A federal court in Missouri has denied in part and granted in part the summary judgment motions filed by Texas and Louisiana rice farmers as well as the company they sued in the first group of cases in this multidistrict litigation (MDL) to be remanded to their transferor courts for trial. In re: Genetically Modified Rice Litig., MDL No. 1811 (E.D. Mo., decided February 1, 2011). The litigation involves claims that conventional U.S. rice farmers sustained market losses when other countries learned that the U.S. rice supply had been contaminated with a genetically modified (GM) rice variety and then prohibited all U.S. imports. To date, the company has lost a number of bellwether trials and has entered settlements with some purportedly affected farmers. Relying on previous dispositive rulings, the court dismissed the Louisiana plaintiffs’ claims under the North Carolina Unfair Trade Practices Act and their claims for punitive damages. The court allowed…
Category Archives 8th Circuit
The American Civil Liberties Union (ACLU) and National Association of Criminal Defense Lawyers (NACDL) have reportedly filed amicus briefs with the Eighth Circuit Court of Appeals, supporting the efforts of counsel for Sholom Rubashkin to overturn his conviction and sentence for financial fraud at his Iowa meat processing facility. The kosher plant was raided in 2008, 389 undocumented workers were arrested, and Rubashkin was initially charged with violating immigration laws. These charges were ultimately dropped, and a jury acquitted him of hiring underage workers. Prosecutors then aggressively pursued charges that he falsified bank records to inflate sales and diverted customer payments for personal use, and he was found guilty on 86 counts in November 2009. The court sentenced Rubashkin to 27 years in prison, a term longer than recommended by prosecutors. While the ACLU and NACDL reportedly focus their briefs on accusations that the sentencing court improperly cooperated with prosecutors…
Northeast dairy farmers have reportedly settled their price-fixing claims against Dean Foods Co. for $30 million and injunctive relief requiring the company to buy a portion of its raw milk from multiple sources. Allen v. Dairy Farmers of America, No. __ (D. Vt., settlement reached December 24, 2010). While the agreement requires court approval, it would reportedly allow some 5,000 to 10,000 farmers to file claims for monetary damages over allegations that Dean Foods would buy milk only through Dairy Farmers of America (DFA) and its affiliates in the region. According to counsel for the plaintiffs, the case will continue against DFA, to resolve claims that “the nation’s largest cooperative monopolized a level of distribution of fluid milk in the Northeast and forced dairy farmers to join DFA or its marketing affiliate [Dairy Marketing Services] to survive.” See DairyLine.com, December 24, 2010; Worcester Business Journal, December 27, 2010; and Burlington…
A company that makes name- and store-brand food products, including cereals, granola products, pastas, and bakery goods, has sued the supplier of soybean food ingredients allegedly contaminated with Salmonella, seeking in excess of $7 million in damages. Ralcorp Holdings, Inc. v. Thumb Oilseed Producers’ Coop., No. 10-1898 (E.D. Mo., filed October 8, 2010). According to the complaint, the companies contracted for the purchase of the defendant’s soy grits under an agreement that guaranteed they would be suitable for human consumption and that the defendant would indemnify and pay damages to the plaintiff for any warranty breaches. Plaintiff Ralcorp Holdings alleges that it incorporated most of the soy grits into its products, specifically granola bars and trail mixes, for sale to a number of retail companies with which Ralcorp had also contracted. Before delivering the final products, Ralcorp claims that it discovered the soy grit ingredient “was, and had been at…
The Eighth Circuit Court of Appeals has affirmed the dismissal of one defendant and several claims in multidistrict litigation (MDL) alleging that a dairy certified as organic and the retailers selling its milk violated state deceptive trade practices laws because the dairy did not comply with national organic program standards. In re: Aurora Dairy Corp. Organic Milk Mktg. Sales Practices Litig., No. 09-2762 (8th Cir., decided September 15, 2010). While finding express and conflict preemption as to those matters dismissed, the court also determined that some claims could survive, depending, on remand, how the district court rules on defendants’ motions to strike the consolidated class complaint and the plaintiffs’ motion to amend that complaint. Dismissed outright from the 19 consolidated putative class actions was the company that certified Aurora Dairy as an organic supplier. According to the court, “to the extent state law permits outside parties, including consumers, to interfere…
