Pilgrim’s Pride Corporation says it will appeal a ruling by a federal magistrate judge that awards more than $25 million to growers formerly associated with the company’s processing plant in El Dorado, Arkansas, which it closed in 2008. Magistrate Judge Charles Everingham IV in the Eastern District of Texas ruled that the company’s actions in closing the plant were contrary to the federal Packers & Stockyard Act.

“We’re disappointed in the court’s findings, and we don’t find them consistent with the Packers & Stockyards Acts,” said Bill Lovette, president and CEO of Pilgrim’s Pride.  “We completely reject the idea that we tried to manipulate the market. We tried to live in the market, not manipulate it.”

About 90 growers joined in the lawsuit against Pilgrim’s, and the judge awarded damages ranging from less than $50,000 to more than $700,000 to various plaintiffs.  The judge said it was difficult to determine the appropriate amount of damages.

“Although the court finds that these plaintiffs suffered damages in fact,” the judge wrote, “the court has had more difficulty estimating the amount of their damages with reasonable certainty.”

Pilgrim’s had filed for bankruptcy when it closed the plant.  Everingham cited an email from the chief restructuring officer, William Snyder, discussing the implications of allowing another entity to operate the plant. The email showed that the company “expected that the idling of El Dorado would materially affect the national supply of commodity chicken and would result in an upward price adjustment,” Judge Everingham wrote.

 

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