Chinese iPod Factory Owner Sues For Libel - InformationWeek
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8/30/2006
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Chinese iPod Factory Owner Sues For Libel

Two Chinese journalists have had their cars confiscated, among other things, and are being sued for libel after their newspaper printed a story about long working hours and poor conditions in a local iPod factory.

SHANGHAI, China — Two Chinese journalists have had their assets frozen and are being sued for $3.7 million after writing a report critical of work conditions in a factory that makes Apple's popular iPod.

The lawsuit was filed by Foxconn Technology, a subsidiary of Taiwanese EMS giant Hon Hai Precision Industry Co. Ltd., which is responsible for making the iPod. It is believed to be one of China's biggest libel suits.

The reporter, You Wang, and editor, Bao Wen, work for the China Business News, a Shanghai-based daily newspaper. Wang confirmed that they have had their credit cards, apartments and car confiscated for writing an article on June 15 that said employees at Foxconn's Shenzhen factory work 12 hours a day, exceeding the hours-per-week work limit.

The report also alleged that workers had to stand while working for 12 hours every day without rest and were not allowed to talk. Female workers reportedly fainted during the long hours.

The lawsuit charges that the news report tarnished Foxconn's reputation by implying that conditions and three-month training regime were cruel and that some workers sought to escape. A Foxconn spokesperson contacted by EE Times declined to comment on the lawsuit.

In June, Apple denied charges of forced labor, but did admit that employees worked longer hours than permitted by the company's code of conduct, which limits normal work weeks to 60 hours and requires at least one day off each week.

Apple initiated its investigation after a report published in the London-based Mail on Sunday (Aug. 27) said that the Foxconn factory pays $50 a month, about half what other iPod makers pay, while forcing workers to endure longer hours.

This is the second time in the last two years that Hon Hai has sued and initiated the seizure of assets from a journalist. In 2004, it sued a Taiwan reporter for $912,000 alleging that a report that detailed some of its sensitive pricing information. Foxconn later withdrew the lawsuit under pressure from the Association of Taiwan Journalists.

Apple said it is working with Foxconn to bring the factory in line with its code. Still, it remains difficult for multinational companies to monitor working conditions in overseas factories. In China, workers are often coached by management to respond positively to spot inspections of working conditions.

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