Case: David v. Signal International, LLC

2:08-cv-01220 | U.S. District Court for the Eastern District of Louisiana

Filed Date: March 7, 2008

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Case Summary

This is the first case filed in the Signal International cases.On Mar. 7, 2008, twelve Indian guestworkers recruited for work in the United States in exchange for green cards filed this class-action lawsuit in the U.S. District Court for the Eastern District of Louisiana. In the aftermath of Hurricane Katrina, plaintiffs were recruited to provide labor and services to defendant Signal International, a company based in Mississippi with operations in the Gulf Coast region, which was in the busine…

This is the first case filed in the Signal International cases.

On Mar. 7, 2008, twelve Indian guestworkers recruited for work in the United States in exchange for green cards filed this class-action lawsuit in the U.S. District Court for the Eastern District of Louisiana. In the aftermath of Hurricane Katrina, plaintiffs were recruited to provide labor and services to defendant Signal International, a company based in Mississippi with operations in the Gulf Coast region, which was in the business of providing repairs to offshore oil rigs. Plaintiffs alleged that defendant ran a fraudulent and coercive employment recruitment scheme.

Plaintiffs also named the following agents as co-defendants for their involvement in the scheme: Malvern C. Burnett, his law offices, and his Gulf Coast Immigration Law Center (New Orleans lawyers); Global Resources and Michael Pol (Mississippi-based recruiters); Dewan Consultants and Sachin Dewan (India-based recruiters); Indo-Amerisoft and Kurella Rao (New Orleans labor brokers); and J&M Associates (Mississippi-based labor brokers). Plaintiffs later added others, including Billy Wilks of J&M.

Plaintiffs asserted class action claims, on behalf of a class of over 500 workers, under the Trafficking Victims Protection Act (TVPA) (18 U.S.C. § 1589 (forced labor) and 18 U.S.C. § 1590 (trafficking)), the Racketeer Influenced Corrupt Organizations (RICO) Act (18 U.S.C. § 1962), the Civil Rights Act of 1866 (42 U.S.C. § 1981), and the Ku Klux Klan Act of 1871 (42 U.S.C. § 1985). Plaintiffs also asserted collective action claims under the Fair Labor Standards Act (FLSA), and claims for damages under a theory of fraud, negligent misrepresentation, and breach of contract. Several plaintiffs also brought individual claims of false imprisonment, assault, battery, intentional infliction of emotional distress and/or negligent infliction of emotional distress. Plaintiffs were represented by the ACLU, the Southern Poverty Law Center, the Asian American Legal Defense and Education Fund, the Louisiana Justice Institute, and attorneys from several large private law firms.

Plaintiffs alleged that they paid recruiters as much as $20,000 each for travel, visa, and recruitment fees, but upon arrival in the United States found out they would not receive the green cards promised to them. Instead, plaintiffs were allegedly forced to pay additional fees of $1,050 per month to live in racially segregated labor camps in Mississippi and Texas with security guards and oppressive rules, and were subject to squalid living conditions, more dangerous and less desirable work assignments than those given to American workers, and threats of both legal and physical harm if they complained about the conditions or decided not to provide labor. Defendant Signal filed a third-party complaint alleging that it did not misrepresent the immigration incentives to any of the plaintiffs, and that it was relying on the recruiters and their lawyers to lawfully provide foreign workers.

During discovery, Magistrate Judge Daniel Knowles granted a protective order in Apr. 2009 prohibiting inquiries into current immigration status, current address of any plaintiff, or employers of any plaintiff after they left Signal. Magistrate Judge Knowles held that the damage and prejudice that would result from discovery into current immigration status outweighed its probative value, and noted the order was necessary since undocumented litigants would likely drop out of the suit if forced to produce immigration documents. In Aug. 2010, Magistrate Judge Knowles denied a motion by Signal to compel production of T- and U-visa applications, since it would necessarily result in an inquiry into the plaintiffs' current immigration status.

On Nov. 10, 2010, the District Court (Judge Jay Zainey) granted Signal's motion to dismiss plaintiffs' claim for class certification for injunctive relief, and plaintiffs filed a supplemental motion to certify the class for claims under the TVPA, Civil Rights Act, RICO Act, and KKK Act. Discovery continued for two more years.

