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L.A. lawyer accused of fraud in pesticide litigation

A judge says Juan Dominguez conspired with Nicaraguan workers, allegedly left sterile by exposure to DBCP on banana plantations, to file claims against Dole Food and Dow Chemical.

August 05, 2009|alan zarembo and Victoria Kim

CHINANDEGA, NICARAGUA, AND LOS ANGELES — In the sweltering hub of Nicaragua's once-thriving banana industry, Juan Dominguez saw an opportunity.

He arrived in Chinandega in 2002, shortly after watching a CNN report about men claiming they had become sterile from exposure to DBCP, a pesticide used on banana plantations in the 1970s. Until then, Dominguez was best known as the mustachioed personal injury lawyer pictured on the backs of Los Angeles buses and had no experience in international law.

"I'm not a religious man," he said recently, "but this felt like a calling."

Today, it feels more like a disaster.

Dominguez stands accused by a judge of participating in a broad conspiracy built on phony claims. Cases that he expected would go to trial this year have been thrown out. A $3.2-million jury verdict on behalf of six plaintiffs in 2007, which he had hoped would be the first of many victories against Dole Food Co. and Dow Chemical Co., is likely to be overturned.

The accusations against him came in a highly unusual proceeding in which Los Angeles County Superior Court Judge Victoria Chaney relied on secret testimony collected by Dole. Dominguez and other plaintiffs' attorneys had set out to find legitimate claims but turned to fraud when they found few, she wrote. What resulted was a "heinous" scheme "cemented together by human greed and avarice," she said in making her ruling.

Dole, which ran the banana plantations at the time, has used the ruling to cast doubt on dozens of other DBCP claims in U.S. courts, including efforts to enforce tens of millions of dollars in judgments from courts in Nicaragua. "An international legal shakedown," Theodore Boutrous, an attorney for Dole, calls the claims.

Dominguez, 52, now faces investigations by the State Bar of California and scrutiny by the U.S. Department of Justice.

He said he has done nothing wrong: "I don't engage in anything illegal or unethical."

"The whole thing is a crazy nightmare," he said.

In Nicaragua, the judge's ruling was widely met with disgust. "That Chaney," people say. The local version of events blames the multinational companies and their pesticide for much of what ails people. Anyone who disagrees is accused of being paid by Dole.

Here, DBCP is more than a pesticide. It is a political movement. The forces of poverty and corruption cloud the most basic facts surrounding the claims. The truth that can be established is one that Chaney alluded to in her ruling: If Nicaraguans truly were injured by DBCP a generation ago, what has happened since makes identifying the victims nearly impossible.

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In the late 1970s, several men repackaging DBCP at a factory in Lathrop, Calif., realized that they all had the same problem: They couldn't get their wives pregnant.

After the chemical was shown to have caused their sterility, the United States suspended most uses in 1977 and banned DBCP two years later. Dole continued to spray it on banana plantations in Nicaragua until at least 1980.

It's unclear what level of exposure farmworkers had to DBCP. The irrigation workers who sprayed the chemical to kill worms in banana tree roots presumably got the highest doses. But science hasn't determined what minimum level causes sterility.

Regardless of those unknowns, the chances of Nicaraguans winning compensation were slim. The courts did not have the resources to handle such complex litigation and, in any case, couldn't force U.S. companies to pay up. And Dole successfully argued that U.S. courts were inappropriate forums for the Nicaraguan cases.

Then in 2001, Nicaragua enacted a fast-track law that made it far easier for alleged DBCP victims to win judgments in Nicaragua.

Suddenly Dole, which is based in Westlake Village, was less resistant to having DBCP cases heard in the U.S. courts. Several U.S. firms, lured by the potential for big jury verdicts, set up operations in Chinandega.

Their arrival fanned a political movement around DBCP, known to Nicaraguans by the brand name Nemagon. To many poor Nicaraguans, it became a catchall cause for their ills: cancer, kidney trouble, headaches, blemishes, nervousness, even bad eyesight.

Three years ago, several hundred people claiming to be victims erected a shantytown in front of the national assembly in Managua, the capital, to draw attention to their complaints. They are still there.

On a recent day, one of the encampment's leaders, Altagracia Socorro Solis, ushered an old woman into a shelter and pointed to her swollen knees.

"See the deformities," Solis said. "It's the pesticide."

More than 20,000 men and women have signed on as clients with law firms in Chinandega, equivalent to about a sixth of the city's population. Many had been rounded up by union bosses, activists and paid recruiters.

Wilber Wilson, a 60-year-old taxi driver in the city, said a former neighbor asked him to join a lawsuit.

"I told him, 'No. I wasn't a banana worker,' " he said. "He said, 'It doesn't matter.' "

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