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iPod manufacturer alters libel suit against journalists

Following outcry, Foxconn reduces damages sought over reports of unfair working conditions in Chinese plant.

Foxconn, the company employed by Apple Computer to manufacture the iPod, has reduced the damages it is seeking in a lawsuit against two Chinese journalists over claims about the treatment of workers at a factory run by one of its subsidiaries.

The two China Business News journalists at the center of the case, Wang You and Weng Bao, were initially hit with a libel suit claiming 30 million yuan (around $3.8 million) in damages and had their assets, including bank accounts, frozen by a Chinese court.

But the ensuing furor seems to have had an effect. Foxconn is in the token amount of 1 yuan. And the company has withdrawn a petition to freeze their assets.

The disputed articles alleged that workers in Foxconn's Longhua plant were forced into extra overtime, put up with cramped living conditions and had to stand for 12 hours or more at a time.

A recent itself--prompted by reports in the London-based Mail on Sunday--found that staff were working longer than their 60 contractual hours and identified other breaches of its code of conduct.

In a statement earlier this week, Foxconn accused the pair of "careless journalism," adding: "Of this entire episode, what the company had asked for is simply the right to protect her reputation, to preserve the Chinese dignity. Any claim to us is more for its symbolic meaning than anything. We hereby solemnly announce that we will donate entire eventual compensation to non-profit organization for good cause."

The suit provoked a media outcry, culminating in an open letter from encouraging Apple CEO Steve Jobs to defend the journalists. According to an Apple spokesman, the company is "working behind the scenes to resolve this issue."

Jo Best of reported from London.