On Jan. 3, 2012, Judge Zainey again denied class certification because not all of the questions of law or fact common to the class members predominated over any questions affecting only individual members. Because claims under the TVPA necessarily involve the victim's perspective, the Court concluded these claims were not proper for certification. A determination on forced labor requires the jury to consider an individual's consent or lack thereof and whether the victim was coerced subjectively to provide labor based on the defendant's threats. Even if there were characteristics common to the class, such as immigration status or payment of exorbitant fees, the Court found that these characteristics did not substitute for the subjective aspects of why each plaintiff would stay at Signal. Additionally, part of the harms claimed were financial and reputational harms -- factors that were uniquely individual in nature.

Plaintiffs' § 1981 claim for discriminatory employment practices on the basis of race, national origin, and immigration status was also found to be inappropriate for class status. Plaintiffs acknowledged they would need to forgo emotional distress claims in order to be granted class certification. The Court noted that the recruitment refunds plaintiffs sought were not attributable to the workplace discrimination allegedly carried out by Signal. The Court was also concerned that plaintiffs' willingness to forgo emotional distress recovery threatened the rights of the class members, since the complaint alleged a significant amount of emotional harm. Given that each individual plaintiff in this case had the potential for a large recovery, the Court did not find that class certification would be superior to individual trials.

The Court found that plaintiffs' RICO claims were inappropriate for certification because the predicate acts that need to be proven require individualized proof. Plaintiffs would also be unable to show causation for their RICO injuries without resorting to individual proof of reliance. Finally, the Court found plaintiffs' KKK Act claims to be inappropriate for certification because the kind of coercion needed to show a violation of the 13th Amendment -- physical or legal coercion that requires the victim to work by law -- was not at issue in this case.

Once class certification was denied, it was decided that this case would proceed with the twelve named plaintiffs. Judge Zainey determined the initial trial would consist of five of the named plaintiffs; the plaintiffs would select three and Signal would select two.

On July 12, 2014, the U.S. Judicial Panel on Multidistrict Litigation denied Signal's motion to transfer all of the cases pending against it to the Eastern District of Louisiana.

On Aug. 5, 2014, plaintiffs filed their final Sixth Amended Complaint.

On Aug. 12, 2014, District Judge Susie Morgan denied Signal's motion to dismiss plaintiffs' claims under the FLSA for recruitment fees. The Court granted Signal's motion to dismiss claims for inbound travel and visa expenses under the FLSA, because plaintiffs did not plead that these expenses were primarily for the benefit of Signal.

On Oct. 14, 2014, Judge Morgan denied Signal's motion for interlocutory appeal of the Court's prohibition of discovery on plaintiffs' post-Signal information including immigration status.

On Jan. 6, 2015, Judge Morgan determined that the law of India would govern the claims of fraud and negligent misrepresentation, while the law of Mississippi would govern the claims of breach of contract, quasi-contract, and agency.

On Jan. 27, 2015, Judge Morgan issued an order pertaining to briefing she had required the parties to submit on issues of law under the TVPA. She found that punitive damages were allowed under the TVPA, while the affirmative defense of in pari delicto (arguing that two parties are equally at fault) is not, as it is squarely at odds with the policy behind the TVPA. She also found that psychological and reputational harm were included in the definition of "serious harm" under the TVPA.

By the time of trial, the only remaining defendants were Signal, Burnett, and Dewan. (Co-defendants J&M, Rao, and Pol were all in bankruptcy proceedings, which stayed judgment against them.)

A 24-day jury trial concluded on Feb. 18, 2015; the jury awarded plaintiffs $14,100,000 in damages. The jury decided in favor of plaintiffs regarding their claims of discriminatory terms and conditions of employment, retaliation, intentional infliction of emotional distress, and false imprisonment, and in favor of the defendants regarding RICO and fraud (these being subsumed under the other claims).

The jury decided the breach of contract claim in favor of Burnett and Dewan but awarded damages to plaintiffs against Signal, Burnett Law Offices, and Dewan Consultants. The TVPA claim was divided similarly, with the jury finding in favor of Burnett and Dewan but against Signal, Burnett Law Offices, and Dewan Consultants. The TVPA findings for Burnett and Dewan were reversed by the Court on Sept. 9, 2015.

