RCA Taiwan Ex-Workers’ Quest for Justice Could End Soon

The Taipei District Court on April 17 will reach a decision in a legal battle between RCA, once one of the world’s largest electronics companies, and former workers in Taiwan who claim they are suffering from various types of cancer caused by exposure to hazardous chemicals while working at an RCA factory in Taoyuan more than 40 years ago.

The case may be appealed twice after the April decision.

The legal dispute, the first class-action suit in Taiwan’s legal history, pits nearly a thousand former employees against RCA, which operated one of the world’s largest color TV factories in Taiwan. The former workers, mostly women from poor families, say that without any warning or training from RCA, they were exposed to as many as 20 types of poisonous chemicals through skin contact, in the factory air they breathed and in the untreated ground water they drank while working in the RCA plant.

“My three daughters and I worked at the RCA plant to improve our financial situation,” ex-employee Cheng-Wang Ai-chu said in Voice Refused to Be Forgotten (拒絕被遺忘的聲音), an oral history of the event. “We bought a home facing the plant and have lived there until now. My daughters married and soon developed serious illnesses. One passed away. One had her ovaries removed, and the other was unable to get pregnant and now needs dialysis three times a week.”

The workers say they are part of a tragedy behind Taiwan’s much-vaunted economic miracle during the 1970s, when the government sought to transform the island’s economy from agriculture to production of high value-added electronic products. RCA’s operations in Taiwan ran from 1970 to 1992, employing tens of thousands of people. Now, thousands of those ex-workers who have joined a self-help group are either suffering or dead from various types of cancer.

Two years after the factory closed in 1992, then-legislator Jaw Shao-kong (趙少康) revealed to the press that RCA had been dumping waste organic solvents into wells at factory sites in Taoyuan and Zhubei, polluting the surrounding soil and aquifers. After the report was made public, ex-RCA workers became suspicious that their illnesses were caused by exposure to the dangerous chemicals.

The Taiwanese government pushed RCA to remediate damage to the soil and aquifers. While the U.S.-based company took steps to clean up the pollution, it was never able to return the aquifers to their original condition.

Moreover, up until now, not one of the ex-RCA workers has won any compensation from RCA for medical expenses or other personal losses from the contamination. Yet the surviving workers, many of them now in their 50s and 60s, say they are not giving up the legal battle.

Toxic cocktail

Trichloroethylene and tetrachlorethylene were among the chemicals found in the aquifers below the RCA sites. Years after the RCA factories were closed, a study by Taiwan’s Industrial Technology Research Institute (ITRI) found levels of the chemicals in surrounding aquifers to exceed World Health Organization (WHO) standards for drinking water by a factor of as much as 1,000 times.

RCA factory workers used the organic solvents to clean printed circuit boards that were assembled into color TVs and other electronic products. They touched the chemicals with their hands in the manufacturing process and breathed the volatile solvents in the air of the factory, which had almost no ventilation, the workers say. When they took two breaks during the daily work period to wash, drink and eat, they used untreated water pumped from the same ground where RCA was dumping waste solvents into wells, according to the workers.

Trichloroethylene is a clear non-flammable liquid with a sweet smell that nearly a century ago was used as an anesthetic. Since the 1970s, trichloroethylene has been banned in the food and pharmaceutical industries in much of the world. In 2005, the U.S. Environmental Protection Agency formally characterized the chemical as a human carcinogen.

Tetrachlorethylene is a colorless liquid widely used for dry cleaning of fabrics. The International Agency for Research on Cancer has classified the chemical as a Group 2A carcinogen, which means that it is probably carcinogenic to humans. Tetrachloroethylene is a central nervous system depressant that can enter the body through respiratory or dermal exposure.

The factory workers say they were so unaware of the danger posed by the chemicals that they sometimes used the solvents to wash their hands and even clean their clothes.

The lawyers defending RCA Taiwan have up to now forestalled a court decision on the grounds that there is no cause-and-effect relationship between the chemicals used in the RCA plants and the cancers that the ex-workers are suffering from.

According to the book Voice Refused to Be Forgotten, more than 300 of the ex-RCA workers who joined a self-help group have died from cancer and more than 1,000 are cancer sufferers.

RCA Taiwan said its records on employees were destroyed in a warehouse fire. The Taiwan government also said that it lost its RCA Taiwan records.

It is hard to find accurate statistics on the total number of former RCA workers who are currently suffering or deceased from cancer and other work-related illnesses, says Wu Chih-gang, one of the former RCA employees. “If you go to the Bureau of Labor Insurance under the Ministry of Labor, they won’t tell you. It’s a very irresponsible thing to do.”