Lawyers for Sholom Rubashkin, who was recently sentenced to 27 years in prison for financial fraud discovered in connection with a kosher meatpacking plant in the aftermath of a 2008 raid to find illegal immigrants, have alleged trial-court improprieties in their request for a new trial. U.S. v. Rubashkin, No. 08-1324 (N.D. Iowa, filed August 5, 2010). According to Rubashkin’s motion, the federal district court occupied temporary space near the plant so that the 300-plus undocumented workers arrested in the raid could be processed the following day. This raised the issue of Judge Linda Reade’s prior involvement with prosecutors. “Indeed, Chief District Judge Linda Reade stated in September 2008 in a written opinion that she engaged in purportedly limited ‘logistical cooperation’ with law-enforcement authorities in order to provide attorneys and interpreters for the arrested aliens and to conduct their trials in Waterloo.” To the contrary, Rubashkin claims, eight months after…
According to news sources, a St. Louis jury has awarded more than $500,000 to a Louisiana farmer who alleged that when the U.S. rice supply was contaminated in 2006 with a genetically modified (GM) crop that was somehow released from testing facilities, he lost $1.5 million due to lost sales abroad. In re: Genetically Modified Rice Litig., MDL No. 1811 (E.D. Mo.). The lawsuit is the third to reach trial of more than 500 consolidated before a multidistrict litigation court in eastern Missouri; it marks the third loss in federal court for the defendant, which is facing more than $52 million in jury awards. Two state trials also resulted in plaintiff verdicts. While the defendant has not apparently disputed the contamination, it has denied that it was negligent and contends that rice sales recovered shortly after the initial plunge. See Bloomberg Businessweek and Post Dispatch, July 14, 2010.
The former manager of an Iowa-based kosher meatpacking plant that was raided by immigration authorities in 2008 has reportedly been sentenced to 27 years for financial fraud and ordered to pay $27 million in restitution. While the initial case against Sholom Rubashkin involved the hiring of hundreds of illegal immigrant workers, prosecutors apparently changed their focus to his alleged mishandling of loans that led to bank losses of $26 million. The presiding federal judge reportedly released a 52-page memorandum in advance of the sentencing hearing to explain her decision. The sentence, two years longer than requested by prosecutors, has generated controversy given the relatively lighter sentences meted out to corporate officials responsible for greater frauds in recent years. Six former U.S. attorneys general submitted a letter to the judge supporting a lighter prison term. Rubashkin’s lawyers have indicated that they will appeal the sentence. See The New York Times, June…
A number of Minnesota-based apple growers have filed a complaint against the regents of the University of Minnesota and others claiming that exclusive and limited licensing agreements pertaining to the cultivation and sale of a new apple variety violate federal and state competition and restraint of trade laws. Aamodt Apple Farm, Inc. v. Regents, U. Minn., No. __ (Minn. Dist. Ct., Hennepin Cty., filed June 16, 2010). According to the complaint, the SweeTango®, a cross between the Honeycrisp™ and Zestar!™ varieties, was developed with the use of state funding through the university’s apple-breeding program. One grower allegedly has an exclusive license to grow the apple and may license others to grow it on its behalf. The agreements allegedly limit the number of trees that can be planted and where and how the apples can be sold. The plaintiffs allege unreasonable restraint of trade in commerce; establishment, maintenance and use of a…
A Missouri resident has filed a complaint in federal court against Kraft Foods Inc., alleging that it has been marking its Kool-Aid® and Country Time Lemonade® drink mix packages with the U.S. patent numbers for container patents that expired in April 2008. Brown v. Kraft Foods Inc., No. 10-1007 (E.D. Mo., filed June 1, 2010). Claiming that the marking violates 35 U.S.C. § 292, the plaintiff seeks injunctive relief, “a civil monetary fine of $500 per false marking offense,” costs, attorney’s fees, and interest. This litigation is one of a recent crop of false marking lawsuits to which the Federal Circuit Court of Appeals apparently opened the door when it ruled that the penalty could be imposed under the law on a per unit basis. Shook, Partner Peter Strand is focusing on false marking issues in his May and June IpQ newsletters. The May issue can be accessed here.
