OCM: Supreme Court Denies Pickett Appeal

OCM: Supreme Court Denies Pickett Appeal

Nebraska News

Contact:  Keith Mudd – 573-735-2742 – www.competitivemarkets.com
March 27, 2006

OCM expressed disappointment today in the Supreme Court’s refusal to hear the Pickett v Tyson class action cattle price manipulation case. The Pickett plaintiffs filed a writ of certiorari on January 6, 2006. The Supreme Court declined to hear the case in a notice published today.

“The Courts have now rendered the Packer & Stockyards Act of 1921 (P&S Act) meaningless,” said Keith Mudd, OCM president. “The 11th Circuit Court of Appeals ruled previously that livestock producers can show billions of dollars harm from price manipulation, but if the packer has the smallest business justification for its conduct, the packer wins.”

The Pickett case was filed in 1996 in the U.S. District Court, Middle District of Alabama. The plaintiff cattlemen asserted IBP, Inc. (now Tyson) used captive supply cattle procurement strategies to lower cattle prices unlawfully. A class estimated to include more than 30,000 cattle producers was certified. On February 17, 2004, an Alabama jury found Tyson violated the law causing nearly $1.3 billion in producer market losses. On April 23, 2004, the judge presiding over the case overturned the verdict, claiming the jury was required to find Tyson had a legitimate business justification for its conduct.

“The Packers & Stockyards Act prohibits unfair market conduct, and price manipulation,” said Mudd. “Congress included no language allowing unfair practices or price manipulation if the packer has a good reason for doing so. Producers must now work through the state legislatures and federal Congress to return fairness to agricultural marketing.”

Another 2005 11th Circuit Court of Appeals case, London v. Fieldale Farms, held a poultry farmer contractually terminated for discriminatory reasons cannot prevail unless he/she shows the poultry integrator also harmed competition in the poultry market nationally.

Senator Tom Harkin introduced the Fair Agricultural Markets Act of 2006, in part, to eliminate the loopholes in the P&S Act. “OCM applauds Senator Harkin for his leadership on livestock market fairness issues,” continued Mudd. “Congress wrote the P&S Act, the Courts have now misinterpreted it, and Congress must now clarify it for the law to serve its original purpose.”

OCM is a non-profit, multidisciplinary organization working for fair, open and competitive markets in agriculture and realistic trade policies.