Background: Wheeler v. Pilgrim's Pride Corp.
09/18/2009 08:28AM
Bookmark
Subscribe
In Wheeler v. Pilgrim's Pride Corp., 536 F.3d 455 (5th Cir. 2008), the Fifth Circuit Court of Appeals held that under the plain textual reading of the Packers and Stockyards Act, there is no requirement that a plaintiff show an adverse effect on commerce to make a claim. Therefore, the plaintiffs were not required to show that Pilgrim's Pride Corporation's conduct had an adverse effect on commerce to make a claim under the PSA.
Background
The plaintiffs, Cody Wheeler, Don Davis, and Davey Williams, grew broilers for defendant Pilgrim's Pride Corporation (PPC). Id. at 456. Under the contract signed by the parties, PPC provided the growers with chickens, feed, and supplies necessary to raise the chickens. When the chickens had matured, they were then returned to PPC, and the chickens, feed, and medicine all remained PPC's property throughout the growing process. The compensation for the growers was determined according to a tournament system, which put each grower in competition with the others to produce the most and best chickens in order to receive greater compensation. The source of the lawsuit was the growers' discovery that all of the growers were under this type of contract except one grower. The one grower not subject to compensation through the tournament system was Lonnie Pilgrim, the founder and chairman of PPC. Under Mr. Pilgrim's contract, he was able to purchase the supplies and chickens and then sell the chickens back to PPC, which led to greater compensation than the other growers received under the tournament system. The growers sued PPC under the PSA demanding that PPC afford them the same opportunity that was afforded to Mr. Pilgrim.