Law360: Poultry Giants Can't Dodge Workers' Wage-Fixing Suit

Mar 11, 2021

By Christopher Cole

A Maryland federal judge declined to toss proposed class action claims from workers against three poultry companies accused of plotting to keep wages low and also rejected an effort to trim the suit to exclude jobs the plaintiffs didn't do.

U.S. District Judge Stephanie A. Gallagher turned down three separate requests to dismiss Jennie-O Turkey Store Inc., Mountaire Farms Inc. and Sanderson Farms Inc. from the litigation on various grounds they cited in December. She also ruled against limiting the suit's scope to hourly, not salaried, work and to leave out turkey processing jobs.

Numerous poultry producers ensnared in the suit, including the three that individually sought dismissal, had contended that because the named plaintiffs were hourly chicken processing workers, they lacked standing to sue over the alleged conspiracy's impact on salaried and turkey processing jobs.

But Judge Gallagher rejected that argument, although she acknowledged that it was a tough call because of conflicting approaches to standing in class actions, from the U.S. Supreme Court down to district courts in the Fourth Circuit, where there's no clear precedent.

"Against this murky backdrop, the court ultimately finds the 'class certification' approach most persuasive in the context of this case, where the interests of the named hourly chicken employees are not 'significantly different' than those of the salaried and turkey employees," she wrote Wednesday.

She cited the high court's 2003 ruling in a race-based admissions case, Gratz v. Bollinger , finding that a transfer student plaintiff had standing to sue on behalf of prospective freshmen, too.

"Plaintiffs are pleased with the court's ruling and are now eager to move forward in the litigation and take this case to trial," an attorney for the poultry workers, George F. Farah of Handley Farah & Anderson PLLC, told Law360 in an email Thursday.

The dismissal moves involved the second amended complaint. The sprawling suit was first filed in August 2019, when the workers alleged the poultry processors, which together own and run roughly 200 poultry plants in the United States, held clandestine meetings and traded information in an effort to tamp down wages for hundreds of thousands of workers at their facilities. The suit also names two consulting companies, Webber Meng Sahl and Co. and Agri Stats Inc., that the workers allege were part of the scheme.

In declining Wednesday to trim the suit, Judge Gallagher also pointed to the First Circuit's 2018 ruling, In re: Asacol Antitrust Litigation, that "nothing in ... precedent ... suggests that the claims of the named plaintiffs must in all respects be identical to the claims of each class member."

"This court has already determined that plaintiffs have sufficiently pled the existence of a singular poultry labor market, irrespective of whether the workers are salaried or hourly, or work with chicken or turkey," she wrote.

The complaint's allegations are consistent across all members of the class and "constitute the heart of the case and suggest that, as in Gratz and In re Asacol, the named plaintiffs have a sufficient personal stake in the adjudication of the class members' claims to establish standing, even for those class members from slightly different backgrounds."

Jennie-O, Mountaire and Sanderson, in their own motions to exit the suit, challenged the sufficiency of the suit's antitrust claims and suggested that the complaint "engages in impermissible group pleading," the judge noted. However, she concluded that "each of these challenges falls short."

The judge said in a footnote that, as the court earlier expressed, "it is well aware that plaintiffs' allegations are sparse in many respects."

"At this early stage of the litigation, however, plaintiffs need only clear the low plausibility bar and need not provide the sort of detailed factual explication that defendants seek," she said, citing the Twombly ruling. "Should the threads that tie plaintiffs' case together — in particular those that link each individual defendant to the various elements of the alleged conspiracy — remain tenuous in later stages of this litigation, they will undoubtedly face an uphill battle as the standard of proof they must clear increases."

Representatives for the companies that filed dismissal motions did not immediately respond to press inquiries Thursday.

The workers are represented by Matthew Handley, Rachel Nadas, George Farah, Rebecca Chang and William Anderson of Handley Farah & Anderson PLLC, Daniel Small, Benjamin Brown, Brent Johnson, Daniel Silverman, Alison Deich and Zach Glubiak of Cohen Milstein Sellers & Toll PLLC and Steve Berman, Breanna Van Engelen, Shana Scarlett and Rio Pierce of Hagens Berman Sobol Shapiro LLP.

The companies are represented by attorneys from Jones Day, Greene Espel PLLP, Hogan Lovells, Womble Bond Dickinson, Alston & Bird LLP, Stinson LLP, The Law Group of NW Arkansas LLP, Faegre Drinker Biddle & Reath LLP, Baker Donelson Bearman Caldwell & Berkowitz PC, Sidley Austin LLP, Rose Law Firm, Venable LLP, Whiteford Taylor & Preston LLP, Weil Gotshal & Manges LLP, Miles & Stockbridge PC, Kirkland & Ellis LLP, Shook Hardy & Bacon LLP, Conner & Winters, Offit Kurman, Simpson Thacher & Bartlett LLP, Proskauer Rose LLP, Rosenberg Martin Greenberg LLP, Saul Ewing Arnstein & Lehr LLP, and Skadden Arps Slate Meagher & Flom LLP.

The case is Jien et al. v. Perdue Farms Inc. et al., case number 1:19-cv-2521, in the U.S. District Court for the District of Maryland.

We are lawyers who seek to improve the world. We fight for: workers deprived of wages, consumers deceived about products, tenants denied access to housing, farmers mistreated by processors, parents deprived of adequate parental leave, investors who were defrauded, small businesses harmed by antitrust violations, persons with disabilities denied access, whistleblowers who uncover fraud, and women and communities of color subject to discrimination.

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