The Texas chapter of one of the nation’s most powerful unions filed for bankruptcy after losing a multi-million dollar lawsuit for its smear campaign against a Houston janitorial company.
A jury ordered Service Employees International Union Texas, also known as SEIU District Five, to pay Professional Janitorial Service of Houston $7.8 million in September for making false claims about the company during a campaign to rally support from workers and local activists.
A Texas judge rejected the union’s request for a mistrial on November 15 and ordered it to hand over files associated with the case to the company for discovery.
The union said that filing for Chapter 11 bankruptcy protection reflects the best interests of its members given the costly judgement.
“This filing ensures that our union will remain open for business, representing members at the bargaining table and maintaining the vital role the union plays in helping working Houstonians have a voice at work, protecting them from unfair employers, and building a better future for their families,” SEIU Texas President Elsa Caballero said in a statement. “Bankruptcy is a common process provided under the law to protect organizations—such as corporations, non-profits, unions etc.—and allows us to seek temporary relief from our debt while we continue to pursue our appeal of an unfair judgment.”
Brent Southwell, the CEO of the janitorial company, said it plans to continue seeking information from the union to ensure that it is not hiding money to dodge the jury award. He said the company could pursue action against the union’s national office, which has more than 1.5 million members, if the Texas branch is not able to pay the judgment.
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