Post-trial, the parties contested whether the Court should enter a final judgment for the five trial plaintiffs despite the pending claims from the other seven plaintiffs, or whether the second trial should take place first. On Mar. 20, 2015, the Court entered final judgment, reasoning that the plaintiffs had “been waiting since the George W. Bush Administration for their day in court,” and that there was no “just reason” to delay a final determination.

On Aug. 14, 2015, plaintiffs filed a motion to receive attorneys’ fees (for over $5 million). After the District Court enjoined the Burnett defendants from transferring money out of their bank account, on Aug. 28, Dewan and Burnett both appealed plaintiffs' motion on Sept. 23, 2015. However, parties appear to have settled the matter, including dismissing the appeal. We do not have information on the terms of this specific settlement of attorneys' fees.

In Dec. 2015, in the related EEOC case, the EEOC announced that the parties had reached a settlement for all cases, approved by the bankruptcy court. Signal would pay $5 million to 476 guestworkers through a claims process. All aggrieved individuals included in the litigation could receive relief in spite of the bankruptcy proceedings. Signal's CEO also issued an apology for its conduct.

On Apr. 18, 2017 in David, the District Court entered a sealed stipulated judgment as to Dewan. The same day, the Court dismissed Burnett as a defendant, with prejudice. On Apr. 26 the Court also dismissed Dewan as a defendant, without prejudice. The court ruled plaintiffs had the right to reopen the action against Dewan if the settlement was not carried out by Aug. 1, 2018. On Aug. 2, 2018 the plaintiffs and defendants submitted a Joint Motion to extend the time period Dewan had to complete the settlement until October 1, 2018, with the Court retaining jurisdiction to enforce the settlement agreement against Dewan.

As of the writing of this summary (on November 30, 2019), there has been no indication that the defendants completed the settlement. It is unclear whether litigation remains ongoing for the remaining seven plaintiffs, as a trial date has yet to be determined; or whether their claims have been settled.

	Document
2:08-cv-01220	Docket [PACER] David v. Signal International LLC	Aug. 2, 2018	Aug. 2, 2018 Docket
1 2:08-cv-01220	Complaint David v. Signal International LLC	March 7, 2008	March 7, 2008 Complaint
45 2:08-cv-01220	RICO Case Statement David v. Signal International LLC	April 28, 2008	April 28, 2008 Pleading / Motion / Brief
156 2:08-cv-01220	Order and Reasons David v. Signal International LLC	Sept. 11, 2008	Sept. 11, 2008 Order/Opinion 2008 WL 4266214
367 2:08-cv-01220	Order and Reasons	April 2, 2009	April 2, 2009 Order/Opinion 257 F.R.D. 114
617 2:08-cv-01220	Order (re: Rao's Attorney-Client Privilege)	Dec. 28, 2009	Dec. 28, 2009 Order/Opinion 2009 WL 5215326
747 2:08-cv-01220	Order	July 6, 2010	July 6, 2010 Order/Opinion 2010 WL 2723180
797 2:08-cv-01220	Consent Protective Order	July 29, 2010	July 29, 2010 Order/Opinion
854 2:08-cv-01220	Order (re: Signal’s Motion to Compel Production of T-Visa Applications)	Aug. 26, 2010	Aug. 26, 2010 Order/Opinion 735 F.Supp.2d 440
912 2:08-cv-01220	Order	Nov. 5, 2010	Nov. 5, 2010 Order/Opinion 2010 WL 4667972

Title	Description		External URL Date / External URL
Settlements End Multiple H-2B Human-Trafficking Suits Knaub, Kelly	Law360, New York (April 7, 2017, 4:48 PM EDT) -- Foreign workers who sued Signal International over alleged human trafficking have reached settlements with two law firms and an attorney who were also…	April 7, 2017	April 7, 2017 https://www.law360.com/...
Signal International Lawsuits Southern Poverty Law Center (SPLC)	The SPLC filed suit on behalf of guest workers from India who were defrauded and exploited in a labor trafficking scheme engineered by a Gulf Coast marine services company, an immigration lawyer and …	Feb. 28, 2015	Feb. 28, 2015 https://www.splcenter.org/...
David, et al. v. Signal International, LLC, et al. American Civil Liberties Union (ACLU)	Hundreds of workers trafficked to the U.S. from India to work in shipyards after Hurricane Katrina were lured here with dishonest assurances of becoming lawful permanent U.S. residents. In February 2…	May 29, 2013	May 29, 2013 https://www.aclu.org/...

