ALEXANDRIA, Va. (CN) - The Chinese couple who sued Yahoo! for its role in the husband's being sentenced to 10 years of forced labor in a Chinese prison says the man who brokered the settlement with Yahoo! extorted millions of dollars from them. Plaintiff Ling Yu, of Beijing, is the wife of Wang Xiaoning, who is serving 10 years in a Chinese prison, accused of leaking state secrets.
Yu and Wang sued Harry Hongda Wu, of Vienna, Va., and his Washington, D.C.-based nonprofits, the Laogai Research Foundation and the Laogai Human Rights Organization. They also sued the Yahoo! Human Rights Fund, which was set up as part of the settlement of their previous case.
The new federal complaint alleges fraud, conversion and breach of fiduciary duty.
Yu and Wang made headlines in 2007 when they claimed Yahoo! gave up an IP address and other identifying information that landed Wang in a forced labor prison for political prisoners.
Yu says she turned to Harry Wu, who had served 19 years in a Chinese labor camp, to "assist her with ... the identification of legal counsel and her subsequent initiation of litigation against Yahoo!"
After Wu's incarceration, he moved to the United States and set up the Laogai Research Foundation, a nonprofit "dedicated to documenting and exposing systematic abuses of human rights in China, focusing on the forced labor camps," according to Laogai's website.
Because Yu does not speak English, she says she gave Wu her power of attorney to press her complaint in her interest.
After a congressional investigation, worldwide headline and public outcry, Yu met with Yahoo! CEO Jerry Yang and Wu and his assistant Tienchi. The parties agreed to settle and Wu persuaded Yu to drop her attorney and redraft his power of attorney agreement, according to the complaint.
Though they spoke Chinese at the meeting, the settlement that was reached a few weeks later was written only in English, and Wu took painstaking measures to keep the numbers secret, Yu says.
"Tienchi was specifically instructed by defendant Wu not to disclose any specific settlement amounts to plaintiff Yu, intending to conceal same from plaintiff Yu," she says.
Yu says she found out later that Yahoo! had agreed to pay $3.2 million to her and her husband and give additional cash to the Yahoo! Human Rights Fund, which is managed and directed by Laogai.
Yu also claims that Wu lied to her, claiming she needed to pay her old attorney $600,000 in legal fees. After she paid, he asked for a $1 million "voluntary" donation to Laogai.
"After plaintiff Yu refused, upon information and belief, defendant Wu replied '$2 million is enough for you' and demanded $1.2 million dollars from plaintiff Yu. In making such demand, defendant Wu became angry and abusive," the complaint states.
Yu says Wu "chastised" her and called her "ungrateful."
Yu says she later discovered that the settlement money was being held in a trust. She says that though it belonged rightfully to her and her husband, she was led to believe that she had to give money to Laogai to get access to the money.