Walmart Complaint
DAN STORMER, State Bar No. 101967
ANNE RICHARDSON, State Bar No. 151541
HADSELL & STORMER, INC.
128 North Fair Oaks Avenue, Suite 204
Pasadena, CA 91103
Tel: 626-585-9600
Fax: 626-577-7079
[additional counsel continued on next page]
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES, CENTRAL DISTRICT
__________________________________________________
JANE DOE I, JANE DOE II, JOHN DOE I, and )
JOHN DOE II, Individually and on behalf of Wal-Mart )
workers in Shenzhen, China; ))
JANE DOE III and JANE DOE IV, Individually and ) CASE NO.:
on behalf of Wal-Mart workers in Dhaka, Bangladesh; ))
JANE DOE V, JANE DOE VI, and JOHN DOE III, ) CLASS ACTION
Individually and on behalf of Wal-Mart ) COMPLAINT FOR
workers in Bogor, Indonesia; ) INJUNCTIVE RELIEF AND
) DAMAGES
JANE DOE VII, and JANE DOE VIII, )
Individually and on behalf of Wal-Mart )
workers in Mastapha, Swaziland; ))JANE DOE IX, JANE DOE X, JANE DOE XI, and ) JURY TRIAL DEMANDED
JOHN DOE IV, Individually and on behalf of Wal-Mart )
workers in Managua and Sebaco, Nicaragua, ))
KRISTINE DALL, BRUCE REEVES, )
CHRISTINE KAPOSY, AND SHARLOTTE VILLACORTA, )
Individually and on behalf of similarly situated California )
workers. )
c/o 8530 Stanton Ave, Buena Park, CA 90622 )
Plaintiffs, ))
v. ))
WAL-MART STORES, INC. )
702 S.W. 8th Street )
Bentonville, Arkansas 72716 )
Defendant. )
____________________________________________________ )
TERRY COLLINGSWORTH
NATACHA THYS
DEREK BAXTER
INTERNATIONAL LABOR RIGHTS FUND
733 15th Street, N.W., Suite 920
Washington, D.C. 20005
Tel:202-347-4100
Fax:202-347-4885
PAUL HOFFMAN, State Bar No. 71244
DO KIM
SCHONBRUN, DE SIMONE, SEPLOW,
HARRIS & HOFFMAN, LLP
723 Ocean Front Walk
Venice, CA 90201
Tel: 310 396-0731
Fax: 310 399-7040
I. INTRODUCTION AND SUMMARY OF THE ACTION
1. Plaintiffs Jane Doe I, Jane Doe II, John Doe I, John Doe II (the “China
Plaintiffs”); Jane Doe III, Jane Doe IV (the “Bangladesh Plaintiffs”); Jane Doe V, Jane Doe VI,
John Doe III (the “Indonesia Plaintiffs”); Jane Doe VII and Jane Doe VIII (the “Swaziland
Plaintiffs”); John Doe IV, Jane Doe IX, Jane Doe X, Jane Doe XI (the “Nicaragua Plaintiffs”),
and Bruce Reeves, Kristine Dall, Christine Kaposy, Sharlette Villacorta (the “California
Plaintiffs”) bring this class action suit on behalf of themselves, as well as all those similarly
situated within the designated regions of the aforementioned countries, for injunctive relief and
damages.
2. All Plaintiffs except the California Plaintiffs bring suit for breach of contract as
third party beneficiaries to Defendant Wal-Mart Stores, Inc.’s (hereinafter “Wal-Mart”) supply
contracts with garment factories located in China, Bangladesh, Indonesia, Swaziland and
Nicaragua. The supply contracts require that the foreign suppliers in the identified countries
producing goods for Wal-Mart adhere to Wal-Mart’s Standards for Suppliers Agreement
(hereinafter referred to interchangeably as “Code of Conduct”) as a direct condition of supplying merchandise to Wal-Mart. In exchange, Wal-Mart was obligated to ensure supplier compliance
with their Code of Conduct, and adequately monitor working conditions in supplier factories.
Indeed, Wal-Mart represents to the public at large that it is committed to and, in fact does,
strictly undertake such obligations given the well-documented evidence by public reports and its own monitoring audits that serious worker rights violations were notoriously routine in the
identified countries.
3. In failing to leverage its economic position and actual control over supplier factories to undertake adequate monitoring, ensure supplier compliance, and/or otherwise terminate its business relationship with non-complying supplier factories, Wal-Mart breached its
obligations under its supply contract to the direct detriment of Plaintiffs, as well as similarly
situated members of the proposed class. As a result, the non-California Plaintiffs were subjected
to forced overtime, payments below the legal minimum and overtime wages as established by
the laws of supplier countries identified herein, and overall were forced to work in sub-standard
sweatshop conditions detrimental to their health and safety and in violation of their basic human rights. Such violations also constitute negligence and unjust enrichment under California state
law, as well as unfair business practices under California’s Unfair Business Practices Act,
§17200, et. seq.
4. Finally, the California Plaintiffs, Bruce Reeves, Kristine Dall, Christine Kaposy,
Sharlette Villacorta, bring a claim as California residents harmed by Wal-Mart’s unfair business
practices, as described above, also under California’s Unfair Business Practices Act §17200 and
for unjust enrichment under California state law.
5. Plaintiffs bring their claims against Wal-Mart in the United States because Wal-
Mart’s Standard for Suppliers Agreement is premised and controlled by U.S. law, Wal-Mart
explicitly claims that it monitors and enforces its Code of Conduct from its headquarters in the
US, and the Standard for Suppliers is routinely advertised in the U.S. as Wal-Mart’s Code of
Conduct for foreign suppliers. Moreover, as more fully discussed below, the courts of the non-
California Plaintiffs’ home forums do not provide an adequate, alternative forum due to, inter
alia, notoriously corrupt judiciaries, lack of independent judicial branches, and lack of effective
and enforceable remedies.
6. More importantly, Plaintiffs and their families would be subjected to threats of
reprisal, including threats of current and future job loss, and in many cases, threats of physical
danger by the supplier companies and/or their home country governments if they were to fully
pursue and enforce these claims in their home countries. Accordingly, Plaintiffs also bring their
claims using pseudonyms, in lieu of their true identities, to protect themselves and their families from such harm and retaliation.
II. PARTIES
A. The China Plaintiffs
7. Plaintiff John Doe I is a Chinese citizen residing in Shenzhen, China. Plaintiff
John Doe I is currently employed by XXX factory (this and the other factory in China described
below) is a pseudonym to protect the Chinese Plaintiffs and their co-workers from retaliation),
also in Shenzhen, China, where he is continually subjected to forced overtime, paid below the
minimum wage, and denied full overtime pay. The level of forced overtime is so high that
Plaintiff John Doe I is not allowed to take holidays off, weekly days off, or daily rest periods
mandated by the labor laws of China. XXX factory also withheld the first three months of John
Doe I’s pay, which effectively prevented John Doe I from leaving his employment at the factory.
All of these violations occurred and continue to occur while John Doe I works on Wal-Mart
orders issued to XXX factory, which is a toy factory that supplies merchandise to Wal-Mart for
sale in the U.S. market on a regular and routine basis. John Doe I brings this suit on behalf of
himself and all others similarly situated and employed by Wal-Mart supplier factories in
Shenzhen, China.
8. Plaintiff John Doe II is a Chinese citizen residing in Shenzhen, China. Plaintiff
John Doe II is also currently employed by XXX factory in Shenzhen, China, where he is
continually subjected to forced overtime, paid below the minimum wage, and denied full
overtime pay. The level of forced overtime is so high that Plaintiff John Doe II is not permitted
to take holidays off, weekly days off, or provided with daily rest periods mandated by the labor
laws of China, as well as internationally-accepted standards. As with John Doe I, XXX company
also withheld the first three months of John Doe II’s pay, which effectively prevents John Doe II
from leaving his employment at XXX factory. All of these violations occurred and continue to
occur while John Doe II works on Wal-Mart orders issued to XXX factory, which is a toy
factory that supplies merchandise to Wal-Mart for sale in the U.S. market on a regular and
routine basis. John Doe II brings this suit on behalf of himself and all others similarly situated
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and employed by Wal-Mart supplier factories in Shenzhen, China.
9. Plaintiff Jane Doe I is a Chinese citizen residing in Shenzhen, China. Plaintiff
Jane Doe I is employed as a sewing machine operator at YYY factory in Shenzhen, China, where
she is routinely subjected to forced overtime, denied proper minimum wage and overtime pay,
and forced to work in unsafe working conditions without proper safety equipment. The level of
forced overtime is so high that Plaintiff John Doe I is not permitted to take holidays off, weekly
days off, or provided with daily rest periods mandated by the labor laws of China. These
violations occurred and continue to occur while Jane Doe I works on Wal-Mart orders issued to
YYY factory, which is a garment and toy factory that supplies merchandise to Wal-Mart for sale
in the U.S. market on a regular and routine basis. Jane Doe I brings this suit on behalf of herself
and all others similarly situated and employed by Wal-Mart supplier factories in Shenzhen,
China.
10. Plaintiff Jane Doe II is a Chinese citizen residing in Shenzhen, China. Plaintiff
Jane Doe II is also employed as a sewing machine operator at YYY factory in Shenzhen, China,
where she is routinely subjected to forced overtime and denied fully overtime pay. These
violations occurred and continue to occur while Jane Doe II works on Wal-Mart orders issued to
YYY factory, which is a garment and toy factory that supplies merchandise to Wal-Mart for sale
in the U.S. market on a regular and routine basis. Jane Doe II brings this suit on behalf of herself
and all others similarly situated and employed by Wal-Mart supplier factories in Shenzhen,
China.
11. The Chinese Plaintiffs do not have access to an independent and unbiased
judiciary system in China in which to bring their claims. There is not even a credible basis for
asserting that Chinese courts are independent from other branches of government. Even the U.S.
State Department agrees that Chinese Courts are improperly influenced by the executive branch.
This lack of independence by the judiciary, which due to State investment in the garment sector
in China, means that the one-party system will protect the sector from any effort to remedy rights
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violations. Further, the legal system in China has notorious levels of corruption, which ensures
that garment workers like the Plaintiffs, who are migrant laborers stripped of their rights when
working outside of their home provinces, have no ability to bring their claims in China. More
fundamentally, China has a unique place on the roster of countries that use violent reprisals,
imprisonment, torture and execution to suppress assertions of rights by workers seeking to
secure labor rights, such that the type of labor case presented here, even assuming such case
could be brought in China, would certainly subject the China Plaintiffs to harm from violent
retaliation.
B. The Bangladesh Plaintiffs
12. Plaintiff Jane Doe III is a Bangladeshi citizen residing in Dhaka, Bangladesh.
Approximately between September 2002 through April 2004, she was employed as a helper and
junior sewing operator by Western Dresses factory where she was subjected to forced overtime
and denied full overtime pay. These violations occurred while Plaintiff Jane Doe III was
producing garments for a Wal-Mart work-order issued to Western Dresses. Western Dresses is a
factory located in Dhaka, Bangladesh that supplies clothing merchandise to Wal-Mart for sale in
the U.S. market on a regular and routine basis. She brings this suit on behalf of herself and all
others similarly situated employed by Wal-Mart supplier factories in Dhaka, Bangladesh.
