Chiquita loses suit to stop SEC release of records

A produce deliveryman loads boxes of Chiquita Brands International Inc. bananas onto a truck in San Francisco. Chiquita was fined $25 million after pleading guilty in March 2007 to engaging in transactions with a terrorist group. Bloomberg News file photo.

Chiquita Brands International Inc.’s bid to stop the U.S. Securities and Exchange Commission from releasing documents on payments to a Colombian terrorist group was dismissed by a federal judge.

U.S. District Judge Richard Leon in Washington rejected the company’s argument that the damage it would suffer from disclosure of the records should bar their release to a public-interest group under the Freedom of Information Act.

“Chiquita’s speculation about potential publicity and its effect on a future jury in the Florida litigation does not satisfy the level of certainty required” to exempt the records from the law’s requirements, Leon said in a decision Wednesday.

Chiquita, based in Charlotte, N.C., contended the documents might compromise the fairness of trials in Florida, where families who claim relatives were kidnapped and murdered after the company made payments to the United Self Defense Forces of Colombia, or AUC, and other terror groups, have filed lawsuits.

Ed Loyd and Steve Himes, spokesmen for the company, didn’t immediately respond to phone messages seeking comment on the ruling.

The SEC is “pleased with the decision,” John Nester, a commission spokesman, said in an emailed statement. 

Terrorist group

Chiquita, the owner of the namesake banana brand, was fined $25 million after pleading guilty in March 2007 to engaging in transactions with a terrorist group for paying AUC militias $1.7 million from 1997 to 2004.

The Chiquita suit was triggered by a request for the records under FOIA by the Washington-based National Security Archive, a group that opposes government secrecy.

In its complaint against the SEC, Chiquita alleged that the organization is allied with plaintiffs’ lawyers in the Florida litigation and seeks to influence those proceedings as well as a criminal investigation of former employees in Colombia.

Michael Evans, a senior analyst for the group, said it isn’t a party to the litigation and doesn’t stand to gain anything from its outcome.

“Our interest is in documenting U.S.-Colombian relations, particularly security relations, and we’ve known for a long time that Chiquita is a big part of that story,” Evans said.

‘Important collection’

The records sought includes “payments to leftist guerilla groups as well as the right-wing AUC,” Evans said. “It’s perhaps the most important collection of records about corporate ties to terrorism.”

The company has said its employees were victims, and that the actions the company took were motivated to protect the lives of its employees and their families.

Evans said the records will show that the company received security services from some of the groups it paid. Release of the records “will let the public see for themselves if those payments were for extortion, or security, or both,” Evans said.

The FOIA case is Chiquita Brands International Inc. v. U.S. Securities and Exchange Commission, 13-cv-00435, U.S. District Court, District of Columbia (Washington).

The Florida litigation is In Re: Chiquita Brands International Inc., Alien Tort Statute and Shareholders Derivative Litigation, 08-md-1916, U.S. District Court, Southern District of Florida (Ft. Lauderdale).