USA: Activists Challenge Corporations They Say Are Tied to Slavery

They owned, rented or insured slaves. Loaned money to plantation owners. Helped hunt down the runaways. Some of America's most respected companies have slavery in their pasts. Now, 137 years after the final shots of the Civil War, will there be a reckoning?

A powerhouse team of African-American legal and academic stars is getting ready to sue companies it says profited from slavery before 1865. Initially, the group's aim is to use lawsuits and the threat of litigation to squeeze apologies and financial settlements from dozens of corporations. Ultimately, it hopes to gain momentum for a national apology and a massive reparations payout by Congress to African-Americans.

Neither goal will be easily achieved.

There is considerable evidence that proud names in finance, banking, insurance, transportation, manufacturing, publishing and other industries are linked to slavery. Many of those same companies are today among the most aggressive at hiring and promoting African-Americans, marketing to black consumers and giving to black causes.

So far, the reparations legal team has publicly identified five companies it says have slave ties: insurers Aetna, New York Life and AIG and financial giants J.P. Morgan Chase Manhattan Bank and Fleet Boston Financial Group.

Independently, USA TODAY has found documentation tying several others to slavery:

* Investment banks Brown Bros. Harriman and Lehman Bros.

* Railroads Norfolk Southern, CSX, Union Pacific and Canadian National.

* Textile maker WestPoint Stevens.

* Newspaper publishers Knight Ridder, Tribune, Media General, Advance Publications, E.W. Scripps and Gannett, parent and publisher of USA TODAY.

Successive generations of African-Americans, starting with slaves freed in 1865, have failed to persuade Congress to apologize and make restitution for slavery. Attempts by descendants of slaves to sue the federal government for damages have been dismissed.

By targeting corporations, the activists are opening a new chapter in black America's quest to be compensated for two and a half centuries of bondage. The activists contend that major corporations today possess wealth that was created by slaves or at the expense of slaves -- and that it's time for African-Americans to reclaim that wealth.

Evidence against corporations sits in university libraries, historical collections and corporate archives. Slaves haunt the pages of old letters, newspapers, receipts, payroll sheets, account books, annual reports and court records.

Ads Seeking 'my Negro boy'

There are insurance policies naming their masters as beneficiaries; railroad rule books prescribing 39 lashes of the whip for recalcitrant slaves; newspapers publishing ads offering rewards for the return of ''my Negro boy.''

The list of corporations tied to slavery is likely to grow. Eventually, it could include energy companies that once used slaves to lay oil lines beneath Southern cities, mining companies whose slaves dug for coal and salt, tobacco marketers that relied on slaves to cultivate and cure tobacco.

Slavery's long shadow also could fall over some of Europe's oldest financial houses, which were leading financiers of the antebellum cotton trade.

Lloyd's of London, the giant insurance marketplace, could become a target because member brokerages are believed to have insured ships that brought slaves from Africa to the USA and cotton from the South to mills in New England and Britain.

The original benefactors of many of the country's top universities -- Harvard, Yale, Brown, Princeton and the University of Virginia, among them -- were wealthy slave owners. Lawyers on the reparations team say universities also will be sued.

Ties Can Be Tenuous

The connection between modern-day corporations and slavery can be tenuous. Records seldom show the extent to which a given company depended on slave labor or profited from sales to slave owners. Many of the companies that are potential targets for reparations lawsuits didn't exist until after emancipation, some not until the 20th century. Instead, they bought the slave histories of other companies in corporate acquisitions over the years.

Last August, insurance giant AIG, founded 54 years after the Civil War, bought another insurer, American General. With the purchase came U.S. Life Insurance, which American General had acquired in 1997. In going through U.S. Life's archives last fall, AIG discovered that the unit had insured slaves in its early years.

Aetna first confronted allegations it had insured slaves two years ago. Since then, it has struggled to put the matter to rest, apologizing and pointing out that it funds college scholarships for African-Americans, pays for studies on racial disparities in health care and sponsors a national forum on race.

Antebellum-era slave policies ''don't reflect what our company is today at all,'' says Aetna spokesman Fred Laberge. ''We have a strong record of diversity and supporting causes and hiring.''

USA TODAY contacted all the companies named in this article. Some acknowledged the evidence, others disputed it. Many declined comment. Of those that did comment, virtually all said the current company isn't liable for what happened before the Civil War.

Behind the new legal thrust is the Reparations Coordinating Committee, headed by Harvard law professor Charles Ogletree and author-activist Randall Robinson. The team includes heavyweight trial lawyers Johnnie
Cochran and Dennis Sweet, and scholars such as Harvard's Cornel West, Georgetown's Richard America and Columbia's Manning Marable.

''Once the record is fleshed out and made fully available to the American people, I think companies will feel some obligation'' to settle, Robinson says. ''Regret's not good enough. Aetna made money, derivatively at least, from the business of slavery. . . . Aetna has to answer for that.''

The legal obstacles are daunting. Slaves and their masters are dead. Company records, though sometimes damning, are seldom complete. Damages may be impossible to calculate. Most important, no company accused of profiting from slavery was breaking U.S. law at the time: Slavery was not a crime.

''We've never seen a case where someone who died hundreds of years ago can have a simple, common-law tort revived. The law wasn't designed for this,'' says Anthony Sebok, a tort expert at Brooklyn Law School.

