Case Summary Archive - 2003
This Archive contains case summaries posted from January 1, 2003, through December 31, 2003. For more recent postings, go to Case Summaries.
Index
Administrative Law
D.C. Circuit Vacates EPA Directive Issued in Press Release
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by pesticide manufacturers and a trade association against the Environmental Protection Agency ("EPA") challenging a directive that was issued by the EPA in a press release providing that the EPA would no longer consider or rely on third-party human studies when evaluating pesticide safety, the United States Court of Appeals for the District of Columbia vacated the directive because it constituted a binding regulation that should not have been issued without a notice of proposed rulemaking and opportunity for public comment. CropLife America v. E.P.A.
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Posted: Aug. 2003
Applicants Not Allowed to Collect Fees and Costs Under EAJA
Lynn Cox
National AgLaw Center Research Assistant
In an action for attorney's fees brought by loan applicants against the United States Department of Agriculture, the United States Court of Appeals for the Eighth Circuit has ruled that the Equal Access to Justice Act (EAJA) did not allow recovery for both attorney's fees and agent's fees. Lane v. U.S. Dept. of Agric. The court also concluded that the judicial officer did not abuse his discretion by not allowing fees that accrued before the date of denial of the delinquent loan servicing applications.
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Posted: July 2003
Agriculture and Urbanization
County Ordinances Governing Hog Farms Invalidated
Randal Busby
National AgLaw Center Research Assistant
An individual and an agribusiness association brought an action challenging two county ordinances, as well as rules issued by the county board of health, that regulated the operation, construction, and expansion of swine farms. Craig v. County of Chatham. The Supreme Court of North Carolina held first that the county's swine ordinance and enforcement rules were preempted by state law because the county board of health did not demonstrate that the more stringent regulations were required to protect public health and second that the county's amended zoning ordinance for swine farms was invalid because it stemmed from the preempted swine ordinance.
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Posted: Dec. 23, 2003
Hog Feedlot Owners' Due Process and
Takings Claims Dismissed
Ursula T. Ransburg
National AgLaw Center Research Fellow
Landowners brought an action against the owners of a neighboring hog feedlot, the corporation that owned the pigs grown at the feedlot, the county board of commissioners that allowed the feedlot to be constructed, and a county official. Overgaard, et.al. v. Rock County Board of Commissioners. The landowners alleged that the county violated 42 U.S.C. § 1983 and their rights to substantive and procedural due process when the county allowed the feedlot to operate, requested declaratory relief, and raised claims for nuisance, trespass, negligence, and inverse condemnation. The United States District Court for the District of Minnesota rejected the plaintiff landowners' § 1983 claim, holding that they did not have a constitutionally-protected property interest created under state law that was needed to maintain a § 1983 claim. The court also dismissed the plaintiff landowners' state law claims with prejudice, finding that those claims should be handled by a state court.
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Posted: Dec. 10, 2003.
Ordinance Enacted to Preserve Agricultural
Lands and Activities Invalid
Harrison M. Pittman
Staff Attorney
In an action brought by a property owner seeking review of a zoning board's decision to deny his challenge to the constitutionality of a zoning ordinance that restricted development of single-family detached housing in agricultural areas, the Supreme Court of Pennsylvania has reversed the zoning board's decision. C & M Developers, Inc. v. Bedminster Tp. Zoning Hearing Board. The court ruled that although the township could, pursuant to its police power, enact an ordinance designed to protect its agricultural lands and activities, the zoning board abused its discretion when it determined that the ordinance was reasonable and substantially related to the township's interest in protecting its agricultural lands and activities. See id. at 155-56. It also ruled that when read as whole, the ordinance unreasonably infringed upon the property owner's constitutional right to freely use and enjoy his property.
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Posted: Aug. 29, 2003
Neighbors Prevail in Private Nuisance Action
Against Owners of Dairy Farm
Harrison M. Pittman
Staff Attorney
Two property owners brought a private nuisance action against operators of a dairy farm located less than one-third of a mile from the owners' property. Pestey v. Cushman, 788 A.2d 496, 500 (Conn. 2002). The trial court ruled in favor of the plaintiff-property owners. See id. 499-500. The Supreme Court of Connecticut affirmed the trial court's decision, ruling that the trial court properly instructed the jury with respect to the necessary elements of a claim for private nuisance and that the trial court properly admitted testimony from one of the property owners that the decline in the value of his property was due to the offensive odors produced by the operators' dairy farm. See id. at 502-09. It also ruled that the property owners established the foundation necessary to qualify a waste management handbook as a learned treatise with respect to the issue of odor control and that the evidence presented at trial supported the jury's determination that the dairy farm was the proximate cause of the property owners' loss of enjoyment of their property.
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Posted: Aug. 29, 2003
Permanent Injunction that Enjoined Irrigation Practices Reversed
Lynn Cox
National AgLaw Center Research Assistant
In an action brought by landowners against neighboring landowners for negligence, nuisance, trespass, and seeking injunctive relief because their home suffered flood damage, allegedly as a result of their neighbors' irrigation practices, the Montana Supreme Court held that the district court abused its discretion when it imposed a permanent injunction enjoining the neighboring landowners from continuing their irrigation practices when the district court's own findings and conclusions were that the plaintiffs' flood irrigation practices were lawful. Wells v. Young.
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Posted: Aug. 27, 2003
Idaho Courts Have Jurisdiction Over Out-of-State Corporation
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by a resident of the State of Idaho against a Washington farming operation alleging that her respiratory difficulties were caused by the farming operation's grass burning activities, the Idaho Supreme Court has held that the alleged tortious conduct on the part of the Washington farming operation within the state of Idaho was sufficient to subject it to personal jurisdiction in Idaho. McAnally v. Bonjac, Inc.
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Posted: July 7, 2003
Developer Not Stopped by Ag Preservation District
Randal Busby
National AgLaw Center Research Assistant
In an action involving a developer that was in the process of obtaining a permit for a housing development project when an adjacent parcel of land was approved as an agricultural preservation district which, pursuant to the Delaware Agricultural Lands Preservation Act (the "Act"), required the developer to abide by a setback requirement in constructing the housing development, the Supreme Court of Delaware has ruled that the developer's good faith pursuit of all of the necessary steps to secure permits for the development precluded, as a matter of law, the development from being characterized as a "new subdivision development" subject to the setback requirement under the Act. In re 244.5 Acres of Land.
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Posted: June 12, 2003
Farmer Granted Conditional Use Permit To Develop Land
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by several landowners challenging a county board of commissioner's decision to grant another landowner a conditional use permit that allowed the landowner to divide his farmland into residential lots, the Idaho Supreme Court has ruled that the proposed development was in harmony with the county's comprehensive plan and applicable statutes, and therefore affirmed the county board of commissioner's decision. Whitted v. Canyon County Board of Com'rs.
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Posted: June 6, 2003
Farmer's Due Process Rights Violated by County Board
Harrison M. Pittman
Staff Attorney
In an action brought by a farmer challenging a county board's determination that he operated an unauthorized "junkyard" when he maintained a bushhog, a bulldozer, a crane, and other equipment outdoors on his farm, the Florida Court of Appeals for the Fifth District has ruled that the county board violated the farmer's due process rights when it refused to allow the farmer to present certain evidence at his hearing. Kupke v. Orange County.
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Posted: June 3, 2003
Not All Plaintiffs Required to Mediate in Nuisance Action
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by several plaintiffs against a hog farm and its operators in which some, but not all, of the plaintiffs participated in pre-litigation mediation, the North Carolina Court of Appeals has ruled that the plaintiffs who did not participate in the pre-litigation mediation were not subject to dismissal because they had not participated in the mediation. Powell v. Bulluck.
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Posted: May 28, 2003
Valuation of Farm Equipment Allowed In Takings Action
M. Elizabeth Skinner
National AgLaw Center Graduate Assistant
In an action brought by a regional water authority to condemn a tract of land so that it could construct a city water project, the North Carolina Court of Appeals has ruled that expert testimony regarding the value of certain farming equipment located on the property was properly allowed and that the jury verdict with respect to just compensation for the taking was not an unlawful compromise or quotient verdict. Piedmont Triad Regional Water Authority v. Lamb.
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Posted: April 28, 2003
Conditional Use Permit For Hog Operation Denied
Brian J. Oakey
National AgLaw Center Graduate Assistant
In an action brought by a farmer seeking judicial review of a county board of commissioners' decision to deny him a conditional use permit that would have allowed him to construct two large hog farming operations, the South Dakota Supreme Court has ruled that there was sufficient evidence to support the denial of the farmer's conditional use permit application. In re Conditional Use Permit Denied to Meier.
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Posted: April 15, 2003
Ordinance Related To County's Police Powers
John D. Mead
National AgLaw Center Graduate Assistant
The Kentucky Court of Appeals has held that a county ordinance that set forth restrictions with respect to the construction and operation of poultry facilities was properly enacted under the police powers granted to the county under Kentucky law. Upchurch v. Cumberland Co. Fiscal Ct. The action was brought by poultry farmers who purchased land for the purpose of constructing a new poultry facility prior to the county's enactment of the ordinance at issue.