ECF Number	Description	Date	Link Date / Link
1	COMPLAINT against all defendants (Filing fee $ 350.) filed by all plaintiffs. (Attachments: # 1 Complaint (Cont)# 2 Exhibit 1# 3 Civil Cover Sheet)(gbw, ) (Entered: 03/10/2008) 1 Complaint (Cont) View on PACER 2 Exhibit 1 View on PACER 3 Civil Cover Sheet View on PACER	March 7, 2008	March 7, 2008 Clearinghouse
2	Summons Issued as to Signal InternationaL LLC, Malvern C. Burnett, Gulf Coast Immigration Law Center, L.L.C., Law Offices of Malvern C. Burnett, A.P.C., Indo-Ameri Soft L.L.C., Kurella Rao, J & M Associates, Inc. of Mississippi, Global Resources, Inc., Michael Pol, Sachin Dewan, Dewan Consultants Pvt. Ltd.. (gbw, ) (Entered: 03/10/2008)	March 7, 2008	March 7, 2008 PACER
7	EXPARTE/CONSENT MOTION to Appear Pro Hac Vice as to Kristi L. Graunke (Filing fee $5. PAID) by all plaintiffs. (gbw, ) (Entered: 03/17/2008)	March 7, 2008	March 7, 2008 PACER
9	EXPARTE/CONSENT MOTION to Appear Pro Hac Vice as to Jennifer Rosenbaum (Filing fee $5. PAID) by all plaintiffs. (gbw, ) (Entered: 03/17/2008)	March 7, 2008	March 7, 2008 PACER
12	EXPARTE/CONSENT MOTION to Appear Pro Hac Vice as to Morris Dees (Filing fee $5. PAID) by all plaintiffs. (gbw, ) (Entered: 03/18/2008)	March 7, 2008	March 7, 2008 PACER
14	EXPARTE/CONSENT MOTION to Appear Pro Hac Vice as to Tushar J. Sheth (Filing fee $5. PAID) by all plaintiffs. (gbw, ) (Entered: 03/18/2008)	March 7, 2008	March 7, 2008 PACER
15	EXPARTE/CONSENT MOTION to Appear Pro Hac Vice as to Daniel Werner (Filing fee $5. PAID) by all plaintiffs. (gbw, ) (Entered: 03/18/2008)	March 7, 2008	March 7, 2008 PACER
3	RICO STANDING ORDER. By Clerk.(jrc, ) (Entered: 03/10/2008)	March 10, 2008	March 10, 2008 PACER
4	SUMMONS Returned Executed; Law Offices of Malvern C. Burnett, A.P.C. served on 3/12/2008. (gbw, ) (Entered: 03/14/2008)	March 13, 2008	March 13, 2008 PACER
5	SUMMONS Returned Executed; Malvern C. Burnett served on 3/12/2008. (gbw, ) (Entered: 03/14/2008)	March 13, 2008	March 13, 2008 PACER
6	SUMMONS Returned Executed; Gulf Coast Immigration Law Center, L.L.C. served on 3/12/2008. (gbw, ) (Entered: 03/14/2008)	March 13, 2008	March 13, 2008 PACER
8	ORDER granting 7 Motion to Appear Pro Hac Vice as to Kristi L. Graunke.. Signed by Judge Jay C. Zainey on 3/13/08. (gbw, ) (Entered: 03/17/2008)	March 13, 2008	March 13, 2008 PACER
10	ORDER granting 9 Motion to Appear Pro Hac Vice as to Jennifer Rosenbaum.. Signed by Judge Jay C. Zainey on 3/13/08. (gbw, ) (Entered: 03/17/2008)	March 13, 2008	March 13, 2008 PACER
18	ORDER granting 14 Motion to Appear Pro Hac Vice as to Tushar J. Sheth.. Signed by Judge Jay C. Zainey on 3/13/08. (gbw, ) (Entered: 03/20/2008)	March 13, 2008	March 13, 2008 PACER
19	ORDER granting 15 Motion to Appear Pro Hac Vice as to Daniel Werner.. Signed by Judge Jay C. Zainey on 3/13/08. (gbw, ) (Entered: 03/20/2008)	March 13, 2008	March 13, 2008 PACER
17	ORDER granting 12 Motion to Appear Pro Hac Vice as to Morris S. Dees.. Signed by Judge Jay C. Zainey on 3/13/08. (gbw, ) (Entered: 03/20/2008)	March 14, 2008	March 14, 2008 PACER
