Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca6-08-05577/USCOURTS-ca6-08-05577-0/pdf.json

Nature of Suit Code: 891
Nature of Suit: Agricultural Acts
Cause of Action: 

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RECOMMENDED FOR FULL-TEXT PUBLICATION

Pursuant to Sixth Circuit Rule 206

File Name: 10a0127p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT _________________

ALTON T. TERRY,

Plaintiff-Appellant,

v.

TYSON FARMS, INC.,

Defendant-Appellee.

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No. 08-5577

Appeal from the United States District Court

for the Eastern District of Tennessee at Winchester.

No. 08-00003—Harry S. Mattice, Jr., District Judge.

Argued: March 4, 2009

Decided and Filed: May 10, 2010 

Before: NORRIS, COOK, and GRIFFIN, Circuit Judges.

_________________

COUNSEL

ARGUED: Cynthia Noles Johnson, JOHNSON LAW, P.C., Cohutta, Georgia, for

Appellant. Jay T. Jorgensen, SIDLEY AUSTIN LLP, Washington, D.C., for Appellee.

Jonathan H. Levy, UNITED STATES DEPARTMENT OF JUSTICE, Washington, DC, for

Amicus Curiae. ON BRIEF: Cynthia Noles Johnson, JOHNSON LAW, P.C., Cohutta,

Georgia, Russell D. Hedges, MOORE & HEDGES, Tullahoma, Tennessee, for Appellant.

Jay T. Jorgensen, Carter G. Phillips, SIDLEY AUSTIN LLP, Washington, D.C., Travis R.

McDonough, Roger W. Dickson, Zachary H. Greene, MILLER & MARTIN PLLC,

Chattanooga, Tennessee, for Appellee. Jonathan H. Levy, Michael S. Raab, UNITED

STATES DEPARTMENT OF JUSTICE, Washington, DC, for Amicus Curiae. 

_________________

OPINION

_________________

GRIFFIN, Circuit Judge. Plaintiff Alton T. Terry, a Tennessee poultry farmer,

entered into a contract with defendant Tyson Farms, Inc., the nation’s largest poultry

processing firm, to raise chickens. The present action evolved from purportedly unlawful

1

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retaliatory actions taken by Tyson against Terry in response to his affiliation with, and

leadership role in, a newly organized regional growers’ association. Terry brought suit

under the Agricultural Fair Practices Act of 1967 (“AFPA”), 7 U.S.C. § 2303, alleging

unlawful interference and discrimination based on his membership in the growers’

association; and the Packers and Stockyards Act (“PSA”), 7 U.S.C. §§ 192(a) and (b),

alleging that Tyson engaged in unfair, discriminatory or deceptive practices, and subjected

him to undue or unreasonable prejudice or disadvantage.

Tyson moved to dismiss Terry’s complaint pursuant to Federal Rule of Civil

Procedure 12(b)(6). The district court granted the motion as to both claims and entered

judgment in favor of Tyson. In doing so, the court determined that Terry failed to allege his

involvement with an “association of producers,” as defined and required by the AFPA,

7 U.S.C. § 2302(c) (2008). The district court also awarded Tyson attorney’s fees incurred

in defending against Terry’s AFPA claim, pursuant to 7 U.S.C. § 2305(a). With respect to

Terry’s PSA claim, the district court held that proof of injury to competition is a necessary

element of a claim under 7 U.S.C. §§ 192(a) and (b) and, because Terry failed to plead that

Tyson’s actions had an adverse effect on competition, this count likewise must be dismissed

for failure to state a claim.

Terry now appeals the dismissal of his complaint and the district court’s award of

attorney’s fees to Tyson. For the following reasons, we affirm.

I.

In our de novo review of the district court’s grant of Tyson’s motion to dismiss under

Rule 12(b)(6), we construe Terry’s complaint in the light most favorable to him and accept

his well-pled factual allegations as true. Jones v. City of Cincinnati, 521 F.3d 555, 559 (6th

Cir. 2008).

In 2001, Terry bought a poultry farm in Tennessee and entered into an agreement

with Tyson, which contracts with independent growers to raise broiler chickens owned and

provided by the company. Tyson provides the chicks, feed, and technical advice; the

responsibility of the grower is to raise the chickens to a target processing weight and then

return the mature birds to Tyson. Tyson pays its growers according to a formula that

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1

9 C.F.R. § 201.82(b) provides: “Whenever live poultry is obtained under a poultry growing

arrangement, the poultry shall be transported promptly after loading and the gross weight for grower

payment purposes shall be determined immediately upon arrival at the processing plant, holding yard, or

other scale normally used for such purpose.” 

2

9 C.F.R. § 201.108-1(e)(4) states in pertinent part: “Poultry growers . . . are entitled to observe

the balancing, weighing, and recording procedures. A weigher shall not deny such persons that right or

withhold from them any information pertaining to the weight.” 

measures the relative productivity of the growers by comparing the amount of feed provided

and the weight of the chickens upon their return to the processing plant. Consequently, the

weight of the chickens at the end of the grow-out period is an important factor in the

compensation equation, and federal regulations provide that weighing is to occur

immediately upon arrival at the processor’s plant. See 9 C.F.R. § 201.82(b).1

 A grower is

entitled to watch his birds being weighed. See 9 C.F.R. § 201.108-1(e)(4).2

 Tyson’s

alleged failure to promptly weigh Terry’s chickens and allow Terry access to the

weighing of his birds began the chain of events that culminated in this lawsuit.

Before he purchased the farm, Terry researched the poultry business, reviewed

the seller’s production records, and spoke with Tyson’s production manager at its

Shelbyville, Tennessee, complex about Tyson’s intent to continue its placement of

chickens at the farm following the sale. The production manager assured Terry that the

farm and equipment were in excellent condition and that it was a top-producing farm.