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Posted: April 15, 2003
Retroactive Application of Right to Farm Law Denied
Sean Brister
National AgLaw Center Graduate Assistant
In a private nuisance action brought by a business owner against a neighboring grain elevator, the Supreme Court of Nebraska has refused to retroactively apply amendments to the state's right to farm statute that became effective more than a year after the filing of the action and would have exempted the grain elevator from such a nuisance suit. Soukop v. ConAgra, Inc. The court determined that the amendments could not be retroactively applied because the state legislature did not clearly express the intention that the amendments be applied retroactively.
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Posted: April 15, 2003
County Board's Grant Of Permit For CAFO Affirmed
John D. Mead
National AgLaw Center Graduate Assistant
The Minnesota Supreme Court has held that a county board of commissioners' grant of a conditional use permit ("CUP") for a confined hog-feeding operation was not unreasonable or arbitrary, and that it was the responsibility of the county zoning department to enforce a half-mile setback provision set forth in the county ordinance at issue. Schwardt v. County of Watonwan.
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Posted: April 15, 2003
Development Company Granted Permanent Injunction
Brandy L. Brown
National AgLaw Center Graduate Assistant
In an action brought by a development company against two homeowners seeking to have the homeowners enjoined from maintaining poultry of any kind on their property, the Superior Court of Pennsylvania has granted the development company's request for a permanent injunction. Buck Hills Falls Company v. Press. The court reversed the trial court's decision and remanded the matter for the trial court to consider whether development company was allowed to recover attorney's fees.
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Posted: April 7, 2003
Stray Voltage Ruled to be a Nuisance
Sean Brister
National AgLaw Center Graduate Fellow
In a nuisance action brought by two Iowa dairy farmers against an electric utility company for their dairy herd's alleged exposure to stray voltage produced by the utility's transmission lines, the Iowa Supreme Court has ruled that the farmers could maintain their action even though it was based solely on a nuisance theory and was not accompanied by a claim for negligence. Martins v. Interstate Power Company. The court ruled that in stray voltage cases a nuisance claim does not have to be predicated on a negligence claim because of the inherent degree of danger likely to result in damage.
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Posted: Mar. 14, 2003
Farmer Held Not Liable For Irrigation Runoff
John D. Mead
National AgLaw Center Graduate Assistant
In an action brought against a farmer by a residential developer who suffered damages resulting from irrigation runoff from the farmer's operation, the California Court of Appeals has upheld a trial court's entry of summary judgment and its application of § 3482.5 of the California Civil Code, a statute which exempts farming activities from nuisance lawsuits when the requisite elements of the statute have been satisfied. Rancho Viejo, L.L.C. v. Tres Amigos Viejos, L.L.C.
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Posted: Feb. 3, 2003
County's CAFO Ordinance Upheld
Patricia Farnese
National AgLaw Center Graduate Fellow
The Idaho Supreme Court has ruled that a county's concentrated animal feeding operation ("CAFO") ordinance was not void, even though a County Commissioner that participated in the enactment of the ordinance had a conflict of interest as defined under Idaho state law. Gooding County v. Wybenga. The court held that the adoption of the ordinance was not tainted by the Commissioner's conflict of interest because the ordinance was ultimately enacted "sufficiently independent" of the Commissioner's involvement. The matter was remanded for further consideration.
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Posted: Feb. 3, 2003
Idaho Supreme Court Upholds CAFO Ordinance
Jay Kiiha
National AgLaw Center Graduate Fellow
The Idaho Supreme Court has held that a trial court did not have the authority to invalidate a county ordinance involving a concentrated animal feeding operation ("CAFO") on a petition for judicial review because the petition did not include a claim for declaratory relief. Scott v. Gooding County.
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Posted: Feb. 3, 2003
Ag Torts
Defective Combine Not Unreasonably Dangerous
Randal Busby
National AgLaw Center Research Assistant
A farmer brought a product liability action against the manufacturer of a combine that the farmer used to harvest grain, alleging that the combine experienced a malfunctioning defect when it failed to properly separate, collect, and store seed after cutting it from the stalks. Russell v. Deere & Co. After the trial court granted summary judgment in favor of the manufacturer, the farmer appealed to the Oregon Court of Appeals. The Oregon Court Appeals held that the allegedly defective was not unreasonably dangerous to persons or property, as is required to maintain a product liability claim under Oregon law.
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Posted: Nov. 20, 2003
Bankruptcy
Farmer-Debtors Not Allowed to Avoid FSA Lien
in Farming Equipment and Machinery
Gaby R. Jabbour
National AgLaw Center Research Assistant
In In re Henke, the United States Bankruptcy Court for the District of North Dakota held that farmer-debtors could not avoid a lien held by the Farm Service Agency ("FSA") on certain farm equipment and machinery because the debtors failed to demonstrate that the property constituted "tools of the trade" pursuant to Bankruptcy Code § 522(f).
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Posted: Dec. 23, 2003
Farmer's Rental Income Does Not Affect Status as "Family Farmer"
Harrison M. Pittman
Staff Attorney
In In re Maynard, the United States District Court for the Southern District of New York held that a debtor qualified as a "family farmer" because he was engaged in a farming operation and the rental income he received from a corporate entity constituted farm income.
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Posted: Dec. 23, 2003
Debtor Lacked Intent to Harm Lender
John D. Mead
National AgLaw Center Research Fellow
An agricultural lender brought an adversary proceeding seeking to except a debt from discharge when the debtor converted the lender's collateral in violation of the terms of a written agreement between the lender and the debtor. In re Bennett. The United States Bankruptcy Court for the Central District of Illinois ruled that although the debtor's failure to read or understand the parties' agreement may not have protected the debtor from a breach of contract claim, it did preclude a determination that the debtor acted with intent to harm the lender or deprive the lender of its property rights.
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Posted: Dec. 10, 2003.
Chapter 12 Debtor's Confirmed Plan Vacated
Lynn Cox
National AgLaw Center Research Assistant
In an action brought by a creditor seeking to have vacated a debtor's confirmed Chapter 12 bankruptcy plan, the United States Bankruptcy Court for the Central District of Illinois has ruled that the debtor's confirmed plan should be vacated even though the creditor failed to appear and object to the debtor's plan at the confirmation hearing. In re Hunt.
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Posted: Nov. 20, 2003.
Disaster Payment Not Considered Property of the Estate
Gaby R. Jabbour
National AgLaw Center Research Assistant
The United States Bankruptcy Court for the District of Idaho has ruled that a postpetition disaster relief payment received by two Chapter 12 debtors was not property of the bankruptcy estate because the program authorizing the disaster payment did not exist at the time the debtors filed their bankruptcy petition. In re Stallings.
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Posted: Aug. 29, 2003
Debtors Not Engaged in Farming Operation at Confirmation Eligible for Chapter 12
Gaby R. Jabbour
National AgLaw Center Research Assistant
The United States Bankruptcy Court for the District of Idaho has ruled that debtors who were actively engaged in dairy farming and were eligible for Chapter 12 relief on the date their petition was filed did not lose eligibility because they no longer operated their dairy farm at the time of the confirmation hearing. In re Nelson. The court interpreted the phrase "engaged in a farming operation" contained in 11 U.S.C. § 101(18) to require only that "a debtor be farming at the time of filing . . . where there is an indication that a debtor has temporarily ceased farming activity during the pendency of the bankruptcy case, but intends to return to active farming operations when financially able to do so."
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Posted: Aug. 29, 2003
Farmer Status Is an Affirmative Defense That Might Be Waived
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by a debtor alleging that the bankruptcy court did not have jurisdiction over him because an involuntary bankruptcy petition cannot be brought against a farmer, the United States Court of Appeals for the Fifth Circuit has held that an individual's status as a farmer does not go to the jurisdiction of the bankruptcy court over an involuntary bankruptcy petition but instead is an affirmative defense that may be waived. In re McCloy.
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Posted: July 7, 2003
Court Affirms "Tools of Trade" Exemption for Wife
Randal Busby
National AgLaw Center Research Assistant
A bank and a bankruptcy trustee challenged a "tools of the trade" exemption claimed by debtors in certain farm equipment on the grounds that the debtor-wife did not have an ownership interest in the farm equipment. In re Lampe. Alternatively, they argued that the debtor-wife had an ownership interest in the equipment so that a partnership existed that precluded both debtors from claiming a "tools of the trade" exemption. See id. The United States Court of Appeals for the Tenth Circuit ruled that the bankruptcy trustee failed to prove that the debtor-wife lacked an ownership interest in the farm equipment and failed to meet its burden that a partnership existed between the husband and wife that would have precluded the debtors from claiming a "tools of the trade" exemption.
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Posted: June 20, 2003
Party With Right of First Refusal Must Have Sale Notice
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by a corporation that submitted the highest bid at the auction of a debtor's assets alleging that the bankruptcy court abused its discretion by ordering the reopening of the bidding process and by approving a compromise and a settlement that governed the procedures for the final auction, the Bankruptcy Appellate Panel (BAP) for the Eighth Circuit has ruled that the bankruptcy court did not err in finding that the party with the right of first refusal had not received sufficient notice of the proposed sale and that it did not abuse its discretion in continuing the auction and in approving the compromise regarding the terms to govern the continued auction. In re Farmland Industries, Inc.