11	SUMMONS Returned Executed; Signal InternationaL LLC served on 3/10/2008. (gbw, ) (Entered: 03/18/2008)	March 17, 2008	March 17, 2008 PACER
13	EXPARTE/CONSENT MOTION to Appear Pro Hac Vice as to Mary Bauer (Filing fee $5. PAID) by all plaintiffs. (gbw, ) Additional attachment(s) added on 3/18/2008 (gbw, ). Additional attachment(s) added on 3/18/2008 (gbw, ). (Entered: 03/18/2008) 1 Declaration View on PACER 2 Certificate View on PACER	March 17, 2008	March 17, 2008 PACER
16	ORDER granting 13 Motion to Appear Pro Hac Vice as to Mary C. Bauer.. Signed by Judge Jay C. Zainey on 3/17/08. (gbw, ) (Entered: 03/20/2008)	March 18, 2008	March 18, 2008 PACER
20	EXPARTE/CONSENT First MOTION for Extension of Time to Answer re 1 Complaint by Malvern C. Burnett, Gulf Coast Immigration Law Center, L.L.C., Law Offices of Malvern C. Burnett, A.P.C.. (Attachments: # 1 Proposed Order)(Alexis, Ralph) (Entered: 03/20/2008) 1 Proposed Order View on PACER	March 20, 2008	March 20, 2008 PACER
21	EXPARTE/CONSENT First MOTION for Extension of Time to Answer re 1 Complaint of plaintiffs by Signal InternationaL LLC. (Attachments: # 1 Proposed Order)(Hangartner, Erin) (Entered: 03/24/2008) 1 Proposed Order View on PACER	March 24, 2008	March 24, 2008 PACER
22	ORDER granting 21 Motion for Extension of Time to Answer. Signed by Judge Jay C. Zainey on 3/25/08. (ala, ) (Entered: 03/26/2008)	March 26, 2008	March 26, 2008 PACER
23	ORDER granting 20 Motion for Extension of Time to Answer as to Malvern C. Burnett, Gulf Coast Immigration Law Center, L.L.C. and Law Offices of Malvern C. Burnett, A.P.C. answer due 4/21/2008. Signed by Judge Jay C. Zainey on 3/26/08. (ala, ) (Entered: 03/26/2008)	March 26, 2008	March 26, 2008 PACER
24	EXPARTE/CONSENT MOTION for Extension of Time to File RICO Case Statement by Kurian David. (Attachments: # 1 Proposed Order)(Graunke, Kristi) (Entered: 03/26/2008) 1 Proposed Order View on PACER	March 26, 2008	March 26, 2008 PACER
25	ORDER granting 24 Motion for Extension of Time to File RICO Case Statement as set forth in document. Signed by Judge Jay C. Zainey on 3/28/08. (ecm, ) (Entered: 03/31/2008)	March 31, 2008	March 31, 2008 PACER
26	EXPARTE/CONSENT Second MOTION for Extension of Time to Answer by Signal International LLC. (Attachments: # 1 Proposed Order)(Douglas, Donald) (Entered: 04/11/2008) 1 Proposed Order View on PACER	April 11, 2008	April 11, 2008 PACER
27	ORDER granting 26 Motion for Extension of Time to Answer. Signed by Judge Jay C. Zainey on 4/11/08. (ala, ) (Entered: 04/14/2008)	April 14, 2008	April 14, 2008 PACER
28	EXPARTE MOTION for Extension of Time to Answer by Malvern C. Burnett, Gulf Coast Immigration Law Center, L.L.C., Law Offices of Malvern C. Burnett, A.P.C.. (Attachments: # 1 Proposed Order)(Alexis, Ralph) Modified on 4/15/2008 (gbw, ). (Entered: 04/14/2008) 1 Proposed Order View on PACER	April 14, 2008	April 14, 2008 PACER
29	EXPARTE/CONSENT MOTION for Extension of Time to Answer Complaint by Global Resources, Inc., Michael Pol. (Attachments: # 1 Proposed Order)(Harowski, Christy) Modified text on 4/17/2008 (gbw, ). (Entered: 04/16/2008) 1 Proposed Order View on PACER	April 16, 2008	April 16, 2008 PACER
