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Chiquita partly off hook in terror finance case

November 4, 2014

A lawsuit by 4,000 Colombians against corporate fruit giant Chiquita for making $1.7 million in extortion payments to militants in Colombia from 1997 to 2004 was dismissed by the 11th U.S. Circuit Court of Appeals in Atlanta this July. The appeals court found that the activity wasn’t subject to U.S. jurisdiction since it all took place in Colombia. Chiquita has already paid a $25 million fine in connection with the case in 2007.

Plaintiffs might have better luck if they pursued damages on the basis of the U.S. Anti-Terrorism Act, which was recently used successfully to prosecute Arab Bank for handling Hamas bank accounts, rather than relying on the Alien Tort Statute. Presumably, Chiquita could still be held liable under other statutes because extortion payments may have been directed by their offices in the U.S. That being said, Arab Bank intended to support Hamas while Chiquita’s underlying intent was to protect its employees from attacks by paramilitary insurgents.

While the original amount of $1.7 million in extortion payments is less than the $4 million that Arab Bank transferred to Hamas leaders from 2000 to 2001, or the $12.4 million that the Holy Land Foundation gave to Hamas from the mid- to late-1990s, it’s still a lot of money. Even though at least one prominent Filipino politician has endorsed paying off guerrillas, the Chiquita case serves as another reminder that international corporations shouldn’t pay ransoms or meet the extortion demands of local rebel groups or terrorists.

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