These assurances lead Terry to believe that the farm would need no substantial

improvements in the near future. In the summer of 2001, Terry and his family moved

to the farm, and he took over management of the poultry flock.

Terry thereafter became aware of numerous problems that poultry growers were

experiencing with Tyson and other poultry processors. In 2002, Terry attended a

conference in North Carolina with other contract growers, attorneys representing

growers, and representatives of farmers’ organizations. The purpose of the conference

was to address the problems faced by growers in their dealings with processors and to

provide guidelines for the organization of grower associations. After the conference,

Terry became actively involved in organizing the poultry growers in his area into what

ultimately became the Tennessee Poultry Growers Association (“TPGA”). In 2004, he

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was elected chairman of the directors for the TPGA. In his capacity as a TPGA officer,

Terry educated poultry growers about their rights under federal law and reported

complaints about Tyson to officials at the Packers and Stockyards Administration in

Washington, D.C.

Meanwhile, Terry became concerned that his poultry was not being weighed

promptly upon arrival at the Tyson plant, as required by his contract and federal

regulations. In August and December of 2004, he went to Tyson’s plant to watch his

birds being weighed, but he was denied access. He complained to a federal official and

requested that a letter be sent to Tyson. On February 13, 2005, Terry followed a truck

loaded with his poultry to Tyson’s processing plant. When he arrived at the plant at 2:00

a.m., he was told that his chickens would not be weighed until after 4:00 a.m. When

Terry returned at 4:00 a.m., he was once again denied access to the plant. Plaintiff called

an agent with the Grain Inspection Division of the Packers and Stockyards

Administration, who told Terry that he was in route to the plant and would find out why

Terry was not allowed to observe the weighing of his poultry.

Later that same week, Terry met with Tyson’s local managers. Following the

meeting, Tyson delayed its placement of birds on Terry’s farm for a full flock rotation,

costing Terry $30,000 in lost compensation. When Terry met with Tyson’s managers

again on March 28, 2005, they informed him that Tyson made a “company decision” to

discontinue the placement of birds at his farm after he made the weighing complaint.

Terry asked for, but was refused, compensation for the damages he sustained as a result

of the missed flock.

On January 11, 2006, Tyson notified Terry that his contract would not be

renewed, allegedly because of his confrontational behavior toward Tyson’s

representatives and his failure to make “costly and unnecessary” changes to his poultry

operation, despite the fact that Terry was a successful poultry producer and was “well

above average” in the grower rankings. Terry avers that “[t]he reasons provided by

Tyson for termination of [his] contract were false and pretextual to disguise Tyson’s real

reason, which was to thwart [his] efforts to organize growers, and in retaliation for [his]

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complaints to the Packers [and] Stockyards Administration.” Terry subsequently

advertised his farm for sale, but claims that he has been unable to sell it due to Tyson’s

demands for costly upgrades as a condition to the continued placement of poultry at the

farm. This lawsuit followed.

II.

“[T]o survive a motion to dismiss, the complaint must contain either direct or

inferential allegations respecting all material elements to sustain a recovery under some

viable legal theory.” Tam Travel, Inc. v. Delta Airlines, Inc., 583 F.3d 896, 903 (6th Cir.

2009) (citation omitted). “We need not accept as true legal conclusions or unwarranted

factual inferences, and conclusory allegations or legal conclusions masquerading as

factual allegations will not suffice.” Id. (citations and internal quotation marks omitted).

“[T]he complaint’s ‘[f]actual allegations must be enough to raise a right to relief above

the speculative level,’ and ‘state a claim to relief that is plausible on its face.’” Id.

(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007)).

The parties to this appeal do not dispute the factual specificity of Terry’s

allegations. Rather, at issue is whether Terry’s complaint contains adequate “direct or

inferential allegations respecting all material elements to sustain a recovery” under the

AFPA and PSA. Tam Travel, Inc., 583 F.3d at 903. With regard to the latter statute,

however, we must first settle the question whether a showing of injury to competition

is a necessary element of a claim under the PSA.

III.

This case poses a matter of first impression in this circuit: whether a plaintiff

asserting unfair discriminatory practices or undue preference under §§ 202(a) and (b) of

the PSA must allege an adverse effect on competition in order to state a claim. This

issue is not novel to other courts; it has been addressed by seven of our sister circuits,

with consonant results. All of these courts of appeals unanimously agree that an

anticompetitive effect is necessary for an actionable claim under subsections (a) and (b).

For the reasons that follow, we join this legion.

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Section 202 of the PSA, codified at 7 U.S.C. § 192, provides:

It shall be unlawful for any packer or swine contractor with respect to

livestock, meats, meat food products, or livestock products in

unmanufactured form, or for any live poultry dealer with respect to live

poultry, to:

(a) Engage in or use any unfair, unjustly discriminatory,

or deceptive practice or device; or

(b) Make or give any undue or unreasonable preference

or advantage to any particular person or locality in any

respect, or subject any particular person or locality to any

undue or unreasonable prejudice or disadvantage in any

respect; or

(c) Sell or otherwise transfer to or for any other packer,

swine contractor, or any live poultry dealer, or buy or

otherwise receive from or for any other packer, swine

contractor, or any live poultry dealer, any article for the

purpose or with the effect of apportioning the supply

between any such persons, if such apportionment has the

tendency or effect of restraining commerce or of creating

a monopoly; or

(d) Sell or otherwise transfer to or for any other person,

or buy or otherwise receive from or for any other person,

any article for the purpose or with the effect of

manipulating or controlling prices, or of creating a

monopoly in the acquisition of, buying, selling, or dealing

in, any article, or of restraining commerce; or

(e) Engage in any course of business or do any act for the

purpose or with the effect of manipulating or controlling

prices, or of creating a monopoly in the acquisition of,

buying, selling, or dealing in, any article, or of restraining

commerce; or

(f) Conspire, combine, agree, or arrange with any other

person (1) to apportion territory for carrying on business,

or (2) to apportion purchases or sales of any article, or

(3) to manipulate or control prices; or

(g) Conspire, combine, agree, or arrange with any other

person to do, or aid or abet the doing of, any act made

unlawful by subdivisions (a), (b), (c), (d), or (e) of this

section.

