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Big Businesses Sued for Apartheid Reparations

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Times Staff Writer

An American lawyer who helped Holocaust victims win $1.25 billion from Swiss banks now says he plans to make South Africa’s top mining concern pay even more for allegedly exploiting thousands of workers and perpetuating this country’s racist apartheid system.

New York attorney Ed Fagan, working with South African lawyers, on Friday filed lawsuits in federal jurisdictions in New York and Nevada asking for up to $6.1 billion in damages from the South African corporation Anglo American and the diamond company De Beers, in which Anglo American has a 45% stake.

The timing of the lawsuit, which Anglo American immediately rejected, was calculated to capitalize on growing frustration in South Africa with the pace of economic change and on publicity surrounding the release two weeks ago of the final report of the country’s Truth and Reconciliation Commission.

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“It’s something that everybody’s been waiting for,” the lawyer said Saturday of the Anglo American class-action lawsuit on behalf of 50,000 former employees -- the first such suit to target a major South African corporation for apartheid-era wrongdoing.

Fagan said the lawsuit was “emboldened by” the Truth and Reconciliation Commission report, which singled out the mining house as an example of a company that it said not only benefited from apartheid’s cheap and unfair labor system but helped the government create the apartheid policies that would ensure that labor supply.

“What this is about is corporate accountability and rectifying not just wrongs that happened 50 to 60 years ago but present-day human rights violations -- and that’s what’s so exciting about the case,” Fagan said.

Anglo American said in a statement that it “strongly rejects the efforts made by U.S. lawyers and others to use U.S. courts to resolve important issues for South Africa’s future.”

The mining company, one of the largest in the world, said it is involved in many efforts to foster reconciliation and help rebuild South Africa, and added that it had opposed many apartheid policies.

“We firmly believe that our opposition helped bring about an end to the apartheid system,” the statement said.

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The company said that it would not engage in a dialogue with Fagan’s team and that the debate over how best to rebuild South Africa “must necessarily take place in South Africa by South Africans through their democratic institutions.”

“Anglo American believes that the question of whether reparations to individuals is an appropriate or effective way to assist in the rebuilding of South Africa is a matter to be resolved through South Africa’s democratic processes -- including, if necessary, its courts -- as part of South Africa’s ongoing broad efforts to bring about reconciliation and reconstruction after apartheid,” the company said.

The mining house is not alone in questioning Fagan’s efforts. Last year, a group that has filed similar lawsuits in South Africa distanced itself from Fagan because of his alleged “cowboy tactics.”

Fagan, who last summer filed U.S. lawsuits against a group of foreign banks and businesses involved in South Africa during the apartheid years -- roughly four decades that began in 1950 -- said attempts to portray his work in South Africa as carpetbagging are unfair.

He pointed out that one of the lawyers working with him in South Africa is Dumisa Ntsebeza, a member of the Truth and Reconciliation Commission who led its investigative efforts.

“If they think they are only going to have to talk to and settle with the government, I’ve got news for them,” Ntsebeza said Saturday of Anglo American. He said the company has had plenty of time to ante up substantial money to help more than 20,000 apartheid victims identified by the Truth and Reconciliation Commission gain a sense of “self-respect and human dignity.”

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“Why must we think they are genuine now? They are stalling again,” he said.

Fagan attained prominence in the 1990s when he was one of the lawyers responsible for winning a $1.25-billion settlement from Swiss banks that kept deposits of people who died or were prisoners in concentration camps during the Holocaust. Since then, he has filed class-action lawsuits in a number of high-profile cases, including a cable-car fire that killed 155 people in Austria in 2000.

On Saturday, Fagan also announced plans to file a similar class-action lawsuit in California on Monday against the Aliso Viejo-based construction company Fluor Corp., which helped the South African synthetics company Sasol during the apartheid era. That lawsuit, seeking damages of up to $1 billion, will be brought on behalf of 4,500 former Sasol employees, Fagan said.

The Fluor lawsuit is designed to draw attention to the company’s involvement in apartheid-era South Africa just when it’s been asked by the Bush administration to bid on reconstruction work in postwar Iraq, Fagan said.

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