13. Plaintiff Jane Doe IV is a Bangladeshi citizen residing in Dhaka, Bangladesh.
From approximately October 2000 through October 2002, Plaintiff Jane Doe IV was employed
as a sewing operator by Lucid Garments factory where she was subjected to forced overtime and
denied full overtime pay. These violations occurred while Plaintiff Jane Doe IV was producing
garments for a Wal-Mart work order issued to Lucid Garments. Lucid Garments is a factory
located in Dhaka, Bangladesh that supplies clothing merchandise to Wal-Mart for sale in the
U.S. market on a regular and routine basis. She brings this suit on behalf of herself and all others
similarly situated employed by Wal-Mart supplier factories in Dhaka, Bangladesh.
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14. The Bangladesh Plaintiffs are unable to bring their claim in Bangladesh due to a
well-known record of violent reprisal against workers who complain about labor rights
conditions or who attempt to secure their labor rights. Factory owners in Bangladesh routinely
employ private security squads, known locally as “Mastans”, for this very purpose. These
“Mastans” routinely assault, rape and in some cases kill workers who complain even about the
most minute labor rights violations or who attempt to form trade unions. Nazma Akther, for
example, who was the leader of the national union federation of garment workers, had acid
thrown on her and was badly injured as a result. Plaintiffs would be subjected to the same sort of
violence if they were to pursue their claims in Bangladesh. Moreover, even assuming that such
claims could safely be brought, the Bangladeshi judiciary is notoriously corrupt and could not
adequately ensure Plaintiffs a fair trial or provide adequate remedies.
C. The Indonesia Plaintiffs
15. Plaintiff Jane Doe V is an Indonesian citizen residing in Bogor, Indonesia.
Plaintiff Jane Doe V is employed in the Sewing Department of PT Citra Bumilang Admitra as a
sewer. From approximately June 2004 until September 2004, when the Wal-Mart contract with
PT Citra Bumilang Admitra was terminated, she was subjected to violations of Indonesian law,
including unpaid work hours, unpaid overtime, and requirements to work excessive hours.
These violations occurred while Plaintiff was working on Wal-Mart work orders issued to PT
Citra Bumilang Admitra for coats made under the “George” label. PT Citra Bumilang Admitra
is a factory that supplies garments to Wal-Mart for sale in the United States on a regular and
routine basis. She brings this suit on behalf of herself and all others similarly situated employed
by Wal-Mart supplier factories in Indonesia.
16. Plaintiff Jane Doe VI is an Indonesian citizen residing in Bogor, Indonesia. Until
she was suspended for her union activities, in approximately July 2004, Plaintiff Jane Doe VI
was employed in the Finishing Department of PT Citra Bumilang Admitra. From approximately June 2004 until July 2004, she was required to work certain periods of time without pay, and subjected to discrimination against because of her union activities. From July 2004 to September 2004, she was unlawfully suspended due to her union activities. These violations occurred while Plaintiff was working on Wal-Mart work orders issued to PT Citra Bumilang Admitra for coats made under the “George” label. PT Citra Bumilang Admitra is a factory that supplies garments to Wal-Mart for sale in the United States on a regular and routine basis. She brings this suit on behalf of herself and all others similarly situated employed by Wal-Mart supplier factories in Indonesia.
17. Plaintiff John Doe III is an Indonesian citizen residing in Tangerang, Indonesia.
Plaintiff John Doe III is employed as a chief mechanic by PT Busanaremaja Agracipta where
one of his principal responsibilities is servicing and repairing sewing machines used in
production lines making Wal-Mart clothing. From approximately 2002 to the present, he has
been forced to work overtime, denied proper overtime pay and paid below the legal minimum
wage. These violations occurred while Plaintiff was working on Wal-Mart work orders issued to
PT Busanaremaja Agracipta, which supplies clothing merchandise to Wal-Mart for sale in the
U.S. market on a regular and routine basis. He brings this suit on behalf of himself and all others
similarly situated employed by Wal-Mart supplier factories in Indonesia.
18. The Indonesian Plaintiffs do not have access to an independent and unbiased
judiciary system in Indonesia in which to bring their claims. Despite the stated formal
independence of Indonesian courts from other branches of government, it is well recognized
even by the U.S. State Department that the Indonesian Courts continue to be unduly and
improperly influenced by the executive branch. This lack of independence by the Indonesian
judiciary, along with notorious levels of corruption, have been consistently reaffirmed by
numerous United Nations and human rights reports. There is also a noted history of violent
reprisal against trade union leaders and those seeking to secure labor rights, such that the type of labor case presented here, even assuming such case could be brought in Indonesia, would subject
the Indonesian Plaintiffs to harm and retaliation. Further, the laws of Indonesia do not provide
adequate remedies for the violations alleged herein.
D. The Swaziland Plaintiffs
19. Plaintiff Jane Doe VII is a citizen of the Kingdom of Swaziland residing in
Mastapha, Swaziland. From approximately July 1, 2002 through September 9, 2003, Plaintiff
Jane Doe VII was a full time, permanent employee of Leo Garments where she was subjected to forced overtime, paid below the legal minimum wage, and denied full overtime compensation.
These violations occurred while Plaintiff Jane Doe VII was producing garments for a Wal-Mart
work order issued to Leo Garments. Leo Garments is a factory located in Mastapha, Swaziland,
which supplies clothing merchandise to Wal-Mart for sale in the U.S. market on a regular and
routine basis. She brings this suit on behalf of herself and all others similarly situated in
Swaziland who are employed by Wal-Mart supplier factories.
20. Plaintiff Jane Doe VIII is a citizen of the Kingdom of Swaziland residing in
Mastapha, Swaziland. Plaintiff Jane Doe VIII is currently employed as a machinist by Hong-
Yein factory in Mastapha, Swaziland, and has been employed since June 2003. During her
employment she has been subjected to forced overtime and paid below the legal minimum wage,
and denied full overtime compensation. These violations occurred while Plaintiff Jane Doe VIII
was producing garments for a Wal-Mart work order issued to Hong Yein. Hong Yein is a
factory located in Mastapha, Swaziland, which supplies clothing merchandise to Wal-Mart for
sale in the U.S. market on a regular and routine basis. She brings this suit on behalf of herself
and all others similarly situated in Swaziland who are employed by Wal-Mart supplier factories.
21. The Swaziland Plaintiffs do not have access to full and complete judicial relief if
their claims were brought in Swaziland as they would face certain retribution and punishment
from interested private parties and operatives of the Government of Swaziland. Swaziland does
not have an independent judiciary, but rather the judiciary is within the executive branch. The King directly appoints all judges and these judges can be demoted or removed from office at any
time for any reason. As evidence of his direct control, the King has interfered to prevent
enforcement of judicial orders by issuing contradictory decrees. Thus, if this case is not allowed
to proceed in this Court, Plaintiffs will not have an adequate alternative forum in Swaziland.
E. The Nicaragua Plaintiffs
22. Plaintiff John Doe IV is a citizen and resident of Nicaragua, residing in the town
of Managua. He was employed at King Young, S.A. as a sewing machine operator from the
period of January through March, 2004 prior to being fired for his union activity. During his
employment, Plaintiff John Doe IV was subjected to forced overtime, paid below the legal
minimum wage, and denied full overtime compensation. These violations occurred while
Plaintiff John Doe IV was producing garments for a Wal-Mart work-order issued to King
Young. King Young is a factory located in Managua, Nicaragua, which supplies clothing
merchandise to Wal-Mart for sale in the U.S. market on a regular and routine basis. He brings
this suit on behalf of himself and all others similarly situated in Nicaragua who are employed by
Wal-Mart supplier factories.
23. Plaintiff Jane Doe IX is a citizen and resident of Nicaragua residing in the town of
Managua. She was employed at King Young Factory as a quality inspector from the period of
January through April, 2004 prior to being fired for her union activity. During her employment,
Plaintiff Jane Doe IX was subjected to forced overtime, paid below the legal minimum wage,
and denied full overtime compensation. These violations occurred while Plaintiff Jane Doe IX
was producing garments for a Wal-Mart work-order issued to King Young. She brings this suit
on behalf of herself and all others similarly situated in Nicaragua who are employed by Wal-
Mart supplier factories.
24. Plaintiff Jane Doe X is a citizen and resident of Nicaragua residing in the town of
Sebaco. She has been employed at Presitex, S.A. as a sewing machine operator since January 2000. During her employment, Plaintiff Jane Doe X has been subjected to forced overtime, paid
below the legal minimum wage, and denied full overtime compensation. These violations
occurred while Plaintiff Jane Doe X was producing garments for a Wal-Mart work-order issued
to Presitex. Presitex is a factory located in Managua, Nicaragua, which supplies clothing
merchandise to Wal-Mart for sale in the U.S. market on a regular and routine basis. She brings
this suit on behalf of himself and all others similarly situated in Nicaragua who are employed by
Wal-Mart supplier factories.
25. Plaintiff Jane Doe XI is a citizen and resident of Nicaragua residing in the town of
Sebaco. She has been employed at Presitex, S.A. as a sewing machine operator since January
2001. During her employment, Plaintiff Jane Doe XI has been subjected to forced overtime, paid
below the legal minimum wage, and denied full overtime compensation. These violations
occurred while Plaintiff Jane Doe XI was producing garments for a Wal-Mart work-order issued
to Presitex. She brings this suit on behalf of herself and all others similarly situated in Nicaragua
who are employed by Wal-Mart supplier factories.
26. The Nicaraguan Plaintiffs could not bring their claims against Wal-Mart in
Nicaragua because Nicaragua does not have an independent judiciary and its administrative
labor judges and the labor ministers frequently accept bribes from employer factories. Further,
even assuming that a case could be brought successfully, the prospect of enforcing a judgment
against the employer is virtually impossible and, to date, only a handful of cases have been able
to undergo the legal procedure of enforcement. Plaintiffs also could not bring a third party
beneficiary claim against Wal-Mart in Nicaragua as this claim would be precluded by the Labor
Code, which would force them into a labor law system plagued with corruption. Finally, for the
Plaintiffs who are still employed by the identified factories, proceeding with a case for lost
wages would effectively destroy their livelihoods and ability to support their families due to
certain retaliation they would suffer.
F. The California Plaintiffs
27. Plaintiff Bruce Reeves was enjoying the pay and benefits attributable to his
membership in Local 324 of the United Food and Commercial Workers Union (UFCW). He was
working in an environment in which workers’ basic rights were respected, and he was being paid a liveable wage. As a direct result of Wal-Mart’s announced entry into the Southern California
market, Plaintiff’s employer, Ralph’s, informed him that he would have to take reductions in pay and benefits to cuts costs and allow the employer to attempt to compete with Wal-Mart. Plaintiff understood that if he refused to accept these pay and benefit concessions, there was a high risk that he would lose his job, either due to a reduction in force at his employer or because the employer would go out of business.
