Growers take Pilgrims Pride to federal court

Tuesday, June 14, 2011 - 2:19pm

FROM THE LONGVIEW NEWS-JOURNAL:

Longview, TX — Pilgrims Pride is headed to court Thursday in a federal lawsuit filed by former chicken-growers.

The lawsuit is a combination of two 2009 complaints filed by the city of Clinton, Ark., and Shelia and James Adams, who own or have owned 368 poultry farms in Arkansas, Oklahoma, Louisiana and Texas, including in Nacogdoches and Mount Pleasant. The lawsuits were originally filed in federal bankruptcy court, but a Fort Worth federal court consolidated the cases and moved the venue to Marshall.

Pilgrims has denied it violated the federal Packers and Stockers Act.

A bench trial before U.S. District Judge Charles Everingham is scheduled to begin at 9 a.m. Thursday at the federal courthouse in Marshall.

Formerly headquartered in Pittsburg, Pilgrim’s Pride filed bankruptcy in 2008. It emerged from bankruptcy in late 2009 after selling a majority stake to Brazilian meat producer JBS USA. Company headquarters was moved from East Texas to Greeley, Colo., in 2010.

The lawsuits allege Pilgrims violated the Packers and Stockers Act through its plan to manipulate the price of chicken, its creation of an insider system of advantages and its retaliation for and termination of growers who refused to continually make capital investments in their facilities.

“Pilgrims has repeatedly, falsely claimed that its economic troubles were the result of a sort of ‘perfect storm’ for the poultry industry, a condition in which high feed prices, low demand and high debt combined to force it to seek Chapter 11 protection,” the plaintiffs’ attorneys wrote in the complaint. “However, a review of its recent actions toward its growers reveals a far different factual history, and that more accurate history is best summarized as a series of attempts to manipulate chicken prices and create illegal preferences, all at the growers’ expense.”

Read the full story here.
 

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