Antitrust Law Daily Wrap Up, ANTITRUST—DVt: Dairy Farmers Certified as Class to Pursue Antitrust Claims, (Nov 20, 2012)
Organizations Mentioned:BakerHostetler | Land O'Lakes, Inc.
By Jeffrey May, J.D.
Two proposed subclasses of dairy farmers have been certified by a federal district court in Vermont to pursue conspiracy and monopoly claims against milk cooperative Dairy Farmers of America, Inc. (DFA) and subsidiary marketing organization Dairy Marketing Services, LLC (DMS) (Allen v. Dairy Farmers of America, Inc., November 19, 2012, Reiss, C.).
The farmers alleged a wide-ranging conspiracy at both the processor and cooperative levels to fix, stabilize, and artificially depress prices for raw Grade A milk and to allocate markets in the Northeast United States. The alleged conspirators included: Dean Foods, HP Hood LLC, National Dairy Holdings, Farmland Dairies LLC, Kraft, Dairylea Cooperative, Inc., St. Albans Cooperative Creamery, Inc., Agri-Mark, Inc., Land O'Lakes, Inc., and Maryland and Virginia Milk Producers Cooperative Association, Inc.
The court rejected the defendants' argument that the plaintiffs failed to establish that the proposed subclasses did not resolve issues identified by the court in a December 2011 decision (279 F.R.D. 257, 2012-1 Trade Cases ¶77,759), denying class certification.
The court granted the plaintiffs’ request for certification of two subclasses:
(1) the DFA/DMS subclass, consisting of all dairy farmers who produced and pooled raw Grade A milk in the market from 2002 to the present, who were members of DFA or otherwise sell milk through DMS; and
(2) the non-DFA/DMS subclass, consisting of all dairy farmers who produced and pooled raw Grade A milk in the market from 2002 to the present, who were not members of DFA or did not sell milk through DMS.
The defendants contended that the subclasses did not rectify the issues with class certification because a "substantial" number of DFA and DMS members still opposed the lawsuit. The court explained, however, that, "to the extent dairy farmers do not wish to participate in this lawsuit, they will not be forced to do so.”
The conflict in the case was addressed by certifying the two subclasses and to permit the DFA/DMS dairy farmers who chose to remain members of the class to have their own class representatives and class counsel, according to the court.
The plaintiffs satisfied the certification requirements of Rule 23 of the Federal Rules of Civil Procedure. The court explained that determining whether the plaintiffs could prove that class members suffered the same antitrust injury commonly referred to as "antitrust impact" was a “complicated task.” The defendants had challenged the plaintiffs' antitrust impact theory on a number of grounds each of which primarily related to its persuasiveness.
Based on the totality of the plaintiffs' evidence presented regarding antitrust impact, the court concluded that the plaintiffs “established by a preponderance of the evidence a means of establishing antitrust impact through a common body of admissible proof and through common questions of law and fact which clearly predominate over individualized questions.”
The court also ruled that class action was the most fair, efficient, and effective vehicle for the presentation of the plaintiffs' claims and the defendants' defenses to them.
This is Case No. 5:09-cv-230.
Danyll W. Foix (Baker & Hostetler LLP) for plaintiff. Amber L. McDonald (Baker & Miller PLLC) for defendant.
Cases: Antitrust VermontNews