Source: https://caselaw.findlaw.com/us-11th-circuit/1421816.html
Timestamp: 2020-07-03 20:37:40
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ADKINS v. Cagle's, Inc., Cagle's Farms, Inc., Defendants-Appellees. | FindLaw
ADKINS v. Cagle's, Inc., Cagle's Farms, Inc., Defendants-Appellees.
Lucius ADKINS, Jill Adkins, Plaintiffs-Counter-Defendants-Appellants, v. CAGLE FOODS JV, LLC, d.b.a. Cagle-Keystone Foods, Defendant-Counter-Claimant-Appellee, Cagle's, Inc., Cagle's Farms, Inc., Defendants-Appellees.
No. 04-11447.
Before EDMONDSON, Chief Judge, and TJOFLAT and KRAVITCH, Circuit Judges. James G. Lingle, H. Clay Fulcher, Lingle & Fulcher, PLLC, Rogers, AR, Cynthia Noles Johnson, Johnson Law, P.C., Cohutta, GA, for the Adkins. Howard A. Rosenthal, Gary D. Fry, Malcolm S. Gould, Philadelphia, PA, J. Anderson Davis, C. King Askew, Mark M.J. Webb, Brinson, Askew, Berry, Seigler, Richardson & Davis, LLP, Rome, GA, Dawn G. Benson, Watson, Spence, Lowe & Chambless, Albany, GA, for Defendants.
This case involves an interpretation of the Packers & Stockyards Act, 7 U.S.C. § 192(a) and (b), which prohibits live poultry dealers from “engag [ing] in or us[ing] any unfair, unjustly discriminatory, or deceptive practice or device,” or “mak[ing] or giv[ing] any undue or unreasonable preference or advantage to any particular person or locality in any respect, or subject[ing] any particular person or locality to any undue or unreasonable prejudice or disadvantage in any respect”. The plaintiffs, Lucius and Jill Adkins, are broiler growers under contract with defendant operators of poultry processing facilities. The Adkins claim that the defendants, Cagle's, Inc. (“Cagle's”), Cagle's Farms, Inc. (“Cagle's Farms”), and Cagle Foods JV, LLC (“Cagle JV”), violated federal agricultural statutes, committed state-law fraud and breach of contract, and are liable under other related causes of action.
Lucius Adkins joined the United Poultry Growers' Association (“UPGA”) in 1997, and became the UPGA president in November 1998. At about the same time that Lucius became involved in the UPGA, the Adkins allege that Cagle JV began sending them poor quality birds to raise on their farms. The Adkins also claim that Cagle JV sometimes sent them poor quality feed for the birds or failed to send sufficient feed. Lucius asserts that employees of Cagle JV repeatedly threatened that he should do as the company told him or the company would “break” him. The Adkins claim that these threats were meant to discourage participation in the UPGA.
In June 2001, the Adkins filed the present action in the Middle District of Georgia against Cagle JV, Cagle's, and Cagle's Farms. The complaint brought claims for (1) violation of the Packers and Stockyards Act (“PSA”), (2) fraud, (3) violation of the Georgia RICO statute, (4) fraudulent inducement and promissory estoppel, (5) violation of the Agricultural Fair Practices Act (“AFPA”), and (6) breach of contract. In response, Cagle's, Inc., and Cagle's Farms, Inc. filed a motion for summary judgment arguing, inter alia, that they had not had dealings with the Adkins since 1993 and that the Adkins' claims were therefore time-barred. The district court granted the motion. Cagle JV filed a motion for summary judgment on the merits of the Adkins' claims. The district court granted Cagle JV's motion as well. The Adkins appeal both rulings.
We review the district court's grant of a motion for summary judgment de novo. Hinson v. Clinch County, Georgia Board of Education, 231 F.3d 821, 826 (11th Cir.2000). The moving party bears the initial burden of showing that there is an absence of a genuine issue of material fact and that it is therefore entitled to judgment as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). If the moving party meets this burden, the non-moving party must show the existence of a genuine issue of material fact that remains to be resolved at trial. Fitzpatrick v. City of Atlanta, 2 F.3d 1112, 1115 (11th Cir.1993). The non-moving party must set forth specific facts showing that there is a genuine issue for trial, not merely make a summary denial of the movant's allegations. Fed.R.Civ.P. 56(e).