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Posted: June 20, 2003
Bankruptcy Appellate Panel Lacks Jurisdiction
Gaby R. Jabbour
National AgLaw Center Research Assistant
The Bankruptcy Appellate Panel (BAP) for the Eighth Circuit has ruled that it did not have jurisdiction over an appeal brought by two debtors because the debtors' appeal was closely interwoven with a creditor's appeal from the same bankruptcy court order and the creditor's appeal had been timely filed with the district court. In re Brown. The BAP also ruled that it lacked jurisdiction to hear the debtors' appeal because the debtors filed their appeal one day after the expiration of the ten-day appeals deadline and did not file a postjudgment motion that would have been sufficient to extend the ten-day deadline.
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Posted: June 6, 2003
Ag Department's Lien Junior To Other Creditors' Liens
Harrison M. Pittman
Staff Attorney
The Bankruptcy Appellate Panel for the Sixth Circuit has ruled that a lien held by the Tennessee Department of Agriculture ("TDOA") in an insolvent farmer's cotton crop was junior to the liens held by two other creditors in the same crop. In re Hollingshead. The panel ruled that the TDOA forfeited its right to obtain payment ahead of other prior secured parties when it failed to exercise the options available to it under Tennessee law.
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Posted: June 6, 2003
Post-Discharge Secured Debt Excepted From Discharge
Harrison M. Pittman
Staff Attorney
In an action involving a debtor who completed payments pursuant to his Chapter 12 bankruptcy plan and received a discharge but subsequently defaulted on two post-discharge payments it owed to one of its creditors, the United States Bankruptcy Court for the Western District of Oklahoma has ruled that, despite the creditor's attempt to collect both the secured and unsecured portions of the pre-petition bankruptcy claim, its claim was limited to the amount of the secured claim. In re Stidham.
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Posted: June 3, 2003
Debtor's Motion to Revoke Arbitration Award Denied
Harrison M. Pittman
Staff Attorney
In an action brought by a debtor objecting to a proof of claim filed by one of its creditors, an agricultural cooperative, and seeking revocation of the arbitration award upon which the cooperative's proof of claim was based, the United States Court of Appeals for the Sixth Circuit has ruled that the debtor could not challenge the arbitration award because it failed to timely file a motion to vacate or modify the award pursuant to the Federal Arbitration Act ("FAA"). In re Robinson.
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Posted: May 13, 2003
Security Interest Has Priority Over Landlord's Privilege
E. John Edwards III
National AgLaw Center Graduate Assistant
In a dispute between a bank that had a perfected security interest in a farmer's crops and a landlord who claimed that it had a superior interest in the same crops because it held a statutory lessor's "privilege" under Louisiana law, the United States District Court for the Western District of Tennessee has upheld the bankruptcy court's ruling in favor of the bank. In Re Parks Planting Co. The decision is unreported.
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Posted: April 23, 2003
USDA Denied Right Of Setoff in Chapter 12 Case
Jay Kiiha
National AgLaw Center Graduate Assistant
The Bankruptcy Appellate Panel ("BAP") for the Tenth Circuit has ruled that the USDA did not have a right to setoff the amount it owed to two Chapter 12 debtors in farm program payments against what it claimed the debtors owed to it as a result of a foreclosure judgment. In re Myers. The BAP determined that the debtors discharged their personal liability in their previous Chapter 7 bankruptcy case, and therefore there was no claim that the USDA could setoff against the debtors.
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Posted: April 15, 2003
Cash Rent Not Income From Farming Operation
Sean Brister
National AgLaw Center Graduate Assistant
The United States Bankruptcy Court for the Central District of Illinois has ruled that a farmer who received cash rent "up front and in full" from a lease of farm ground was ineligible for Chapter 12 bankruptcy relief. In re Swanson. The bankruptcy court determined that the cash rent was not income derived from a farming operation and therefore the farmer did not earn more than fifty percent of his gross income from a farming operation, as required to be a "family farmer" eligible for Chapter 12 bankruptcy relief.
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Posted: April 7, 2003
Reduction In Bankruptcy Attorney's Hourly Rate Upheld
John D. Mead
National AgLaw Center Graduate Assistant
In In re Miller, two Chapter 12 debtors appealed a bankruptcy court's decision to reduce the amount of attorney fees to be paid to their attorney, as well as the court's decision to allow the attorney fees to be paid through the bankruptcy plan as administrative expenses, instead of being paid outside the plan directly to the attorney. In re Miller. The Bankruptcy Appellate Panel ("BAP") for the Tenth Circuit held that the bankruptcy court correctly applied the law in determining the reasonableness of the requested attorney fees, that the evidence supported the bankruptcy court's decision to reduce attorney fees, and that it correctly determined that the attorney fees should be paid through the plan, rather than outside the plan and directly to the attorney.
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Posted: April 2, 2003
Parties' Stipulation Not Required in Reorganization Plan
Patricia Farnese
National AgLaw Center Graduate Assistant
The United States Court of Appeals for the Ninth Circuit has affirmed a bankruptcy court's decision to confirm a debtor's bankruptcy reorganization plan over the objections of two creditors that the plan did not allow one of the creditors to foreclose on portions of the debtor's land. In re Allen. The parties had previously stipulated, with court approval, that such foreclosure proceedings could occur. The Ninth Circuit held that for the terms of the parties' stipulation to be required as part of the reorganization plan, the stipulation must clearly state that it was intended to be incorporated into the reorganization plan.
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Posted: Mar. 5, 2003]
Pre-Revised Article 9 Security Agreement Not Effective
Brandy L. Brown
National AgLaw Center Graduate Assistant
In an action brought by two Chapter 12 debtors to determine the status of a creditor's security interest in the debtors' growing crops, the United States Bankruptcy Court for the District of Kansas has ruled that the creditor's interest did not attach to the growing crops because the security agreement did not contain a description of the land on which the crops were growing as required by former Article 9. In re Stout. Thus, the court ruled that the debtors' estate was entitled to the proceeds of the growing crops that were planted prepetition, free of any of the creditor's claims.
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Disaster Payments Property of the Estate
Harrison M. Pittman
Center Research Attorney
The United States District Court for the District of North Dakota has affirmed a decision that held that crop disaster payments received post-petition by two Chapter 12 debtors were "property of the estate" because the payments were proceeds of the estate property that were in the debtors' possession at the time debtors filed their bankruptcy petition. FarmPro Services, Inc. v. Brown.
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Posted: Feb. 3, 2003
Eighth Circuit Remands Homestead Exemption Case
Jay Kiiha
National AgLaw Center Graduate Fellow
The United States Court of Appeals for the Eighth Circuit has ruled that under Minnesota law a determination of whether a debtor-farmer was allowed to claim a homestead exemption in a 155-acre parcel of land, in addition to a five-acre parcel of land that the farmer owned and occupied as his residence, involved a fact-based determination of whether the farmer-debtor used the 155-acre parcel for farming purposes in such a manner that both parcels were occupied or cultivated as one parcel of land. In re Stenzel. The Eighth Circuit remanded the matter to the bankruptcy court so that the bankruptcy court could make this determination.
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Posted: Feb. 3, 2003
Biotechnology
Monsanto Sues Farmer for Patent Infringement and Breach of Contract
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by Monsanto Company (Monsanto) against farmers who purchased genetically modified seeds containing Monsanto's patented biotechnology alleging that the farmers reused the patented biotechnology without its authorization and replanted the seed in violation of a "Technology Agreement" signed by the farmers that required the farmers to use the seed in only one growing season, the United States District Court for the Eastern District of Missouri has ruled that Monsanto was entitled to summary judgment on its claims for patent infringement and breach of contract. Monsanto Co. v. Swann.
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Posted: July 7, 2003
Patent Suit Transferred To Missouri Federal Court
Gaby R. Jabbour
National AgLaw Center Research Assistant
In a motion brought by Monsanto Company (Monsanto) to transfer an action brought by Bayer Bioscience, N.V. (Bayer) to the United States District Court for the Eastern District of Missouri, the United States District Court for the District of Delaware has granted Monsanto's motion, holding that Monsanto had met its burden of demonstrating that transfer was appropriate. Bayer Bioscience N.V. v. Monsanto Co.
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Posted: June 12, 2003
Class Certification Reversed in Suit Against Monsanto
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by several farmers against the manufacturers and distributors of a genetically engineered cotton seed for fraud, violations of the Texas Deceptive Trade Practices Act, negligence, negligent misrepresentation, and usury, and seeking class certification, the Texas Court of Appeals has reversed a trial court's decision to certify the class action because there were arguable defenses peculiar to a subset of plaintiffs that destroyed the typicality requirement necessary to achieve class status. Monsanto Co. v. Davis.
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Posted: June 6, 2003
Checkoff Decisions
DWF Enjoined from Collecting Fees for Generic Marketing
Lynn Cox
National AgLaw Center Research Assistant
In an action brought by an alligator farmer against the Secretary of the Louisiana Department of Wildlife and Fisheries ("DWF") to permanently enjoin the DWF from collecting mandatory fees to finance generic marketing of alligator products, the United States District Court for the Middle District of Louisiana has ruled that the mandated fees violated the First Amendment as unconstitutional compelled commercial speech. Pelts & Skins, L.L.C. v. Jenkins.
