WASHINGTON — An opinion issued by The U.S. Court of Appeals for the Fifth Circuit in a 9-7 vote in Wheeler v. Pilgrim's Pride Corp. holds that in order to establish a claim under Sections 202(a) or 202(b) of the Packers and Stockyards Act (PSA), a plaintiff must demonstrate that the challenged practice has an anti-competitive effect, according to the American Meat Institute.
Plaintiffs must show that the challenged practice adversely affects or is likely to adversely affect competition, the court ruled. A divided panel of the Fifth Circuit had previously held by a 2-1 vote that a plaintiff need not demonstrate an anti-competitive effect in order to establish a claim under Sections 202(a) or 202(b).
In holding that an anti-competitive effect is required, the Fifth Circuit joins numerous other circuits that have reached the same conclusion.
Both A.M.I. and the National Chicken Council submitted an amicus brief to the en banc court, and counsel for A.M.I. and N.C.C. presented arguments before the court, along with counsel for Pilgrim's Pride.
Whether the P.S.A. requires a showing of anti-competitive effect is of enormous importance to the poultry- and meat-packing industries. If an anti-competitive effect were not required to establish a P.S.A. claim, liability under the P.S.A. would be virtually limitless. Thus, the en banc court's ruling is a significant victory for the poultry and meatpacking industries.
A.M.I. relays the plaintiffs in Wheeler have the opportunity to seek review of the Fifth Circuit's decision before the U.S. Supreme Court. A petition for certiorari would be due in 90 days, unless plaintiffs seek and obtain an extension.