11th Circ. upholds Judge Strom's dismissing cattlemen's suit against Tyson

Hard feelings and burning wallets remain after 11th circuit upholds decision by Nebraska Federal Judge Lyle Strom to vacate a jury's $1billion verdict against Tyson meats under the federal Packers and Stockyards Act and enter judgment in Tysons favor. 11th Circuit orders substantial costs against Plaintiffs. Court also chides Plaintiff's counsel for "emotional" arguments and weak expert witnesses. Farm and Food: Go forth and make serfs of all By ALAN GUEBERT and news of the costs judgment against the farmers Effectively killed the Packers and Stockyards Act of 1921, which is supposed to “assure fair competition and fair trade practices, safeguard farmers and ranchers, and protect consumers and members of the livestock, meat, and poultry industries from unfair business practices that can unduly affect meat and poultry distribution and prices.” Largely gutted the U.S. Department of Agriculture’s mandate to “promote fair and competitive trading practices for the overall benefit of consumers and American agriculture.” Gave agribusiness giants permission to run U.S markets like wholly-owned subsidiaries+. And it was all done in the name of “efficiency,” a word not found in either the Packers and Stockyards Act or the U.S. Constitution. How in the world did a lawsuit against Tyson Fresh Meats — in which a jury awarded $1.28 billion to cattlemen because Tyson’s use of contracted cattle cut cash cattle prices — end up granting giant meatpackers market power they could only dream of? Simple, says Roger McEowen, an ag law professor at Iowa State University. “The judges in this case created a standard that isn’t in the Packers and Stockyards Act; a standard that says ‘The PSA exists to aid efficiency so packers can compete with each other.’” Michael Stumo, legal counsel for the Organization for Competitive Markets, agrees. He participated in the original Alabama lawsuit against Tyson, (called the Pickett case for plaintiff Henry Lee Pickett), in which a jury handed Tyson a $1.28 billion lump to the head, a penalty overturned by trial judge, U.S. District Judge Lyle Strom of Nebraska. The plaintiffs appealed. “The appellate court basically changed a competition enforcement statute, the (Packers and Stockyards Act,) into an efficiency statute,” Stumo said. In doing so, the court said that if there is a “business justification”— here, efficiency — for violating the act, then no violation occurs. This standard, adds Stumo, “is not in the Packers and Stockyards Act text nor it is in antitrust law. But the 11th Circuit believes it should be no matter that a jury has already said it’s not and the actual law says it’s not.” Indeed, the decision () is remarkable for not only what it includes but also what it excludes. For example, nowhere in its 33 pages is there one reference to any of the amicus briefs submitted to the court in support of the jury’s original judgment against Tyson. Somehow, though, the court did find space — and, more importantly, a reason — to include trial judge Strom’s snide and away-from-the-jury characterization of Auburn University’s C. Robert Taylor, Pickett’s expert witness who proved to the jury that Tyson’s use of captive cattle led to 5 percent lower cash cattle prices. The remark by Strom — “I’d say, Dr. Taylor, you’re nuts.” — is not only silly, wrong and inflammatory, it’s immaterial. That’s why the jury never heard it. Also, the Aug. 16 opinion chastises Nebraska attorney David Domina, one of plaintiff Pickett’s lead attorneys in the case, for his opening statement the court characterizes as “emotional.” So what? The court’s view of Domina’s statement has nothing to do with its task: determine if the case was decided fairly and correctly under the law, not whether an attorney reaches for a jury’s heartstrings or even stands on his head in the attempt. “This is a very hostile opinion,” says Peter Carstensen, a professor at the University of Wisconsin’s law school and an antitrust specialist, “that shows a profound failure on the part of the court to understand that a legal framework is absolutely essential to make markets work.” Like McEowen and Stumo, Carstensen views the decision as a gut-splitter for the Packers and Stockyards Act and its overarching USDA agency, the Grain Inspection, Packers and Stockyards Administration. “This