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The Tainted Milk Powder Incident – Hope in the Midst of Despair

January 26, 2011

A Chinese lawyer details the efforts of plaintiffs and their lawyers to seek justice for victims of tainted milk powder.

The tainted milk powder incident erupted on September 11, 2008, becoming known as China’s 9/11. In America’s 9/11, many firefighters gave their lives for others. In China’s 9/11, notable sacrifices were also made. Parents of affected children protecting their own legal rights and interests, their supporters, passionate rights defenders, and lawyers—all paid the price. They were vilified, detained, and some were even sentenced to prison. A new business district is rising on the ruins of America’s 9/11. As for China’s 9/11, the story cannot be easily or briefly told.

Looking back on the past, facing the present, and surveying the future, is it possible to see hope in the midst of the victims’ despair in China’s 9/11?

1. Review of the events leading to China’s 9/11

On September 11, 2008, the Chinese media reported that Sanlu infant formula had been contaminated with the industrial chemical melamine, which can cause stones to develop in the urinary tract. The Ministry of Health said those responsible for the “kidney stone babies” would be severely dealt with. The State Administration for Quality Supervision, Inspection, and Quarantine (AQSIQ) said it would open an investigation into the incident in which infants were suspected of having fallen ill due to consumption of the milk powder. At the same time, the Shijiazhuang Sanlu Group Co., Ltd. Recalled all Sanlu infant formula milk powder produced prior to August 6, 2008.

On September 16, 2008, AQSIQ issued a list of 22 brands of infant formula milk powder in which melamine had been detected, among them Qingdao Sheng Yuan Dairy Co., Ltd., makers of Sheng Yuan brand infant formula milk powder.

On September 17, 2008, in response to a proposal by legal scholar Xu Zhiyong in Beijing, lawyer Li Fangping came forward to initiate the formation of a legal aid group for the tainted milk victims. On September 18, 2008, members of the legal aid group were informed of the decision and were told to gather in a restaurant the following evening to discuss matters related to the formation of the legal aid group for victims of the tainted milk powder. That same afternoon, several lawyers separately received warnings by telephone from Liu Jun, the Deputy Secretary General of the Beijing Lawyers Association, who had learned of the dinner gathering by the legal aid group. Her warnings to the lawyers were essentially: (1) the Party and government have become more experienced at handling disasters and other emergencies; and (2) local legal aid groups already exist that could provide legal aid to the tainted milk powder victims. The subtext was that there was no need for people to concern themselves pointlessly and create bodies such as a legal aid group. The Chinese Lawyers Association, like other professional organizations in China, is a semi-official group, so one can imagine that Deputy General Secretary Liu’s phone calls reflected the official view.

The call to help the tainted milk powder victims was publicized online and through other media outlets. Lawyers across the country quickly responded. In just a few days nearly 100 lawyers registered for the legal aid group. On the afternoon of September 25, 2008, in the conference room of the Beijing Bureau of Justice, Deputy General-Secretary Liu met with five lawyers who were the first on the list of volunteers in the legal aid group for tainted milk powder victims, including Li Fangping, Qu Haibin, and Li Jinglin. She said, “The Hebei Lawyers Association has contacted the Beijing Lawyers Association and requested that the Beijing Lawyers Association not get involved in the claims for compensation for the child victims of tainted milk powder in Hebei Province—legal aid would be handled by Hebei lawyers themselves.” Li Fangping told Deputy General-Secretary Liu at this meeting that based on a September 23 report in the Hong Kong Ta Kung Pao newspaper, a pro-mainland newspaper, Hebei lawyers had been ordered by the Committee of Political and Legislative Affairs not to take compensation
cases on behalf of the child victims, and to “keep their distance.”

The Committee of Political and Legislative Affairs is an abbreviation for the Committee of Political and Legislative Affairs of the Communist Party of China (CPC). It is the unit within Party committees at all levels whose specific task is to supervise the public security bureaus, the procuratorates, the courts, the bureaus of justice, and the state security bureaus. Lawyers associations are semiofficial organizations under the direct leadership of bureaus of justice; no lawyer has the ability to defy an order from the Committee of Political and Legislative Affairs.

Later, Li Fangping was called in by the Office of Lawyer Supervision of the Beijing Municipal Bureau of Justice for a private chat, during which he was forced to withdraw from the tainted milk powder victims’ legal aid group. Among the others lawyers involved in the group, many responded that they had been given a heads-up by the Bureau of Justice or by their own law firms that they were not permitted to involve themselves in the legal aid group. As a result, the group had barely begun to operate when it vanished into thin air. So when, following the October 1 National Day holiday, Xu Zhiyong sent a text message on behalf of the legal aid group, soliciting lawyers to represent child victims of tainted milk in specific cases, not a single lawyer responded. This led to the decision by Xu Zhiyong and Teng Biao to come forward jointly as doctors of law to offer their services without charge to victims of tainted milk powder in compensation suits.

