Business owners sue rivals that hire illegals

LOS ANGELES -- Business owners frustrated by lax enforcement of immigration laws are taking their fight to court, accusing competitors of hiring illegal workers to achieve an unfair advantage.

The legal action is an attempt by business and anti-illegal-immigration groups to create an economic deterrent against hiring illegal employees.

In the first of a series of lawsuits, a temporary employment agency that supplies farm workers sued a grower and two competing companies on Monday.

Similar cases claiming violations of federal anti-racketeering laws have yielded mixed results. The California lawsuit is thought to be the first based on a state's unfair-competition laws, legal analysts said.

Santa Monica, Calif.-based Global Horizons claimed in the lawsuit that Munger Brothers, a grower, hired illegal alien workers from Ayala Agricultural Services and J&A Contractors. All the defendants are based in California's farm-rich Central Valley.

The suit claims that Munger Brothers had a contract with Global Horizons to provide more than 600 blueberry pickers this spring, but nixed the agreement so it could hire illegal aliens.

"Competitors hiring illegal immigrants is hurting our business badly," Global Horizons President Mordechai Orian said. "It's to the point that doing business legally isn't worth it."

Ayala Agricultural Services manager Javier Rodriguez had not seen the suit but said the company does not hire undocumented immigrants.

"If somebody doesn't have a green card or work documents, we don't hire them," he said.

Messages left with Munger Brothers and J&A Contractors were not returned.

With an estimated 12 million to 20 million illegal aliens in the United States, undocumented workers are a large part of the nation's work force.

But immigration law enforcement at work sites is limited. In fiscal year 1999, authorities arrested 2,849 persons at work sites compared with 1,145 arrests last year, according to the federal Immigration and Customs Enforcement agency.

To prove competitors hire illegal aliens, businesses could use public records involving prior violations, testimony from former employees who have worked alongside illegal aliens, and recovered W-2 tax forms that show people working under fake names and Social Security numbers, said David Klehm, the lead lawyer for cases in Southern California.

Companies planning to file additional lawsuits include farms and factories that depend heavily on immigrant labor, Mr. Klehm said.

Legal analysts said the cases could be difficult to win. Under the California statutes, plaintiffs must prove a competitor directly harmed their business.

"Unless you've got smoking-gun evidence, it's hard to tie economic loss of one business to another's practices," said Niels Frenzen, a law professor at the University of Southern California.

He thinks it is the first time the unfair-competition law has been used to target illegal immigration.

The Global Horizons lawsuit came after a settlement was reached in a Washington state class action suit involving employees of Zirkle Fruit Co. who sued their employer for driving down wages by hiring undocumented workers.

Based on federal anti-racketeering laws, the case was settled for $1.3 million in January after the 9th U.S. Circuit Court of Appeals overturned a lower court's decision to dismiss it.