B. The Adkins' Claims Against Cagle Foods JV
1. Packers and Stockyards Act Claim
The PSA prohibits live poultry dealers from “engag[ing] in or us[ing] any unfair, unjustly discriminatory, or deceptive practice or device,” or “mak[ing] or giv[ing] any undue or unreasonable preference or advantage to any particular person or locality in any respect, or subject[ing] any particular person or locality to any undue or unreasonable prejudice or disadvantage in any respect”. 7 U.S.C. § 192(a) and (b). The Adkins have alleged that Cagle JV violated this statute when it (1) provided them with inferior birds, (2) provided them with inferior or insufficient feed, (3) improperly weighed birds they had raised, and (4) offered them an unfair arbitration contract.6
Beginning in 1999, Cagle JV offered broiler growers a new form of Broiler Production Agreement which contained an arbitration clause. The Adkins allege that these arbitration contracts were unfair. At first the arbitration contracts were made available to all broiler growers, at their option, with a higher rate of pay for those who accepted them. The contracts were changed later so that all growers received the same pay, with arbitration still at the grower's option. There is nothing unfair or discriminatory about Cagle JV's offer of a higher rate of pay in consideration for arbitration. Furthermore, contrary to the Adkins' assertion, there is no evidence that Cagle JV ever “guaranteed” the Adkins a pay increase which they were later “denied” because of their failure to sign the arbitration contract.
2. Fraud Claim
To sustain a fraud claim under Georgia law, the plaintiff must show (1) a false representation made by the defendants; (2) scienter, or knowledge of the statement's falsity at the time it was made; (3) an intention to induce the plaintiff to act or refrain from acting in reliance on the statement; (4) the plaintiff's justifiable reliance; and (5) damage to the plaintiff. Pro-Fab v. Vipa, Inc., 772 F.2d 847, 851 (11th Cir.1985). The Adkins claim that Cagle JV committed four types of intentional and false acts: (1) recording false trailer weights; (2) recording false tare and gross weights; (3) failing to promptly weigh the Adkins' birds; and (4) providing inferior birds.
3. Georgia RICO Claim
To prove a violation of the Georgia RICO statute, the Adkins must demonstrate two or more predicate acts which are related and have continuity. Pelletier v. Zweifel, 921 F.2d 1465, 1513 (11th Cir.1991); O.C.G.A. § 16-14-3(8). The Adkins have attempted to prove federal mail fraud and state-law theft by deception.
To prove a violation of the federal mail fraud statute, the Adkins must show that Cagle JV “(1) intentionally participate[d] in a scheme to defraud another of money or property and (2) use[d] the mails or wires in furtherance of that scheme.” Pelletier, 921 F.2d at 1498. To prove theft by deception under Georgia law, the Adkins must demonstrate that Cagle JV had criminal intent and knowledge. Avery v. Chrysler Motors Corp., 214 Ga.App. 602, 448 S.E.2d 737 (1994). The Adkins relied on the same facts for these claims as for their fraud claim. Because we have found that Cagle JV did not make any fraudulent or deceptive communications or have any kind of criminal intent, the Adkins' claim fails. The Adkins also claim that Cagle JV committed mail fraud by mailing fraudulent final statements to them. However, the Adkins have not identified any statement which was allegedly fraudulent.
4. Fraudulent Inducement and Promissory Estoppel Claims
Georgia law is clear that “fraud cannot be predicated upon statements which are promissory in their nature as to future acts.” Warner v. Jeter, 115 Ga.App. 6, 7, 153 S.E.2d 626 (1967); see also Smith v. McClung, 215 Ga.App. 786, 788, 452 S.E.2d 229 (1994) (holding that “representations concerning expectations and hopes are not actionable”). Georgia courts also have held that, absent something more, a promise that a business could be expected to generate a certain income does not constitute fraud. See Krys v. Henderson, 85 Ga.App. 323, 325, 69 S.E.2d 635 (1952).
The Adkins also claim that the initial estimates constituted promises which were enforceable by the doctrine of promissory estoppel. Under Georgia law such an estoppel requires a showing that (1) the defendant made certain promises, (2) the defendant should have expected that the plaintiffs would rely on such promises, and (3) the plaintiffs did in fact rely on such promises to their detriment. Doll v. Grand Union Co., 925 F.2d 1363 (11th Cir.1991). Importantly, where a plaintiff seeks to enforce an underlying contract which is reduced to writing, promissory estoppel is not available as a remedy. Bank of Dade v. Reeves, 257 Ga. 51, 354 S.E.2d 131 (1987). Furthermore, promissory estoppel does not apply to representations concerning the future, but to representations of past or present facts. Voyles v. Sasser, 221 Ga.App. 305, 305-306, 472 S.E.2d 80 (1996).
