Lawyers in New York have filed the first ever lawsuit against U-S retailers for the mistreatment of workers in foreign-owned factories operating on American soil.

The factories are located in the U-S territory of Saipan, a small island in the South Pacific.

The workers and human rights groups filed three lawsuits in California and Saipan over the sale of these goods, many marked “Made in the U.S.A.,” attorney Al Meyerhoff said at a news conference.

Among the 18 companies named in the suits are The Limited, Wal-Mart, Sears, The Gap, Tommy Hilfiger, the May Company, J. Crew, Oshkosh B’Gosh, Associated Merchandising, Cutter & Buck Inc., Gymboree Manufacturing, Lane Bryant Inc., Warnaco and Dayton-Hudson Inc., which owns Marshall Fields.

These companies either had no comment or did not immediately return calls.

Meyerhoff said that Saipan – the main island of the Northern Mariana Islands, an American commonwealth in the central Pacific – “is America’s worst sweatshop.”

The lawsuits accuse the companies of violating federal law by engaging in a racketeering conspiracy with the foreign-owned subcontractors in Saipan in the past decade.

It’s the first legal attempt to hold U.S. retailers accountable for alleged mistreatment of workers under the federal Racketeering Influences Corrupt Organization (RICO) laws, Meyerhoff said.

The subcontractors allegedly force people to work up to 12 hours a day, seven days a week, and pay them below the legal minimum wage of $3.05.

Many of the workers earn less than $500 a month, said Carmencita Abad, a Filipino native who spent six years on the island – a sleepy, 13-mile-long sugar cane island – working for one of the companies.

The workers, mostly young women, live as many as eight to a room in guarded barracks enclosed by barbed wire. They have no access to drinking water except the bottled water they’re forced to buy, and the only bathing water available to many is the sea, according to

Ms. Abad. Many had paid as much as $7,000 to be brought to Saipan “and they were promised the American Dream,” said Meyerhoff.

“We were afraid to complain,” said Ms. Abad, adding that she had seen workers beaten when they questioned working conditions.

She said that quality inspectors representing The Gap had visited her factory, but conditions did not change after they left.

“I took the job because, like millions of people, I wanted to come to America,” she said.

The companies also are being sued under the Alien Tort Claims Act, a centuries-old law enacted to deal with pirates and allows actions to be brought by a foreign national for human rights violations.

In addition to workers from the Philippines, the labor force on Saipan comes from China, Bangladesh and Thailand. The factories in which they work are owned mostly by Chinese, Japanese and Korean subcontractors to the U.S. companies.

Together, the three lawsuits are seeking more than $1 billion in damages, disgorgement of profits and unpaid wages for conditions that allegedly have persisted in the past decade.

The federal government last year estimated that the companies collectively saved more than $200 million in duties for $1 billion worth of garments shipped from Saipan, which is duty free and does not fall under U.S. immigration laws.

The workers’ two class-action suits were filed in federal courts in California and Saipan. The human rights groups – Global Exchange, Sweatshop Watch, Asian Law Caucus and the Union of Needletrades, Industrial and Textile Employees – filed their
lawsuit in California state court.

The other companies named in the lawsuits are The Dress Barn and Jones Apparel Group, Nordstrom and J.C. Penney.

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