Jury Deliberates Lawsuit - Suit against U.S. meat processor for alleged damages inflicted on cattle ranchers is in the hands of a jury
February 12, 2004
By Chris Harris, Editor
MEAT Processing Global and MeatNews.com
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A $2 billion lawsuit filed against Springdale, Arkansas-headquartered Tyson Foods by cattle ranchers accusing the company of price manipulation finally went to a jury in a Montgomery, Alabama courthouse. According to the lawsuit, Tyson Fresh Meats Inc. allegedly used contracts with select ranchers to depress beef cattle prices. Tyson argues that it was low demand that drove down the beef market.
During a one-month trial, each side criticized the other's failure to produce concrete evidence and witnesses. It has been eight years since six cattle ranchers filed a class-action lawsuit on behalf of some 30,000 producers who sold cattle to IBP Inc. -- which Tyson purchased in late 2001 -- in the cash market between February 1994 and October 2002.
The cattlemen's claim hinges on Tyson's use of marketing agreements, in which cattle producers pledge to ship a certain number of cattle to a packer, according to an Associated Press report. The plaintiffs contend Tyson has used those agreements to stay out of the market when prices are high, thereby driving prices down and threatening the livelihood of thousands of ranchers. Tyson countered that even though it buys roughly one-third of the 30 million cattle sold to U.S. packers each year, that share of the market does not allow the company to set the market price unilaterally.
Copyright 2003-2004 Watt Publishing Company
Web posted: February 12, 2004
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