A federal judge has dismissed with prejudice a lawsuit filed by Cody Easterday claiming Tyson Fresh Meats Inc. created a monopoly market in the Northwest and violated federal and state statutes.
U.S. District Judge Stanley Bastian in the Eastern District of Washington ruled Easterday does not have standing to sue Tyson on any of the claims as the contracts were between the company and Easterday Ranches, not Cody Easterday individually.
Lawyers for Easterday filed a suit against Tyson Fresh Meats Inc. in February 2023, alleging it created an anti-trust atmosphere where cattle feeders, including Easterday, had to contract with Tyson. Easterday claimed that he and Easterday Ranches for a decade were subject to being charged erroneous fees, interest and commissions in violation of federal and state law. The suit states Tyson violated the Packers and Stockyards Act of 1921, the Sherman Antitrust Act of 1890 and the Washington State Consumer Protection Act.
Complaint
Until the bankruptcy liquidation, Easterday Ranches operated three feedlots with a combined capacity of 75,000 head and also contracted with other feedlots under a 50/50 arrangement where both parties assumed the risk.
The suit stated that in the spring of 2010, Tyson changed the terms of the agreement and determined Easterday Ranches should bear 100% risk for any shortfall related to purchasing, feeding and delivery of cattle to Tyson’s Pasco, WA, processing plant. To minimize risk, Easterday Ranches had “the option to use (Tyson) CME contracts, both basis and actual basis, to help manage his risk.”
Between 2010 and 2020, both parties negotiated changes and amendments to the cattle feeding agreement. The suit claims Easterday “understood at the time he signed each agreement that he did not have the ability to negotiate with Tyson any of the terms or conditions of such agreements.”
The suit showed beginning in 2016 and until November 2020, Easterday submitted false invoices to Tyson under the cattle feeding agreement. On Dec. 7, 2020, Easterday agreed to transfer ownership of cattle owned by Easterday Ranches to Tyson.
The suit claimed Easterday thought Tyson owned the cattle at all times prior to delivery as part of the feeding agreement and that Tyson paid him an anticompetitive suppressed price due to Tyson’s exertion of a monopoly market.
“Plaintiff has suffered injuries as a result of Defendant’s actions, including but not limited to the loss of income that he would have received as President and owner of Easterday Ranches absent Defendant’s conduct, as well as damage to the value and forced liquidation of land comprising of his real estate and improvements, which were owned, in part, in Plaintiff’s personal capacity, and not by Easterday Ranches. Plaintiff has further suffered injury as a result of personal guarantees he was forced to undertake,” the suit read.
Tyson filed a motion to dismiss the case in April 2023, stating Easterday lacked standing to sue and that Easterday Ranches should bring the claims against the company.
However, Tyson continued that Easterday Ranches resolved any standings through bankruptcy proceedings following Easterday’s “criminal fraud scheme.” Easterday is serving an 11-year sentence after pleading guilty to one count of wire fraud.
Tyson said Easterday does not allege antitrust conduct and harm to competition under the statutes of the federal claims.
Ruling
Bastian ruled that Easterday did not personally contract with Tyson and that Easterday Ranches was the entity that suffered the direct injury. Bastian said if Easterday was allowed to assert antitrust claims, double recovery would be possible. Easterday would fall out of the zone to be protected by the statutes of the federal claims.
Bastain ruled that Easterday does not have standing in the district court to file federal claims because the court does not have subject matter jurisdiction and therefore will not exercise jurisdiction over the state claim.
Second suit
Easterday also filed a second lawsuit shortly after his conviction pending in the same court.
Easterday filed suit against Tyson Fresh Meats Inc., contending the company breached its contract to sell “Cody’s Beef” to Japanese consumers.
Easterday said that in 2013 the two parties agreed to use Easterday’s likeness to sell beef to the Japanese food processing company Nippon Ham under the “Cody’s Beef” label and they would share the risks and profits of supplying beef.
In April 2023, Bastian granted Tyson Fresh Meats Inc. a partial dismissal of the charges as lawyers for Easterday failed to provide enough essential details in the complaint showing where and who approached Easterday, and how and where the negotiations took place for the case to have merit in the Washington District Court.
Bastian allowed lawyers for Easterday to file an amended complaint, which was completed on May 5. The amended complaint included information dismissed previously.
Again, Tyson filed a motion to dismiss in June, claiming Easterday “treats a documented business deal between Tyson and Easterday Ranches as including an undocumented personal deal between Tyson and himself. He puts forward no facts to support that theory, and the new complaint includes writings that contradict it.”
A hearing is scheduled for November. — Charles Wallace, WLJ contributing editor