28. Plaintiff Bruce Reeves suffered a concrete reduction in his pay and benefits that is
directly attributable to Wal-Mart’s comparative advantage of being able to offer low prices
because it produces, or causes to be produced, many of its products outside the United States
under conditions that violate the local laws where the good are produced, generally accepted
international norms, and the specific provisions of Wal-Mart’s own “Code of Conduct.”
29. Plaintiff Kristine Dall was enjoying the pay and benefits attributable to her
membership in Local 324 of the United Food and Commercial Workers Union (UFCW). She
was working in an environment in which workers’ basic rights were respected, and she was
being paid a liveable wage. As a direct result of Wal-Mart’s announced entry into the Southern
California, Plaintiff’s employer, Ralph’s, informed her that she would have to take reductions in
pay and benefits to cut costs and allow the employer to attempt to compete with Wal-Mart.
Plaintiff understood that if she refused to accept these pay and benefit concessions, there was a
high risk that she would lose her job, either due to a reduction in force at her employer or
because the employer would go out of business.
30. Plaintiff Kristine Dall suffered a concrete reduction in her pay and benefits that is
directly attributable to Wal-Mart’s comparative advantage of being able to offer low prices because it produces, or causes to be produced, many of its products outside the United States
under conditions that violate the local laws where the good are produced, generally accepted
international norms, and the specific provisions of Wal-Mart’s own “Code of Conduct.”
31. Plaintiff Christine Kaposy was enjoying the pay and benefits attributable to her
membership in Local 770 of the United Food and Commercial Workers Union (UFCW). She
was working in an environment in which workers’ basic rights were respected, and she was
being paid a liveable wage. As a direct result of Wal-Mart’s announced entry into the Southern
California, Plaintiff’s employer, Safeway Corp., informed her that she would have to accept
reductions in her benefits and pension plan to cut costs so that Safeway could attempt to compete
with Wal-Mart. Plaintiff understood that if she refused to accept these benefit and pension
concessions, there was a high risk that she would lose her job, either due to a reduction in her
employer’s work force or because the employer would go out of business.
32. Plaintiff Christine Kaposy suffered a concrete reduction in her pay and benefits
that is directly attributable to Wal-Mart’s comparative advantage of being able to offer low
prices because it produces, or causes to be produced, many of its products outside the United
States under conditions that violate the local laws where the goods are produced, as well as
generally accepted international norms and the specific provisions of Wal-Mart’s own “Code of
Conduct.”
33. Plaintiff Sharlette Villacorta was enjoying the pay and benefits attributable to her
membership in Local 770 of the United Food and Commercial Workers Union (UFCW). As a
result of Wal-Mart’s entry into Southern California, Plaintiff’s employer lost a significant
amount of business which resulted in the inability of her employer to give any raises or increase
in benefits. Plaintiff’s and other employees’ hours were also cut making it difficult, if not
impossible, to make a living wage. As a result, the employees went on strike. After striking, the
employees’ contracts were even more disadvantageous, specifically because they mandated that
the employees would not receive a raise for a period of three years. Plaintiff understood that if she refused to accept these pay and benefit concessions, there was a high risk that she would lose her job, either due to a reduction in force at her employer or because the employer would go out of business.
34. Plaintiff Sharlette Villacorta suffered a negative impact in her employment
contract and in her pay and benefits that is directly attributable to Wal-Mart’s comparative
advantage of being able to offer low prices because it produces, or causes to be produced, many
of its products outside the United States under conditions that violate the local laws where the
goods are produced, generally accepted international norms, and the specific provisions of Wal-
Mart’s own “Code of Conduct.”
G. Defendant Wal-Mart and the Wal-Mart Code of Conduct
35. Defendant Wal-Mart Stores, Inc. is a for-profit corporation with headquarters in
Bentonville, Arkansas. Today, it is the world’s largest retailer and is engaged in the business of
selling discounted merchandise, including garments and toys, both in the U.S. and
internationally. Its retail stores are located throughout the United States, including California.
Wal-Mart owns and operates over 140 stores and Sam’s Clubs in California, where it directly
employs over 40,000 workers. In addition, it has four distribution centers and one office facility
located in California, and receives massive amounts of shipments by sea and air in California
from its suppliers abroad, including from the specific suppliers at issue in this case. Much of
Wal-Mart’s products enter the stream of commerce from California.
36. Despite its revenue and position as a market leader in the retail industry, Wal-
Mart is notoriously known for its consistent failure to protect worker rights in its own stores, as
well as in the factories of its overseas suppliers. Since the 1990's, numerous investigations have
revealed Wal-Mart’s consistent practice of sourcing merchandise from suppliers using
sweatshop conditions. Probably the most well known was the 1992 Kathie Lee Gifford
controversy. Based on this and other controversies, in 2001 KLD Research & Analytics, Inc.,
A copy of the most recent (2005) Standard for Suppliers is attached to this Complaint as
Exhibit A.
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who compile the Domini 400 Social Index, removed Wal-Mart from its index of socially
responsible corporations. The company had not done enough to ensure that its domestic and
international vendors operate factories that meet basic human rights and labor standards. KLD is
not alone in sanctioning Wal-Mart. Investigation after investigation of Wal-Mart’s operations
and suppliers reveal that Wal-Mart is an unrepentant and recidivist violator of human rights.
37. Precisely because of the notorious worker rights violations in its supplier
factories, which there is no question Wal-Mart had knowledge of, Wal-Mart developed in 1992 a
Code of Conduct (known formally as the “Standards for Suppliers”). This was a central
decision, made by upper management at the company headquarters in Arkansas, and from its
inception, was to apply to all suppliers, including those that are the subject of this litigation. The
Code of Conduct, which is incorporated into its supply contracts with foreign suppliers, purports
to require all suppliers to adhere to applicable laws regarding basic conditions of employment,
including: Compensation; Hours of Labor; Forced Labor/Prison Labor; Child Labor;
Discrimination/Human Rights; Freedom of Association and Collective Bargaining; and
Workplace Environment.1 There have been various versions of this Code of Conduct produced
by Wal-Mart since 1992, but all versions purport to extend these fundamental rights to workers
in Wal-Mart suppliers. As part of its public representations, Wal-Mart promises to do business
with suppliers who are in compliance with the Code of Conduct.
38. This supply contract and Code of Conduct is uniform and globally-applicable, and
is imposed and monitored from Wal-Mart’s headquarters in Arkansas. Regional offices,
including Bangalore, India, Shenzhen, China, Singapore, and Honduras oversee local production
and report directly to Wal-Mart’s headquarters in Arkansas. The power to hire and fire staff
responsible for monitoring activities is vested in the Central Management office. The regional
offices implement the policies and practices of the Wal-Mart headquarters, resulting in a uniform practice and procedure being applied to all Wal-Mart suppliers in Asia, Africa, and Latin America. Among the requirements imposed by the regional offices, at the direction of the
headquarters office, is the requirement that Wal-Mart’s Code of Conduct be incorporated in all
supplier agreements, including those located in China, Bangladesh, Indonesia, Swaziland, and
Nicaragua, the countries identified herein.
39. As part of its obligations under the supply contract, and as per its specific promise
to the consuming public in the U.S., including California, Wal-Mart promises to monitor
supplier factories to ensure compliance with the Code of Conduct. Specifically, the preamble to
a 2003 version of the Code of Conduct states that “the conduct of its suppliers can be attributed
to Wal-Mart and affect its reputation, . . . and hereby reserves the right to make periodic,
unannounced inspections of supplier’s facilities to satisfy itself of supplier’s compliance with
these standards.” The 2005 version reinforces that Wal-Mart has the “right of inspection.”
40. Paragraph 5 of the 2004 version of the Code of Conduct (FACTORY
INSPECTION REQUIREMENTS) requires that “[s]cheduled inspections should typically be
conducted a maximum of three times per year to ensure compliance with the standards, terms,
and conditions set forth herein. Wal-Mart reserves the right to conduct unannounced factory
inspections. . . . In the case of suppliers working through Global Procurement Direct Imports,
audits should be conducted by Wal-Mart’s internal auditors.” The 2005 version provides a
specific “right of inspection” to Wal-Mart.
41. Wal-Mart’s monitoring consists of factory investigations by Wal-Mart hired
auditors based on a color coded system: factories with low-risk violations are assessed as Green, factories with medium-risk violations are assessed as Yellow, factories with high-risk violations
are assessed as Red, and factories with critical violations are Failed. However, significant
numbers of factories receive Yellow (medium risk) and Red (high risk) ratings, particularly
those in China, but Wal-Mart continues to source from them. Further, other than child labor,
there are not clear guidelines on what violations fall under the particular ratings. It also requires
two consecutive Red ratings for Wal-Mart to suspend orders, but the company can request
purchases again from these same factories once the factory receives a Yellow rating, still
medium risk. Thus, Wal-Mart products are being produced by workers in facilities that are
known risks. Further, at most, only 8% of all Wal-Mart audits in 2004 are unannounced, and
while auditors are supposed to perform off-site worker interviews for each audit, Wal-Mart
admits that workers are often coached on the answers to give inspectors.
42. Because Wal-Mart’s system limits factory inspections to those conducted by
internal Wal-Mart auditors, or relies upon consultants paid for by Wal-Mart, it is far from
effective and allows rampant violations to continue. In essence, based on its policy created by
central management, Wal Mart’s code enforcement is a closed loop: Wal-Mart adopts the code,
monitors the code, and reports on whether code compliance has been achieved – in the absence
of meaningful transparency and in the absence of any independent, external mechanisms for
enforcing the code. A dramatic illustration of the corrupt nature of the system is that a former
regional inspector for Wal-Mart recently sued the company for terminating him after he
protested the utter lack of integrity in the inspection process. Among other things, he exposed
that Wal-Mart inspectors were pressured to produce positive reports for factories not in
compliance with the Code of Conduct to avoid any disruption in the Wal-Mart production
process.
43. The conditions endured by the Plaintiffs in violation of law and the Wal-Mart
Code of Conduct are the result of Wal-Mart’s central practices of ignoring the requirements of
its Code of Conduct, and knowingly imposing price and time requirements on suppliers that
necessarily result in sweatshop conditions. Further, Wal-Mart fails to take account of its
knowledge of risk and knowingly uses factories that have failed to pass even Wal-Mart’s lax
system of inspection and monitoring. Knowing of the risks in many of its suppliers, Wal-Mart
still fails to exercise adequate supervision of compliance with its Code of Conduct, as well as
compliance with local laws and well-established international standards, such as Conventions of
the ILO. In contrast, Wal-Mart has an effective system of monitoring and supervision to ensure
that all of its suppliers, including those named herein, meet Wal-Mart’s standards for price,
quality and timely delivery.