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7 U.S.C. § 192 (hereinafter “§ 192”).

Terry alleges in Count Two of his complaint that “[d]efendant violated the [PSA]

by engaging in unfair, unjustly discriminatory, or deceptive practices or devises [sic] in

violation of § 202 of the [PSA], 7 U.S.C. § 192(a); and by subjecting Plaintiff to undue

or unreasonable prejudice or disadvantage in violation of 7 U.S.C. § 192(b).” However,

Tyson argued, and the district court agreed, that because the PSA is essentially an

antitrust statute, subsections (a) and (b) require a party to allege an adverse effect on

competition in order to sustain a cause of action. The district court dismissed Terry’s

PSA claim for failure to allege such anticompetitive activity on Tyson’s part. In

reaching this conclusion, the court noted the dearth of Sixth Circuit precedent on this

issue and followed the prevailing tide of other circuit court decisions that have held that

subsections (a) and (b) of § 192 require an anticompetitive effect.

The tide has now become a tidal wave, with the recent issuance of the Fifth

Circuit Court of Appeals’ en banc decision in Wheeler v. Pilgrim’s Pride Corp., 591

F.3d 355 (5th Cir. 2009) (en banc), in which that court joined the ranks of all other

federal appellate courts that have addressed this precise issue when it held that “the

purpose of the Packers and Stockyards Act of 1921 is to protect competition and,

therefore, only those practices that will likely affect competition adversely violate the

Act.” Wheeler, 591 F.3d at 357. All told, seven circuits – the Fourth, Fifth, Seventh,

Eighth, Ninth, Tenth, and Eleventh Circuits – have now weighed in on this issue, with

unanimous results. See Wheeler, 591 F.3d 355; Been v. O.K. Indus., Inc., 495 F.3d 1217,

1230 (10th Cir. 2007); Pickett v. Tyson Fresh Meats, Inc., 420 F.3d 1272, 1280 (11th

Cir. 2005), cert. denied, 547 U.S. 1040 (2006); London v. Fieldale Farms Corp., 410

F.3d 1295, 1303 (11th Cir. 2005), cert. denied, 546 U.S. 1034 (2005); IBP, Inc. v.

Glickman, 187 F.3d 974, 977 (8th Cir. 1999); Philson v. Goldsboro Milling Co., Nos.

96-2542, 96-2631, 164 F.3d 625, 1998 WL 709324, at *4-5 (4th Cir. Oct. 5, 1998)

(unpublished table decision); Jackson v. Swift Eckrich, Inc., 53 F.3d 1452, 1458 (8th Cir.

1995); Farrow v. United States Dep’t of Agric., 760 F.2d 211, 215 (8th Cir. 1985);

DeJong Packing Co. v. United States Dep’t of Agric., 618 F.2d 1329, 1336-37 (9th Cir.

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1980), cert. denied, 449 U.S. 1061 (1980); and Pac. Trading Co. v. Wilson & Co., 547

F.2d 367, 369-70 (7th Cir. 1976).

In this appeal, Terry, joined by amicus curiae United States Department of

Agriculture (“USDA”), seeks to persuade us to adopt the decidedly minority view

embraced by some district courts and vigorously articulated by Judge Garza, along with

six of his colleagues, in his dissenting opinion in Wheeler. See Wheeler, 591 F.3d at 371

(Garza, J., dissenting). See also Schumacher v. Tyson Fresh Meats, Inc., 434 F. Supp.

2d 748, 754 (D.S.D. 2006) (holding that “§ 192(a)[] does not prohibit only those unfair

and deceptive practices which adversely affect competition”); Kinkaid v. John Morrell

& Co., 321 F. Supp. 2d 1090, 1102 (N.D. Iowa 2004) (“[T]his court finds that only a

strained reading of the statute could require that practices that are ‘unfair’ or ‘deceptive’

within the meaning of § 192(a) must also be ‘monopolistic’ or ‘anticompetitive’ to be

prohibited.”); Gerace v. Utica Veal Co., Inc., 580 F. Supp. 1465, 1469-70 (N.D.N.Y.

1984) (holding that it is unnecessary to allege restraint of trade or hindrance of

competition under § 192(a)).

Ultimately, Terry and the USDA would have this court deviate from the course

taken by the seven other circuits that have spoken on this issue, thus creating a conflict.