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Posted: July 7, 2003
Advertising Assessment Violates First Amendment
Lynn Cox
National AgLaw Center Research Assistant
In an action brought by brand name grape producers against the California Table Grape Commission ("Commission") challenging a state law that required grape producers to pay assessments to the Commission to fund generic advertising of grapes, the United States Court of Appeals for the Ninth Circuit Court of Appeals has ruled that the advertising assessments violated the plaintiffs' First Amendment rights and were therefore unconstitutional. Delano Farms Co. v. California Table Grape Comm'n.
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Posted: June 20, 2003
Dairy Checkoff Does Not Violate the First Amendment
John D. Mead
National AgLaw Center Graduate Assistant
In an action brought by two dairy farmers challenging the constitutionality of the dairy checkoff assessment authorized under the Dairy Promotion and Research Program, the United States District Court for the Middle District of Pennsylvania has ruled that the dairy checkoff assessment was not an unconstitutional restraint of the dairy farmers' right to free speech under the First Amendment. Cochran v. Veneman.
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Posted: April 25, 2003
Clean Water Act
Mushroom Waste Ruled Point Source Pollution
Under Clean Water Act
Harrison M. Pittman
Staff Attorney
Property owners brought an action against a mushroom storage and processing facility alleging that the facility's wastewater drained into a nearby stream that flowed into a pond located on their property in violation of, inter alia, the Clean Water Act ("CWA"). Reynolds v. Rick's Mushroom Serv., Inc.The United District Court for the Eastern District of Pennsylvania ruled that the wastewater was a "pollutant" and that the system designed by the facility to prevent the discharge of the wastewater into the nearby stream was a "point source" under the CWA.
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Posted: Nov. 20, 2003
CWA Jurisdiction Must Be Determined by Evidence at Trial
Randal Busby
National AgLaw Center Research Assistant
In an action brought by environmental groups against hog farms for alleged violations of the Clean Water Act ("CWA"), the United States Court of Appeals for the Fourth Circuit has ruled that the district court's denial of the hog farms' motion for reconsideration of standing constituted an abuse of discretion. American Canoe Ass'n v. Murphy Farms, Inc. The court affirmed, however, that the environmental groups had standing to sue. The court also vacated the final judgment entered below and remanded the issue of CWA jurisdiction for trial as a matter of correct procedure.
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Posted: Aug. 27, 2003
State's NPDES/CAFO Program Must Comply With CWA
Jay Kiiha
National AgLaw Center Graduate Assistant
In an action brought by an environmental group and two of its members against the Environmental Protection Agency ("EPA") alleging that the EPA had actual knowledge that the State of Indiana failed to adopt and enforce adequate laws and regulations with respect to the discharge of pollutants produced by confined animal feeding operations ("CAFOs") and that the State of Indiana failed to require those operations to obtain National Pollutant Discharge Elimination System ("NPDES") permits, the United States District Court for the Southern District of Indiana has ruled that the State of Indiana was required to bring its NPDES program into compliance with the Clean Water Act ("CWA"). Save the Valley, Inc. v. United States E.P.A. The court further ruled that if the State of Indiana failed to comply with the CWA, the EPA would be ordered "to undertake and process withdrawal proceedings for Indiana's [NPDES] program."
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Posted: April 15, 2003
Ninth Circuit Affirms TMDL Decision
Brian J. Oakey
National AgLaw Center Graduate Assistant
In an action brought by several landowners and three agricultural groups against the Environmental Protection Agency ("EPA") challenging the EPA's authority to determine the total maximum daily load ("TMDL") for a local river, the United States Court of Appeals for the Ninth Circuit has ruled that the Clean Water Act ("CWA") authorized the EPA to determine the TMDL for a river that was polluted by logging runoff and other nonpoint sources of pollution after the state of California failed to timely establish the TMDL for the river. Pronsolino v. Nastri.
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Posted: April 7, 2003
Aerial Pesticide Spraying Activity a Point Source
John D. Mead
National AgLaw Center Graduate Assistant
In an action brought by several environmental groups against the United States Forest Service ("Forest Service") alleging that the Forest Service violated the National Environmental Policy Act ("NEPA") and the Clean Water Act ("CWA") when it conducted an aerial pesticide spraying program in forest lands located in Washington and Oregon, the United States Court of Appeals for the Ninth Circuit has ruled that the spraying program was a "point source" source of pollution that required the Forest Service to obtain a National Pollution Discharge Elimination System ("NPDES") permit before conducting the spraying program. League of Wilderness Defenders/Blue Mountains Biodiversity Project v. Forsgren. In addition, the Ninth Circuit enjoined the Forest Service from continuing the spraying program until it completed an Environmental Impact Statement ("EIS") that adequately analyzed mitigation measures regarding potential pesticide drift.
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Posted: April 2, 2003
Dairy Operation Violated Clean Water Act
Harrison M. Pittman
Staff Attorney
In an action brought by an environmental group against a Washington dairy operation in which the environmental group alleged that the dairy operation had committed several violations of the Clean Water Act ("CWA"), the United States Court of Appeals for the Ninth Circuit has held that the dairy operation received sufficient notice from the environmental group of the alleged violations as required by the CWA's "citizen suit" provision, that ongoing violations of the CWA had occurred, and that there was a reasonable likelihood that these violations would recur. Community Ass'n for Restoration of the Environment v. Henry Bosma Dairy. The court also ruled that a drainage ditch that ran from the dairy operation and eventually flowed into a nearby river was a "navigable water" under the CWA. Finally, the court determined that the dairy operation was a Concentrated Animal Feeding Operation ("CAFO") and was therefore a point source subject to the National Pollutant Discharge Elimination System ("NPDES") permit requirements set forth in the CWA.
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Posted: Mar. 5, 2003
District Court Lacks Jurisdiction in CWA Action
Harrison M. Pittman
Staff Attorney
The United States District Court for the District of Oregon has ruled that it lacked subject matter jurisdiction under the Clean Water Act ("CWA") to entertain an action in which a fruit processor was alleged to have violated the CWA when it used wastewater produced from its fruit processing facilities to irrigate several of its fruit fields. Hiebenthal v. Meduri Farms.
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Posted: Mar. 5, 2003
Challenge to CWA Listing Not Ripe
Brandy L. Brown
National AgLaw Center Graduate Fellow
In an action brought by a nonprofit farmers' association against the Environmental Protection Agency ("EPA") challenging the EPA's approval of Missouri's Clean Water Act listing of pollution-impaired waters, the United States Court of Appeals for the Eighth Circuit has ruled that it lacked proper jurisdiction to hear the matter because the challenge was not yet ripe for adjudication. Missouri Soybean Ass'n v. United States EPA. The Eighth Circuit dismissed the action without prejudice because its decision was not an adjudication on the merits.
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Posted: Jan. 3, 2003
Commercial Transactions
Court of Federal Claims Lacks Jurisdiction
Over Boll Weevil Eradication Foundation
Gaby R. Jabbour
National AgLaw Center Research Assistant
An owner of a crop-dusting service who entered into a contract with a non-profit organization brought an action for breach of contract against the United States when the non-profit organization terminated the contract entered into between it and the crop-dusting service owner. Morgan v. United States. The United States Court of Federal Claims dismissed the crop-dusting owner's complaint for lack of jurisdiction because there was no privity of contract between the owner and the United States even though the non-profit organization complied with a federally-mandated regulatory scheme in spending federal monies pursuant to a boll weevil eradication program.
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Posted: Aug. 29, 2003
City's Sale of Water To Meat Processor Was Sale of Goods
Lynn Cox
National AgLaw Center Research Assistant
In an action brought by a meat processing company against a city for negligence, breach of express warranty, and breach of implied warranty of fitness for a particular purpose, alleging that the water that the city supplied to the meat processing company contained a foreign substance harmful to its business, the South Dakota Supreme Court has ruled that the city's furnishing of water to the meat processing company was a sale of goods under Article 2 of the Uniform Commercial Code ("UCC"). Dakota Pork Indus. v. City of Huron. It also ruled that the contract for the sale of water did not contain any express warranties and that the contract did not contain an implied warranty of fitness for a particular purpose. It therefore affirmed the trial court's decision to grant summary judgment in favor of the city.
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Posted: Aug. 27, 2003
Landowner's Assent Not Required for Implementation of
Wetland Reserve Program Conservation Plan
John D. Mead
National AgLaw Center Research Fellow
A landowner who conveyed an easement to the United States in accordance with the Wetlands Reserve Program sought a declaratory judgment that the government improperly implemented a conservation plan on his land without his approval. Big Meadows Grazing Ass'n v. U.S. ex rel. Veneman. The United States Court of Appeals for the Ninth Circuit rejected the landowner's claims, holding that the statute governing the Wetlands Reserve Program did not require the landowner to assent to a conservation plan in order for that plan to be implemented.
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Posted: Dec. 23, 2003
Cooperatives
Ag Coop Members' Damages Reduced to Present Value
Randal Busby
National AgLaw Center Research Assistant
In an action for fraud and breach of contract brought by former members of an agricultural cooperative against the agricultural cooperative they were once members of, the Georgia Court of Appeals has ruled that the trial court erred in failing to reduce the plaintiffs' damages award by discounting equity accounts to present value. Gold Kist, Inc. v. Moody.