opinion basically creates a lawless market because it says that if a meatpacker’s conduct is consistent with some business purpose, then anything goes—even serfdom.” As such, the Packers and Stockyards Act is functionally dead, he says, and the “only thing that can salvage it is if someone pours a hardening agent into backbones at USDA so it stands up and writes tough rules on marketing contracts.” But, he adds, given the fact that USDA itself is largely a captive of meatpackers, “That’s not going to happen.” Congress can make it happen, though, by resuscitating, then updating, the Packers and Stockyards Act in the 2007 Farm Bill. Let’s start by calling it the Anti-Serfdom Act. Alan Guebert is a freelance agricultural journalist. He can be reached at agcomm@sbcglobal.net or at 21673 Lago Dr., Delavan, IL 61734. ranchers must pay Tyson's expenses in federal cattle-pricing case q By staff and wire reports MONTGOMERY, Ala. — A handful of cattlemen, including two Nebraskans, their $1 billion verdict in their favor reversed in a price-fixing lawsuit against corporate giant Tyson Fresh Meats, now have to pay the nation’s largest beef packer more than $70,000 in court expenses. “They’ve thrown our industry into the Tyson meat grinder and said ’Welcome to serfdom,“’ cattleman Mike Callicrate, a plaintiff in the beef lawsuit, said Friday. The 11th U.S. Circuit Court of Appeals in Atlanta unanimously upheld an Alabama U.S. district court decision ordering five cattlemen, including Nebraskans Chris Abbott of Gordon and Robert Rothewell of Arthur, and Rothwell’s corporation, to pay Tyson, of Springdale, Ark., expenses totaling $70,198.60 for the trial conducted last year in Montgomery. The amount covers expenses such as transportation and office supplies, but does not include attorney fees. The lawsuit accused Tyson of using illegal cattle-buying practices to manipulate beef prices. Tyson countered that it used legitimate business practices that do not subvert the market principles of supply and demand. The plaintiffs were represented in the case by David Domina, an Omaha attorney. “It’s obvious we’re disappointed with the restults,” Domina said. It’s typical for the losing side in a civil case to pay the expenses of the winner, according to Domina, and the larger issue is the appeal he will bring of the case as a whole. Domina said he will appeal to the entire 13 judges of the 11th Circuit Court of Appeals, and if that effort fails, he will take the case to the U.S. Supreme Court. “These were well intentioned people trying to the right thing for their industry,” Domina said of the plaintiffs. In the ruling, the appeals court said “this case was not a close and difficult one” and noted that those who filed the suit “lost every aspect of the case and Tyson prevailed on it.” Thomas C. Green, Tyson’s lead attorney, said the appeals court decision proves that corporations have the freedom to make contracts in the agricultural sector. “I think the plaintiffs need to get a grip and relax,” Green said. “Their view of the law has always been one-sided and obviously shortsighted.” Callicrate called the court developments were an example of a complete failure of justice. “These judges are not looking at the law,” he said. “They are looking at what benefits big business.” In a separate ruling last week, the three-judge 11th Circuit panel unanimously affirmed a June 2004 ruling by the trial judge, U.S. Senior District Judge Lyle Strom of Nebraska, who threw out the jury’s finding that Tyson used contracts with a select few beef producers to manipulate cattle market prices. As part of its verdict, the jury recommended Tyson pay $1.28 billion to a class of cattlemen affected over an eight-year period. But Strom, instead of ruling on the size of the class and amount of damages, found that the cattlemen had failed to show sufficient evidence against Tyson, and reversed the verdict. In their appeal, attorneys for the cattlemen had asked the 11th Circuit to find that the jury based its decision on a reasonable review of the evidence. They said that in another case the 11th Circuit had refused to “second-guess the jury” if its action was reasonable. But the appeals court disagreed. On the matter of costs, teh appeals court said the cattlemen must pay Tyson’s expenses despite the beef packer’s wealth and their “limited financial resources.”