Statutes of limitations on torts, or injury claims, typically last no longer than two or three years and have been extended in rare exceptions to only 30 years. Before broadening a tort case to a class-action lawsuit, reparations advocates must find the descendant of a slave damaged by one of the defendants. Then they must decide who qualifies as a slave descendant and who, in essence, is black.

The reparations team could choose instead to sue for restitution, arguing that companies were ''unjustly enriched'' from their use of uncompensated labor. Those cases often hinge on whether plaintiffs can give a clear, precise accounting of what was wrongfully taken from them and what they produced. That's easy when someone wants restitution for a lost object, such as a building. But how do you separate the output of slaves from that of other workers on, for example, a railroad?

Earlier reparations cases -- targeting the government -- have been dead ends. The group wants to avoid a repeat of Cato v. United States, a $100 million reparations case brought against the federal government in 1995. A sympathetic U.S. Appeals Court in San Francisco dismissed the case after saying it could not find a legal basis for it. The panel said descendants of slaves must go to Congress, not the courts, to get redress for crimes against their ancestors.

That's not to say there is no precedent for reparations. Since 1995, the state of Florida has paid about $2 million in reparations to the victims of a 1923 race riot in the black settlement of Rosewood.

Ultimately, the court of public opinion could be the one that matters most. That much was clear to the German, Austrian, Swiss and French companies sued by Holocaust survivors and other Europeans victimized by the Nazis.

The Holocaust cases, filed by the dozens between 1996 and 2000, were weak on the law and almost certain to be dismissed by U.S. courts. But they were corrosive to the reputations of defendant companies as long as they could linger on court dockets. The companies have settled for more than $8 billion, at the urging of the U.S. government, which mediated.

Owen Pell, a lawyer at White & Case who represented Chase Manhattan against accusations it illegally blocked accounts held by Jews in wartime France, says dozens of U.S. companies have quietly begun searching their archives in anticipation that they could be named in slavery lawsuits.

Public Relations Damage

The reparations movement can't win in court, Pell insists. ''But companies have learned you don't judge a lawsuit by its merits. You judge it by the potential public relations damage. Corporate America is following this issue. They understand how nasty it could get if someone comes in and says you have blood on your hands.''

It shouldn't come to that, says Willie Gary, a reparations team member. He says companies tied to slavery should step forward and make amends by putting money into African-American scholarships and education. ''Based on what America stands for and has stood for, it's the right thing to do. There's an opportunity to make a wrong right,'' he says. ''This should be a negotiated matter. We shouldn't be in litigation for 20 years.''

Black and white Americans are sharply divided on the issue, a USA TODAY/CNN/Gallup poll shows. Big majorities of African-Americans believe companies that profited from slavery should apologize, make cash payments to descendants of slaves and set up scholarship funds for blacks. About a third of whites believe apologies and scholarships are a good idea; only 11% of whites favor cash payments to slaves' descendants.

Either way, reparations activists are preparing for a fight. Many of them battled to isolate apartheid-era South Africa and make pariahs of U.S. companies operating there in the 1980s. Expect the same bruising tactics -- and some new ones -- this time:

* Pressuring shareholders. That means demanding that pension funds and other big institutional investors dump shares of companies linked to slavery. Activists also may try forcing them to formally debate the issue at annual meetings.

* Swaying consumers. They will try to persuade African-Americans to pull money from accused banks and switch policies from tainted insurers.

* Blocking mergers. Already, they have tried to get government regulators to kill corporate deals by AIG and J.P. Morgan Chase Manhattan on the grounds the companies haven't told shareholders of potential legal
liabilities stemming from any past involvement in slavery. The deals went through anyway.

* Enlisting African-American job recruits. The reparations group has close ties to black fraternities and sororities at the nation's colleges. It could urge graduates to shun companies accused of slave profiteering and harass corporate recruiters sent to campuses by accused companies.

The reparations team has been extraordinarily secretive. Members won't reveal the timing, corporate defendants, damages and precise legal argument of any planned lawsuits. That's partly a strategic determination to keep the opposition in the dark. Partly, it reflects unresolved disagreements among the lawyers and scholars putting the case together.

May Be the Last Shot

With each passing day, slavery slips further into time. Gary and other trial lawyers on the team are mindful that this effort may be the last shot at addressing a historical wrong. They say their work is likely to be done pro bono. By not charging, they hope to guard against accusations they're looking to get rich by conducting corporate shakedowns.

One certainty is that new corporate cases are merely the undercard for the main event: The Holy Grail for the reparations movement is a national apology from Congress and a massive federal payout that could take the form of direct payments to African-Americans or trillions in new spending on education and social programs aimed at them.

Central to any national reparations campaign is a belief that present-day gaps between whites and blacks are rooted in the past. Reparations backers argue that disparities in income, education, health, housing, divorce rates and crime grew out of the trauma of 246 years of slavery and more than a century of continuing oppression: Jim Crow laws, lynchings, job discrimination, segregation, mortgage covenants, redlining, racial profiling and other abuses.

Congress has effectively turned a deaf ear to that argument. It has stifled reparations legislation sponsored each year since 1989 by Rep. John Conyers Jr., D-Mich. But by identifying companies that made money off slavery, reparations backers believe they can turn corporations and their CEOs into lobbyists for national restitution.

A few companies may open their checkbooks, Pell says.

''What proponents of reparations are really trying to do is use the lawsuits as a tool,'' he says. ''It's a hammer against businesses to create a call for a federal government solution.''

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