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Posted: July 7, 2003
Cooperative Member Bound By Arbitration Clause
John D. Mead
National AgLaw Center Graduate Assistant
The South Carolina Court of Appeals has held that an agricultural cooperative was allowed to amend its bylaws to incorporate an arbitration clause and that a dispute between the cooperative and one of its members was required to be submitted to arbitration. McMillan v. Gold Kist, Inc.
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Posted: April 2, 2003
Feed Retailer and Customer Sue Over Poisoned Feed
Patricia Farnese
National AgLaw Center Graduate Fellow
The United States District Court for the Northern District of West Virginia has granted in part and denied in part a horse feed retailer's motion to dismiss a counterclaim filed by one of its customers who owned horses that became ill after they were given horse feed allegedly contaminated with rat poison. Southern States Cooperative, Inc. v. I.S.P. Co., Inc. The retailer brought an action against the customer for defamation, product disparagement, and tortious interference with business relationships, and the customer filed a counterclaim alleging negligence, strict liability, and breach of implied warranties, among other claims. The customer also alleged that the retailer had violated the West Virginia Commercial Feed Law and the West Virginia Pesticide Control Act. The district court ruled that neither the West Virginia Commercial Feed Law nor the West Virginia Pesticide Control Act gave rise to a private cause of action and that the customer's claims for negligence, strict liability, and breach of implied warranties were not preempted by the Federal Insecticide, Fungicide, and Rodenticide Act ("FIFRA"). The court also ruled that the customer's claim under the West Virginia Commercial Feed Law was not preempted by the FIFRA.
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Posted: Mar. 14, 2003
Crop Insurance
Farmer's State Law Claims Against Crop Insurance Company
Not Preempted by FCIA or Implementing Regulations
Harrison M. Pittman
Staff Attorney
In Dailey v. American Growers Ins., the Supreme Court of Kentucky held that state law claims brought against a reinsured crop insurance company were not preempted by either the Federal Crop Insurance Act ("FCIA") or FCIA's implementing regulations.
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Posted: Dec. 23, 2003
Crop Insurance Company Seeks Indemnification
from FCIC and RMA
Harrison M. Pittman
Staff Attorney
A crop insurance company has brought an action against the Federal Crop Insurance Corporation ("FCIC") and the Risk Management Agency ("RMA") seeking, inter alia, indemnification for costs and losses it incurred pursuant to § 1508(j) of the Federal Crop Insurance Act ("FCIA") after the FCIC modified the conditions applicable to "prevented planting coverage." Am. Growers Ins. Co. v. Fed. Crop Ins. Corp. (unreported decision). In the alternative, the crop insurance company sought administrative review of a decision by the Agriculture Board of Contract Appeals to grant the defendants' motion for summary judgment. The United States District Court for the Southern District of Iowa dismissed the insurance company's claims against the FCIC for breach of the Standard Reinsurance Agreement and against the FCIC and RMA for violation of contract rights and affecting a deprivation of property without due process of law and affecting a taking of its property without just compensation in violation of the Fifth Amendment of the United States Constitution. The court ruled, however, that § 1508(j) allowed the company to seek indemnification for costs and losses from the FCIC and RMA and that this claim was not barred by a one-year statute of limitations.
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Posted: Dec. 10, 2003.
Court Rules That FCIC Properly Cancelled Coverage
Randal Busby
National AgLaw Center Research Assistant
In an action brought by several farmers challenging a decision of the Federal Crop Insurance Corporation ("FCIC") to cancel crop revenue coverage ("CRC") policies for durum wheat, the United States District Court for the District of North Dakota has ruled that the farmers did not have a protected property interest in the CRC policies and that the FCIC had properly cancelled the farmers' policies. The court also ruled that the farmers were not required to exhaust their administrative remedies with the National Appeals Division ("NAD") before bringing suit. Kuster v. Veneman.
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Posted: June 20, 2003
No Takings in Breach of Contract Claim Against FCIC
Randal Busby
National AgLaw Center Research Assistant
The United States District Court for the Southern District of Iowa has ruled that a crop insurer could not file a claim as an original action instead of as an appeal after it received an adverse administrative decision and further that the insurer could not assert a takings claim in the same action in which it had asserted a breach of contract claim. Am. Growers Ins. Co. v. Fed. Crop Ins. Corp. The court also ruled that it had jurisdiction over the action and that the Risk Management Agency ("RMA") was subject to suit.
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Posted: June 20, 2003
FCIC Reinsured Premiums Not Subject to State Tax
Randal Busby
National AgLaw Center Research Assistant
Posted: June 6, 2003
In an action brought by an insurance company seeking a declaratory judgment that the Federal Crop Insurance Act ("FCIA") preempted a Massachusetts law that taxed the premiums paid by out-of-state insurance corporations, the Supreme Judicial Court of Massachusetts has ruled that the FCIA preempted Mass. Gen. Laws Ann. because crop insurance premiums reinsured by the Federal Crop Insurance Corporation ("FCIC") are exempt from state taxation under the FCIA. ACE Prop. & Cas. Ins. Co. v. Comm'r of Revenue.
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Posted: June 20, 2003
FCIA Does Not Completely Preempt State Regulations
Randal Busby
National AgLaw Center Research Assistant
In an action brought by two insurance companies against the Commissioner of the Minnesota Department of Commerce alleging that the Commissioner's authority under Minnesota state law to conduct examinations of insurance companies was preempted by the Federal Crop Insurance Act ("FCIA"), the United States District Court for the District of Minnesota has held that the FCIA and its implementing regulations did not completely preempt insurance regulatory standards contained in Minnesota law or the Commissioner's jurisdiction under such law to conduct examinations of insurance companies. Alliance Ins. Co. and Farmers Alliance Mut. Ins. Co. v. Wilson.
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Posted: May 30, 2003
State Law Claims Not Completely Preempted By FCIA
Sean Brister
National AgLaw Center Graduate Assistant
In an action brought by two insureds in state court against their crop insurance company in which the insurance company removed the matter to federal district court and filed a motion for summary judgment, the United States District Court for the District of North Dakota has denied the motion for summary judgment and ruled that the case was improperly removed to federal court. Bullinger v. Trebas. The court ruled that the Federal Crop Insurance Act (FCIA) did not create a federal cause of action against the insurance company and that the doctrine of complete preemption did not apply to the state law claims brought against it.
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Posted: April 15, 2003
Crop Insurers Must Exhaust Administrative Remedies
Patricia Farnese
National AgLaw Center Graduate Assistant
In an action involving a crop insurance dispute between several sugar beet growers and their insurers in which the insurers filed a third-party complaint against the Federal Crop Insurance Corporation ("FCIC") and the FCIC filed a motion to dismiss the third-party complaint, the United States District Court for the District of Minnesota has ruled that it lacked jurisdiction to consider the FCIC's motion to dismiss. In re 2000 Sugar Beet Crop Ins. Litigation 2002. The district court ruled that it lacked jurisdiction because the insurers were required to exhaust their administrative remedies before the matter could be judicially reviewed.
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Posted: April 7, 2003
Grower Required to Submit Dispute to Arbitration
Patricia Farnese
National AgLaw Center Graduate Assistant
In an action brought by several insured sugar beet growers against their insurers when the growers were denied coverage under their federal crop insurance policies, the United States District Court for the District of Minnesota has ruled that the parties were required to submit their dispute to arbitration. In re 2000 Sugar Beet Crop Ins. Litigation.
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Posted: Mar. 18, 2003
Environmental Law
Cattle Grazing An Integral Part of Swine Production
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by the state of Missouri against a swine production operation alleging that the operation violated the Missouri Farming Corporations Act ("MFCA") when it leased cattle grazing rights to local farmers, the Missouri Court of Appeals has held that the term "the production of swine or swine products" contained in the MFCA necessarily included cattle grazing and that the operation's leasing of grazing rights was not prohibited but came under an exception to the corporate farming prohibitions. State ex rel. Nixon v. Premium Standard Farms, Inc.
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Posted: June 6, 2003
Organic Farmer's Request for Hearing Denied
Harrison M. Pittman
Staff Attorney
The Texas Court of Appeals has affirmed a decision of the Texas Commission on Environmental Quality to deny an organic farmer's request for a contested case hearing to challenge a corporate poultry farm's application for a permit that would allow the farm to change its operation from a dry waste-management system to a wet waste-management system. Collins v. Texas Natural Resource Conservation Commission. The court determined that there was substantial evidence supporting the Commission's determination that the organic farmer was not an affected person and therefore not entitled to a contested hearing; that he did not have a liberty or property interest entitling him to predeprivation procedural protection; and that he was afforded sufficient procedural due process by the Commission.
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Posted: June 3, 2003
Plaintiffs Suing Hog Companies Lack Standing
Harrison M. Pittman
Staff Attorney
In an action brought by environmental groups and other individuals against three hog companies for several state law claims based on pollution and contamination of three rivers that allegedly occurred as a result of the companies' mishandling of hog waste, the North Carolina Court of Appeals has ruled that the plaintiffs lacked standing to bring its action. Neuse River Foundation, Inc. v. Smithfield Foods, Inc.
