On August 7, 2013, 4 Indian guestworkers filed a lawsuit in the United States District Court for the Eastern District of Texas for harm suffered as a result of an allegedly fraudulent and coercive employment recruitment scheme. Plaintiffs filed this suit after District Judge Jay Zainey denied class certification on January 3, 2012 in a related case, IM-LA-0010.

Plaintiffs were allegedly brought into the United States to provide labor and services to Defendant Signal International. Signal is based in Pascagoula, Mississippi and is in the business of providing repairs to offshore oil rigs in the Gulf Coast region. Three plaintiffs worked at Signal's site in Orange, Texas and one plaintiff worked in Pascagoula. The complaint alleges that Plaintiffs paid Defendant Signal's recruiters as much as $20,000 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 forced to pay additional fees to live in racially segregated labor camps ($1050 per month), and were subject to squalid living conditions and threats of both legal and physical harm if they complained about the conditions or decided not to provide labor.

Plaintiffs asserted claims under the Trafficking Victims Protection Reauthorization Act (18 U.S.C. §1584 et seq, the Racketeer Influenced Corrupt Organizations Act (18 U.S.C. §1962, the Declaratory Judgment Act (28 U.S.C. §2201), as well as claims of fraud, negligent misrepresentation, and breach of contract. Plaintiffs are represented a private law firm.

In July 2014, United States Magistrate Judge Zack Hawthorn denied Signal's motion to transfer this case to the Eastern District of Louisiana. The court reasoned that the plaintiffs in this case only overlap with the David case, IM-LA-0010, insofar as their FLSA claims in the David case are concerned. Judge Hawthorn found the similarity in issues in the cases is not substantial enough to warrant transfer because the current venue is otherwise proper.

In June 2015, the magistrate judge severed and transferred Signal's cross-claims against Malvern Burnett, the Law Office of Malvern Burnett, and Gulf Coast Immigration Law Center to the Eastern District of Louisiana, finding that there was significant overlap between Signal's crossclaims in this case and in David v. Signal International, LLC filed in Eastern District of Louisiana.

Also in June 2015, the magistrate judge issued an order regarding the proper use of expert testimony. He excluded an expert retained by Signal to opine on Signal's safety practices, finding the expert was unqualified to give such opinion because he had not adequately compared Signal's practices to others in the industry. Magistrate Judge Hawthorn also excluded opinions that attempted to interfere with the jury's role, such as the one that said Signal did not force or coerce the workers into staying in the man camp. He narrowed the opinions of experts on both sides regarding human trafficking, noting they could only speak generally on the matter and not on whether there was or was not human trafficking in this case.

In July 2015, the court stayed the case after Signal filed for bankruptcy. In re Signal Int’l, Inc, et al., No. 15-11498 (Bankr. D. Del. July 12, 2015). As a part of the bankruptcy filings, the plaintiffs entered into a plan support agreement (PSA) which contemplated a settlement of the claims of this lawsuit against Signal entities through a consensual chapter 11 plan proposed by Signal. The PSA became effective on December 14, 2015. As of November 2016, the stay remains effective in light of Signal's ongoing bankruptcy case.

Anna Dimon - 05/14/2015
Soojin Cha - 11/20/2016


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