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Genetically Engineered Tree Company ArborGen Found Guilty of Abusing Workers: $53.5 Million Awarded to Employees

Just before the holidays a judge ruled in favor of ten ArborGen workers, resulting in a $53.5 million judgement against the biotech firm, as well as its founders, International Paper, MeadWestvaco (now WestRock) and New Zealand-based Rubicon, plus several of their executive staff and Board members.

Unfortunately, the story came out on 29 January, in the middle of a holiday week, and was almost completely unreported.

“We have always argued that ArborGen is acting recklessly in their pursuit of the commercial development of risky and unproven genetically engineered eucalyptus, pine and other trees.  It turns out we have good reason to be concerned.  If ArborGen is lying to and defrauding their own employees, how can we believe anything they say about the ‘safety’ of their GE trees?” stated Dr. Rachel Smolker, co-Director of Biofuelwatch.

On 29 January, the Charleston, SC Post and Courier reported that the judge in the case ruled the workers had been tricked by ArborGen and the others into accepting incentive plan changes that depleted most of their wealth.

The Post and Courier quoted Chip Bruorton, a lawyer with Rosen Hagood who represented the workers stated, “The defendants orchestrated a scheme to [give] the employees false information, misrepresentations and concealment as part of a wrongful scheme to defraud them [and fail] to provide the employees with the value they were entitled to.”

The trial showed the 10 employees should have received a combined $11.3 million of equity but instead were coerced into accepting a new financial plan that provided a combined $414,330 of equity.

From the from Summary of Court’s Findings of Fact, [p. 96]: “This court finds that ArborGen’s … employees …were in turn abused by ArborGen, its founders, its board members and its management team.  The Defendants orchestrated a cover-up scheme created and executed to switch the Plaintiffs out of the [original financial plan] that the Defendants had determined to be ‘too rich’…”

In the Summary [pp 156-157], the judge found that ArborGen Executive staff and Board members resorted to “trickery and deceit” with an “intent to defraud.”

The judge further stated,

“A review [of the facts] leads inexorably to the conclusion that Defendants used deception, misplaced trust, and pressure tactics to convince Plaintiffs to sign up for the [less valuable] financial Plan.

“Rather than be honest and candid, Defendants relied on trickery and deceit.

“The aim was to help ArborGen and its founders by getting rid of a plan that was viewed as too good for the employees.

“Plaintiffs have proven by clear and convincing evidence that Defendants’ attempted

Termination of Plaintiffs’ contract rights … amounted to breach of contract accompanied by fraudulent act, and that the fraudulent acts element … was committed with an intent to defraud.”

In September, Global Justice Ecology Project and the Campaign to STOP GE Trees organized an action at the world headquarters of ArborGen resulting in two arrests.  The aim of the action was to expose ArborGen’s refusal to divulge information about plans to commercialize their GE loblolly pines, which the USDA said could move forward with no environmental or social impact review and no public input.  The action also highlighted the growing public opposition to GE trees.

In 2015 alone, more than a quarter of a million people signed on to reject genetically engineered trees and protests took place on 6 continents.

After the action, ArborGen made their first public statement about their work on GE loblolly pines and other GE trees in a local paper.  In it, they argued that they were not working on GE loblolly pines and had “no plans…right now” to offer GE products.

In light of the recent lawsuit, however, these claims are coming under increased scrutiny.  “If they lie to their employees, why wouldn’t they lie about their plans to release GE trees?” asked stated Ruddy Turnstone, GE Tree Campaigner for Global Justice Ecology Project and Steering Committee member of the international Campaign to STOP Genetically Engineered Trees.  “The US government, for example, lists two active ArborGen GE loblolly pine field trials in South Carolina and Georgia.”

ArborGen is also developing freeze-tolerant GE eucalyptus trees, which are being trialed across six Gulf Coast states. In 2011 ArborGen submitted a petition to the USDA requesting permission to commercially sell this GE eucalyptus, prompting an Environmental Impact Statement, which has yet to be released to the public.  On November 18th, the USDA’s Animal Plant Health Inspection Service (APHIS) announced that the US Fish and Wildlife Service was evaluating this EIS.

In a statement to shareholders, Rubicon CEO Luke Moriarty (a defendant in the lawsuit) said ArborGen plans to sell half a billion of these GE eucalyptus every year for plantations from South Carolina to Texas. ArborGen keeps the locations of their GE trees secret and refuses to provide information about them to the public.

In December, MeadWestvaco, another co-founder of ArborGen, dropped the charges against the protesters than face a jury trial. ArborGen’s world headquarters are situated on MeadWestvaco land.

ArborGen claims their GE trees are safe and will have no environmental impact.  But GE eucalyptus trees, for example, are not only prone to be invasive, they are explosively flammable–leading Jim Hightower to call them “living firecrackers.”  They have also been likened to “flammable kudzu.”  They are not native to this hemisphere and wildlife cannot use them.  In Brazil eucalyptus plantations are called “Green Deserts” because nothing can live in them.

GE tree opponents promise to continue to increase the heat in 2016.  People can sign on to the petition against GE trees here.

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Anne Petermann is the Executive Director, Global Justice Ecology Project and the Coordinator of the International Campaign to STOP GE Trees.  She has been working on the problem of GE trees since first learning of them in 1999.

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