Antitrust Law Daily Wrap Up, ANTITRUST NEWS: Goat breeders allege registry association rule changes restrained trade, (Feb 10, 2014)

By Linda O’Brien, J.D., LL.M.

In an action for injunctive relief, a group of grey/brown pygmy goat breeders allege that a national pygmy goat registry organization and several of its members imposed rules changes to bar the registration of grey/brown pygmy goats and eliminate competition in the market, according to a complaint filed in the federal district court in San Diego (Hosley v. National Pygmy Goat Assn., filed February 7, 2014).

The National Pygmy Goat Association (NPGA), the world’s largest pygmy goat registry and membership organization, sanctions competitions and shows of pygmy goats nationwide and has affiliated clubs in many states. The suit was brought by Debra Hosley and other well-known and successful breeders of pygmy goats who are or were members of the NPGA. Pygmy goats known as grey/brown or agoutis with tan highlights (grey/brown agoutis) have been registered and shown in the NPGA for at least 30 years. All of the plaintiffs have bred, raised, registered, exhibited, and sold grey/brown agouti goats since 1998 without incident.

The complaint alleges that the membership of the NPGA is composed of various individuals and entities, some of which compete with the plaintiffs. The NPGA’s rules and breed standards control whether a particular pygmy goat can be registered and also whether a goat is valuable or not. In 2005, the changes were made to the breed standard that included four categories of colors: solid, black, agouti, and caramel. Under “Agouti” the standard read “Body colors: All body colors are acceptable.”

According to the complaint, in 2008, a complaint was received by the NPGA that the grey/brown agouti color pattern was undesirable and believed to be a trait of cross breading with a Nigerian dwarf goat. A committee report submitted with the complaint recommended removal of the all body colors language from the breed standard. The removal of the language would effectively make the registering, breeding and showing of grey/brown goats useless and eliminate competition among all pygmy goats. The Board decided to clarify the color pattern and add a new color for agoutis for registration purposes, the complaint stated.

Because the removal of the all colors language was not approved by the Board, the proponents of the language change maliciously composed and published numerous false and misleading oral and written statements regarding the plaintiffs and their pygmy goat herds. As a result of these statements, the plaintiffs’ personal reputation and their reputations as breeders of high quality pygmy goats has been damaged, the complaint states. In 2010, after several failed attempts and due to their campaign, the proponents garnered the votes to pass a motion removing the all colors language from the breed standard. As a result of the language change, previously registered grey/brown agoutis have been effectively removed from registerable goats.

The plaintiffs assert claims for interference with business relations, and violations of the Cartwright Act, Lanham Act, and Sections 1 and 2 of the Sherman Act. The action seeks injunctive relief, damages, costs of suit, attorneys’ fees, and any other just and proper relief.

The case is No. 14CV0290 H.

Attorneys: Edward W. Burns (Burns, Schaldenbrand, Rodriquez) for Debra Hosley.

Companies: National Pygmy Goat Assn.

News: Antitrust CaliforniaNews