Dole Food apparently is beset by bogus product liability claims filed by Nicaraguan banana farm works who claim they were made sterile by a pesticide, DBCP, last used in the 1970’s. An article in the latest issue of BUSINESS WEEK magazine (7/1/09 p. 16, “A Bunch of Fake Claims Against Dole?”).
Courts in that Central American country have awarded plaintiffs $2.2 billion in damages so far. Dole is not droll in fighting the claims and maintains that a mini-industry has sprung up south of the border to recruit people who never worked on the farms, give them briefings to make then credible and send them to sham medical clinics to goose up the damages.
Where are Bill Lerach or Dickie Scruggs when you need them?)
One upshot from this situation emerges for risk managers. Companies need to fine tune their mechanisms to handling foreign claims, an area that often gets short shrift. The tort lottery is most prominent in America, but other countries are finding it a tasty export from the good old USA.
Further, this vignette is a reminder that insurance fraud is not just an asbestos thing or a domestic U.S. phenomenon. Foreign claims-handling capabilities must include a search for SIU and fraud-fighting tools.