44. Wal-Mart acknowledges, and represents to the public, in both its 2002 and 2003
Annual Report on Supplier Standards and/or Factory Certification Report (hereinafter “Supplier
Standards Reports”) that its “Factory Certification Program” used to implement the Code of
Conduct has the “fundamental objective” of “encourag[ing] implementation of necessary
changes that will ultimately result in an improved quality of life for the workers who supply our
stores with the merchandise our customers demand.” In 2005 Wal-Mart began calling its overall
monitoring effort the “Ethical Sourcing Program.”
45. All Wal-Mart suppliers must sign the Code of Conduct and acknowledge that they
have read and accept the terms. They must also acknowledge that failure to comply with the
Code of Conduct can result in the immediate cancellation by Wal-Mart of all orders and refusal
by Wal-Mart to continue to do business in any manner with the supplier. All suppliers must also
post, in the local language, a copy of the Code of Conduct in a location that is visible to all
employees.
46. In Appendix B to its 2002 Supplier Standards Report, Wal-Mart states that it
“trains its auditors to review factory practices against Wal-Mart’s standards and local and
national requirements.” The auditors must then “report the findings, and then the Wal-Mart
Factory Certification Department assesses the factories.” Further, “during the factory visit, the
auditor will interview employees.”
Paragraph 6 (RIGHT OF INSPECTION) of the 2004 Code of Conduct also provides that:
[t]o further assure proper implementation of an compliance with the
standards set forth herein, Wal-Mart or a third party designated by
Wal-Mart, will undertake affirmative measures, such as on-site inspection
of production facilities, to implement and monitor said standards. Any
supplier which fails or refuses to comply with these standards or does
not allow inspection of production facilities is subject to immediate
cancellation of any and all outstanding orders, refuse or return any
shipment, and otherwise cease doing business with Wal-Mart.
47. Plaintiffs, and members of the proposed subclasses, as a matter of economic
reality, have been and are dependent upon Wal-Mart for their livelihoods and supplier
compliance with the minimum and overtime wage protections within Wal-Mart’s Code of
Conduct. Based on its vast economic power, Wal-Mart, based on its Code of Conduct, can and
does control the working conditions within the supplier factories. It could use its power and
position to prevent its producers from profiting from the inhumane treatment of Plaintiffs and
members of the proposed subclasses. Instead, Wal-Mart is itself the reason for the inhumane
conditions. It uses its vast market power to insist on low unit prices that are possible only if
workers are squeezed to such an extreme degree that they can barely survive the long hours and
low wages they are forced to endure. Indeed, Wal-Mart’s pricing methods necessarily assume
that its profits will be based in part on forcing suppliers to systematically and routinely deprive
the workers of their basic rights and legally-mandated benefits.
48. Specifically, Wal-Mart controlled the working conditions imposed upon Plaintiffs
by the identified suppliers through its supply contract, as evidence by the following:
(a) Wal-Mart exercised meaningful control over the minimum wage and overtime
policies of the identified supplier factories due to its obligation under the supply contract to
monitor and audit the working conditions therein;
(b) Wal-Mart exercised meaningful control over the minimum wage and overtime
policies of the supplier factories through the power to cancel any and all outstanding orders,
refusal or return of any shipment, and the ability to cease a business relationship with the
supplier in non-compliance the Code of Conduct;
(c) Wal-Mart exercised meaningful control over the operative details of Plaintiffs’ tasks,
including the quantity, quality standards, turnaround time, and other operative details of the
production process with regards to the production of goods to be exported to Wal-Mart stores;
(d) Wal-Mart personnel and/or its agents supervised the production process by, according
to its own obligations under the supply contract, being present at the supplier factories where
Plaintiffs worked, and because they review, inspect, oversee, monitor and audit such work,
routinely taking random samples from the production line before shipment to ensure quality
control; and
(e) Wal-Mart ultimately has control over the working conditions at all of its suppliers
because of its notorious policy of requiring the lowest possible prices, which Wal-Mart knows,
makes it impossible for suppliers to comply with even the most basic laws where they operate,
including wage and hours laws.
49. Wal-Mart operates with specific knowledge that a large member of its suppliers
operate in violation of law, as well as in violation of Wal-Mart’s Code of Conduct and Wal-Mart
further knows its monitoring process may be the sole mechanism available to workers in supplier
factories to obtain legal compliance. Indeed, in both its 2002 and 2003 Supplier Standards
Reports, Wal-Mart admits that in “[m]any countries we source from have very good labor laws
but, for a variety of reasons, they may not be routinely enforced. In many cases our auditing
process is the main law enforcement mechanism for the factories from which we source.”
III. SPECIFIC DAMAGES SUFFERED BY PLAINTIFFS
A. The China Plaintiffs
50. Plaintiffs John Doe I and II have been employed at XXX factory in Shenzhen,
China since at least early 2000, and are currently employed there today. Continually throughout
their employment, Plaintiffs John Doe I and John Doe II have been subjected to forced overtime
and denied full overtime pay. They also do not receive the legal minimum wage, and are not
permitted to take holidays off, weekly days off, or provided with daily rest periods mandated by
the labor laws of China. Finally, XXX company withholds the first three months of all workers’
pay, including Plaintiffs John Doe I and John Doe II’s pay, and if any worker quits, this pay is
retained by the company. Given the hand-to-mouth subsistence of the workers, this effectively
prevents John Doe I and John Doe II from leaving their employment at XXX factory, and has
denied them even a semblance of a personal life because they are constantly being forced to
work extra hours for no additional pay.
51. Plaintiffs Jane Doe I and II have been employed at YYY factory in Shenzhen,
China as sewing machine operators since 2003 and are currently employed there today. On a
regular basis, Plaintiffs Jane Doe I and Jane Doe II are subjected to forced overtime and denied
full overtime pay. They, along with their co-workers, are routinely required to punch out after
nine hours of work, and then forced to work until they have finished their daily quota. They are
not paid for this extra work, which often is several more hours a day and requires them to work
late into the night. Neither Plaintiff Jane Doe I or Jane Doe II have a choice, but are forced to
stay for this unpaid work, or they will lose their position and be blacklisted, a common practice
which garment factories in Shenzhen, China use to keep workers in line.
52. Plaintiffs Jane Doe I and Jane Doe II also do not receive the legal minimum wage,
and are not permitted to take holidays off, weekly days off, or daily rest periods mandated by the
labor laws of China. Finally, Plaintiffs Jane Doe I and Jane Doe II are not provided with any
safety equipment, and both suffer from respiratory illness and skin rashes as a result of the cotton
and wool dust they are constantly exposed to.
B. The Bangladesh Plaintiffs
53. Plaintiff Jane Doe III was employed as a helper and junior sewing operator by
Western Dresses factory from approximately September 2002 through April 2004, where she
was subjected to forced overtime, denied full overtime pay, and severely beaten.
54. As a helper, Plaintiff Jane Doe III’s job was to measure and mark with chalk the
location where the back pocket was to be sewn on the pants being assembled. During this time,
she worked from 7:45 a.m. to 10:00 or 11:00 p.m. seven days a week with only two minimal rest breaks in between lasting between 20 to 30 minutes. In the first six months that she worked she
did not have a single day off, yet was paid below the minimum wage. Nor could she refuse to
work the required hours of overtime as the factory doors are locked and she would be fired
immediately if she left.
55. The extremely long hours worked by Plaintiff Jane Doe III were necessary to
produce between 120 and 150 pieces per hour. During her first week of work, her line
supervisor attacked Jane Doe III by slapping her face so hard that her nose began bleeding
simply because she was unable to meet this high quota. The supervisor slapped her four times,
each time screaming that she was not making her quota. Jane Doe III was so frightened that she
began to cry, and fainted.
56. After six months when Plaintiff Jane Doe III became a junior sewing operator,
she continued to have to produce 120 pieces per hour and if she did not meet this quota, the line
supervisors would forcefully slap the pants across her face. As a sewing operator, she had to
work even more hours of overtime, working from 8:00 a.m. until 3:00 a.m. at least 7 or 8 nights
a month prior to the shipments going out. At times, she had to work until 7:00 a.m. the next
morning. For all this, Jane Doe III was paid less than the legally-mandated minimum and
overtime wages.
57. Plaintiff Jane Doe IV was employed as a sewing operator by Lucid Garments
factory in Dhaka, Bangladesh from approximately October 2000 through October 2002. About a
year and three months into working for Lucid Garments, Plaintiff Jane Doe IV became pregnant
yet continued to work at the factory. However, during her seventh month of pregnancy, she
became ill and could not maintain the rapid pace of production. Her supervisor refused to let her
take a rest break, screaming that he did not want to hear anything about her being pregnant and
that she should leave the factory if she did not want to work. Unable to continue working, Jane
Doe IV had to take a short break sitting by the side of her machine. The supervisor stood over
her and then kicked her hard in her stomach. Plaintiff Jane Doe IV fell to the floor crying and
immediately felt the baby shift. Her daughter, who is now two years old, was born with a bruise
on her head, which remains extremely sensitive to the touch.
58. After this horrific incident, Plaintiff Jane Doe IV was only able to go home after
the production manager interceded and gave permission. However, she was forced to return the
next morning and work in the factory until she was about 8 ½ months pregnant. Upon leaving,
she was denied any maternity benefits even though Bangladeshi law mandates twelve weeks
paid maternity leave.
59. During Plaintiff Jane Doe IV’s employment with Lucid Garments, she was also
paid below the legal minimum wage and denied full overtime pay. Specifically, she worked from
8:00 in the morning to 10:00 or 11:00 p.m. seven days a week with only one day off per month.
At times, she was forced to work until 3:00 in the morning.
C. The Indonesia Plaintiffs
60. Plaintiff Jane Doe V is employed in the Sewing Department of PT Citra
Bumilang Admitra as a sewer. From approximately June 2004 until approximately September
2004, when the Wal-Mart contract with PT Citra Bumilang Admitra was terminated, she was
required to work from 6:45 or 7:00 a.m. (even though her paid shift did not begin until 7:30
a.m.) until as late as 8:00 to 10:00 p.m. at night, Mondays through Fridays. Her supervisor
yelled at her when she left one night at 6:00 p.m., as the quota had not yet been met for that day.
She frequently was forced to work through her lunch hour without pay in order to meet the
quota. These violations occurred as Plaintiff Jane Doe V worked sewing George jackets for
Wal-Mart. Additionally, she was required to work Saturdays, from 7:30 a.m. until as late as 3:00
or 4:00 p.m.
61. Plaintiff Jane Doe V was not paid overtime for much of this work, despite the fact
that Indonesian law requires overtime to be paid after 7 hours worked per day (in the event that a worker is, like Plaintiff Jane Doe V, on a six-day workweek schedule). Frequently, overtime was not paid for work performed after 7 hours of work, and though she was sometimes
ANNE RICHARDSON, State Bar No. 151541
HADSELL & STORMER, INC.