We decline to do so. “[W]hile we recognize that we are not bound by the law of other

Circuits, this court has also routinely looked to the majority position of other Circuits in

resolving undecided issues of law. We also take note of the importance of maintaining

harmony among the Circuits on issues of law.” Wong v. Partygaming Ltd., 589 F.3d

821, 827-28 (6th Cir. 2009) (citations omitted); see also United States v. Washington,

584 F.3d 693, 698 (6th Cir. 2009) (“[T]his court routinely looks to our sister circuits for

guidance when we encounter a legal question that we have not previously passed

upon.”). As one court has explained, this is more than a courtesy:

As a general matter, we do not create conflicts among the circuits

without strong cause. We adhere to this view because federal law (unlike

state law) is supposed to be unitary. It would, of course, be foolhardy to

suggest that we should blindly adhere to another circuit court’s decision

as a fail-safe method of preventing intercircuit conflict. Congress has

created multiple and co-equal intermediate federal appellate courts, each

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3

See also Admiral Fin. Corp. v. United States, 378 F.3d 1336, 1340 (Fed. Cir. 2004) (“[W]e

accord great weight to the decisions of our sister circuits when the same or similar issues come before us,

and we do not create conflicts among the circuits without strong cause.”) (internal quotation marks

omitted); Am. Vantage Cos., Inc. v. Table Mountain Rancheria, 292 F.3d 1091, 1098 (9th Cir. 2002)

(“[A]lthough we are by no means compelled to follow the decisions of other circuits, there is virtue in

uniformity of federal law as construed by the federal circuits.”) (citation and internal quotation marks

omitted); United States v. Auginash, 266 F.3d 781, 784 (8th Cir. 2001) (“Although we are not bound by

another circuit’s decision, we adhere to the policy that a sister circuit’s reasoned decision deserves great

weight and precedential value. As an appellate court, we strive to maintain uniformity in the law among

the circuits, wherever reasoned analysis will allow, thus avoiding unnecessary burdens on the Supreme

Court docket.”) (internal quotations marks omitted); Mayer v. Spanel Int’l Ltd., 51 F.3d 670, 675 (7th Cir.

1995) (“We do not create conflicts among the circuits without strong cause.”); Int’l Soc’y for Krishna

Consciousness, Inc. v. Lee, 925 F.2d 576, 580 (2d Cir. 1991) (“Where there is the considerable weight of

unanimous authority, we believe that creation of such a circuit conflict must be based on an abiding

conviction that the view of several other courts is unreasonable, lest the Supreme Court’s ability to resolve

conflicts among the circuits be impaired by the sheer number of such conflicts.”). 

4

“[W]e are not constrained to follow [the views of our sister circuits] if, in our opinion, they are

based upon an incomplete or incorrect analysis.” Nixon v. Kent County, 76 F.3d 1381, 1388 (6th Cir.

1996) (citation omitted). 

with an equal power and duty to decide the cases properly brought before

it. This regime, by design, embraces the possibility of a considered

difference in views among the circuit courts on a given question; a policy

of blind adherence to the decision of another circuit, apart from any

utility it might have in promoting uniformity and predictability in

outcome, would flout the manifest will of Congress. As then-Judge

Ginsburg had occasion to observe in In re Korean Air Lines Disaster,

“each [federal court] has an obligation to engage independently in

reasoned analysis.” 829 F.2d 1171, 1176 (D.C. Cir. 1987), aff’d, 490

U.S. 122 [] (1989). At the same time, the interest that all prospective

parties before the court have in uniformity and predictability of outcome

must be given its due. We thus temper the independence of the analysis

in which we engage by according great weight to the decisions of other

circuits on the same question.

Washington Energy Co. v. United States, 94 F.3d 1557, 1561 (Fed. Cir. 1996).3

 Indeed,

the Wheeler court was sensitive to the vast body of cohesive precedent when it pointed

out that “[p]redictability must be the lodestar.” Wheeler, 591 F.3d at 363.

As the next in line to interpret § 192.s requirements, we, too, assign great weight

to the unanimity of thought that precedes our own determination of this issue. Needless

to say, “[w]e are not merely to count noses.” United States v. Hill, 48 F.3d 228, 232 (7th

Cir. 1995).4

 However, the rationale employed by our sister circuits is well-reasoned and

grounded on sound principles of statutory construction. Moreover, under the

fundamental principle of stare decisis, we deem the construction of this nearly 90-year-

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old statute to be a matter of settled law. We therefore join these circuits and hold that

in order to succeed on a claim under §§ 192(a) and (b) of the PSA, a plaintiff must show

an adverse effect on competition.

In the present case, the district court properly determined that although Terry

asserts a number of wrongful acts by Tyson, his complaint does not allege that Tyson’s

actions had an anticompetitive effect: “Plaintiff focuses solely on how Defendant’s

action harmed him as an individual grower. He makes no allegations regarding the

effect of Defendant’s actions on the pricing of poultry or on overall competition in the

poultry industry.” Accordingly, the district court did not err in granting Tyson’s motion

to dismiss Terry’s PSA claim.

IV.

Congress enacted the AFPA in 1968 to “protect[] the right of farmers and other

producers of agricultural commodities to join cooperative associations through which

to market their products,” and “to rectify a perceived imbalance in bargaining position

between producers and processors of such products.” Mich. Canners and Freezers

Ass’n, Inc. v. Agric. Mktg. and Bargaining Bd., 467 U.S. 461, 464 (1984) (footnotes

omitted). “[T]he Act’s principal purpose is to protect individual producers from

interference by processors when deciding whether to belong to a producers’ association

. . . .” Id.; see also Newark Gardens, Inc. v. Mich. Potato Indus. Comm’n, 847 F.2d

1201, 1203 (6th Cir. 1988); 7 U.S.C. § 2301 (“Because agricultural products are

produced by numerous individual farmers, the marketing and bargaining position of

individual farmers will be adversely affected unless they are free to join together

voluntarily in cooperative organizations as authorized by law.”). Consistent with these

aims, the AFPA proscribes certain actions by processors, known as “handlers” under the

Act:

It shall be unlawful for any handler knowingly to engage or permit any

employee or agent to engage in the following practices:

(a) To coerce any producer in the exercise of his right to

join and belong to or to refrain from joining or belonging

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5

The recently enacted Food, Conservation, and Energy Act of 2008 expanded the definition of