RCA’s rise and fall

During the same time that RCA was manufacturing color TVs in Taiwan and contaminating the local environment, it also transferred key semiconductor technology to Taiwan that led to the rise of the island’s huge silicon chip industry.

During the 1970s, Minister of Economic Affairs Sun Yun-suan (孫運璿) led a four-year, US$10 million project to transfer RCA’s chip technology to Taiwan. The investment was a bargain that led to the creation of Taiwan’s chip industry, today earning billions of US dollars in annual revenue and accounting for nearly a third of the world’s chip production.

In April 1976, ITRI sent 19 engineers to RCA’s facilities in the US for training in semiconductor technology.

The trainees included Robert Tsao (曹興誠), who would later become chairman of United Microelectronics Corp (UMC); Tsai Ming-kai (蔡明介), chairman of leading chip design house MediaTek; and F.C. Tseng (曾繁城), vice chairman of Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest contract chipmaker.

Just as Taiwan’s chip industry was rising, RCA’s fortunes were plummeting.

RCA, once one of the world’s leading electronics companies, was founded in 1919 as a partnership between U.S. companies General Electric (GE), Westinghouse and several other firms. Its original mission was to act as a center for investors to merge individual patents to keep the U.S. lead in in wireless technology following World War I.

RCA Laboratories in Princeton, New Jersey, led many innovations such as color television, the electron microscope, semiconductor technology, liquid crystal displays (LCD), direct broadcast satellite systems and high-definition television.

Yet during the late 1960s and 1970s, RCA diversified to become a conglomerate, acquiring Hertz in rental cars, Banquet in frozen foods, Coronet in carpeting, Random House in publishing and Gibson in greeting cards, as the company slipped into financial disarray. RCA soon acquired the sobriquet “Rugs, Chickens & Automobiles” as a result.

Business and financial conditions led to RCA’s takeover by GE in 1986 and its subsequent breakup. GE then sold the rights to make RCA- and GE-branded televisions and other consumer electronics products in 1988 to France’s Thomson Consumer Electronics in exchange for some of Thomson’s medical businesses.

Today, RCA exists as little more than a memory.

Yet for the former employees in Taiwan, the memory is nightmarish. RCA’s change in ownership during the 1980s has complicated the legal struggle in Taiwan to claim damages.

Incomplete laws

In the years after RCA Taiwan’s pollution was exposed, a series of responses to the incident show how ill prepared the government was to deal with matters involving environmental protection and occupational hazards.

“Before the RCA incident, Taiwan was a nation lacking complete laws,” says Stephen Chou, one of the lawyers representing the former RCA employees. “Why did this U.S. company come to Taiwan? Because Taiwan’s wages were low and because Taiwan’s environmental regulations were incomplete. The company came to Taiwan to lower its operating costs and boost profit.”

In July 1998, a total of 1,451 ex-RCA workers created a group (RCA 環境污染受害者自救會) to seek damages from their former employer. In November of the same year, the Executive Yuan created a working group including officials of the Environmental Protection Agency, the Department of Health, the Council of Labor Affairs (CLA) and the Ministry of the Interior to investigate RCA Taiwan.

It was not until 2000 that Taiwan enacted the Soil and Groundwater Pollution Remediation Act (土壤及地下水污染整治法). After that, RCA Taiwan requested the Taiwan government to reduce its capital, as part of an effort to exit Taiwan.

In response, the Taiwan Association for Victims of Occupational Injuries (TAVOI), working with the ex-RCA employees, demanded that the CLA freeze RCA Taiwan’s funds.

Then in March of 2001, Premier Chang Chun-hsiung (張俊雄), a founding member of the Democratic Progressive Party (DPP) who served under President Chen Shui-bian (陳水扁), ordered that the Executive Yuan dissolve the working group created to investigate the RCA pollution incident.

The ex-RCA workers were so angered that they took to the streets, protesting outside the Executive Yuan, the American Institute in Taiwan and the Ministry of Foreign Affairs.

In February 2002, a team of lawyers working on behalf of the ex-RCA workers requested a temporary seizure of RCA’s funds in Taiwan, at the time worth NT$2.4 billion (US$76 million). The lawyers discovered that all of RCA’s money had been remitted abroad.

It is quite likely that Lee and Li Attorneys, representing RCA Taiwan, helped the U.S. company move nearly all its money out of Taiwan, according to lawyer Stephen Chou.

The Central Bank is very strict with foreign exchange controls, Chou says.

“The Central Bank refused to let RCA Taiwan expatriate its capital because the Central Bank was aware of the company’s environmental issues,” Chou said. Later, RCA Taiwan mandated Lee and Li to circumvent the restrictions on capital reduction by remitting the money to an overseas bank where RCA Taiwan had an account.