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Posted: June 3, 2003
State Law Not Preempted by Swampbuster
Gaby R. Jabbour
National AgLaw Center Research Assistant
The United States District Court for the Southern District of California has ruled that because the "Swampbuster" provisions contained in Title XII of the Food Security Act (FSA) of 1985 were enacted pursuant to the Spending Clause, they do not preempt the laws or regulations of an unconsenting state and its political subdivisions. Citizens for Honesty and Integrity in Regional Planning v. County of San Diego. The court also ruled that even if legislation enacted pursuant to the Spending Clause could preempt the laws or regulations of an unconsenting state, there was no clear and manifest evidence that Congress intended for the Swampbuster provisions to preempt state and local authority to regulate wetlands.
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Posted: My 28, 2003
Estate Planning and Taxation
Several taxpayers have brought an action before the United States Court of Appeals for the Seventh Circuit challenging a determination made by the Commissioner of Internal Revenue to recognize as taxable gains certain transfers of property that the taxpayers made to a farming corporation in exchange for stock. Seggerman Farms, Inc. v. Comm'r of Internal Revenue. The Seventh Circuit has affirmed the Commissioner's determination, ruling that the taxable gain resulted in the amount that the liabilities exceeded the taxpayers' adjusted basis in the transferred property.
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Posted: Dec. 23, 2003
Cattle Ranch Buyers Sue For Breach of Contract
John D. Mead
National AgLaw Center Graduate Assistant
In an action brought by two purchasers of a cattle ranch against the sellers of the ranch for failure to carry out the provisions of an agreement between the parties for cancellation of two contracts of deed, the Supreme Court of South Dakota has ruled that the matter was not barred by res judicata and that the purchasers were not entitled to equitable relief. Rindal v. Sohler.
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Posted: April 28, 2003
Finance and Credit
Liability of Guarantor Dependent on Guaranty Agreement
Gaby R. Jabbour
National AgLaw Center Research Assistant
In an action brought by the guarantors of a bankrupt debtor against a bank alleging that the bank's failure to perfect its security interest as to some assets of the debtor constituted a lack of good faith and fair dealing, the Missouri Court of Appeals has held that the guarantors were primarily liable on the debt and that the bank's failure to perfect a security interest in collateral did not constitute bad faith. Mercantile Bank, N.A. v. Loy.
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Posted: June 20, 2003
Knowledge Required To Prove Wrongful Possession
Lynn Cox
National AgLaw Center Research Assistant
The Montana Supreme Court has upheld a district court's ruling that a farmer who purchased a tractor from a bankruptcy debtor obtained the tractor lawfully, did not violate a court order when it did not deliver the tractor to a bank claiming an interest in the tractor, and did not interfere with those who were directed to recover the tractor. 1st Bank v. Winderl. The court ruled that the buyer did not wrongfully possess the tractor because he did not have knowledge that the tractor was purchased from identifiable insurance proceeds.
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Posted: June 6, 2003
Farmers Bound by Shared Appreciation Agreements
Harrison M. Pittman
Staff Attorney
In an action brought by several farmers asserting that they were not obligated to make certain payments under the Shared Appreciation Agreements they entered into with the United States Department of Agriculture ("USDA") and challenging the USDA's determination of the maximum amount that could be collected from them under the Agreements, the United States Court of Appeals for the Eighth Circuit has affirmed a district court's decision to dismiss the farmers' action. Stahl v. Veneman. Stahl is the most recent decision issued in a series of litigation dealing with these particular issues. See Israel v. United States Dep't of Agric.; Bukaske v. United States Dep't of Agric; Stahl v. Veneman.
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Posted: May 13, 2003
Oral Lease Agreement For Farm Properties Enforced
Eugenio A. Lomba
National AgLaw Center Graduate Assistant
The Oregon Court of Appeals has ruled that an oral lease agreement made between cotenants of certain farm properties was valid and enforceable. Aylett v. Aylett. The court ruled that acts of part performance on the part of two of the cotenants were exclusively referable to the parties' oral agreement, and therefore the oral agreement fell outside the scope of the statute of frauds.
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Posted: April 28, 2003
Foreclosure Judgment on Landlord's Lien Upheld
Eugenio A. Lomba
National AgLaw Center Graduate Fellow
In an action brought by a landlord seeking to foreclosure on a lien that it held in a tenant's crop, the Georgia Court of Appeals has affirmed in part, and reversed in part, a trial court's decision in favor of the landlord. Bitt Int'l. Co., Inc. v. Fletcher. The appeals court ruled that the tenant was not entitled to a jury trial, amounts owed for supplies and equipment furnished by landlord's corporation were not covered by the crop lien, and stakes furnished by the landlord were within the crop lien. The court also ruled that the amount of judgment that exceeded the amount of a bond posted by the tenant was void because the tenant's crop had failed.
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Posted: April 28, 2003
Government Prevails in FSA Judicial Foreclosure Action
Sean Brister
National AgLaw Center Graduate Assistant
In an action brought by the government against two mortgagors to foreclose on several real property mortgages that were used to secure three Farm Service Agency (FSA) loans, the United States District Court for the Western District of New York has granted summary judgment in favor of the government, ruling that proof that the loans existed, that the mortgagors defaulted on those loans, and that the loans were secured by mortgages entitled the government to foreclosure. U.S. v. Fugle.
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Posted: April 15, 2003
Bank Has Priority Over Supplier's Secured Interest
Harrison M. Pittman
Staff Attorney
In an action brought by a secured creditor against an agricultural supply company committed a conversion when it removed agricultural chemicals from the debtor's facility, the Kansas Court of Appeals has ruled that the secured creditor had priority over the supplier because it was the first to file a financing statement, and the supplier failed to give proper notice of its purchase money security interest claim in the debtor's inventory. Guaranty State Bank & Trust Co. v. Van Diest Supply Co.
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Posted: Mar. 18, 2003
Creditor Must Prove Equipment Delivered to Debtor
Brian J. Oakey
National AgLaw Center Graduate Assistant
The Minnesota State Court of Appeals has reversed and remanded a decision that held that a debtor's failure to make the payments required to another farmer in order to obtain a 50 percent ownership interest in certain farm equipment did not give rise to any right in the farm equipment and that the creditor's security interest did not attach in the equipment. American State Bank of Olivia v. Ladwig & Ladwig, Inc. The dispute concerned whether a debtor had acquired a sufficient ownership interest in a piece of farm equipment, a combine, for the bank's security interest to attach. See id. The court concluded "that the question of whether debtor acquired a sufficient ownership interest in the combine for [the creditor's] security interest to attach depends on whether the combine was 'delivered' to debtor." The court determined that there was a genuine issue of material fact with respect to whether the combine was "delivered" to the debtor.
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Posted: Feb. 3, 2003
Food Safety
Producer Convicted of Violating Virginia Food Act
Eugenio A. Lomba
National AgLaw Center Graduate Assistant
In an appeal brought by a producer who was convicted for offering misbranded food for sale and for operating a "food manufacturing plant" without inspection, the Virginia Court of Appeals has ruled that the evidence presented at trial was sufficient to establish that the defendant operated a food manufacturing plant as defined in the Virginia Food Act and that the defendant sold food items in packaged form. McClellan v. Commonwealth. The appeals court also ruled that the trial court properly admitted expert testimony from the Director of Consumer Protection for the Department of Agriculture and that her right to be protected from double jeopardy was not violated.
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Posted: April 23, 2003
Labor
Court Grants Migrant Workers' Motion to
Certify Two Class Actions
Randal Busby
National AgLaw Center Research Assistant
Several agricultural workers have sought certification of two classes alleging that several violations of the Migrant and Seasonal Agricultural Worker Protection Act ("AWPA") occurred during their employment at tomato and chili pepper packing houses located in Florida. Martinez v. Mecca Farms, Inc. The United States District Court for the Southern District of Florida has granted the workers' motions for class certification, ruling that undocumented aliens had standing under the AWPA to challenge compensation for work already performed; the proposed classes met the numerosity and commonality requirements for certification pursuant to Fed.R.Civ.P. 23(a); and undocumented workers were not inherently inadequate class representatives for purposes of typicality and adequacy of representation requirements.
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Posted: Dec. 23, 2003
Poultry Producer-Company Not a "Farmer" Under
National Labor Relations Act
John D. Mead
National AgLaw Center Research Fellow
Sanderson Farms, Inc. (Production Division) ("Sanderson Production"), a wholly-owned subsidiary of Sanderson Farms, Inc., a company engaged in the production, processing, marketing, and distribution of poultry, sought judicial review of a decision by the National Labor Relations Board ("NLRB") in which the NLRB found that live-haul and pull-up drivers employed by Sanderson Production were not "agricultural labors" and therefore exempted from the scope and protection of the National Labor Relations Act. Sanderson Farms, Inc. v. Nat'l Labor Relations Bd. The United States Court of Appeals for the Fifth Circuit affirmed the NLRB's decision and granted the NLRB's motion for an enforcement order.
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Posted: Dec. 10, 2003.
Workers' Compensation Is Exclusive Remedy For Injured Farmworker
Lynn Cox
National AgLaw Center Research Assistant
An agricultural employee who suffered severe injuries as a result of a vehicle accident that occurred in the course and scope of his employment relationship with a licensed farm labor contractor has brought an action against the farm labor contractor seeking compensation for his injuries. Ruiz v. Cabrera. The California Court of Appeals has ruled that the California Farm Labor Contractors Act ("FLCA") did not provide an implied exception to the general rule of workers' compensation exclusivity and that the exclusive remedy provision contained in the California Workers' Compensation Act ("WCA") barred the injured agricultural employee from bringing a tort action against the farm labor contractor. The court also ruled that the provisions of the WCA mandating workers' compensation for farmworkers rendered obsolete the section of the FLCA governing injuries to farmworkers transported in the FLCA licensee's insured vehicles.