“association of producers” to include “an organization whose membership is exclusively limited to

agricultural producers and dedicated to promoting the common interest and general welfare of producers

of agricultural products.” 7 U.S.C. § 2302(2)(B). See Pub. L. 110-234, § 11003(6)(B), and Pub. L. 110-

246, § 11003(6)(B) (redesignating former subsection (c) of § 2302 as paragraph 2 and added subparagraphs

(A) and (B)). The issue of retroactive application of this amendment, effective May 22, 2008, has not been

raised by Terry on appeal and hence is forfeited. See generally United States v. Johnson, 440 F.3d 832,

845-46 (6th Cir. 2006) (“[A]n appellant abandons all issues not raised and argued in its initial brief on

appeal.”) (citation and quotation marks omitted); Farm Labor Org. Comm. v. Ohio State Highway Patrol, 308 F.3d 523, 544 n.8 (6th Cir. 2002) (“It is well established that an issue not raised in a party’s briefs on

appeal may be deemed waived.”). 

to an association of producers, or to refuse to deal with

any producer because of the exercise of his right to join

and belong to such an association; or

(b) To discriminate against any producer with respect to

price, quantity, quality, or other terms of purchase,

acquisition, or other handling of agricultural products

because of his membership in or contract with an

association of producers[.]

7 U.S.C. §§ 2303(a) and (b).

In Count One of his complaint, Terry alleges that Tyson violated § 2303 by

“knowingly permitting its employee or agent to coerce and intimidate Plaintiff in the

exercise of his right to join and belong to an association of producers and by

discriminating against Plaintiff with respect to the quantity and quality of poultry and

feed supplied to Plaintiff because of his membership in an association of producers.”

The parties do not dispute that Tyson is a “handler” and Terry is a “producer,”

as defined by the AFPA. See 7 U.S.C. §§ 2302(3)(A) and(4) (defining these respective

terms). Rather, the dispositive issue is whether the association with which Terry was

affiliated – the TPGA – satisfies the AFPA’s definition of an “association of producers,”

so as to bring his allegations of coercion and discrimination under the protective

umbrella of the statute. During the time period relevant to this cause of action, the

AFPA defined an “association of producers” as “any association of producers of

agricultural products engaged in marketing, bargaining, shipping, or processing as

defined in section 1141j(a) of Title 12, or in section 291 of this title.” 7 U.S.C. § 2302(c)

(emphasis added).5

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 Section 2302(c) of the AFPA cross-references two other statutes, the Agricultural

Marketing Act of 1929 (“AMA”) and the Capper-Volstead Act, which define similar

farming associations. The AMA was enacted to promote the efficient production and

distribution of agricultural commodities, in part, by permitting producers to organize

“cooperative associations” to assist in bringing products to market. 12 U.S.C.

§ 1141(a)(3); see Fairdale Farms, Inc. v. Yankee Milk, Inc., 635 F.2d 1037, 1042 (2d

Cir. 1980) (observing that the declared policy of the AMA is “to promote the effective

merchandising of agricultural commodities” through “a farm marketing system of

producer-owned and producer-controlled cooperative associations.”). The AMA defines

the term “cooperative association” as

any association in which farmers act together in processing, preparing for

market, handling, and/or marketing the farm products of persons so

engaged, and also means any association in which farmers act together

in purchasing, testing, grading, processing, distributing, and/or furnishing

farm supplies and/or farm business services . . . .

12 U.S.C. § 1141j(a).

The Capper-Volstead Act “removed from the proscription of the antitrust laws

cooperatives formed by certain agricultural producers that otherwise would be directly

competing with each other in efforts to bring their goods to market.” Nat’l Broiler Mktg.

Ass’n v. United States, 436 U.S. 816, 822 (1978) (footnote omitted). It was passed by

Congress in 1922 “to make it clear that the formation of an agricultural organization with

capital would not result in a violation of the antitrust laws, and that the organization,

without antitrust consequences, could perform certain functions in preparing produce for

market.” Id. at 824; see also Newark Gardens, Inc., 847 F.2d at 1208 (noting that the

Capper-Volstead Act “exempts agricultural cooperatives from the antitrust laws”). The

Capper-Volstead Act includes within its scope agricultural producers who “act together

in associations . . . in collectively processing, preparing for market, handling, and

marketing [farm products] in interstate and foreign commerce.” 7 U.S.C. § 291. “The

real sense behind such an association and the prime purpose of the persons so banding

together is to accomplish a common objective – collective marketing. It is a collection

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of producers cooperating to sell the goods they have produced.” United States v. Elm

Springs Farm, Inc., 38 F. Supp. 508, 511 (D. Mass. 1941); see also Alexander v. Nat’l

Farmers Org., 687 F.2d 1173, 1185 (8th Cir. 1982) (“The unmistakable purpose of the

Capper-Volstead Act is to permit farmers and only farmers to band together and benefit

economically from collective marketing of their products.”).

In its motion to dismiss, Tyson argued that the TPGA does not qualify as an

AFPA “association of producers” because Terry does not allege that the TPGA engaged

in the requisite “marketing, bargaining, shipping, or processing” activities enumerated

in § 2302(c); instead, Terry’s complaint avers only that the TPGA gathered information,

educated its members, and reported complaints about Tyson and other processors to the

government – functions purportedly outside of the purview of the AFPA.

The district court examined Terry’s complaint and, relying on the plain language

of § 2302(c), agreed with Tyson that the TPGA does not fall within the statutory

definition of an “association of producers”:

Interpreting § 2302(c), the United States Court of Appeals for the Sixth

Circuit has held that a state-run potato commission was not an

“association of producers” because it did not engage in marketing,

bargaining, shipping or processing of agricultural products. Newark

Gardens, Inc. v. Mich. Potato Indus. Comm’n, 847 F.2d 1201, 1206 (6th

Cir. 1988).

