Organization for Competitive Markets
P.O. Box 6486
Lincoln, NE 68506
Date: June 16, 2004
FOR IMMEDIATE RELEASE
Contact: John Lockie, 406-628-9850
OCM Joins Amicus Brief Supporting
Pickett v Tyson Appeal
Lincoln, NE ~ The Organization for Competitive Markets (OCM) was joined today by 50 organizations signing on to an amicus (friend of the court) brief supporting the plaintiff cattlemen in the Pickett v Tyson Fresh Meats cattle price manipulation case. The historic litigation was the first class action in the history of the Packers & Stockyards Act. Professors Roger McEowen (Kansas State University), Peter Carstensen (University of Wisconsin College of Law), and Neil E. Harl authored the brief. These luminaries are experts in agricultural law, antitrust law and economics.
“This is one of the most important cases in agriculture today,” said Keith Mudd, OCM Vice President. “OCM and its members have been very active in supporting the Pickett plaintiffs, and the principle that markets should be open and competitive. Competition, not control, is what has made our country great. With the USDA controlled by meat packer interests, this principle must be protected in the courts.”
On February 17, 2004, a jury found that Tyson used captive supplies as a method to drive down the price of cash market cattle and awarded damages in the amount of $1.28 billion. On April 23, 2004, Federal Judge Lyle E. Strom overturned the verdict. The plaintiffs immediately appealed their case to the 11th Circuit Court of Appeals. The plaintiffs represent all cattle owners in the class who sold cash market cattle exclusively to Tyson Fresh Meats (formerly IBP) between February 1, 1994 and October 31, 2002.
In overturning the jury’s verdict Judge Lyle E. Strom did not dispute that captive supplies are anticompetitive and caused lower prices. However, Judge Strom said that Tyson had good reasons to do so. First, Tyson was justified in manipulating the market because the company could obtain a consistent and reliable supply of cattle through captive supplies. Further, the court said that the company needed to "meet the competition" because other meat packers were using captive supplies as a source during the same time period.
"The Packers & Stockyards Act was not passed to help the packers, it was passed to help producers in the face of packer market power," continued Mudd. "During the trial, Dick Bond, president of Tyson Fresh Meats and Jerry Hausman, Tyson’s paid expert, admitted that there was enough cattle in the cash marketplace to fill the company’s plants if they would merely bid higher. Additionally, we don’t think the 11th Circuit will agree that Tyson can break the law just because other companies break the law as well. We are confident that the 11th Circuit Court of Appeals will reinstate the jury verdict."
The Organization
for Competitive Markets (OCM) is a multidisciplinary, nonprofit group of
farmers, ranchers, academics, attorneys and policy makers dedicated to
reclaiming the agricultural marketplace for independent farmers, ranchers and
rural communities. OCM helps lead the
Cattlemen’s Competitive Market Project which is a voluntary contribution
program funding the effort to increase demand for U.S. cattle and beef in open
and competitive markets.