128 North Fair Oaks Avenue, Suite 204
Pasadena, CA 91103
Tel: 626-585-9600
Fax: 626-577-7079
[additional counsel continued on next page]
SUPERIOR COURT OF THE STATE OF CALIFORNIA
FOR THE COUNTY OF LOS ANGELES, CENTRAL DISTRICT
__________________________________________________
JANE DOE I, JANE DOE II, JOHN DOE I, and )
JOHN DOE II, Individually and on behalf of Wal-Mart )
workers in Shenzhen, China; ))
JANE DOE III and JANE DOE IV, Individually and ) CASE NO.:
on behalf of Wal-Mart workers in Dhaka, Bangladesh; ))
JANE DOE V, JANE DOE VI, and JOHN DOE III, ) CLASS ACTION
Individually and on behalf of Wal-Mart ) COMPLAINT FOR
workers in Bogor, Indonesia; ) INJUNCTIVE RELIEF AND
) DAMAGES
JANE DOE VII, and JANE DOE VIII, )
Individually and on behalf of Wal-Mart )
workers in Mastapha, Swaziland; ))JANE DOE IX, JANE DOE X, JANE DOE XI, and ) JURY TRIAL DEMANDED
JOHN DOE IV, Individually and on behalf of Wal-Mart )
workers in Managua and Sebaco, Nicaragua, ))
KRISTINE DALL, BRUCE REEVES, )
CHRISTINE KAPOSY, AND SHARLOTTE VILLACORTA, )
Individually and on behalf of similarly situated California )
workers. )
c/o 8530 Stanton Ave, Buena Park, CA 90622 )
Plaintiffs, ))
v. ))
WAL-MART STORES, INC. )
702 S.W. 8th Street )
Bentonville, Arkansas 72716 )
Defendant. )
____________________________________________________ )
TERRY COLLINGSWORTH
NATACHA THYS
DEREK BAXTER
INTERNATIONAL LABOR RIGHTS FUND
733 15th Street, N.W., Suite 920
Washington, D.C. 20005
Tel:202-347-4100
Fax:202-347-4885
PAUL HOFFMAN, State Bar No. 71244
DO KIM
SCHONBRUN, DE SIMONE, SEPLOW,
HARRIS & HOFFMAN, LLP
723 Ocean Front Walk
Venice, CA 90201
Tel: 310 396-0731
Fax: 310 399-7040
I. INTRODUCTION AND SUMMARY OF THE ACTION
1. Plaintiffs Jane Doe I, Jane Doe II, John Doe I, John Doe II (the “China
Plaintiffs”); Jane Doe III, Jane Doe IV (the “Bangladesh Plaintiffs”); Jane Doe V, Jane Doe VI,
John Doe III (the “Indonesia Plaintiffs”); Jane Doe VII and Jane Doe VIII (the “Swaziland
Plaintiffs”); John Doe IV, Jane Doe IX, Jane Doe X, Jane Doe XI (the “Nicaragua Plaintiffs”),
and Bruce Reeves, Kristine Dall, Christine Kaposy, Sharlette Villacorta (the “California
Plaintiffs”) bring this class action suit on behalf of themselves, as well as all those similarly
situated within the designated regions of the aforementioned countries, for injunctive relief and
damages.
2. All Plaintiffs except the California Plaintiffs bring suit for breach of contract as
third party beneficiaries to Defendant Wal-Mart Stores, Inc.’s (hereinafter “Wal-Mart”) supply
contracts with garment factories located in China, Bangladesh, Indonesia, Swaziland and
Nicaragua. The supply contracts require that the foreign suppliers in the identified countries
producing goods for Wal-Mart adhere to Wal-Mart’s Standards for Suppliers Agreement
(hereinafter referred to interchangeably as “Code of Conduct”) as a direct condition of supplying merchandise to Wal-Mart. In exchange, Wal-Mart was obligated to ensure supplier compliance
with their Code of Conduct, and adequately monitor working conditions in supplier factories.
Indeed, Wal-Mart represents to the public at large that it is committed to and, in fact does,
strictly undertake such obligations given the well-documented evidence by public reports and its own monitoring audits that serious worker rights violations were notoriously routine in the
identified countries.
3. In failing to leverage its economic position and actual control over supplier factories to undertake adequate monitoring, ensure supplier compliance, and/or otherwise terminate its business relationship with non-complying supplier factories, Wal-Mart breached its
obligations under its supply contract to the direct detriment of Plaintiffs, as well as similarly
situated members of the proposed class. As a result, the non-California Plaintiffs were subjected
to forced overtime, payments below the legal minimum and overtime wages as established by
the laws of supplier countries identified herein, and overall were forced to work in sub-standard
sweatshop conditions detrimental to their health and safety and in violation of their basic human rights. Such violations also constitute negligence and unjust enrichment under California state
law, as well as unfair business practices under California’s Unfair Business Practices Act,
§17200, et. seq.
4. Finally, the California Plaintiffs, Bruce Reeves, Kristine Dall, Christine Kaposy,
Sharlette Villacorta, bring a claim as California residents harmed by Wal-Mart’s unfair business
practices, as described above, also under California’s Unfair Business Practices Act §17200 and
for unjust enrichment under California state law.
5. Plaintiffs bring their claims against Wal-Mart in the United States because Wal-
Mart’s Standard for Suppliers Agreement is premised and controlled by U.S. law, Wal-Mart
explicitly claims that it monitors and enforces its Code of Conduct from its headquarters in the
US, and the Standard for Suppliers is routinely advertised in the U.S. as Wal-Mart’s Code of
Conduct for foreign suppliers. Moreover, as more fully discussed below, the courts of the non-
California Plaintiffs’ home forums do not provide an adequate, alternative forum due to, inter
alia, notoriously corrupt judiciaries, lack of independent judicial branches, and lack of effective
and enforceable remedies.
6. More importantly, Plaintiffs and their families would be subjected to threats of
reprisal, including threats of current and future job loss, and in many cases, threats of physical
danger by the supplier companies and/or their home country governments if they were to fully
pursue and enforce these claims in their home countries. Accordingly, Plaintiffs also bring their
claims using pseudonyms, in lieu of their true identities, to protect themselves and their families from such harm and retaliation.
II. PARTIES
A. The China Plaintiffs
7. Plaintiff John Doe I is a Chinese citizen residing in Shenzhen, China. Plaintiff
John Doe I is currently employed by XXX factory (this and the other factory in China described
below) is a pseudonym to protect the Chinese Plaintiffs and their co-workers from retaliation),
also in Shenzhen, China, where he is continually subjected to forced overtime, paid below the
minimum wage, and denied full overtime pay. The level of forced overtime is so high that
Plaintiff John Doe I is not allowed to take holidays off, weekly days off, or daily rest periods
mandated by the labor laws of China. XXX factory also withheld the first three months of John
Doe I’s pay, which effectively prevented John Doe I from leaving his employment at the factory.
All of these violations occurred and continue to occur while John Doe I works on Wal-Mart
orders issued to XXX factory, which is a toy factory that supplies merchandise to Wal-Mart for
sale in the U.S. market on a regular and routine basis. John Doe I brings this suit on behalf of
himself and all others similarly situated and employed by Wal-Mart supplier factories in
Shenzhen, China.
8. Plaintiff John Doe II is a Chinese citizen residing in Shenzhen, China. Plaintiff
John Doe II is also currently employed by XXX factory in Shenzhen, China, where he is
continually subjected to forced overtime, paid below the minimum wage, and denied full
overtime pay. The level of forced overtime is so high that Plaintiff John Doe II is not permitted
to take holidays off, weekly days off, or provided with daily rest periods mandated by the labor
laws of China, as well as internationally-accepted standards. As with John Doe I, XXX company
also withheld the first three months of John Doe II’s pay, which effectively prevents John Doe II
from leaving his employment at XXX factory. All of these violations occurred and continue to
occur while John Doe II works on Wal-Mart orders issued to XXX factory, which is a toy
factory that supplies merchandise to Wal-Mart for sale in the U.S. market on a regular and
routine basis. John Doe II brings this suit on behalf of himself and all others similarly situated
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and employed by Wal-Mart supplier factories in Shenzhen, China.
9. Plaintiff Jane Doe I is a Chinese citizen residing in Shenzhen, China. Plaintiff
Jane Doe I is employed as a sewing machine operator at YYY factory in Shenzhen, China, where
she is routinely subjected to forced overtime, denied proper minimum wage and overtime pay,
and forced to work in unsafe working conditions without proper safety equipment. The level of
forced overtime is so high that Plaintiff John Doe I is not permitted to take holidays off, weekly
days off, or provided with daily rest periods mandated by the labor laws of China. These
violations occurred and continue to occur while Jane Doe I works on Wal-Mart orders issued to
YYY factory, which is a garment and toy factory that supplies merchandise to Wal-Mart for sale
in the U.S. market on a regular and routine basis. Jane Doe I brings this suit on behalf of herself
and all others similarly situated and employed by Wal-Mart supplier factories in Shenzhen,
China.
10. Plaintiff Jane Doe II is a Chinese citizen residing in Shenzhen, China. Plaintiff
Jane Doe II is also employed as a sewing machine operator at YYY factory in Shenzhen, China,
where she is routinely subjected to forced overtime and denied fully overtime pay. These
violations occurred and continue to occur while Jane Doe II works on Wal-Mart orders issued to
YYY factory, which is a garment and toy factory that supplies merchandise to Wal-Mart for sale
in the U.S. market on a regular and routine basis. Jane Doe II brings this suit on behalf of herself
and all others similarly situated and employed by Wal-Mart supplier factories in Shenzhen,
China.
11. The Chinese Plaintiffs do not have access to an independent and unbiased
judiciary system in China in which to bring their claims. There is not even a credible basis for
asserting that Chinese courts are independent from other branches of government. Even the U.S.
State Department agrees that Chinese Courts are improperly influenced by the executive branch.
This lack of independence by the judiciary, which due to State investment in the garment sector
in China, means that the one-party system will protect the sector from any effort to remedy rights
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violations. Further, the legal system in China has notorious levels of corruption, which ensures
that garment workers like the Plaintiffs, who are migrant laborers stripped of their rights when
working outside of their home provinces, have no ability to bring their claims in China. More
fundamentally, China has a unique place on the roster of countries that use violent reprisals,
imprisonment, torture and execution to suppress assertions of rights by workers seeking to
secure labor rights, such that the type of labor case presented here, even assuming such case
could be brought in China, would certainly subject the China Plaintiffs to harm from violent
retaliation.
