Does an American company have the right to fire competent Latino workers who’ve taken jobs after supplying fraudulent Social Security numbers, and would it then be permissible under the First Amendment for a community activist to publicly label that company “racist”?
That isn’t a hypothetical question, but one that ignited controversy this month inside the California Court of Appeal based in Santa Ana. The case centers on labor protests against Overhill Farms Inc., a Los Angeles County-based frozen-food company that in May 2009 fired nearly one-third of its workforce, all Latinos. Company officials declared the former employees, some of whom had been employed for more than a decade and made as much as $14 per hour, “illegal aliens.”
While there are national implications involving freedom of speech and federal enforcement of immigrant policies, the story’s centerpiece is Nativo Lopez, perhaps Southern California’s most polarizing community activist. Lopez’s style is best described as punch first—repeatedly—ask questions after your opponent requires an ambulance. The 61-year-old Santa Ana resident’s defense of illegal immigrants has won him TV appearances with Bill O’Reilly at Fox News and Lou Dobbs at CNN as well as routine mocking from KFI-AM radio’s John & Ken. In an interview with me 12 years ago, Lopez proudly recounted bloody fistfights he’d had in his youth with white bigots. Indeed, Lopez said then that he preferred the days of direct, physical confrontation to what he viewed as the lackadaisical efforts of present-day activists.
So, it was no surprise that when more than 250 Latino workers at Overhill Farms learned they would be fired if they failed to produce valid Social Security cards, they turned to Lopez, national director of Hermandad Mexicana Latinoamericana. It was also no surprise that Lopez responded against the company with indignation. He orchestrated a series of protests and labeled the company “racist.”
But Lopez’s plan backfired. None of the workers without Social Security cards returned to work. According to court records, Lopez now finds himself not just liable for allegedly smearing a publicly traded company with annual revenues of about $200 million but also being pegged as a shameless political opportunist and, worse, an extortionist.
According to Overhill Farms’ attorney Steven J. Goon, Lopez—a man “with a checkered past”—“inserted himself” into the labor dispute and encouraged company officials to accept another round of fake information from the employees in hopes of duping federal agents. In a legal brief, Goon said company officials refused to cooperate.
In retaliation, Goon wrote to the appellate judges, Lopez acted “maliciously” by launching “a campaign of lies against Overhill Farms in an attempt to coerce Overhill to ignore and violate the law [by re-hiring] illegal aliens . . . This is textbook extortion.”
Handbills distributed at Lopez’s rallies—at Overhill Farms and one of its clients, Panda Express—weren’t tepid. Overhill Farms is “an abusive and racist employer” and an “immoral company” that “discriminates against [and] exploits Latinos,” “unfairly terminated” them, “stole their work” and “used intimidation and fear to control its workforce,” states one flyer, which also accused the company of “receiving more than $1 million a year off the backs of Latinos” while supplying food to Jenny Craig, Jack in the Box, Safeway and Costco.
There was more to the story. It had been federal agents conducting an audit via computer who had discovered the fake Social Security card scheme—not officials at Overhill Farms. It was the IRS that notified the company of the so-called “e-raid” (electronic raid) findings and informed the company that it faced a minimum $80,000 fine if it continued to employ illegal workers.
In a May 2009 letter to the employees, company president Jim Rudis praised them as “hard-working people” and called the situation “the most difficult I have ever faced in my 40-year career.” But he advised them that they had 30 days to supply accurate Social Security numbers or face termination. “Please believe me that if there was any reasonable alternative, we would have chosen a different direction,” he wrote.
Only one of 254 employees supplied an accurate number; she got her job back.
But to Lopez, who denies he asked the company to engage in illegal conduct, Rudis used the IRS audit “as a pretext” to fire Latino workers, arguing that “the Social Security Administration web site does not direct that employers fire individuals who have discrepancies” with their Social Security cards.
“Mr. Rudis is confident that we will be passive and will accept this racist and discriminatory abuse against Latino families without a fight,” states a handbill distributed at Lopez’s rallies. “But he is wrong. [He] will soon learn . . . he has committed a grave error, the biggest of his life. We demand a return to our employment with full back pay . . . We will take our cause to the streets, the community, other unions, our churches, the media and the World Wide Web.”
To Goon, Lopez “played the race card . . . because the truth [of an “illegal alien” worker scheme] would garner little sympathy or public support.” He also said the evidence contradicts the claim that Overhill Farms is anti-Latino, noting “nearly all of the employees hired to replace [those fired Latinos] were Hispanic.”
“The only difference,” he said, “was that the new employees provided valid Social Security numbers.”
Overhill Farms filed a lawsuit against Lopez and the protesters claiming defamation and intentional interference with business. But citing Lopez’s recent bankruptcy and pending criminal charges in an unrelated voter-fraud case, the company primarily sought a court-ordered injunction that prohibits future—and, what its officials would say are similarly dishonest—protests.
After a November 2009 hearing, Superior Court Judge Robert J. Moss granted most of the company’s wishes. Lopez appealed, claiming that the U.S. Constitution grants him “absolute” First Amendment protection to publicly utter his opinion that Overhill Farms is racist.
In a 28-page ruling issued this month, an all-Republican appellate court led by justices William Bedsworth and William Rylaarsdam rejected Lopez’s contention, arguing that he’d made his “racist firing claim sound far more credible than it actually is” by giving the public “materially incomplete and misleading” information.
The third justice on the panel, Richard D. Fybel, dissented.
“My colleagues in the majority have incorrectly made this court the first state or federal appellate court in America, ever, to hold that the epithet ‘racist’ constitutes a provably false assertion of fact as the basis of a claim of defamation,” wrote Fybel. “The employees’ claims might not be persuasive . . . that does not make them defamatory.”
Fybel suggested the First Amendment had been weakened: “To illustrate this point, would it be actionable if the Los Angeles Times, the Orange County Register, Fox News or MSNBC complained that the actions by anyone were ‘racist’ or ‘discriminatory’? Of course not. Employees complaining about their employer enjoy the same protection.”
Carol Sobel, Lopez’s attorney, agrees, observing, “You don’t like to be told you are a fascist or a racist or a sexist, but those are statements of opinion . . . This case is an attempt by a large corporation to silence a small group of former employees and their advocate.”
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A version of this story first appeared on the Weekly’s Navel Gazing blog.
This article appeared in print as "Crying ‘Racist’: What Nativo Lopez calls free speech, an appeals court calls defamation."