A meat processor in eastern Idaho is alleged to have failed to pay clients for more than $2 million worth of cattle.
Intermountain Packing LLC of Idaho Falls, ID, is accused by Idaho companies Dry Creek Dairies LLC and Idaho Magic Milk LLC, as well as Washington-based Washington Agri-Investments LLC, of violating the Packers and Stockyards Act. The companies also contend Intermountain Packing breached their contract and engaged in unjust enrichment.
In an amended complaint filed in late November, the companies said they entered into a transaction involving the purchase and sale of livestock with Intermountain Packing between September and November 2023. In the transaction, it was agreed upon that Intermountain would pay the plaintiffs between $1.03 and $1.10 per live weight pound.
The plaintiffs said they delivered livestock in the 40-day time period that totaled a value of $2,148,749, but Intermountain Packing failed to make prompt payment. As a result, the processor engaged in anticompetitive practices and failed to maintain or provide required records, the complaint said.
After failing to pay by the close of the next business day following the deliveries, the companies said Intermountain issued three post-dated checks for livestock delivered on three occasions. The complaint said Dry Creek Dairies attempted to negotiate the checks, but each was dishonored due to stop payment requests by Intermountain. In mid-November, Dry Creek Dairies demanded that the items required to be held in trust be set aside to ensure they were paid for the livestock.
Intermountain Packing was also obligated to purchase an additional 528,597 live pounds of livestock but failed to do so, causing additional damage in that plaintiffs lost 33 cents per pound, the complaint said.
“Despite repeated demands, Defendants have failed, neglected and refused to pay Plaintiffs for the livestock delivered by Plaintiffs to Defendants or any amount for the damages caused by failing to fulfill its obligations to purchase Plaintiffs’ livestock,” the companies said.
“As a result of Defendants’ conduct, Plaintiffs have suffered damages, including but not limited to lost revenue, financial harm, and reputational injury,” the complaint finished.
In court documents dated Dec. 13, Intermountain Packing denied any wrongdoing.
“To the extent Plaintiffs have suffered any damages, those damages were the result of acts of other persons or entities not under Defendant’s control,” the company said in its response to the complaint.
Intermountain Packing also noted the plaintiffs’ claims were based on credit transactions, not cash sales, and as such, the plaintiffs are not entitled to protections under the Packers and Stockyards Act.
The court ordered the parties to meet and determine a litigation and discovery plan by Jan. 7. A scheduling conference was set for Jan. 14 to review deadlines set in the joint litigation plan.
Poultry antitrust claims settled
In related news, poultry processors and consulting companies recently settled for $180 million after being accused of antitrust claims, including allegations of depressing worker wages.
The settlements include: Allen Harim Foods LLC ($5 million), Amick Farms LLC ($6.25 million), Butterball LLC ($8.5 million), Fieldale Farms Corp. ($5.5 million), Foster Poultry Farms ($13.3 million), Jennie-O Turkey Store Inc. ($3.5 million), Koch Foods Inc. ($18.5 million), OK Foods Inc. ($4.75 million), Tyson Foods Inc. and Keystone Foods Inc ($115.5 million combined).
The settlements come following previously entered settlements in 2023 with additional brands.
“These nine settlements are the result of hard-fought, arm’s-length negotiations with sophistical counsel,” court documents read. “The result is a total settlement fund of $398.05 million, the second-largest recovery ever in a labor antitrust class action.”
The lawsuit alleged the processors conspired to suppress worker wages at processors, hatcheries, feed mills and complexes over a nearly 20-year period. The plaintiffs said the processors violated the Sherman Act by entering illegal agreements to fix compensation for workers and agreeing to exchange compensation information in violation of the rule of reason.
“In pursuit of those claims, Plaintiffs have vigorously litigated this case for more than five years, briefing multiple rounds of motions to dismiss and engaging in extensive discovery,” documents read.
All of the companies denied wrongdoing with the settlement. Agri Stats remains the only non-settled defendant remaining in the case. — Anna Miller, WLJ managing editor