B. The Bangladesh Plaintiffs
12. Plaintiff Jane Doe III is a Bangladeshi citizen residing in Dhaka, Bangladesh.
Approximately between September 2002 through April 2004, she was employed as a helper and
junior sewing operator by Western Dresses factory where she was subjected to forced overtime
and denied full overtime pay. These violations occurred while Plaintiff Jane Doe III was
producing garments for a Wal-Mart work-order issued to Western Dresses. Western Dresses is a
factory located in Dhaka, Bangladesh that supplies clothing merchandise to Wal-Mart for sale in
the U.S. market on a regular and routine basis. She brings this suit on behalf of herself and all
others similarly situated employed by Wal-Mart supplier factories in Dhaka, Bangladesh.
13. Plaintiff Jane Doe IV is a Bangladeshi citizen residing in Dhaka, Bangladesh.
From approximately October 2000 through October 2002, Plaintiff Jane Doe IV was employed
as a sewing operator by Lucid Garments factory where she was subjected to forced overtime and
denied full overtime pay. These violations occurred while Plaintiff Jane Doe IV was producing
garments for a Wal-Mart work order issued to Lucid Garments. Lucid Garments is a factory
located in Dhaka, Bangladesh that supplies clothing merchandise to Wal-Mart for sale in the
U.S. market on a regular and routine basis. She brings this suit on behalf of herself and all others
similarly situated employed by Wal-Mart supplier factories in Dhaka, Bangladesh.
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14. The Bangladesh Plaintiffs are unable to bring their claim in Bangladesh due to a
well-known record of violent reprisal against workers who complain about labor rights
conditions or who attempt to secure their labor rights. Factory owners in Bangladesh routinely
employ private security squads, known locally as “Mastans”, for this very purpose. These
“Mastans” routinely assault, rape and in some cases kill workers who complain even about the
most minute labor rights violations or who attempt to form trade unions. Nazma Akther, for
example, who was the leader of the national union federation of garment workers, had acid
thrown on her and was badly injured as a result. Plaintiffs would be subjected to the same sort of
violence if they were to pursue their claims in Bangladesh. Moreover, even assuming that such
claims could safely be brought, the Bangladeshi judiciary is notoriously corrupt and could not
adequately ensure Plaintiffs a fair trial or provide adequate remedies.
C. The Indonesia Plaintiffs
15. Plaintiff Jane Doe V is an Indonesian citizen residing in Bogor, Indonesia.
Plaintiff Jane Doe V is employed in the Sewing Department of PT Citra Bumilang Admitra as a
sewer. From approximately June 2004 until September 2004, when the Wal-Mart contract with
PT Citra Bumilang Admitra was terminated, she was subjected to violations of Indonesian law,
including unpaid work hours, unpaid overtime, and requirements to work excessive hours.
These violations occurred while Plaintiff was working on Wal-Mart work orders issued to PT
Citra Bumilang Admitra for coats made under the “George” label. PT Citra Bumilang Admitra
is a factory that supplies garments to Wal-Mart for sale in the United States on a regular and
routine basis. She brings this suit on behalf of herself and all others similarly situated employed
by Wal-Mart supplier factories in Indonesia.
16. Plaintiff Jane Doe VI is an Indonesian citizen residing in Bogor, Indonesia. Until
she was suspended for her union activities, in approximately July 2004, Plaintiff Jane Doe VI
was employed in the Finishing Department of PT Citra Bumilang Admitra. From approximately June 2004 until July 2004, she was required to work certain periods of time without pay, and subjected to discrimination against because of her union activities. From July 2004 to September 2004, she was unlawfully suspended due to her union activities. These violations occurred while Plaintiff was working on Wal-Mart work orders issued to PT Citra Bumilang Admitra for coats made under the “George” label. PT Citra Bumilang Admitra is a factory that supplies garments to Wal-Mart for sale in the United States on a regular and routine basis. She brings this suit on behalf of herself and all others similarly situated employed by Wal-Mart supplier factories in Indonesia.
17. Plaintiff John Doe III is an Indonesian citizen residing in Tangerang, Indonesia.
Plaintiff John Doe III is employed as a chief mechanic by PT Busanaremaja Agracipta where
one of his principal responsibilities is servicing and repairing sewing machines used in
production lines making Wal-Mart clothing. From approximately 2002 to the present, he has
been forced to work overtime, denied proper overtime pay and paid below the legal minimum
wage. These violations occurred while Plaintiff was working on Wal-Mart work orders issued to
PT Busanaremaja Agracipta, which supplies clothing merchandise to Wal-Mart for sale in the
U.S. market on a regular and routine basis. He brings this suit on behalf of himself and all others
similarly situated employed by Wal-Mart supplier factories in Indonesia.
18. The Indonesian Plaintiffs do not have access to an independent and unbiased
judiciary system in Indonesia in which to bring their claims. Despite the stated formal
independence of Indonesian courts from other branches of government, it is well recognized
even by the U.S. State Department that the Indonesian Courts continue to be unduly and
improperly influenced by the executive branch. This lack of independence by the Indonesian
judiciary, along with notorious levels of corruption, have been consistently reaffirmed by
numerous United Nations and human rights reports. There is also a noted history of violent
reprisal against trade union leaders and those seeking to secure labor rights, such that the type of labor case presented here, even assuming such case could be brought in Indonesia, would subject
the Indonesian Plaintiffs to harm and retaliation. Further, the laws of Indonesia do not provide
adequate remedies for the violations alleged herein.
D. The Swaziland Plaintiffs
19. Plaintiff Jane Doe VII is a citizen of the Kingdom of Swaziland residing in
Mastapha, Swaziland. From approximately July 1, 2002 through September 9, 2003, Plaintiff
Jane Doe VII was a full time, permanent employee of Leo Garments where she was subjected to forced overtime, paid below the legal minimum wage, and denied full overtime compensation.
These violations occurred while Plaintiff Jane Doe VII was producing garments for a Wal-Mart
work order issued to Leo Garments. Leo Garments is a factory located in Mastapha, Swaziland,
which supplies clothing merchandise to Wal-Mart for sale in the U.S. market on a regular and
routine basis. She brings this suit on behalf of herself and all others similarly situated in
Swaziland who are employed by Wal-Mart supplier factories.
20. Plaintiff Jane Doe VIII is a citizen of the Kingdom of Swaziland residing in
Mastapha, Swaziland. Plaintiff Jane Doe VIII is currently employed as a machinist by Hong-
Yein factory in Mastapha, Swaziland, and has been employed since June 2003. During her
employment she has been subjected to forced overtime and paid below the legal minimum wage,
and denied full overtime compensation. These violations occurred while Plaintiff Jane Doe VIII
was producing garments for a Wal-Mart work order issued to Hong Yein. Hong Yein is a
factory located in Mastapha, Swaziland, which supplies clothing merchandise to Wal-Mart for
sale in the U.S. market on a regular and routine basis. She brings this suit on behalf of herself
and all others similarly situated in Swaziland who are employed by Wal-Mart supplier factories.
21. The Swaziland Plaintiffs do not have access to full and complete judicial relief if
their claims were brought in Swaziland as they would face certain retribution and punishment
from interested private parties and operatives of the Government of Swaziland. Swaziland does
not have an independent judiciary, but rather the judiciary is within the executive branch. The King directly appoints all judges and these judges can be demoted or removed from office at any
time for any reason. As evidence of his direct control, the King has interfered to prevent
enforcement of judicial orders by issuing contradictory decrees. Thus, if this case is not allowed
to proceed in this Court, Plaintiffs will not have an adequate alternative forum in Swaziland.
E. The Nicaragua Plaintiffs
22. Plaintiff John Doe IV is a citizen and resident of Nicaragua, residing in the town
of Managua. He was employed at King Young, S.A. as a sewing machine operator from the
period of January through March, 2004 prior to being fired for his union activity. During his
employment, Plaintiff John Doe IV was subjected to forced overtime, paid below the legal
minimum wage, and denied full overtime compensation. These violations occurred while
Plaintiff John Doe IV was producing garments for a Wal-Mart work-order issued to King
Young. King Young is a factory located in Managua, Nicaragua, which supplies clothing
merchandise to Wal-Mart for sale in the U.S. market on a regular and routine basis. He brings
this suit on behalf of himself and all others similarly situated in Nicaragua who are employed by
Wal-Mart supplier factories.
23. Plaintiff Jane Doe IX is a citizen and resident of Nicaragua residing in the town of
Managua. She was employed at King Young Factory as a quality inspector from the period of
January through April, 2004 prior to being fired for her union activity. During her employment,
Plaintiff Jane Doe IX was subjected to forced overtime, paid below the legal minimum wage,
and denied full overtime compensation. These violations occurred while Plaintiff Jane Doe IX
was producing garments for a Wal-Mart work-order issued to King Young. She brings this suit
on behalf of herself and all others similarly situated in Nicaragua who are employed by Wal-
Mart supplier factories.
24. Plaintiff Jane Doe X is a citizen and resident of Nicaragua residing in the town of
Sebaco. She has been employed at Presitex, S.A. as a sewing machine operator since January 2000. During her employment, Plaintiff Jane Doe X has been subjected to forced overtime, paid
below the legal minimum wage, and denied full overtime compensation. These violations
occurred while Plaintiff Jane Doe X was producing garments for a Wal-Mart work-order issued
to Presitex. Presitex is a factory located in Managua, Nicaragua, which supplies clothing
merchandise to Wal-Mart for sale in the U.S. market on a regular and routine basis. She brings
this suit on behalf of himself and all others similarly situated in Nicaragua who are employed by
Wal-Mart supplier factories.
25. Plaintiff Jane Doe XI is a citizen and resident of Nicaragua residing in the town of
Sebaco. She has been employed at Presitex, S.A. as a sewing machine operator since January
2001. During her employment, Plaintiff Jane Doe XI has been subjected to forced overtime, paid
below the legal minimum wage, and denied full overtime compensation. These violations
occurred while Plaintiff Jane Doe XI was producing garments for a Wal-Mart work-order issued
to Presitex. She brings this suit on behalf of herself and all others similarly situated in Nicaragua
who are employed by Wal-Mart supplier factories.
26. The Nicaraguan Plaintiffs could not bring their claims against Wal-Mart in
Nicaragua because Nicaragua does not have an independent judiciary and its administrative
labor judges and the labor ministers frequently accept bribes from employer factories. Further,
even assuming that a case could be brought successfully, the prospect of enforcing a judgment
against the employer is virtually impossible and, to date, only a handful of cases have been able
to undergo the legal procedure of enforcement. Plaintiffs also could not bring a third party
beneficiary claim against Wal-Mart in Nicaragua as this claim would be precluded by the Labor
Code, which would force them into a labor law system plagued with corruption. Finally, for the
Plaintiffs who are still employed by the identified factories, proceeding with a case for lost
wages would effectively destroy their livelihoods and ability to support their families due to
certain retaliation they would suffer.
F. The California Plaintiffs
27. Plaintiff Bruce Reeves was enjoying the pay and benefits attributable to his
membership in Local 324 of the United Food and Commercial Workers Union (UFCW). He was
working in an environment in which workers’ basic rights were respected, and he was being paid a liveable wage. As a direct result of Wal-Mart’s announced entry into the Southern California
market, Plaintiff’s employer, Ralph’s, informed him that he would have to take reductions in pay and benefits to cuts costs and allow the employer to attempt to compete with Wal-Mart. Plaintiff understood that if he refused to accept these pay and benefit concessions, there was a high risk that he would lose his job, either due to a reduction in force at his employer or because the employer would go out of business.
