Wheeler v. Pilgrim's Pride Corp.

246 F.R.D. 532, 2007 U.S. Dist. LEXIS 79580, 2007 WL 3085798
CourtDistrict Court, E.D. Texas
DecidedSeptember 28, 2007
DocketNo. 5:06-CV-004-DF
StatusPublished
Cited by2 cases

This text of 246 F.R.D. 532 (Wheeler v. Pilgrim's Pride Corp.) is published on Counsel Stack Legal Research, covering District Court, E.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wheeler v. Pilgrim's Pride Corp., 246 F.R.D. 532, 2007 U.S. Dist. LEXIS 79580, 2007 WL 3085798 (E.D. Tex. 2007).

Opinion

ORDER

DAVID FOLSOM, District Judge.

(I) INTRODUCTION

Currently before the Court is Plaintiffs’ Motion for Class Certification (Doc. No. 32). Also pending before the Court is Defendants’ Joint Motion to Strike Plaintiffs’ Expert Declarations (Doc. No. 81) and Plaintiffs’ Motion to Strike the Declaration of David Sibley (Doc. No. 94). All relevant responsive briefing is before the Court and a hearing was held on February 8, 2007. For the reasons set forth below, all three motions are DENIED.

(II) BACKGROUND

The present case involves a class action complaint brought by several chicken “growers” against two of the leading poultry producers in the country: Pilgrim’s Pride Corporation (hereafter “Pilgrim”) and Tyson Foods, Inc., Tyson Poultry, Inc., Tyson Farms of Texas, Inc., Tyson Chicken, Inc., and Hudson Foods, Inc., (collectively “Tyson”). Poultry dealers like Pilgrim and Tyson are commonly called “integrators” and form the backbone of the poultry business. Integrators are not only the primary buyers of production quality chickens, but are also the source of the chicks, feed, and medicine used by the growers. The type of chickens provided to the growers are known as “broilers.” Within this structure, integrators contract with chicken farmers to assist them in raising chickens. These farmers are re[536]*536ferred to as “growers” because they perform the essential function of growing the chicks into production quality birds. In the poultry business this is known as the “grow-out process.” The typical contract between an integrator and a grower provides that the integrator will provide chicks, feed, medicine, and other supplies to the growers. The growers then use their labor and industry specific knowledge to grow out the broilers. The grow-out process typically takes less than two months for each flock. At that time the broilers are transported from the growers back to the integrator for processing.

Defendants compensate the growers based on the “tournament system.”1 The tournament system ranks the growers against each other based on the quality of their broilers, the proportion of broilers that survive the grow-out process, and the amount of feed and supplies used in growing out the birds. There are also other variables such as fuel allowances that affect compensation. Defendants then compensate the growers depending on how they rank against their peers by either adding or subtracting compensation from a base pay rate.

The operations of Pilgrim and Tyson include numerous complexes throughout the United States. Each complex typically has a pullet farm, a breeder farm, hatchery, feed mill, and processing plant. As noted, the broilers are sent back to the processing plant for meat production upon completion of the grow-out process. Due to the costs and other logistical concerns the growers are typically located within forty to fifty miles of the processing plant in the complex.

The named plaintiffs in this action are Cody Wheeler, Don Davis, Davey Williams, and Jerry “Butch” Ward. The first three are growers in Pilgrim’s “Lufkin, Texas Complex.” See Doc. No. 27 at 2. Plaintiff Ward, in turn, is a grower in Pilgrim’s “NETEX Complex.” See id. Although many of the potential class members are Tyson growers, none of the named plaintiffs are growers for Tyson. Plaintiffs’ Sixth Amended Complaint (hereafter “the complaint”) states that Plaintiffs bring Sherman Act claims on their own behalf and on behalf of a similarly situated class of growers. See Doc. No. 27 at 8. The proposed class consists of both Pilgrim and Tyson growers throughout Northeast Texas and Arkansas. See id. Plaintiffs allege that Defendants have illegally made market allocation agreements and price-fixing agreements in violation of Section 1 of the Sherman Act of 1890. See Doc. No. 32 at 10. Specifically, Plaintiffs assert that Defendants have conspired to suppress grower compensation via exchange of confidential price information including the use of Agri-Stats2 reports and agreeing to split the grower market between them by not contracting with the others’ growers. See id. at 10-12. Plaintiffs assert that these acts improperly reduced competition and suppressed the base prices paid to growers. Plaintiffs seek to establish Defendants’ civil liability for these acts under Section 4 of the Clayton Antitrust Act.

(III) DISCUSSION

(A) Whether Plaintiffs Have Standing to Maintain Their Class-Action Complaint

In order to pursue their claims Plaintiffs must first demonstrate that they have standing to do so. See, e.g., Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). The constitutional minimum requirements of standing require a plaintiff to demonstrate (1) an injury in fact; (2) that the injury is fairly traceable to the alleged misconduct of the defendant; and (3) that a favorable decision is likely to redress the injury. See id. The Supreme Court has also made clear that an “injury in fact” must be “an invasion of a legally protected interest which is (a) concrete and particularized, and (b) actual or [537]*537imminent, not conjectural or hypothetical.” See id. (internal quotations omitted). The burden of demonstrating standing to invoke federal jurisdiction falls on the party seeking to establish these elements. See id. at 561, 112 S.Ct. 2130. “Since they are not mere pleading requirements but rather an indispensable part of the plaintiffs case, each element must be supported in the same way as any other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation.” See id.

Furthermore, “[ijnclusion of class action allegations in a complaint does not relieve a plaintiff of himself meeting the requirements for constitutional standing, even if the persons described in the class definition would have standing themselves to sue.” Brown v. Sibley, 650 F.2d 760, 771 (5th Cir.1981). “If the plaintiff has no standing individually, no case or controversy arises. This constitutional threshold must be met before any consideration of the typicality of claims or commonality of issues required for procedural reasons by Fed.R.Civ.P. 23.” See id.

Thus, as a threshold matter, the Court must determine whether Plaintiffs have standing to pursue their class claims. Defendants argue that Plaintiffs lack individual standing and therefore cannot pursue class certification. See Doc. No. 53 at 35 (“Because named Plaintiffs fail to demonstrate standing to pursue their individual claims, they also lack standing to pursue class claims.”). Specifically, Defendants point out that none of the named class representatives have ever worked for Tyson. See Doc. No. 72 at 52. Furthermore, Pilgrim’s notes that Plaintiffs lack proof of their allegations and therefore they lack standing. See id. Defendant Tyson also argues, essentially, that Plaintiffs lack standing because their circumstances are not typical of the overall class. See Doc. No. 72 at 53-54.

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Bluebook (online)
246 F.R.D. 532, 2007 U.S. Dist. LEXIS 79580, 2007 WL 3085798, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wheeler-v-pilgrims-pride-corp-txed-2007.