In his capacity as president of the TPGA, Plaintiff “gathered information

from other growers about problems they were having with Tyson” and

reported these complaints to government agencies. (Complaint, Court

Doc. 1, ¶ 13.). Plaintiff also “educated other growers about federal laws

prohibiting abuse of growers in the poultry industry.” (Id. at ¶ 14.).

Plaintiff distributed video tapes to other growers that reported on

problems in the poultry industry. (Id. at ¶ 15.). From the allegations in

Plaintiff’s complaint, it appears that TPGA is principally involved with

educating growers about their rights and assisting growers with enforcing

their rights by reporting producers’ violations to federal agencies.

Defendant argues that TPGA’s “educational and informational efforts

and, to the extent that they exist, its government complaints, do not

qualify it as an ‘association of producers’” under the AFPA. (Court Doc.

11 at 7.). The statutory language is clear that an “association of

producers” includes only those organizations that engage in “marketing,

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bargaining, shipping or processing” of agricultural products. 7 U.S.C.

§ 2302(c). The Court must therefore evaluate whether the TPGA is

involved with any of the specified activities.

“Marketing” is “the act of buying and selling in a market; the commercial

functions involved in transferring goods from producer to consumer.”

The American Heritage Dictionary of the English Language 1072 (4th

ed. 2000). No reasonable inference can be drawn from the allegations in

the complaint that the TPGA engages in buying or selling of goods in a

market or in the commercial functions involved with transferring goods

from producer to consumer. The actions of the TPGA do not, therefore,

qualify as marketing under § 2302.

“Shipping” is “the act or business of transporting goods.” Id. at 1607.

“Producing” is “to bring forth, yield; to manufacture; to cause to occur

or exist; to make or yield products or a product.” Id. at 1399. No

reasonable inference can be drawn from the complaint that the TPGA is

involved with shipping or producing agricultural goods under § 2302. 

“Bargaining” is “to negotiate the terms of an agreement, as to sell or

exchange; to engage in collective bargaining; to arrive at an agreement.”

Id. at 144. There is no allegation that TPGA negotiates on behalf of any

of its members or, as discussed above, sells or exchanges agricultural

goods. “Collective bargaining” is “negotiation between organized

workers and their employer or employers to determine wages, hours,

rules, and working conditions.” Id. at 362. Although it appears that

Plaintiff, in his role as president of TPGA, discussed issues such as

working conditions and federal laws with other growers, there is no

allegation that he ever discussed those issues with Defendant. Moreover,

the relationship between Plaintiff and Defendant is not that of

employer/employee but of two commercial organizations under

contractual obligations to each other. There is no indication from the

allegations in the complaint that TPGA had any interaction with

Defendant and could not, therefore, have collectively bargained with

Defendant. As such, there is no indication that TPGA engaged in

“bargaining,” collective or otherwise, with regard to agricultural products

as required by § 2302.

The district court further determined that the TPGA’s educational and

enforcement activities did not otherwise fall within the cross-referenced definitions set

forth in the AMA and Capper-Volstead Act, and observed that “[t]here is no apparent

policy reason that the activities of the TPGA would be subject to antitrust laws and

therefore no need to establish an exemption for such activities.” Therefore, because a

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material element of Terry’s AFPA claim was fatally lacking, the district court dismissed

Terry’s AFPA claim. We affirm the district court’s sound decision.

Terry argues that in granting Tyson’s motion to dismiss, the district court

employed a pleading standard that is too exacting under Twombly. He contends that “[a]

plausible reading of [his] [c]omplaint is that one of the purposes of [the TPGA] was to

strengthen the marketing and bargaining position of the growers who were organizing

to address common grievances and concerns in their relationship with Tyson” and,

therefore, the TPGA qualifies as an “association of producers.” According to Terry, the

district court’s “narrow” construction of the AFPA is at odds with the remedial purpose

of the statute, i.e., to prevent processors from using their superior bargaining position to

the detriment of producers. Terry maintains that Tyson has effectively chilled the ability

of its contract growers to form an association for their mutual benefit and increase their

bargaining power, thereby defying the protective goals of the AFPA.

However, Terry’s interpretation of the AFPA disregards the plain language of the

statute, see Thompson v. N. Am. Stainless, 567 F.3d 804, 807 (6th Cir. 2009) (en banc),

and the germane maxim expressio unius est exclusio alterius (“the expression of one

thing is the exclusion of others”), Millsaps v. Thompson, 259 F.3d 535, 546 (6th Cir.

2001), that “justif[ies] the inference that [activities] not mentioned were excluded by

deliberate choice, not inadvertence . . . .” City of Cleveland v. Ohio, 508 F.3d 827, 847

(6th Cir. 2007) (citation and internal quotation marks omitted). Terry’s complaint does

not allege that the TPGA engaged in any of the primary functions of an “association of

producers” enumerated in the AFPA or related statutes. Moreover, Terry’s stance is

contradictory to our prior decision in Newark Gardens.

In Newark Gardens, the plaintiff, a Michigan potato-farming business, brought

suit against the Michigan Potato Industry Commission, alleging that certain provisions

of a Michigan statute that required potato producers to pay a promotional assessment to

the commission was in conflict with and, thus, preempted by the AFPA. Newark

Gardens, 847 F.2d at 1201. The plaintiff argued that it was being coerced into joining

or belonging to an “association of producers” in violation of § 2303(a) of the AFPA, or

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6

These activities were carried out by the individual members. 

maintaining a “marketing contract with an association of producers” in violation of

§ 2303(c). Id. at 1207. The express purpose of the Potato Commission was to “foster,

develop, and promote the potato industry through research, promotion, advertising,

market expansion, development of new markets, education, and the development and

dissemination of market and industry information.” Id. at 1202 (quoting MICH. COMP.