30	ORDER granting 28 Motion for Extension of Time to Answer re 1 Complaint as to Malvern C. Burnett answer due 5/11/2008; Gulf Coast Immigration Law Center, L.L.C. answer due 5/11/2008; Law Offices of Malvern C. Burnett, A.P.C. answer due 5/11/2008.. Signed by Judge Jay C. Zainey on 4/15/08. (gbw, ) (Entered: 04/16/2008)	April 16, 2008	April 16, 2008 PACER
31	Correction of Docket Entry by Clerk re 29 MOTION for Extension of Time to File Response/Reply to Complaint. Filing attorney selected incorrect event. Correct event is 'MOTION for extension of time to answer' and link to complaint. Clerk took corrective action by either re-docketing the event or changing the event. (gbw, ) (Entered: 04/17/2008)	April 17, 2008	April 17, 2008 PACER
32	ORDER granting 29 Motion for Extension of Time to Answer re 1 Complaint. Answer due 5/14/08. Signed by Judge Jay C. Zainey on 4/16/08. (gbw, ) (Entered: 04/17/2008)	April 17, 2008	April 17, 2008 PACER
33	SUMMONS Returned Executed; Global Resources, Inc. served on 4/4/2008, answer due 4/24/2008. (Graunke, Kristi) (Entered: 04/18/2008)	April 18, 2008	April 18, 2008 PACER
34	EXPARTE/CONSENT Second MOTION for Extension of Time to File RICO Case Statement by Kurian David. (Attachments: # 1 Proposed Order)(Graunke, Kristi) (Entered: 04/18/2008) 1 Proposed Order View on PACER	April 18, 2008	April 18, 2008 PACER
35	RESPONSE/MEMORANDUM in Opposition filed by Signal International LLC re 34 Second MOTION for Extension of Time to File RICO Case Statement. (Weinberger, Alan) (Entered: 04/18/2008)	April 18, 2008	April 18, 2008 PACER
36	EXPARTE MOTION for Leave to File Reply Memorandum by Kurian David. (Attachments: # 1 Proposed Order # 2 Proposed Pleading Reply Memorandum)(Graunke, Kristi) Modified on 4/21/2008 (gbw, ). (Entered: 04/18/2008) 1 Proposed Order View on PACER 2 Proposed Pleading Reply Memorandum View on PACER	April 18, 2008	April 18, 2008 PACER
37	Correction of Docket Entry by Clerk re 36 MOTION for Leave to File Reply Memorandum. Filing attorney should have changed 'N' to 'Y' at the question 'Is this an Exparte/Consent Motion Y/N?' before clicking the Next button. Clerk modified docket text to reflect 'Exparte (gbw, ) (Entered: 04/21/2008)	April 21, 2008	April 21, 2008 PACER
38	ORDER granting 36 Motion for Leave to File reply memo in support of second motion for extension of time to file RICO case statement. Signed by Judge Jay C. Zainey on 4/21/08. (gbw, ) (Entered: 04/23/2008)	April 23, 2008	April 23, 2008 PACER
39	RESPONSE/MEMORANDUM in Support filed by all plaintiffs re 34 Second MOTION for Extension of Time to File RICO Case Statement. (gbw, ) (Entered: 04/23/2008)	April 23, 2008	April 23, 2008 PACER
40	ORDER granting 34 Motion for Extension of Time until 4/24/08 to File RICO case statement.. Signed by Judge Jay C. Zainey on 4/22/08. (gbw, ) (Entered: 04/24/2008)	April 23, 2008	April 23, 2008 PACER

Case: David v. Signal International, LLC

2:08-cv-01220 | U.S. District Court for the Eastern District of Louisiana

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