Date: February 17, 2004
FOR IMMEDIATE RELEASE
Contact: Steve Cady, 402-792-0041
Jury Awards $1.3 Billion to Cattlemen in Pickett Case
Lincoln, NE ~ The Organization for
Competitive Markets praised today’s jury verdict that awarded nearly $1.3
billion to the class of cattlemen suing Tyson/IBP for using captive supplies to
manipulate prices downward.
“This is the greatest day for
cattlemen since the passage of the Packers & Stockyards Act in 1921 and the
break up of the big five packers one year earlier,” said Fred Stokes, OCM
president. “Finally, America’s
cattlemen were able to present their case before an unbiased jury to determine
once and for all whether Tyson manipulated prices unfairly with captive supply
cattle.”
The case was filed in 1996 against
IBP. The named plaintiffs are Lee
Pickett (AL), Mike Callicrate (KS), Chris Abbot (NE), Robert Rothwell (NE),
Johnny Smith (SD), and Pat Goggins (MT).
They represent a class of approximately 30,000 cattlemen who sold to IBP
exclusively on the cash market from 1994 to 2002. IBP was purchased by Tyson in 2002, and thus the case is now
entitled Picket v. Tyson Fresh Meats, Inc.
“The plaintiffs experts showed that
Tyson depressed prices by an average of 5.1% over the 8 year class period,”
said Michael Stumo, OCM general counsel, who assisted plaintiff’s counsel
throughout the trial. “This means that
Tyson received one out of every 20 cattle free due to their manipulation of
inventories that allowed them to depress prices.”
“Tyson argued that they needed to
use captive cattle to procure quality cattle, keep their plants full, and
reduce transaction costs,” continued Stumo.
“Tyson’s experts, including Professor Ted Schroeder of Kansas State,
said that beef quality would go down without captive supply. The jury found that those alleged business
justifications were contrived and not true.”
“OCM conveys its heartfelt thanks to
David Domina of Domina Law in Omaha, Nebraska, and Joe Whatley of Whatley Drake
in Birmingham, Alabama, for their case preparation and their dedication to the
U.S. cattle industry,” said Fred
Stokes. “This is an historic day that
will be remembered for generations as the beginning of a turnaround for
competition in the cattle industry.”
The Organization for Competitive Markets is a nonprofit
organization working for fair, open and competitive markets for farmers,
ranchers and rural communities. OCM
helps lead the Cattlemen’s Competitive Market Project which is a voluntary
contribution program focusing on competition in the cattle markets.