit.

Coke reports correctly that the parent company was dismissed from the federal lawsuit based on the Alien Tort Claims Act for murder and torture of trade union leaders. However, that ruling, which Plaintiffs' counsel consider to be reversible error and that will be appealed, held simply that the parent company did not have sufficient ownership or control in the Colombian bottlers to itself be liable based on that relationship. The Court has allowed the case to go forward against both Panamco and Bebidas, the two companies that bottle Coke products in Colombia.

There are two significant points regarding Coke's responsibility for the violence in Colombia despite the Court's ruling. First, to the public and to you, Coke claims the innocence of itself and its bottlers. Coke, like most other multinationals, particularly those that have been the target of previous anti-sweatshop campaigns, recognizes that it is no longer a defense to say that a parent company can profit from illegal acts of subsidiaries or suppliers. Most socially responsible shareholders and investors would not consider a company to be acceptable because they have created a legal wall between itself and illegal offshore operations since the profits are still tainted with violence. Indeed, Coke is playing a very deceitful game on this score. It claims to have a "code of conduct" that applies to all of its operations, but in the fine print it says the code only applies to subsidiary operations in which Coke has a majority share. But, as most students of Coke know, for various tax reasons, Coke retains effective control of its offshore bottlers by its Bottler Agreement and by having several positions on the boards of the bottling companies, but it rarely, if ever, outright owns a majority of these companies. So Coke has been circulating its code in several forums as evidence that it will not tolerate human rights violations, and to show that it is responsible for its bottlers, but the fine print allows a legal loophole to disclaim actual legal liability. You should ask for a copy of the code and get them to explain its relevance to Colombia.

Second, after Coke argued in court that it did not own or control its Colombia bottlers, its Mexican subsidiary, Coke-FEMSA purchased all of 17 or so Colombian bottling plants owned by Panamco, which leaves only one plant in Colombia that is not owned by Coke-FEMSA. As a result of this, we recently moved to amend our Complaint to add Coke and Coke-FEMSA back into the case.

The Violence in Colombia is attributable to Managers of Coke Bottling Plants

Coke emphatically claims in its materials to you that none of the employees at Coke bottling plants in Colombia are involved in the violence. This is simply not true. As Council Member Monserrate verified, and as we allege in our Complaint, Isidro Gil was murdered inside a Coke bottling plant in Carepa: The delegation heard from eyewitnesses to the murder of Coca-Cola worker Isidro Gil inside the walls of a Coca-Cola bottling plant in Carepa, Colombia. The manager of this plant - who fled just before the assassination - was reported to consort with the paramilitaries in the region and had allegedly made threats to wipe out the union prior to this assassination. Eyewitnesses to this murder no longer consider themselves safe in Colombia. Many have sought refuge elsewhere, including the United States through a joint AFL-CIO and US State Department program for threatened trade unionists. As of this time no one has been brought to justice for the death of Isidro Gil, nor any of the other Coca-Cola workers killed throughout Colombia. Indeed, even Coke officials, interviewed by Council Member Hiram Monserrate, faced with undisputable evidence that Isidro Gil was murdered inside the Coke bottling plant by paramilitaries brought in by the plant manager, conceded "there was a possibility that persons employed by the company - but acting without authorization - could have worked with, or have had contact with, paramilitaries. Officials of the U.S. Embassy in Bogota also acknowledged this possibility during a meeting on January 10th, 2004." (Report at p.10; emphasis added).

Likewise, with respect to the other allegations of murder and torture, each of the acts of violence was perpetrated by a Coke bottling plant manager who wanted to get rid of an active union. Coke's cynical assertions of supporting unions around the world are astounding, and irrelevant. In Colombia, where trade union leaders face unusual danger, the Coke bottling plant mangers have harnessed the violence, and benefited from the impunity, to actively seek to get rid of effective union leaders.

Coke has Done Nothing to Address the Violence at the Colombian Bottling Plants

Coke's claims to "deplore and condemn" the violence against trade union leaders in Colombia, but has done nothing towards taking effective action to stop it. The best evidence of this is that one of the Plaintiffs, Juan Carlos Galvis', just recently survived another death threat by paramilitaries. This is verified in a report by Amnesty International.

In discussions with Coke last year, SINALTRAINAL made some very reasonable proposals to Coke, which have been refused. For example, the union simply wanted Coke to make a national ad campaign in Colombia denouncing the violence and making clear to the paramilitaries that such violence against trade union leaders was not welcome by the company. (See the list of those demands.)

Likewise, Council Member Hiram Monserrate, after conducting his ten day investigation made very reasonable recommendations to Coke, including that Coke simply issue "a public statement from Coca-Cola supporting international labor rights in Colombia and denouncing anti-union violence as well as the investigation of affected employees' allegations." (Report at p. 11) The silence by Coke is deafening.

Recommended Action.

The most effective action anyone could take is to make clear to Coke and its corporate allies that any future business is contingent upon Coca-Cola taking immediate action to do the right thing. Looking at the moderate demands made by SINALTRAINAL and Council Member Hiram Monserrate, there is simply no excuse for Coke's refusal to stop the violence in its Colombian bottling plants. Coke can and should take a leadership role to denounce the paramilitary violence, and certainly should not profit from it under any circumstances.

Terry Collingsworth, International Labor Rights Fund

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