AFF Sentinel Vol.6#24

What Is Unfair, Unreasonable, Undue & Unjust to Get Butler's Scrutiny, New Definitions from Plaintiff's Perspective

J. Dudley Butler was a plaintiff's attorney, suing packers, in his past life. Now, he's suddenly the enforcer of the Packers & Stockyards Act as USDA- GIPSA Administrator. And he's brought along his frustrations with the Act.

Speaking at the Organization for Competitive Markets' conference in St. Louis - a group generally opposed to corporate agriculture -- Butler finally revealed his battlefield: Sect. 202 (a) & (b).*

"When you have a term like 'unfair' or `unreasonable' or `undue prejudice,' that's ... a plaintiff lawyer's dream," Butler said. "If we can get in front of a jury on that, we don't get thrown out on what we call summary judgment because that's a jury question," he explained.

"The real thing now, to try to solve the problem quicker, is not only to address the market issues, but to try to define some of those terms, to put parameters around them, about what you can do, what the company can't do, what has to happen in the marketplace. We're developing rules that deal with problems in the marketplace across the board."

What Butler didn't mention was past Congressional attempts to use (a) and (b) to ban all contracts between packers and producers beyond 7- 14 days, effectively eliminating alliances or branded programs.

"From the production agriculture standpoint - GIPSA -- I am going to enforce the Packers & Stockyards Act!" Butler thundered. "I want the federal judges in New Orleans to hear me, that in the Wheeler case, that they got it right the first time! The three judges got it right. We don't need 15 judges looking over their shoulders."

The Wheeler case Butler referenced was a poultry grower lawsuit originally filed against poultry processor Pilgrim's Pride. Contrary to circuit court rulings for decades, the Wheeler case opinion held the P & S Act did not require plaintiffs to prove that the actions of a packer had adverse effects on competition. While many lawsuits require proof the plaintiff has been damaged, some activists somehow feel the livestock industry is different, that proof of harm to competition shouldn't be required. Others feel allowing lawsuits because someone feels damaged but requiring no proof of damage is inviting hundreds of dubious lawsuits.

Beyond that, a critical difference is the Wheeler case involved a grower contract available to one individual but unavailable to other growers. That is not the case, e.g. cattle contracts, which are available to anyone meeting the quality and/or "natural" specifications. Butler, however, sees the plaintiff's side as paramount, making no mention of effects on quality, price and availability to the consumer. He's evidently unhappy the Supreme Court is reviewing the Wheeler case.

"We want to be able to protect one farmer or ten farmers or 100 farmers," Butler said. "But there's absolutely no way in the world -- if you've got one man that has been mistreated, how can you prove that it had an adverse effect on the economy or adverse effect on competition? You can hire all the economists in the world and they can't prove that. That's not what the P&S Act is about."

Butler took pains to explain that (a) and (b) are "remedial." Dictionary meaning: granting the power to fix things.

"And I hope they hear me and I hope they put it in the newspaper."

"I am a big believer in balance and consistency. If we want the industries to survive long haul, it has to be balanced. We know that we have an imbalance of power in some of the industries now."

"I use this analogy when it comes to vertical integration. The herd is stampeding toward the cliff. There is not enough time to turn the herd in poultry. The hog industry is getting closer to the cliff but I think we still can turn the herd. With the cattle industry, it's a little bit further back."

"We want value added agriculture, as you do. We want you to produce the best product you can, just like you want to."

We'll have to see Butler's proposed regulations. Other attempts to "fix" livestock marketing eliminated the packer anchoring contracts for alliances and branded programs providing quality and natural beef. Some attempted to prohibit Americans from owning both cattle and packing plants, fiats that would disadvantage one class of citizen, drive the price of feeder cattle down and drain equity from the feeding segment.

What Butler the plaintiffs' lawyer exploited as undefined, could be exactly what he wants to lock in against modern agriculture now.

*P &SA, Sect. 202 states that it is unlawful for any packer ...to [emphasis ours] (a) engage in or use any unfair, unjustly discriminatory, or deceptive practice or device; or (b) Make or give any undue or unreasonable preference or advantage to any particular person or locality in any respect, or subject any particular person or locality to any undue or unreasonable prejudice or disadvantage in any respect;

Next time: More Butler Philosophy & USDA's New Themes

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