MONTGOMERY, Ala., Aug. 16 /PRNewswire-FirstCall/ -- A U.S. appeals court
has unanimously upheld a ruling that clears Tyson Fresh Meats, Inc., a
subsidiary of Tyson Foods (NYSE: TSN), of any wrongdoing in a long-running
cattle pricing lawsuit, the company reported today.
The 11th Circuit Court of Appeals has affirmed Judge Lyle Strom's decision
last year to reverse a jury verdict against Tyson. Both the appeals court and
Judge Strom found that Tyson did not violate the law through its supply
agreements with independent cattle producers and Tyson has legitimate business
reasons for entering into such agreements.
The plaintiffs, who prefer the sale of cattle through daily negotiated
cash markets, had claimed Tyson used cattle marketing agreements to manipulate
the price of cattle, and asked the federal courts to enjoin the use of
marketing agreements. After losing in district court, the plaintiffs appealed
to the 11th Circuit, which heard oral arguments late last year in Montgomery,
Alabama.
According to the appeals court ruling, "The evidence is undisputed that
marketing agreements provide a more reliable and stable supply of cattle for
meat packers, reduce their transaction costs for purchasing cattle, and allow
them to better match price to actual quality and yield."
"While talk about the independence of cattle farmers has emotional appeal,
the PSA (Packers and Stockyards Act) was not enacted to protect the
independence of producers from market forces," the appeals court judges wrote.
Cattle producers, such as the plaintiffs, "are entitled to their preferences,
but they are not entitled to force those preferences on other producers and on
the packers."
"We're extremely satisfied by this decision, which protects the freedom of
U.S. producers to market cattle the way they want and proves our livestock
buying practices are proper," said John Tyson, chairman and CEO of Tyson
Foods.
"Thousands of producers prefer to sell cattle through marketing
agreements, rather than in the cash market," Tyson said. "This ruling allows
them to continue this practice, which they believe is more efficient and
rewards them for raising cattle that produce the beef consumers demand."
The Washington and Chicago offices of Sidley Austin Brown and Wood
represented Tyson Foods in this litigation.
Tyson Foods, Inc., founded in 1935 with headquarters in Springdale,
Arkansas, is the world's largest processor and marketer of chicken, beef, and
pork and the second-largest food company in the Fortune 500. The company
produces a wide variety of protein-based and prepared food products, which are
marketed under the "Powered by Tyson(TM)" strategy. Tyson is the recognized
market leader in the retail and foodservice markets it serves, providing
products and service to customers throughout the United States and more than
80 countries. Tyson has approximately 114,000 Team Members employed at more
than 300 facilities and offices in the United States and around the world.
SOURCE Tyson Foods, Inc.
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Related links:
http://www.tyson.com
CONTACT:
Gary Mickelson of Tyson Foods, Inc.,
+1-479-290-6111
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