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Court fines 2 garment factories $100K each
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Posted on May 31 2000
The U.S. District Court fined two garment factories yesterday for failure to comply with some of the terms of an earlier settlement agreement involving violations of federal and local labor laws.
Micronesian Garment Manufacturer, Inc. (MGM) and Diorva Saipan Ltd. were both ordered to pay $100,000 each and be placed under five years of probation after being found guilty on contempt of court charges.
During the sentencing, Judge Alex R. Munson set the conditions of the probation, such as not to violate any federal, state or local laws including the Fair Labor Standards Act and the CNMI Nonresident Workers Act.
They must also provide financial information to the U.S. Probation Office and each of the companies should pay assessment fee of $400 to the court.
David Wiseman, attorney for the two garment firms, argued in court for less severe penalties, noting that the sentencing guidelines were ill-suited to the contempt charge.
U.S. Assistant Attorney Kevin Seely, lead prosecutor, said the charges stemmed from MGM and Diorva’s violations of the settlement of a civil complaint filed against them in 1998.
Under that deal, they agreed to pay back wages and overtime compensation to their employees amounting to $550,000. Although they met that requirement, they were not able live up to their promise not to violate federal labor laws when they again failed to pay overtime in November 1998.
The court’s ruling came amid speculations that MGM is shutting down its operations on Saipan, although Mr. Wiseman has denied the report.
The two garment manufacturers resigned from the Saipan Garment Manufacturers Association after they were found to be in violation of the Fair Labor Standard Act.