28. Plaintiff Bruce Reeves suffered a concrete reduction in his pay and benefits that is
directly attributable to Wal-Mart’s comparative advantage of being able to offer low prices
because it produces, or causes to be produced, many of its products outside the United States
under conditions that violate the local laws where the good are produced, generally accepted
international norms, and the specific provisions of Wal-Mart’s own “Code of Conduct.”
29. Plaintiff Kristine Dall was enjoying the pay and benefits attributable to her
membership in Local 324 of the United Food and Commercial Workers Union (UFCW). She
was working in an environment in which workers’ basic rights were respected, and she was
being paid a liveable wage. As a direct result of Wal-Mart’s announced entry into the Southern
California, Plaintiff’s employer, Ralph’s, informed her that she would have to take reductions in
pay and benefits to cut costs and allow the employer to attempt to compete with Wal-Mart.
Plaintiff understood that if she refused to accept these pay and benefit concessions, there was a
high risk that she would lose her job, either due to a reduction in force at her employer or
because the employer would go out of business.
30. Plaintiff Kristine Dall suffered a concrete reduction in her pay and benefits that is
directly attributable to Wal-Mart’s comparative advantage of being able to offer low prices because it produces, or causes to be produced, many of its products outside the United States
under conditions that violate the local laws where the good are produced, generally accepted
international norms, and the specific provisions of Wal-Mart’s own “Code of Conduct.”
31. Plaintiff Christine Kaposy was enjoying the pay and benefits attributable to her
membership in Local 770 of the United Food and Commercial Workers Union (UFCW). She
was working in an environment in which workers’ basic rights were respected, and she was
being paid a liveable wage. As a direct result of Wal-Mart’s announced entry into the Southern
California, Plaintiff’s employer, Safeway Corp., informed her that she would have to accept
reductions in her benefits and pension plan to cut costs so that Safeway could attempt to compete
with Wal-Mart. Plaintiff understood that if she refused to accept these benefit and pension
concessions, there was a high risk that she would lose her job, either due to a reduction in her
employer’s work force or because the employer would go out of business.
32. Plaintiff Christine Kaposy suffered a concrete reduction in her pay and benefits
that is directly attributable to Wal-Mart’s comparative advantage of being able to offer low
prices because it produces, or causes to be produced, many of its products outside the United
States under conditions that violate the local laws where the goods are produced, as well as
generally accepted international norms and the specific provisions of Wal-Mart’s own “Code of
Conduct.”
33. Plaintiff Sharlette Villacorta was enjoying the pay and benefits attributable to her
membership in Local 770 of the United Food and Commercial Workers Union (UFCW). As a
result of Wal-Mart’s entry into Southern California, Plaintiff’s employer lost a significant
amount of business which resulted in the inability of her employer to give any raises or increase
in benefits. Plaintiff’s and other employees’ hours were also cut making it difficult, if not
impossible, to make a living wage. As a result, the employees went on strike. After striking, the
employees’ contracts were even more disadvantageous, specifically because they mandated that
the employees would not receive a raise for a period of three years. Plaintiff understood that if she refused to accept these pay and benefit concessions, there was a high risk that she would lose her job, either due to a reduction in force at her employer or because the employer would go out of business.
34. Plaintiff Sharlette Villacorta suffered a negative impact in her employment
contract and in her pay and benefits that is directly attributable to Wal-Mart’s comparative
advantage of being able to offer low prices because it produces, or causes to be produced, many
of its products outside the United States under conditions that violate the local laws where the
goods are produced, generally accepted international norms, and the specific provisions of Wal-
Mart’s own “Code of Conduct.”
G. Defendant Wal-Mart and the Wal-Mart Code of Conduct
35. Defendant Wal-Mart Stores, Inc. is a for-profit corporation with headquarters in
Bentonville, Arkansas. Today, it is the world’s largest retailer and is engaged in the business of
selling discounted merchandise, including garments and toys, both in the U.S. and
internationally. Its retail stores are located throughout the United States, including California.
Wal-Mart owns and operates over 140 stores and Sam’s Clubs in California, where it directly
employs over 40,000 workers. In addition, it has four distribution centers and one office facility
located in California, and receives massive amounts of shipments by sea and air in California
from its suppliers abroad, including from the specific suppliers at issue in this case. Much of
Wal-Mart’s products enter the stream of commerce from California.
36. Despite its revenue and position as a market leader in the retail industry, Wal-
Mart is notoriously known for its consistent failure to protect worker rights in its own stores, as
well as in the factories of its overseas suppliers. Since the 1990's, numerous investigations have
revealed Wal-Mart’s consistent practice of sourcing merchandise from suppliers using
sweatshop conditions. Probably the most well known was the 1992 Kathie Lee Gifford
controversy. Based on this and other controversies, in 2001 KLD Research & Analytics, Inc.,
A copy of the most recent (2005) Standard for Suppliers is attached to this Complaint as
Exhibit A.
14
who compile the Domini 400 Social Index, removed Wal-Mart from its index of socially
responsible corporations. The company had not done enough to ensure that its domestic and
international vendors operate factories that meet basic human rights and labor standards. KLD is
not alone in sanctioning Wal-Mart. Investigation after investigation of Wal-Mart’s operations
and suppliers reveal that Wal-Mart is an unrepentant and recidivist violator of human rights.
37. Precisely because of the notorious worker rights violations in its supplier
factories, which there is no question Wal-Mart had knowledge of, Wal-Mart developed in 1992 a
Code of Conduct (known formally as the “Standards for Suppliers”). This was a central
decision, made by upper management at the company headquarters in Arkansas, and from its
inception, was to apply to all suppliers, including those that are the subject of this litigation. The
Code of Conduct, which is incorporated into its supply contracts with foreign suppliers, purports
to require all suppliers to adhere to applicable laws regarding basic conditions of employment,
including: Compensation; Hours of Labor; Forced Labor/Prison Labor; Child Labor;
Discrimination/Human Rights; Freedom of Association and Collective Bargaining; and
Workplace Environment.1 There have been various versions of this Code of Conduct produced
by Wal-Mart since 1992, but all versions purport to extend these fundamental rights to workers
in Wal-Mart suppliers. As part of its public representations, Wal-Mart promises to do business
with suppliers who are in compliance with the Code of Conduct.
38. This supply contract and Code of Conduct is uniform and globally-applicable, and
is imposed and monitored from Wal-Mart’s headquarters in Arkansas. Regional offices,
including Bangalore, India, Shenzhen, China, Singapore, and Honduras oversee local production
and report directly to Wal-Mart’s headquarters in Arkansas. The power to hire and fire staff
responsible for monitoring activities is vested in the Central Management office. The regional
offices implement the policies and practices of the Wal-Mart headquarters, resulting in a uniform practice and procedure being applied to all Wal-Mart suppliers in Asia, Africa, and Latin America. Among the requirements imposed by the regional offices, at the direction of the
headquarters office, is the requirement that Wal-Mart’s Code of Conduct be incorporated in all
supplier agreements, including those located in China, Bangladesh, Indonesia, Swaziland, and
Nicaragua, the countries identified herein.
39. As part of its obligations under the supply contract, and as per its specific promise
to the consuming public in the U.S., including California, Wal-Mart promises to monitor
supplier factories to ensure compliance with the Code of Conduct. Specifically, the preamble to
a 2003 version of the Code of Conduct states that “the conduct of its suppliers can be attributed
to Wal-Mart and affect its reputation, . . . and hereby reserves the right to make periodic,
unannounced inspections of supplier’s facilities to satisfy itself of supplier’s compliance with
these standards.” The 2005 version reinforces that Wal-Mart has the “right of inspection.”
40. Paragraph 5 of the 2004 version of the Code of Conduct (FACTORY
INSPECTION REQUIREMENTS) requires that “[s]cheduled inspections should typically be
conducted a maximum of three times per year to ensure compliance with the standards, terms,
and conditions set forth herein. Wal-Mart reserves the right to conduct unannounced factory
inspections. . . . In the case of suppliers working through Global Procurement Direct Imports,
audits should be conducted by Wal-Mart’s internal auditors.” The 2005 version provides a
specific “right of inspection” to Wal-Mart.
41. Wal-Mart’s monitoring consists of factory investigations by Wal-Mart hired
auditors based on a color coded system: factories with low-risk violations are assessed as Green, factories with medium-risk violations are assessed as Yellow, factories with high-risk violations
are assessed as Red, and factories with critical violations are Failed. However, significant
numbers of factories receive Yellow (medium risk) and Red (high risk) ratings, particularly
those in China, but Wal-Mart continues to source from them. Further, other than child labor,
there are not clear guidelines on what violations fall under the particular ratings. It also requires
two consecutive Red ratings for Wal-Mart to suspend orders, but the company can request
purchases again from these same factories once the factory receives a Yellow rating, still
medium risk. Thus, Wal-Mart products are being produced by workers in facilities that are
known risks. Further, at most, only 8% of all Wal-Mart audits in 2004 are unannounced, and
while auditors are supposed to perform off-site worker interviews for each audit, Wal-Mart
admits that workers are often coached on the answers to give inspectors.
42. Because Wal-Mart’s system limits factory inspections to those conducted by
internal Wal-Mart auditors, or relies upon consultants paid for by Wal-Mart, it is far from
effective and allows rampant violations to continue. In essence, based on its policy created by
central management, Wal Mart’s code enforcement is a closed loop: Wal-Mart adopts the code,
monitors the code, and reports on whether code compliance has been achieved – in the absence
of meaningful transparency and in the absence of any independent, external mechanisms for
enforcing the code. A dramatic illustration of the corrupt nature of the system is that a former
regional inspector for Wal-Mart recently sued the company for terminating him after he
protested the utter lack of integrity in the inspection process. Among other things, he exposed
that Wal-Mart inspectors were pressured to produce positive reports for factories not in
compliance with the Code of Conduct to avoid any disruption in the Wal-Mart production
process.
43. The conditions endured by the Plaintiffs in violation of law and the Wal-Mart
Code of Conduct are the result of Wal-Mart’s central practices of ignoring the requirements of
its Code of Conduct, and knowingly imposing price and time requirements on suppliers that
necessarily result in sweatshop conditions. Further, Wal-Mart fails to take account of its
knowledge of risk and knowingly uses factories that have failed to pass even Wal-Mart’s lax
system of inspection and monitoring. Knowing of the risks in many of its suppliers, Wal-Mart
still fails to exercise adequate supervision of compliance with its Code of Conduct, as well as
compliance with local laws and well-established international standards, such as Conventions of
the ILO. In contrast, Wal-Mart has an effective system of monitoring and supervision to ensure
that all of its suppliers, including those named herein, meet Wal-Mart’s standards for price,
quality and timely delivery.