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Posted: Aug. 29, 2003
Farmer Building Farmworker Housing Exempted From County Housing Code
Randal Busby
National AgLaw Center Research Assistant
An owner of farm property who wanted to construct residential buildings on his property to house farmworkers brought an action in trial court seeking an order that would require the county to exempt him from the requirement that he comply with the building permit process while constructing the housing. Trust v. County of Yuma,. The trial court ruled in favor of the farm property owner, and the county appealed to the Arizona Court of Appeals. The Arizona Court of Appeals ruled that the farm property owner did not have to comply with the building permit process because free, on-site housing for farmworkers was "incidental to farming," as defined by Arizona law. It also ruled that the county was precluded from asserting an equal protection claim and that the state statutes that exempted the property owner from complying with the building permit process did not violate equal protection under the Arizona Constitution or the United States Constitution.
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Posted: Aug. 29, 2003
Employee Falls Within FLSA Agricultural Exemption
Eugenio A. Lomba
National AgLaw Center Graduate Assistant
In an action brought by an employee seeking overtime compensation under the Fair Labor Standards Act (FLSA), the United States Court of Appeals for the Eleventh Circuit has ruled that the agricultural exemption contained in the FLSA applied to all employees, including the plaintiff, of a corporation that leased land and employees to another corporation that was engaged in the cultivation and sale of plants and trees. Ares v. Manuel Díaz Farms, Inc. It also ruled that the employee seeking overtime compensation was an "agricultural employee" for purposes of the FLSA agricultural exemption and was therefore not entitled to overtime compensation.
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Posted: April 23, 2003
Migrant Workers' Privacy Interests Protected
Brandy L. Brown
National AgLaw Center Graduate Assistant
In an action brought by several migrant workers against their employers seeking damages and injunctive relief under the Fair Labor Standards Act, the Migrant and Seasonal Agricultural Worker Protection Act, the Racketeer Influenced and Corrupt Organizations Act, and various provisions of New York law, the United States District Court for the Western District of New York has ruled that the workers' fear of retaliation by the employers was sufficiently well-founded to allow the workers to proceed anonymously. Javier H. v. Maria Garcia-Botello.
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Posted: Mar. 5, 2003
Feedlot Employee Entitled to Workers' Comp Benefits
Patricia Farnese
National AgLaw Center Graduate Assistant
In an action brought by an injured feedlot employee seeking to recover workers' compensation benefits, the Nebraska Supreme Court held that the feedlot employee was entitled to workers' compensation coverage because he was not a "farm or ranch laborer" under Neb. Rev. Stat. § 48-106. Larsen v. D B Feedyards, Inc. Two dissenting opinions stated that the employee should be considered a farm or ranch laborer under the statute, thereby exempting the employer from providing workers' compensation benefits.
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Posted: Feb. 3, 2003
Mushroom Workers Not "Agricultural Laborers"
Jay Kiiha
National AgLaw Center Graduate Assistant
The Supreme Court of Pennsylvania has upheld a decision of the Pennsylvania Labor Relations Board ("PLRB") that held that the PLRB had jurisdiction to hear an unfair labor practice complaint brought by a labor union seeking to represent employees of a mushroom production operation. Vlasic Farms Inc. v. Pennsylvania Labor Relations Bd. The court held that the PLRB had jurisdiction to hear the matter because the mushroom workers did not fall within the "agricultural laborer" exclusion set forth in the Pennsylvania Labor Relations Act ("PLRA").
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Posted: Feb. 3, 2003
Landowner Liability
Producers Must Comply with State Hazardous Waste Act
John D. Mead
National AgLaw Center Research Fellow
In an action alleging negligence and violations of the Washington Hazardous Waste Management Act ("HWMA") brought by a hunter who was severely injured when he fell into a concealed pit of burning industrial organic wastes, the Supreme Court for the State of Washington has held that the wastes constituted "dangerous wastes" as defined by the HWMA and that the producers of the wastes were required to comply with the HWMA. Hickle v. Whitney Farms, Inc. The court also ruled that genuine issues of material fact precluded summary judgment with respect to the hunter's negligence claim.
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Posted: Dec. 10, 2003.
No Express Assumption of the Risk Defense in Statute
Randal Busby
National AgLaw Center Research Assistant
In an action for strict liability in trespass brought by a ranch hand against the owner of an adjoining ranch as a result of injuries he suffered while handling a bull that escaped from the adjoining ranch, the Supreme Court of Montana has ruled that the owner of the adjoining ranch could not raise the defense of assumption of risk because the statute governing the liability of livestock owners for trespass did not expressly state that the assumption of the risk defense was available. Madrid v. Fifth Judicial Dist. Court.
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Posted: Nov. 20, 2003
Livestock Marketing
Pork Supplier, Pork Reseller Dispute Contract Terms
Harrison M. Pittman
Staff Attorney
In an action brought by a pork supplier against a pork reseller for breach of contract for refusing part of a delivery of pigs and subsequently informing the supplier that it would no longer accept any deliveries of pigs, the Illinois Court of Appeals has ruled that the parties' contract was ambiguous with respect to the genetic composition of the pigs required under the contract. Shields Pork Plus, Inc. v. Swiss Valley Ag Service. The appeals court also ruled that because of this ambiguity, the trial court did not err when it admitted parol evidence to help determine the parties' intent under the contract. In addition, the court determined that the evidence was sufficient to support the trial court's determination that the parties' intent was to contract for the sale of 100 percent "Newsham" genetic pigs. Finally, the court ruled that the pig reseller breached the parties' contract when it rejected 300 of 680 pigs delivered in a single shipment. It ruled that the evidence concerning the supplier's repudiation of the contract when the seller expressed doubt as to its ability to supply 100 percent "Newsham" pigs was not conclusive and remanded the matter for further consideration.
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Posted: Feb. 3, 2003
Persishable Agricultural Commodities
Sixth Circuit Affirms Decision To Revoke Produce
Broker's PACA License
Harrison M. Pittman
Staff Attorney
In H.C. MacClaren, Inc. v. U.S. Dep't of Agric., the United States Court of Appeals for the Sixth Circuit affirmed an USDA Judicial Officer's decision to revoke the license of a wholesale produce broker whose employees committed numerous and repeated violations of the Perishable Agricultural Commodities Act ("PACA").
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Posted: Dec. 23, 2003
Producer Failed to Preserve Trust Benefits Under PACA
John D. Mead
National AgLaw Center Research Fellow
The United States Court of Appeals for the Sixth Circuit held that a produce wholesaler could not recover from a commercial lender the assets of a statutory trust created by the Perishable Agricultural Commodities Act ("PACA") because it failed to properly preserve its rights to the PACA statutory trust. Overton Distrib., Inc. v. Heritage Bank.
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Posted: Dec. 10, 2003.
PACA Debtor's Equipment, But Not Mutual Funds, Are Assets of PACA Trust
Harrison M. Pittman
Staff Attorney
In In re Bear Kodiak Produce, Inc., a produce supplier brought an action seeking a declaration that its claims to the assets of a statutory trust held by a produce broker were superior to all claims held by the broker, the bankruptcy trustee, and the broker's lender in the same assets because the supplier believed that it was a beneficiary of a statutory trust created under the Perishable Agricultural Commodities Act ("PACA"). The United States Bankruptcy Court for the District of Arizona ruled that some, but not all, of the debtor's assets were reachable by the supplier, thereby giving the supplier superior claims only to those assets that were reachable.
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Posted: Aug. 27, 2003
Second Circuit Affirms PACA Reparations Award
Harrison M. Pittman
Staff Attorney
In an appeal brought by a produce buyer challenging a decision of the United States District Court for the Southern District of New York to approve a $4,800.00 reparations award issued by the USDA in favor of a produce seller and challenging the district court's decision to award the seller $73,250.00 in attorneys' fees, the United States Court of Appeals for the Second Circuit has affirmed both of the district court's determinations. Koam Produce, Inc. v. DiMare Homestead, Inc.
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Posted: June 3, 2003
Supplier's Rights in PACA Trust Abrogated
Harrison M. Pittman
Staff Attorney
In an action brought by a produce wholesaler against a produce dealer and the dealer's owner seeking to enforce its rights in a statutory trust created by the Perishable Agricultural Commodities Act ("PACA"), the United States Court of Appeals for the Seventh Circuit has ruled that the wholesaler's post-default dealings with the dealer were sufficient to nullify the wholesaler's rights in the PACA trust. Patterson Frozen Foods, Inc. v. Crown Foods, Int'l. The court also ruled that the right to enforce a PACA trust is lost whenever the parties enter into a written agreement that satisfies the generally applicable Statute of Frauds.
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Posted: May 28, 2003
Award of Attorneys' Fees Allowed in PACA Action
Harrison M. Pittman
Staff Attorney
In Koam Produce, Inc. v. Dimare Homestead, Inc., the United States District Court for the Southern District of New York has approved a produce shipper's motion for attorneys' fees that totaled more than sixteen times the reparations award entered by the United States Department of Agriculture. The district court had previously approved the USDA's reparations award of $4,800.00 in favor of the produce shipper.