“We don’t know why the Foreign Exchange Bureau approved this transaction,” Chou says.

Lee and Li Managing Director C.V. Chen responded to the allegation.

The allegation “is baseless and false,” Chen said in an e-mailed reply. “As this case is pending in court, we have no further comment on this matter.”

Taiwan’s Legal Aid Foundation, representing the ex-RCA employees, also declined to comment pending the court decision in April.

Lee and Li is one of Taiwan’s largest law firms. Taiwan’s Legal Aid Foundation, established in July 2004, aims to help the disadvantaged by providing free legal assistance.

Elusive target

The disappearance of nearly all of RCA’s capital from Taiwan has made the company an elusive target.

“RCA Taiwan still exists. We think that RCA Taiwan still has money,” says Ho Kuang-wan (賀光卍), one of the TAVOI people who is working with the former RCA employees. “The company has paid to remediate the land in Taoyuan where they dumped the chemicals. They’ve also contracted Lee and Li Attorneys to represent them all these years, so we think they must have money.”

When GE and Thomson were conducting audits of RCA Taiwan prior to their acquisition of RCA, the companies must have learned of the pollution incident and included the potential cost of remediation in their estimations of the value of RCA Taiwan, according to Ho.

“From the very beginning when RCA Taiwan was established until now, their legal consultants were Lee and Li,” says Wu Chih-gang.

“Lee and Li were entrusted with managing RCA Taiwan’s funds,” says TAVOI’s Ho. “We suspect that Lee and Li moved the money out of Taiwan.”

“If foreign companies set up operations, but later are able to move their money out of Taiwan in this way, that’s quite a serious matter,” TAVOI’s Ho adds.

The former employees say they want RCA Taiwan to apologize and use the NT$2.4 billion to remediate the polluted soil and pay compensation to the ex-workers and the families of those who have passed away.

Overcoming setbacks

Since their setbacks starting around 2002, the former RCA workers have rebounded, continuing their efforts, including visits to various labor groups and government organizations in the US to seek justice. Their efforts in the US yielded nothing.

By 2004, with a new team of lawyers, the former workers filed a civil suit against RCA Taiwan that was overturned in court for procedural reasons because the group of former RCA workers had no qualification as a legal person. Taiwan’s Supreme Court granted the group the right to appeal the case.

In 2006, the workers’ group reorganized as a legal entity and gathered support from a group of academics, lawyers and other volunteers working on their behalf. During the next three years, the volunteer workers collected testimony from more than 300 of the former RCA workers.

Lawyer Stephen Chou says that even as a court decision on the case is still pending, the former RCA employees and their supporters have made significant progress through their struggle.

“Before the RCA Taiwan incident, there were no regulations on groundwater pollution or labor safety standards,” he says. The case has helped push forward a number of revisions to the law in Taiwan. Employers will be more cautious in the future. The government will be under pressure to enforce the new regulations protecting workers, according to Chou.

There have also been important advances in the rights of female workers.

After the protests by ex-RCA workers, the CLA announced the Standards for Disability Payment for Breast Loss. Before that time, women who lost their breasts were not entitled to receive National Public Health Insurance coverage.

Deterrent effects

A court decision in favor of the ex-RCA employees should also help to deter companies from polluting the environment and exposing their employees to hazardous conditions, according to Chou.

There are still examples of similar violations even today in Taiwan.

The pledge of Taiwan-based Advanced Semiconductor Engineering Inc. to adhere to environmental protection standards is at odds with its recent history.

The K7 plant of the world’s largest semiconductor assembly-and-test company in Kaohsiung, Taiwan has resumed operations after the Kaohsiung District Court on October 20 last year imposed a fine of NT$3 million on ASE, and five company executives were put on probation for environmental violations. The company says it has been consistently committed to environmental protection.

“We’ve been pledging this for a long time,” ASE CFO Joseph Tung (董宏思) said in an Oct. 31 interview with U.S. trade publication EE Times. “We’ve been doing this for a long time.”

The website of Taiwan’s Environmental Protection Administration tells a different story, however. The website shows that ASE broke environmental laws and paid fines 19 times in 2014, after the silicon wafer operations of the K7 plant were shut down in December 2013 for wastewater violations.

Citizen of the Earth, Taiwan, an environmental group based in Kaohsiung, calls ASE a “serial polluter” on its website.

“The law in Taiwan doesn’t deter violators,” Citizen of the Earth Division Chief Tsai Hui-hsun (蔡卉荀) told EE Times. “The law doesn’t require companies to pay for environmental damage.”

The injured parties will need to form a group and seek the help of experts and academics to counter the company, Chou said.

If that’s the case, the RCA Taiwan class action suit, the first such legal action in Taiwan, will set an important precedent for the future.