Court reaffirms ruling on Tyson cattle contracts

MONTGOMERY, Ala. (AP)--A federal appeals court Aug. 16 upheld a ruling that reversed a landmark price-fixing verdict against the nation's largest beef packer.

The 11th U.S. Circuit Court of Appeals in Atlanta unanimously affirmed a June 2004 ruling by U.S. Senior District Judge Lyle Strom, who threw out a jury's finding that Tyson Fresh Meats Inc. used contracts with a select few beef producers to manipulate cattle market prices.

"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," Tyson Foods Inc.'s chairman and CEO, John Tyson, said Aug. 16 in a statement.

In their June 2004 appeal, the cattlemen asked the 11th Circuit to find that the jury based its decision on a reasonable review of the evidence.

The appeal pointed out that in another case, the 11th Circuit found that it "is the jury's task--not ours--'to weigh conflicting evidence and inferences, and determine the credibility of witnesses.' If reasonable jurors could reach different results, we must 'not second-guess the jury or substitute our judgment for its judgment."'

Strom had said the six cattlemen failed to show sufficient evidence against Tyson. The 11th Circuit agreed, rejecting the cattlemen's appeal to reinstate the verdict that the packer damaged prices in the cash market by $1.28 billion over eight years. The jury had ordered Springdale, Ark.-based Tyson to pay that amount.

The cattlemen, who sued Tyson in 1996, "did not present any evidence from which a reasonable jury could conclude that Tyson lacked pro-competitive justification for using the agreements" with the selected beef producers, the appeals court said in its 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," the court said.

Date: 8/24/05