LAWS § 290.423(1)). We rejected the plaintiff’s “expansive interpretation of the

definition of ‘association of producers,’” namely, its argument that because the Potato

Commission supplied “market information,” it therefore engaged in “marketing” under

the AFPA:

The district court concluded that [the] definitional sections [of the AFPA,

AMA and Capper-Volstead Act] described traditional cooperatives

among farmers and did not contemplate governmental commodity

promotion boards such as the Potato Commission . . . . The district court

found that the Potato Commission was not within “the cooperative

association tradition” because it did not engage in collective bargaining

on behalf of farmers, nor did it perform any act which involved the sale

or transfer of title in potatoes from grower to shipper to retailer to

consumer. Therefore, since the Commission did not fit within the

definitions contained in 7 U.S.C. § 291 or 12 U.S.C. § 1141j(a), the court

reasoned that it was not an “association of producers” within the meaning

of the AFPA as defined in 7 U.S.C. § 2302(c). We agree.

Id. at 1208.

We therefore affirmed the district court’s grant of summary judgment to the

defendant. Id. at 1210. In so holding, we distinguished Treasure Valley Potato

Bargaining Ass’n v. Ore-Ida Foods, Inc., 497 F.2d 203 (9th Cir. 1974), in which the

Ninth Circuit Court of Appeals held that two potato-growers’ associations engaged in

“marketing” within the meaning of the Capper-Volstead Act and therefore were immune

from antitrust prosecution. The Ninth Circuit broadly construed the term “marketing”

and concluded that even though the associations “did not collectively process, prepare

for market, handle or actually sell potatoes,”6

 their activities nonetheless constituted

marketing because each association “negotiat[ed] contracts for the sale of potatoes by

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7

This distinction drawn in Newark Gardens is equally applicable to other cases which have found

that an association has engaged in “marketing” under the Capper-Volstead Act. See, e.g., Fairdale Farms,

Inc., 635 F.2d at 1040 (eschewing a “hyper-technical reading” of the Capper-Volstead Act in determining

that cooperative associations organized for the sole purpose of fixing prices were engaged in marketing

and therefore entitled to antitrust protection under the act); Agritronics Corp. v. Nat’l Dairy Herd Ass’n, Inc., 914 F. Supp. 814, 825 (N.D.N.Y. 1996) (“In the case at bar, the Complaint by its own terms states

that defendants are in the business of ‘testing milk and providing the “official” milk production records

for dairy farmers.’ As such, each defendant [association] clearly has demonstrated that it is performing

a ‘marketing’ function within the meaning of the . . . Capper-Volstead Act[].”); N. Cal. Supermarkets, Inc.

v. Cent. Cal. Lettuce Producers Coop., 413 F. Supp. 984, 991-92 (N.D. Cal. 1976) (citing Treasure Valley

and holding that activities of lettuce producers’ cooperative association fell within protective scope of

Capper-Volstead Act because, even though the cooperative did not grow, ship, sell, or negotiate the sale

of products in its own name, it set prices, supplied market information, and performed other acts related

to the transfer of title of the products). 

its members,” which “necessarily require[d] supplying market information and

performing other acts that are part of the aggregate of functions involved in the

transferring of title to the potatoes.” Treasure Valley, 497 F.2d at 215.

In Newark Gardens, we concluded that “[t]he collective bargaining activities of

the associations which represented the farmers in Treasure Valley are clearly

distinguishable from the activities of the Potato Commission . . . . These bargaining

associations which negotiated with the processors on behalf of the farmers were within

the traditional definition of cooperative associations.” Newark Gardens, 847 F.2d at

1209. By contrast, the Potato Commission “does not attempt to dictate the price, terms,

or timing of the sale of potatoes in Michigan.” Id. at 1206. “Potato producers are free

to sell to whomever they choose at whatever price they negotiate.” Id.

7

As our decision in Newark Gardens makes clear, the term “association of

producers” includes only those organizations that are directly involved with bringing

farmers’ products to market. The TPGA, according to Terry’s well-pled allegations,

simply does not fit this profile. Like the Potato Commission in Newark Gardens, the

TPGA neither negotiates with poultry processors nor “perform[s] any act which

involve[s] the sale or transfer of title in [poultry] from grower to shipper to retailer to

consumer.” Id. at 1208. Nothing in Terry’s complaint suggests that the TPGA is

primarily engaged in one or more of the AFPA’s designated activities, i.e., “marketing,

bargaining, shipping or processing” its members’ agricultural products. 7 U.S.C.

§ 2302(c). Cf. I.C.C. v. Jamestown Farmers Union Federated Coop. Transp. Ass’n, 57

F. Supp. 749, 753 (D. Minn. 1944), aff’d 151 F.2d 403 (8th Cir. 1945) (“[I]f the

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cooperative is predominantly engaged in one or more of the activities specified in the

[AMA], . . . such association does not lose its fundamental character as a cooperative”

by engaging in other activities incidental to the primary statutory activity.). Rather, it

is an organization principally involved with educating growers about their rights and

assisting growers in the enforcement of those rights by reporting processors’ violations

to federal authorities. The fact that the TPGA’s educational and policing activities may

have the incidental benefit of increasing the growers’ bargaining power, as Terry posits,

does not bring it within the AFPA’s definition of “association of producers,” because,

as Newark Gardens demonstrates, such an association must itself bargain or market on

behalf of its members. 