44. Wal-Mart acknowledges, and represents to the public, in both its 2002 and 2003
Annual Report on Supplier Standards and/or Factory Certification Report (hereinafter “Supplier
Standards Reports”) that its “Factory Certification Program” used to implement the Code of
Conduct has the “fundamental objective” of “encourag[ing] implementation of necessary
changes that will ultimately result in an improved quality of life for the workers who supply our
stores with the merchandise our customers demand.” In 2005 Wal-Mart began calling its overall
monitoring effort the “Ethical Sourcing Program.”
45. All Wal-Mart suppliers must sign the Code of Conduct and acknowledge that they
have read and accept the terms. They must also acknowledge that failure to comply with the
Code of Conduct can result in the immediate cancellation by Wal-Mart of all orders and refusal
by Wal-Mart to continue to do business in any manner with the supplier. All suppliers must also
post, in the local language, a copy of the Code of Conduct in a location that is visible to all
employees.
46. In Appendix B to its 2002 Supplier Standards Report, Wal-Mart states that it
“trains its auditors to review factory practices against Wal-Mart’s standards and local and
national requirements.” The auditors must then “report the findings, and then the Wal-Mart
Factory Certification Department assesses the factories.” Further, “during the factory visit, the
auditor will interview employees.”
Paragraph 6 (RIGHT OF INSPECTION) of the 2004 Code of Conduct also provides that:
[t]o further assure proper implementation of an compliance with the
standards set forth herein, Wal-Mart or a third party designated by
Wal-Mart, will undertake affirmative measures, such as on-site inspection
of production facilities, to implement and monitor said standards. Any
supplier which fails or refuses to comply with these standards or does
not allow inspection of production facilities is subject to immediate
cancellation of any and all outstanding orders, refuse or return any
shipment, and otherwise cease doing business with Wal-Mart.
47. Plaintiffs, and members of the proposed subclasses, as a matter of economic
reality, have been and are dependent upon Wal-Mart for their livelihoods and supplier
compliance with the minimum and overtime wage protections within Wal-Mart’s Code of
Conduct. Based on its vast economic power, Wal-Mart, based on its Code of Conduct, can and
does control the working conditions within the supplier factories. It could use its power and
position to prevent its producers from profiting from the inhumane treatment of Plaintiffs and
members of the proposed subclasses. Instead, Wal-Mart is itself the reason for the inhumane
conditions. It uses its vast market power to insist on low unit prices that are possible only if
workers are squeezed to such an extreme degree that they can barely survive the long hours and
low wages they are forced to endure. Indeed, Wal-Mart’s pricing methods necessarily assume
that its profits will be based in part on forcing suppliers to systematically and routinely deprive
the workers of their basic rights and legally-mandated benefits.
48. Specifically, Wal-Mart controlled the working conditions imposed upon Plaintiffs
by the identified suppliers through its supply contract, as evidence by the following:
(a) Wal-Mart exercised meaningful control over the minimum wage and overtime
policies of the identified supplier factories due to its obligation under the supply contract to
monitor and audit the working conditions therein;
(b) Wal-Mart exercised meaningful control over the minimum wage and overtime
policies of the supplier factories through the power to cancel any and all outstanding orders,
refusal or return of any shipment, and the ability to cease a business relationship with the
supplier in non-compliance the Code of Conduct;
(c) Wal-Mart exercised meaningful control over the operative details of Plaintiffs’ tasks,
including the quantity, quality standards, turnaround time, and other operative details of the
production process with regards to the production of goods to be exported to Wal-Mart stores;
(d) Wal-Mart personnel and/or its agents supervised the production process by, according
to its own obligations under the supply contract, being present at the supplier factories where
Plaintiffs worked, and because they review, inspect, oversee, monitor and audit such work,
routinely taking random samples from the production line before shipment to ensure quality
control; and
(e) Wal-Mart ultimately has control over the working conditions at all of its suppliers
because of its notorious policy of requiring the lowest possible prices, which Wal-Mart knows,
makes it impossible for suppliers to comply with even the most basic laws where they operate,
including wage and hours laws.
49. Wal-Mart operates with specific knowledge that a large member of its suppliers
operate in violation of law, as well as in violation of Wal-Mart’s Code of Conduct and Wal-Mart
further knows its monitoring process may be the sole mechanism available to workers in supplier
factories to obtain legal compliance. Indeed, in both its 2002 and 2003 Supplier Standards
Reports, Wal-Mart admits that in “[m]any countries we source from have very good labor laws
but, for a variety of reasons, they may not be routinely enforced. In many cases our auditing
process is the main law enforcement mechanism for the factories from which we source.”
III. SPECIFIC DAMAGES SUFFERED BY PLAINTIFFS
A. The China Plaintiffs
50. Plaintiffs John Doe I and II have been employed at XXX factory in Shenzhen,
China since at least early 2000, and are currently employed there today. Continually throughout
their employment, Plaintiffs John Doe I and John Doe II have been subjected to forced overtime
and denied full overtime pay. They also do not receive the legal minimum wage, and are not
permitted to take holidays off, weekly days off, or provided with daily rest periods mandated by
the labor laws of China. Finally, XXX company withholds the first three months of all workers’
pay, including Plaintiffs John Doe I and John Doe II’s pay, and if any worker quits, this pay is
retained by the company. Given the hand-to-mouth subsistence of the workers, this effectively
prevents John Doe I and John Doe II from leaving their employment at XXX factory, and has
denied them even a semblance of a personal life because they are constantly being forced to
work extra hours for no additional pay.
51. Plaintiffs Jane Doe I and II have been employed at YYY factory in Shenzhen,
China as sewing machine operators since 2003 and are currently employed there today. On a
regular basis, Plaintiffs Jane Doe I and Jane Doe II are subjected to forced overtime and denied
full overtime pay. They, along with their co-workers, are routinely required to punch out after
nine hours of work, and then forced to work until they have finished their daily quota. They are
not paid for this extra work, which often is several more hours a day and requires them to work
late into the night. Neither Plaintiff Jane Doe I or Jane Doe II have a choice, but are forced to
stay for this unpaid work, or they will lose their position and be blacklisted, a common practice
which garment factories in Shenzhen, China use to keep workers in line.
52. Plaintiffs Jane Doe I and Jane Doe II also do not receive the legal minimum wage,
and are not permitted to take holidays off, weekly days off, or daily rest periods mandated by the
labor laws of China. Finally, Plaintiffs Jane Doe I and Jane Doe II are not provided with any
safety equipment, and both suffer from respiratory illness and skin rashes as a result of the cotton
and wool dust they are constantly exposed to.
B. The Bangladesh Plaintiffs
53. Plaintiff Jane Doe III was employed as a helper and junior sewing operator by
Western Dresses factory from approximately September 2002 through April 2004, where she
was subjected to forced overtime, denied full overtime pay, and severely beaten.
54. As a helper, Plaintiff Jane Doe III’s job was to measure and mark with chalk the
location where the back pocket was to be sewn on the pants being assembled. During this time,
she worked from 7:45 a.m. to 10:00 or 11:00 p.m. seven days a week with only two minimal rest breaks in between lasting between 20 to 30 minutes. In the first six months that she worked she
did not have a single day off, yet was paid below the minimum wage. Nor could she refuse to
work the required hours of overtime as the factory doors are locked and she would be fired
immediately if she left.
55. The extremely long hours worked by Plaintiff Jane Doe III were necessary to
produce between 120 and 150 pieces per hour. During her first week of work, her line
supervisor attacked Jane Doe III by slapping her face so hard that her nose began bleeding
simply because she was unable to meet this high quota. The supervisor slapped her four times,
each time screaming that she was not making her quota. Jane Doe III was so frightened that she
began to cry, and fainted.
56. After six months when Plaintiff Jane Doe III became a junior sewing operator,
she continued to have to produce 120 pieces per hour and if she did not meet this quota, the line
supervisors would forcefully slap the pants across her face. As a sewing operator, she had to
work even more hours of overtime, working from 8:00 a.m. until 3:00 a.m. at least 7 or 8 nights
a month prior to the shipments going out. At times, she had to work until 7:00 a.m. the next
morning. For all this, Jane Doe III was paid less than the legally-mandated minimum and
overtime wages.
57. Plaintiff Jane Doe IV was employed as a sewing operator by Lucid Garments
factory in Dhaka, Bangladesh from approximately October 2000 through October 2002. About a
year and three months into working for Lucid Garments, Plaintiff Jane Doe IV became pregnant
yet continued to work at the factory. However, during her seventh month of pregnancy, she
became ill and could not maintain the rapid pace of production. Her supervisor refused to let her
take a rest break, screaming that he did not want to hear anything about her being pregnant and
that she should leave the factory if she did not want to work. Unable to continue working, Jane
Doe IV had to take a short break sitting by the side of her machine. The supervisor stood over
her and then kicked her hard in her stomach. Plaintiff Jane Doe IV fell to the floor crying and
immediately felt the baby shift. Her daughter, who is now two years old, was born with a bruise
on her head, which remains extremely sensitive to the touch.
58. After this horrific incident, Plaintiff Jane Doe IV was only able to go home after
the production manager interceded and gave permission. However, she was forced to return the
next morning and work in the factory until she was about 8 ½ months pregnant. Upon leaving,
she was denied any maternity benefits even though Bangladeshi law mandates twelve weeks
paid maternity leave.
59. During Plaintiff Jane Doe IV’s employment with Lucid Garments, she was also
paid below the legal minimum wage and denied full overtime pay. Specifically, she worked from
8:00 in the morning to 10:00 or 11:00 p.m. seven days a week with only one day off per month.
At times, she was forced to work until 3:00 in the morning.
C. The Indonesia Plaintiffs
60. Plaintiff Jane Doe V is employed in the Sewing Department of PT Citra
Bumilang Admitra as a sewer. From approximately June 2004 until approximately September
2004, when the Wal-Mart contract with PT Citra Bumilang Admitra was terminated, she was
required to work from 6:45 or 7:00 a.m. (even though her paid shift did not begin until 7:30
a.m.) until as late as 8:00 to 10:00 p.m. at night, Mondays through Fridays. Her supervisor
yelled at her when she left one night at 6:00 p.m., as the quota had not yet been met for that day.
She frequently was forced to work through her lunch hour without pay in order to meet the
quota. These violations occurred as Plaintiff Jane Doe V worked sewing George jackets for
Wal-Mart. Additionally, she was required to work Saturdays, from 7:30 a.m. until as late as 3:00
or 4:00 p.m.
61. Plaintiff Jane Doe V was not paid overtime for much of this work, despite the fact
that Indonesian law requires overtime to be paid after 7 hours worked per day (in the event that a worker is, like Plaintiff Jane Doe V, on a six-day workweek schedule). Frequently, overtime was not paid for work performed after 7 hours of work, and though she was sometimes
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