Farmer Loses Appeal in Tyson Contract Challenge

(CN) - A Tennessee poultry farmer failed to prove that Tyson Farms violated federal law by cancelling his contract after he joined a growers' association, the 6th Circuit ruled.

The Cincinnati-based federal appeals court rejected Alton Terry's bid to revive his lawsuit accusing the nation's largest poultry producer of violating the Packers and Stockyards Act (PSA) and the Agricultural Fair Practices Act of 1967 (AFPA).

Terry sued the company after it canceled a poultry-producing contract based on a series of run-ins over his right to be present while Tyson weighed his poultry. Terry said Tyson's actions were retaliatory, because he was actively involved in organizing the Tennessee Poultry Growers Association.

But U.S. District Judge Harry Mattice Jr. said "proof of injury to competition is a necessary element of a claim" under the PSA, while Terry focused only on how Tyson's actions harmed him as an individual grower.

The appellate panel agreed, citing a "tidal wave" of circuit rulings, including a recent 5th Circuit opinion finding that "the purpose of the Packers and Stockyards Act of 1921 is to protect competition and, therefore, only those practices that will likely affect competition adversely violate the Act."

Terry also claimed that Tyson violated the AFPA by "knowingly permitting its employee or agent to coerce and intimidate [him] in the exercise of his right to join and belong to an association of producers."

Again, Judge Mattice found that Terry had misconstrued the "plain language of the Act," ruling that the Tennessee Poultry Growers Association is not an "association of producers" because it does not engage in "marketing, bargaining, shipping, or processing" activities.

Terry argued that Mattice's reading of the Act was too "narrow," but the three-judge panel agreed with the federal judge.

The Tennessee Poultry Growers Association is an "organization principally involved with educating growers about their rights and assisting growers in the enforcement of those rights by reporting processors' violations to federal authorities," Judge Richard Griffin wrote for the panel.

"The fact that the [association's] educational and policing activities may have the incidental benefit of increasing the growers' bargaining power, as Terry posits, does not bring it within the AFPA's definition of 'association of producers.'"

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