Terry has failed to allege that Tyson’s unlawful actions stem from his

involvement with an AFPA-protected “association of producers.” Consequently, his

complaint is deficient, in that it does not “contain either direct or inferential allegations

respecting all material elements to sustain a recovery under some viable legal theory.”

Tam Travel, Inc., 583 F.3d at 903 (citation omitted). We therefore affirm the district

court’s dismissal of his AFPA claim pursuant to Rule 12(b)(6). Cf. Leonhardt v.

Western Sugar Co., 160 F.3d 631, 637 (10th Cir. 1998), abrogated on other grounds by

Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546 (2005) (“The prohibition on

the making of ‘false reports’ [under § 2303(e) of the AFPA] . . . appl[ies] only to false

reports about associations of producers or handlers which are intended to influence or

that have the effect of influencing a producer’s decision to join an association. Because

plaintiffs’ complaint made no allegation concerning membership in such an association,

we affirm the district court’s dismissal of plaintiffs’ AFPA claim for failure to state a

claim.”). 

V.

Next, Terry appeals the district court’s award of attorney’s fees to Tyson for its

legal costs incurred in defending against Terry’s AFPA claim. The AFPA’s fee-shifting

provision states that “[i]n any action commenced pursuant hereto, the court, in its

discretion, may allow the prevailing party a reasonable attorney’s fee as part of the

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costs.” 7 U.S.C. § 2305(a). Terry maintains that we should apply the standard set forth

in Christiansburg Garment Co. v. E.E.O.C., 434 U.S. 412 (1978), in which the Supreme

Court, in the context of a Title VII civil rights case, held that a prevailing defendant

should be awarded attorney’s fees only “upon a finding that the plaintiff’s action was

frivolous, unreasonable, or without foundation,” so as not to discourage civil rights

plaintiffs or “undercut the efforts of Congress to promote the vigorous enforcement of

the provisions of Title VII.” Christiansburg Garment Co., 434 U.S. at 421-22. See also

Garner v. Cuyahoga County Juvenile Court, 554 F.3d 624, 635-36 (6th Cir. 2009)

(applying Christiansburg standard to a claim under 42 U.S.C. § 1988). Terry asserts that

“[a]n award of fees to a prevailing defendant under a lesser standard than that established

by Christiansburg would deter producers such as Terry from acting to enforce their

rights under the AFPA, thus defeating the very purpose of the Act – to prevent

processors from chilling producers from joining together with other growers.” 

However, Terry failed to raise this issue in a timely manner for the district

court’s consideration; hence, it is not properly preserved for our review. See Foster v.

Barilow, 6 F.3d 405, 407-08 (6th Cir. 1993) (holding that issue regarding whether

attorney’s fees could be awarded to prevailing defendants in an action under the Fair

Housing Act, without a determination that the claim was frivolous, groundless, or

unreasonable, was forfeited on appeal because it was not raised in the district court); see

also Smoot v. United Transp. Union, 246 F.3d 633, 648 (6th Cir. 2001) (declining to

consider the plaintiff’s appellate challenge to award of attorney’s fees where the plaintiff

failed to raise an objection in the district court); Moore v. Int’l Bhd. of Elec. Workers,

Local 58, 60 F. App’x 581, 582 (6th Cir. 2003) (unpublished) (affirming district court’s

judgment in favor of defendants where the plaintiff “failed to timely respond to the

defendants’ motion for attorneys’ fees in the district court, [and thus] waived any

objection he had to the defendants’ application for and the district court’s award of

attorneys’ fees”). 

Moreover, there is no reason to deviate from the general forfeiture rule in this

case. When faced with an identical unpreserved challenge to an award of attorney’s fees

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8

Tyson’s proffered attorney’s fees incurred in defending against both the AFPA and PSA claims

totaled $57,455.00. Tyson asserted that $27,461.00, or 47.8% of the total, was for fees incurred in

defending the AFPA claim. The district court adopted the magistrate judge’s report and recommendation

advising that Tyson should be awarded its requested amount of AFPA fees. 

to the prevailing defendants in Foster, we declined to apply the “narrow” exceptions to

the forfeiture rule because “the issue was not developed with sufficient clarity and

completeness in the district court” and “a ruling in favor of the [plaintiffs] would require

further litigation in the district court on the frivolousness issue,” thereby prolonging the

litigation. Foster, 6 F.3d at 407-08 (internal quotation marks omitted). 

We decline to address Terry’s argument under these similar circumstances, where

a remand to the district court for further development of the record on the question of

bad faith would be necessary. 

Terry offers no other reasons why the district court abused its discretion in

awarding attorney’s fees to Tyson, as the prevailing party, under § 2305(a). In fact, our

review of the record indicates that both the magistrate judge, to whom the matter was

referred, and the district court thoroughly evaluated Tyson’s counsel’s billing records,

required itemization of AFPA-related fees and a local attorney’s affidavit attesting to the

reasonableness of the charged hourly rate,8 and then evaluated the requested fees using

the accepted “lodestar” calculation method. See generally B & G Mining, Inc. v. Dir.,

Office of Workers’ Comp. Programs, 522 F.3d 657, 661-63 (6th Cir. 2008); Moore v.

Freeman, 355 F.3d 558, 565-66 (6th Cir. 2004); Paschal v. Flagstar Bank, FSB, 297

F.3d 431, 434-35 (6th Cir. 2002); and Reed v. Rhodes, 179 F.3d 453, 471-73 (6th Cir.

1999). We therefore will not disturb the award. 

VI.

For the reasons stated, we affirm the judgment of the district court. 

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