Both Xu and Teng are key members of the Beijing Open Constitution Initiative (or Gongmeng, short for Beijing Gongmeng Consulting, Ltd.). Like almost all NGOs across China, this one is registered as a company with the local Administration for Industry and Commerce. It was Gongmeng that collected the cases of victims of tainted milk powder and sought authorization for the legal aid group to represent them. Within a short period, the cases collected through the Gongmeng website, like those brought by victims themselves in other locales around the country, found all avenues to litigation of claims completely and utterly blocked. All courts, right up to the Supreme People’s Court, have refused across the board to accept these cases. According to the relevant provisions of China’s Civil Procedure Law of the People’s Republic of China, a court refusing to accept a case for trial must issue a ruling stating its reasons, but no court issued such a ruling. Except for giving notices orally, the courts ignored these lawsuits. The courts were openly derelict, but the victims could not do anything about it. The Communist Party of China could do something about it, but it did nothing.

On March 2, 2009, the vice president of the Supreme People’s Court, Shen Deyong, during an online exchange with netizens, announced that the Supreme People’s Court had completed preparations for accepting cases claiming compensation for victims of tainted milk powder. Personal injury compensation is traditionally the business of the courts of any nation. The Supreme People’s Court long ago formulated judicial interpretations for standards of personal injury; thus there should have been no need for preparatory work. Moreover, there is no conflict between accepting a case and doing preparatory work. What is the problem with accepting a case while considering how to try it? Also, Shen’s comments were not made public through television or newspapers, but were disclosed, by him as a private individual, on the Internet. The way he did this is food for thought.

What difference did these five months of preparation—from September 11, 2008, to March 2, 2009—make to the way the victims’ compensation cases were handled by the people’s courts? The claims for compensation against Sanlu milk powder can serve as an example. According to official announcements, the number of child victims was around 294,000, most of who were sickened by the Sanlu brand. Gongmeng collected about 200 cases, and filed a joint lawsuit in the Intermediate People’s Court of Shijiazhuang, where the Sanlu Group was based. At first the court refused to take these cases; it busied itself with accepting bankruptcy applications from three Sanlu milk powder producers. On March 4, 2009, it indicated its willingness to accept the victims’ compensations claims, but not in a joint suit, demanding that it be broken down into individual lawsuits.

The Civil Procedure Law has provisions regarding joint lawsuits, but it appeared that they do not apply to the People’s Court of Shijiazhuang. Gongmeng and the lawyer it hired, Peng Jian, divided the lawsuit into individual cases, but the Shijiazhuang Intermediate People’s Court still did not accept them, instructing the injured parties to file their cases in a lower court, the Shijiazhuang Xinhua District People’s Court. According to the provisions of the Bankruptcy Law, lawsuits brought against bankrupt enterprises should all be heard in the same people’s court that tries the bankruptcy case. But Shijiazhuang Intermediate People’s Court did not proceed according to the law. In Xinhua District Court, the section in charge of accepting cases declared the photocopied IDs collected by Gongmeng to be invalid and demanded that original IDs of heads of families be produced before it would review the plaintiff material submitted by Peng and others and make a decision on establishing these cases. There is no precedent in China for demanding the original client IDs to be produced in a filing review. No one has outdone the people’s court on this score. The people’s court also declared that it would accept only lawsuits brought by local residents of Shijiazhuang; the rest of the plaintiffs would have to return to their own places of residence to sue. After balking several times, in the end the Shijiazhuang Xinhua District People’s Court accepted two victims’ cases.

Gongmeng’s lawyer, Peng Jian, was still in Beijing bringing four lawsuits on behalf of victims of Sanlu milk powder; of these, two were accepted and two were refused. Gongmeng and its lawyer had limited financial resources and energy, and so they did not go elsewhere to sue the Sanlu milk powder manufacturer. That is to say, the people’s court, after six months of preparation, accepted four compensation lawsuits brought by victims of the Sanlu milk powder manufacturer. And then, after the manufacturer went bankrupt and declared the value of its bankrupt assets to be zero, the court said that it would hear the cases only after the conclusion of the bankruptcy case.

Peng did not give up. In March 2010 he again sued one of the stakeholders in the Sanlu Infant Formula Group, the New Zealand dairy cooperative Fonterra, in a Hong Kong court. The Hong Kong court would not hear the case.

