Mid-Trial, ABC and Beef Producers Settle ‘Pink Slime’ Case

FILE – This March 29, 2012, file photo, shows the beef product that critics call “pink slime” during a plant tour of Beef Products Inc. in South Sioux City, Neb. Beef Products Inc. says the settlement reached with ABC in a $1.9 billion defamation lawsuit over the network’s reports on its lean, finely textured beef product provides a strong foundation on which to grow the business. The terms of the settlement announced Wednesday, June 28, 2017 are confidential. (AP Photo/Nati Harnik, File)

ELK POINT, S.D. (CN) – Wednesday morning in the basement of the Union County courthouse in small-town South Dakota, the presiding judge arrived at her bench and announced the two sides in a defamation case worth billions had reached a settlement after four weeks of trial.

And just like that, the nation’s largest ongoing defamation trial – and the most-watched event in a sleepy county courthouse in a town of 1,900 on an Oxbow of the Missouri River – was over.

The truncated trial revolved around the American Broadcasting Corporation’s news coverage of South Dakota-based Beef Products Inc.’s lean, finely textured beef – which ABC referred to as “pink slime.”

So far, the terms of the agreement have been kept under wraps. But witnesses watching the body language of attorneys leaving the courthouse lent some insight into who might have come out ahead.  Sioux City Journal reporter Nick Hytrek tweeted, “Mood of BPI team much more jovial than when ABC side left the building.”

ABC reporter, Jim Avila, whose March 2012 reports on lean, finely textured beef spurred the lawsuit, was defiant outside the courthouse.

“I think it’s important to note that we are not retracting anything,” Avila said. “We’re not apologizing for anything.”

On Tuesday, presiding Judge Cheryle Gering sent the jury home and suspended proceedings after announcing a “major legal issue.”

“Everyone was silent,” Nils “Jack” Grossman, a retired Minneapolis attorney and resident of Union County, who was a spectator in the courtroom, said in an interview. He said jurors, attorneys, BPI’s family ownership, Eldon and Regina Roth, and ABC reporter Jim Avila all dispassionately listened to the judge’s announcement.

The only detail made public by Gering was that part of the settlement included reimbursement to Union County for its expensive effort to upgrade the small courthouse to accommodate the trial.

The trial became a lightning rod for issues surrounding both the meat industry and freedom of the press, with some local observers recalling the mid-1990s when Texas cattlemen sued Oprah Winfrey for allegedly disparaging red meat during an episode on so-called mad cow disease. South Dakota is one of over a dozen states with agriculture disparagement laws, which makes defamation penalties related to its food products especially harsh. In the case of the current trial, ABC may have had to pay out triple damages if it had lost the case.

Sioux Falls media attorney Jon Arneson suggested in an interview that this law may appear overly friendly to farmers, ranchers, and food-producers, but that the hurdle BPI would have had to clear for victory wasn’t low.

The text of South Dakota’s 1994 law says “disparagement” is a statement the “disseminator knows to be false and that states or implies that an agricultural food product is not safe.”

In other words, BPI would have had to prove that Avila knowingly lied to suggest the harvested beef trim was not only unsavory, but unsafe for consumers.

Earlier testimony had suggested that Avila had been feisty with representatives of the beef industry who had defended LFTB back in 2012, at one point hanging up on an interviewee after yelling, “Fuck you.”

In light of Wednesday morning’s announcement, it’s unclear how the outcome of the case will affect the way news organizations cover such stories.

“A settlement does not establish a precedent,” said Arneson.

On Monday, plaintiffs brought Cleveland State University communications professor, Kimberly Neuendorf, to the stand to testify to the “unprecedented” campaign of negative news coverage the ABC News team heaped on BPI, comparing Avila’s series of reports to attention paid over wrongful deaths from food manufacturers. What was different, BPI’s attorneys said, was that LFTB never made anyone sick. Moreover, they contend, ABC’s popularization of its icky synonym, “pink slime” – first documented by United States Department of Agriculture officials in private memos back in the late 1990s – caused consumer panic in grocery stores across the country.

ABC wasn’t the first to cover LFTB. Years before, The New York Times and Washington Post had reported on the way the company harvested beef from “trim-streams” using centrifuges and cooling plates developed by company founder Roth. In 2011, before Avila’s broadcasts, McDonald’s and Burger King had already dropped LFTB from their hamburgers.

But ABC’s reports were the most destructive to the company’s business, according to BPI. Within two weeks, purchasers of the beef product–small and large meats distributors from New York to California–had stopped asking for beef.

One former executive at beef company JBS, Bill Rupp, said many buyers “specked it” out, meaning grocery chains asked that LFTB—usually comprising less than 15 percent of a ground beef mixture—no longer appear at all in the product. Soon, the Dakota Dunes-based beef processor closed all its plants except its operation in South Sioux City.

In the preceding weeks of trial, attorneys for BPI sought to show that not only was the much-maligned “pink slime” a safe product—using ammonia as a protective agent against E. coli—but also that it was wholesome and all-beef. They brought in a cadre of beef experts, from company executives to quality inspectors to college meat-team judges, all suggesting the flack suffered by LFTB resulted not from the product itself  but an unfair media storm.

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