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Posted: May 28, 2003
Unpaid Suppliers Awarded Preliminary Injunction
Harrison M. Pittman
Staff Attorney
In an action brought by two unpaid produce sellers against a produce buyer, a purported produce buyer, and the purported buyer's principals seeking payment of amounts allegedly owed to the buyers, the United States District Court for the Eastern District of New York has ruled that the sellers established irreparable harm necessary to issue a preliminary injunction and a likelihood of success on the merits of their claims. Horizon Marketing v. Kingdom Int'l. Ltd. The district court also ruled that the purported buyer was a trustee of a statutory trust created by the Perishable Agricultural Commodities Act ("PACA")for the purpose of preliminary injunctive relief.
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Posted: May 28, 2003
Prejudgment Interest Awarded in PACA Action
Harrison M. Pittman
Staff Attorney
In an action brought by a produce seller against another produce seller and an insolvent produce supplier under the Perishable Agricultural Commodities Act ("PACA"), the United States District Court for the District of Columbia has awarded the plaintiff-produce seller prejudgment interest on the disgorged funds after holding in a previous action, Fresh Kist Produce, LLC v. Choi Corp. Inc, that the other produce seller illegally withdrew funds from the PACA trust after the buyer became insolvent. Fresh Kist Produce, LLC v. Choi Corp., Inc.
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Posted: May 13, 2003
Tomato Sellers' PACA Statutory Trust Claims Barred
E. John Edwards III
National AgLaw Center Graduate Assistant
In an action brought by several tomato sellers against a tomato buyer and the buyer's lending institution seeking to recover the balance due on tomatoes delivered by the sellers to the buyer, the United States District Court for the Northern District of Indiana has ruled that the sellers could not recover the balance due because they failed to comply with the procedures required by the Perishable Agricultural Commodities Act ("PACA") to properly preserve their rights in the PACA trust. King v. Hartford Packing Co., Inc.
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Posted: May 13, 2003
Motions for Summary Judgment Denied in PACA Action
Jay Kiiha
National AgLaw Center Graduate Assistant
In a breach of contract action brought under the Perishable Agricultural Commodities Act ("PACA") between a distributor of perishable agricultural commodities and a purchaser of perishable agricultural commodities, the United States District Court for the Northern District of Illinois has denied both parties' motions for summary judgment. Agrexco USA, Ltd. v. Benny's Farm Fresh Distributing Co. Inc.
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Posted: April 28, 2003
Bank Liable to PACA Beneficiaries
Sean Brister
National AgLaw Center Graduate Assistant
In an action brought under the Perishable Agricultural Commodities Act (PACA)by several unpaid produce suppliers against a produce merchant's bank seeking to require the bank to disgorge funds deposited by the merchant that were used to pay down the merchant's overdraft debt to the bank, the United States District Court for the Southern District of New York has ruled that the bank was not a bona fide purchaser and was therefore liable for the merchant's breach of the trust as a third party transferee of the trust assets. Albee Tomato Co. v. Korea Commercial Bank of New York (Albee III). The district court also ruled that the bank was only required to disgorge those funds that were eventually used by the merchant to pay non-PACA beneficiaries. In addition, the court ruled that nine of the produce suppliers perfected their rights in the statutory trust.
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Posted: April 28, 2003
Restaurant Granted Summary Judgment In PACA Action
Jay Kiiha
National AgLaw Center Graduate Assistant
In an action brought by a produce seller against a restaurant chain in which the seller sought to enforce its rights in the assets of a Perishable Agricultural Commodities Act statutory trust, the United States Bankruptcy Court for the Northern District of California has ruled in an unreported decision that the produce seller properly preserved its rights in the PACA statutory trust and that the entire amount of the seller's unpaid claim was payable from funds held in trust by the restaurant chain under the PACA. In re L.R. Holdings, Inc.
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Posted: April 15, 2003
Bank Required to Disgorge Certain PACA Trust Funds
John D. Mead
National AgLaw Center Graduate Assistant
The United States District Court for the Southern District of New York has held that a lender that extended credit to a produce distributor was required to disgorge certain Perishable Agricultural Commodities Act ("PACA") trust funds that the lender received in violation of 7 U.S.C. § 499e(c). E. Armata, Inc. v. David Lee's Produce Service Corp.. However, the lender was not required to disgorge funds that were not derived from the sale of PACA-eligible goods. Moreover, the court determined that the lender was a "bona fide purchaser" with respect to certain transactions because it took reasonable steps to inquire into the produce distributor's financial status, and thus the lender was not required to disgorge all of the trust monies that the plaintiffs sought under the PACA.
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Posted: Mar. 6, 2003
PACA Reparation Award Affirmed
E. John Edwards III
National AgLaw Center Graduate Fellow
In an action brought under the Perishable Agricultural Commodities Act, 7 U.S.C. § 499a - 499t ("PACA"), the United States District Court for the Southern District of New York has affirmed a reparations award of $4,800.00 entered by the United States Department of Agriculture ("USDA") in favor of a tomato seller. Koam Produce, Inc. v. Dimare Homestead, Inc.. The court ruled that the seller was entitled to recover the expenses it incurred for price adjustments in the cost of its produce because those adjustments resulted from falsified USDA inspection certificates.
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Posted: Feb. 3, 2003
Pesticides
Farmers' State Law Claims Preempted by the FIFRA
Lynn Cox
National AgLaw Center Research Assistant
In an action brought by alfalfa farmers against the manufacturer and the seller of an herbicide for breach of express warranty, misrepresentation, and strict product liability when the farmers' crop was damaged by an herbicide, the Arizona Court of Appeals has ruled that the Federal Insecticide, Fungicide, and Rodenticide Act ("FIFRA") preempted each of the plaintiffs' claims. Dillon v. Zeneca Corp.
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Posted: Aug. 27, 2003
Plaintiff's Action Preempted by FIFRA
Patricia Farnese
National AgLaw Center Graduate Assistant
In an action brought by a seed corn and seed soybean producer against a herbicide manufacturer for negligent testing and labeling, strict liability, breach of express and implied warranties, false advertising, and consumer fraud when the producer's crop was damaged by a herbicide, the United States District Court for the District of Minnesota has ruled that the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA) preempted each of the producer's claims. Dahlman Farms, Inc. v. FMC Corporation.
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Posted: April 15, 2003
Ruling In Pesticide Drift Case Reversed and Remanded
Brandy L. Brown
National AgLaw Center Graduate Assistant
In an action brought by an Arkansas cotton farmer against a neighboring rice farmer and a crop duster when the cotton farmer's crop was allegedly damaged by exposure to a pesticide that drifted onto the cotton farmer's crop, the Arkansas Court of Appeals has reversed and remanded a trial court's determination that the rice farmer and crop duster were not negligent. McCorkle Farms, Inc. v. Thompson. The appeals court ruled that the trial court erred when it admitted a report prepared by the Arkansas State Plant Board Commission that concluded that the crop duster was not liable, when it did not allow a jury instruction that stated that a violation of a State Plant Board regulation was evidence of negligence, and when it did not allow a jury instruction pertaining to the liability of an owner for an independent contractor's negligence in performing an inherently dangerous act. The appeals court also ruled that the trial court erred when it admitted certain statistical evidence offered by the defendants involving the average per-acre yield for a ten-year period because the evidence was unreliable due to the lack of comparability to the cotton farmer's land and growing conditions.
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Posted: April 2, 2003
Production Contracts
Contractor's Control Sufficient to Deny Motion to Dismiss
Harrison M. Pittman
Staff Attorney
In an action brought by three plaintiffs against the owners of a pig feedlot and the contractor that supplied pigs to the feedlot for nuisance, negligence, trespass, and violations of the Minnesota Environmental Rights Act ("MERA"), the United States District Court for the District of Minnesota has denied the contractor's motion to dismiss the plaintiffs' claims for nuisance, negligence, and trespass because the contractor had sufficient control over the feedlot to sustain those claims. Overgaard v. Rock County Board of Commissioners. It granted the contractor's motion to dismiss the plaintiffs' claim that it had violated the MERA because the plaintiffs failed to comply with the necessary procedures for bringing a claim under the MERA.
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Posted: June 3, 2003
Poultry Grower Action Against Integrator Continues
Sean Brister
National AgLaw Center Graduate Fellow
In an action for breach of contract, intentional infliction of emotional distress, and racial discrimination brought by an African-American poultry grower against a poultry integrator when the grower's contract was terminated, the Georgia Supreme Court ruled that the grower had alleged issues of material fact sufficient to survive the integrator's motions for summary judgment. Blockum v. Fieldale Farms Corporation.
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Posted: Apr. 23, 2003
Buyer of Potatoes Required To Arbitrate Contract Dispute
Harrison M. Pittman
Staff Attorney
In an action brought by a seller of potatoes against an agricultural corporation and several of its employees for breach of contract, the United States District Court for the District of Maine has ruled that the seller was required to submit the dispute to arbitration because the seller agreed to arbitration and because the arbitration clause was not unconscionable, fraudulent, or otherwise invalid. Sleeper Farms v. Agway, Inc.
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Posted: Feb. 3, 2003
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