As for the Qingdao Municipal Intermediate People’s Court, after preparing for nearly six months, it handled the victims’ lawsuits against the Shengyuan brand milk powder producers as follows: [A court official] advised Li Jinglin, the lawyer who had previously brought the case, that the court had an obligation to advise the parties involved that compensation would be awarded according to state standards; even in a lawsuit, compensation would follow these standards. Li’s reply to the judicial officer was: The state had not set any compensation standards, and what was currently in place was a compensation scheme drawn up by 22 milk powder producers themselves. It was precisely because the parties could not accept the producers’ compensation scheme, as they felt that the standard of compensation in that scheme was too low, that they had come here to sue. Li also said: Even if the court rules against us, as long as it accepts the case, it will be okay. The Qingdao Municipal Intermediate Court accepted the case materials. The filing review deadline went by, but the court did not let Li know whether the case had been accepted.

Li had been waiting for the Beijing Municipal Bureau of Justice to make trouble, and it did: to top it all off, his law firm asked him to find a job elsewhere. But he did not give up. Before he went to another law office, he increased the number of compensation litigants from around 50 to more than 70, and mailed the lawsuit materials to the Shandong Provincial Higher People’s Court. That court ignored them. The court did not need to do anything because the Beijing Municipal Bureau of Justice had intervened: Li’s annual law license review did not go through, and his license was not renewed. The Beijing Municipal Bureau of Justice also made a special call to the law office Li had just joined, telling its director that Li was involved in sensitive cases and had also been involved in the call for direct election of the head of the Beijing Lawyers Association, and so on. The subtext was that he was a dangerous person and that the firm should do something so that he would not dare proceed further with the tainted milk compensation cases against Shengyuan, to avoid causing problems for the law firm.

There are about 170,000 lawyers in China, but probably only two, Peng Jian and Li Jinglin, were willing to represent compensation lawsuits on behalf of the victims of tainted milk powder, and this is what their efforts led to. If even lawyers were having such a hard time filing compensation claims on behalf of tainted milk powder victims, one can well imagine the difficulties the victims would face in pressing their own cases against the milk powder producers. Why would anyone do such a stupid thing?

So, to date, who is it that has been blocking access to compensation litigation for the thousands of victims and by what means? In a country grown used to black hands at work behind the scenes, it is not hard to imagine who is responsible.

Why did the courts unofficially indicate that they would accept the cases and in fact did accept several compensation cases when it was clear that they did not want to accept them? In the beginning, the news of lawyer Li Jinglin filing lawsuits in Qingdao on behalf of child victims of Shengyuan milk powder was reported in the overseas edition of the state controlled People’s Daily. From this fact, it is perhaps apparent that the court’s acceptance of compensation suits by child victims of tainted milk powder was nothing but a ploy to generate favorable international public opinion.

The tainted milk powder victims have nowhere to turn with their complaints. There should always be a place where grievances can be aired, yet it seems pretty unlikely in this case.

On September 24, 2008, the talk show “Yihuyixi” on Phoenix Television, CCTV’s so-called overseas satellite channel, was scheduled to have a discussion on the tainted milk powder incident, but this was changed at the last moment to a discussion of the hero of the day, one Zhou something, who purported to have discovered the South China wild tiger. According to information divulged by the program unit, the Central Propaganda Department had issued a gag order: the tone of the publicity should be uniform, and reports on the tainted milk powder incident must all use the Xinhua News Agency’s prepared script. Central Propaganda Department is the abbreviated name for the Propaganda Department of the CPC Central Committee. All media in China are directly or indirectly under the leadership of the Central Propaganda Department. Rumor has it that the Central Propaganda Department feared it had a bad reputation, so it changed its name in English to the Public Relations Department.

The “Yihuyixi” staff also revealed a rumor: Food manufacturers Mengniu and Yili were to be sponsors of the Olympics, and their milk products sold at the games. But due to the fact that their products failed laboratory tests, though no [apparent] reason could be found, sponsorship was shifted to offer milk products from Beijing’s Sanyuan Foods Company at the Olympics. Later, Chinese officials released a statement to the effect that milk products used at the Olympics were safe, that this is a fact and should be accepted as such, because Beijing Sanyuan Foods is a special supplier to the central government, and therefore the quality of its products is absolutely guaranteed. But if the relevant responsible departments could exercise quality control over all food, as they do over food produced by special suppliers to central government bodies, problems of food safety would absolutely not occur in China, and China would certainly be the world’s number one producer of quality products.

Barred from suing, barred from speaking—victims and lawyers had to settle a huge public incident, but how? By politely accepting the compensation scheme announced by the 22 milk powder producers.