5. Agricultural Fair Practices Act Claim
The Adkins further contend that Cagle JV violated the AFPA by interfering with their attempt to organize and participate in a growers' association and discriminating against them for such participation. Cagle JV concedes that if it engaged in such behavior, it would be in violation of the AFPA. See 7 U.S.C. §§ 2301-2305.
6. Breach of Contract Claim
C. The Adkins' Claims Against Cagle's, Inc. and Cagle's Farms, Inc.
The district court found that the Adkins' claims against Cagle's and Cagle's Farms were barred by the applicable statutes of limitations. For the fraud claim, the applicable statute of limitations is four years. O.C.G.A. §§ 9-3-25, 9-3-26, 9-3-31. The Adkins' fraud claim against Cagle's and Cagle's Farms was based on projections made by Danny Eiland in 1992 and 1993, eight years before the Adkins filed the present complaint. See Denson v. Maloy, 239 Ga.App. 778, 779, 521 S.E.2d 666 (1999) (fraud statute of limitation runs from date injury occurs). The Adkins offer no argument in their briefs on appeal as to why the statute of limitations does not apply. Furthermore, their fraud claim is baseless. The income projections that Cagle's and Cagle's Farms originally provided the Adkins-and on which the Adkins base their claim-contained a disclaimer which made clear that they were “for illustrative purposes only and ․ not intended as a projection or forecast of actual performance.” Even if the Adkins' claim were not barred by the statute of limitations, Georgia law is clear that “fraud cannot be predicated upon statements which are promissory in their nature as to future acts.” Warner v. Jeter, 115 Ga.App. 6, 7, 153 S.E.2d 626 (1967).
The statute of limitations for the AFPA claim is two years. 7 U.S.C. § 2305(c). The Adkins' AFPA claim is based on a conversation between Doug Cagle and Lucius Adkins on December 30, 1998-three and a half years before the instant complaint was filed. The Adkins do not address this issue in their briefs or present any argument as to why the claim is not time-barred.
D. Cagle's, Inc. and Cagle's Farms, Inc.'s Motion for Sanctions
1. The various defendants operate an integrated poultry processing business. They contract some farmers, known as “breeder growers,” to raise hens for the express purpose of laying eggs. These eggs are then hatched at a hatchery. Soon after the eggs are hatched, the young chicks are sent to a “broiler grower,” like the Adkins. Under the basic terms of a Broiler Production Agreement, the broiler grower supplies the chicken houses and does the farm work necessary to raise the chicks, while the defendants supply feed and medications. After a predetermined period, the defendants collect the grown chickens from the broiler grower and weigh them. The broiler growers are paid according to a formula which depends primarily on the weight of the grown birds and the weight of feed used. The defendants then slaughter the chickens, process the meat, and sell it.
2. To avoid confusion, and with all due respect, we refer to the Adkins individually throughout this opinion as “Lucius” or “Jill” as appropriate.
3. Cagle JV came into existence in 1993 as a joint venture between Cagle's and another company in order to expand poultry processing facilities in south Georgia. All the Adkins' dealings after October 1993 were with Cagle JV.
4. Before October 1993, the Broiler Production Agreements were between the Adkins and Cagle's.
5. In April 2002, after the Adkins commenced this litigation, Cagle offered a different contract. The new contract provided for an arbitration option but included a higher rate for growers regardless.
6. We do not imply that these factual allegations, if proved, would establish a violation of the PSA. In the present case, it is sufficient for us to hold that the district court was correct in finding that the Adkins did not prove their allegations, and that the few facts they did produce were clearly insufficient to make out a PSA claim.This court recently held that to prevail under this provision of the Packers and Stockyards Act, a plaintiff must show that the defendant's unfair, unjustly discriminatory, or deceptive trade practice either adversely affects competition or is likely to adversely affect competition. London v. Fieldale Farms Corp., 410 F.3d 1295, 2005 WL 1279147 at *7 (11th Cir.2005). The Adkins have presented no evidence that any of Cagle JV's activities had an adverse effect on competition, or were likely to have such an effect.