In early 2009, the media reported that the 22 milk powder producers, led by the Sanlu company, jointly provided money to the child victims of tainted milk powder. The standard of compensation was as follows: (1) for death: 200,000 yuan ($30,000); (2) for acute conditions: 30,000 yuan ($4,500); (3) for other: 2,000 yuan ($300). Medical costs for the child victims would be covered by insurance companies up until age 18. That is it. According to the fine print: “acute conditions”means only surgery or renal failure; hydronephrosis (accumulation of fluid in the kidney) and kidney stones are not considered acute conditions. If the child’s condition is such that he requires surgery or experiences renal failure, would it not have an impact on the child’s prospect for future employment or marriage and having children? Incredibly enough, such losses must actually be borne by the victim. In addition, travel expenses, living expenses, the cost of time off from work, and so on, incurred by the parents in taking the child to the doctor, are also to be borne by the parents. And, if by chance the victim has not completely recovered after age 18, then what? Should the victim just resign her or himself to this bad luck?

That such an unfair compensation scheme could be so quickly put in place across the country—even widely accepted by the victims—under the supervision and direction of the authorities, is due to the following facts in our society.

First, the tainted milk incident involves broad and systematic corruption that is difficult to investigate. It is well-known that the tainted milk powder products containing melamine included several national brands—and even those exempt from inspection [because of their supposed superior quality]. Consider this: The purpose of setting up the AQSIQ is specifically to control product quality. However, the AQSIQ does not inspect all products’ quality, and rather, it exempts some products [the national brands] from testing. It is very clear that the act of announcing exempted products or brands itself is a dereliction of duty. Furthermore, judging the excellence of merchandise—activities that the AQSIQ organizes—has never been among the functions and responsibilities of the AQSIQ. With common sense, everyone can imagine: How can a company get a “national famous brand” designation without paying for it and cause the responsible government department to abdicate its responsibility and to exempt products from testing, so that the company can produce goods however it wants to?

Second, if infant formula milk powder contains melamine, how can other milk powder be melamine-free? Melamine damages infant urinary systems, so doesn’t it cause urinary disease in other age groups as well?  Who cannot grasp this simple logic? Why is the inspection not continued?

Third, the media revealed that relevant government departments were in the process of stepping up control of the compensation scheme for victims of the tainted milk, which implies that the joint compensation scheme put forward by the 22 milk powder producers has official origins.

Fourth, the specific compensation arrangements are being made by local officials. For all the reasons listed above, if one does not accept the compensation offered by the milk powder producers, what other recourse is there? As a result, the vast majority of the victim families have no choice but to accept this uniform compensation package offered by the 22 companies.

If you are still not convinced that getting justice is an impossible mission, then a miserable fate awaits you. Among the victims’ family members who refused to accept the compensation initiated by those 22 tainted milk producers, some were arrested, ordered to serve Reeducation-Through-Labor, or sentenced to prison.

2. The Future of China’s 9/11

On August 31, 2010, the family of Pei Shiyu, a kidney-stone baby in Lanzhou, Gansu Province, who developed stones as a result of ingesting Shengyuan Youbo milk powder, sued the Shengyuan manufacturer in the Lanzhou Xigu District People’s Court, seeking 200,000 yuan ($30,000) in compensation. On September 7, 2010, Xigu District People’s Court accepted the case, and the fees for the appeal. Then, the Xigu District People’s Court was to send a copy of the complaint to the defendant—in Qingdao—which could have been mailed to the Qingdao court, in accordance with the law, with a request that the Qingdao Court deliver the complaint to the defendant on the Xigu court’s behalf. But the judge in the case said the complaint must be personally delivered into the defendant’s hands. Pei Shiyu’s father, Pei Jinming, knew exactly what was meant by this. He not only paid for the trip but also accompanied the judge on a visit to the famous scenic Qingdao. Despite this, on November 18, 2010, the Xigu District Court returned Pei Jinming’s case fee and transferred the case to Weinan City, a city directly administered by Qingdao, for trial. The reason given by the presiding judge is that the defendant’s registered assets—$50 million—are greater than what the Xigu District Court could handle. The decision to transfer the case was said to be a directive from the president of the Lanzhou Intermediate People’s Court. The defendant was in Qingdao, but the violation took place in Lanzhou.

Thus, according to the provisions of the Civil Procedure Law, the Lanzhou court had jurisdiction. However, the Lanzhou court abdicated its responsibility and transferred the case. One can only think that this fact does not bode well for the outcome of the case.

In this hopelessness, where are the hopes of the victims of China’s 9/11 for fair compensation? They will come after democracy and the rule of law become a reality in China. When that time comes, perhaps the state will take responsibility for the crimes of the administrators who neglect their duty and the unscrupulous profiteers, and justice will be served for the victims of China’s 9/11.