Specht v. Cargill, Incorporated
U.S. District Court, District of Minnesota
Specht v. Cargill, Incorporated
Trial Court Opinion
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
IN RE CATTLE AND BEEF ANTITRUST
LITIGATION
MDL No. 22-3031 (JRT/JFD)
This Document Relates To: MEMORANDUM OPINION AND ORDER
GRANTING DEFENDANTS’ MOTION TO
THE INDIRECT SELLER ACTION (“Specht DISMISS THE SPECHT AMENDED
Case”), Civil No. 22-2903 COMPLAINT
Richard M. Paul, III, PAUL LLP, 601 Walnut Street, Suite 300, Kansas City,
MO 64106; Michael Montaño, GUERRA LLP, 875 East Ashby Place, Suite
1200, San Antonio, TX 78212, for Plaintiffs.
Kosta S. Stojilkovic, WILKINSON STEKLOFF LLP, 2001 M Street, Northwest,
10th Floor, Washington, D.C. 20036, for Defendants Cargill, Incorporated
and Cargill Meat Solutions Corporation.
Chelsea A. Bollman, JONES DAY, 90 South Seventh Street, Suite 4950,
Minneapolis, MN 55402, for Defendant National Beef Packing Company,
LLC.
Jon B. Jacobs, PERKINS COIE LLP, 700 13th Street, Northwest, Suite 800,
Washington, D.C., 20005, for Defendants Tyson Foods, Inc., and Tyson Fresh
Meats, Inc.
Jessica J. Nelson, SPENCER FANE, 100 South Fifth Street, Suite 2500,
Minneapolis, MN 55402, for Defendants JBS USA Food Company, JBS
Packerland, Inc., Swift Beef Company, and JBS S.A.
The putative Specht Class Members (“Plaintiffs”) filed an Amended Complaint on
behalf of producers of feeder cattle who indirectly sell cows and calves to one or more
Defendants in this action. Defendants now move to dismiss Plaintiffs’ Amended
Complaint.
Because Plaintiffs have not clearly demonstrated that they are producers of feeder
cattle as that term is understood by the CME Feeder Cattle Index and beef production
industry at large, their new allegations fail to establish causation and a direct injury as
would be necessary for antitrust standing. The Court will therefore dismiss Plaintiffs’
Sherman Act, Packers and Stockyards Act, and state antitrust and consumer protection
claims for lack of antitrust standing under Associated General Contractors of California,
Inc. v. California State Council of Carpenters, 459 U.S. 519 (1983). The Court will also
dismiss the remaining state law claims arising under Colorado and Florida laws.
BACKGROUND
I. FACTS
The Plaintiffs’ factual allegations remain largely the same as those outlined in the
Court’s prior order. See In re Cattle and Beef Antitrust Litig., No. 22-3031, 2023 WL
5310905, at *1–2 (D. Minn. Aug. 17, 2023). As such, the Court will only summarize and
address newly alleged facts relevant to the current motion.
Cow-calf operations are the first step in the beef supply market. (Am. Compl. ¶ 62,
Oct. 18, 2023, Docket No. 371.)1; see also In re Cattle and Beef Antitrust Litig., 2023 WL
5310905, at *1 (depicting diagram of beef production market). Cow-calf entities retain
1 Unless otherwise noted, all citations are to Case No. 22-3031.
cattle for the gestation period and then raise the calves until they are weaned from their
mothers. (Am. Compl. ¶¶ 62–63.); In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *1. After the cattle are weaned, they are raised until they are large enough for finishing at the feedlots—generally, when they are between 600 to 800 pounds. (Am. Compl. ¶ 63.) Ranchers can raise the cattle until they are large enough for finishing and sell directly to a feedlot or, if the cattle are too small or light to enter the feedlot, to stockers or backgrounders, who will raise the cattle until they are large enough for finishing. (Id.); In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *1. Feedlots or finishing
operations are the final phase of the beef production system, wherein the cattle are fed
to harvest weight. (Am. Compl. ¶ 64.) Once cattle reach between 950 and 1,500 pounds,
they become fed cattle. (Id.) The finishing process generally takes less than 6 months.
(Id.) Fed cattle are sold and slaughtered at packing plants operated by packers like
Defendants. (Id. ¶ 66.) The entire cattle production cycle from birth to slaughter is
typically 15 to 24 months. (Id. ¶ 68.)
In their Amended Complaint, Plaintiffs relabel themselves as producers of feeder
cattle who indirectly sell cattle to one or more Defendants in this case. (Id. ¶ 2.) Feeder
cattle are ultimately sold as “fat” or “fed” cattle. (Id. ¶ 7.) Plaintiffs define feeder cattle
as “calves, steers, or heifers raised by cow-calf-entities, ranchers, or backgrounders in the
United States, which feedlots use to produce fed cattle.” (Id. ¶ 1 n.1.) This expansion of
Plaintiffs from cow-calf ranchers to producers of feeder cattle in effect expands to include
all indirect sellers, including cow-calf-entities, ranchers, and backgrounders. (Compare
No. 22-2903, Class Action Compl. 4 1, Oct. 31, 2022, Docket No. 1, with Am. Compl. 4] 2.)
Plaintiffs reassert the same price-fixing conspiracy by Defendants as in their
original complaint. See In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *2.
They assert that Defendants conspired to suppress the price of fed cattle, and that their
coordinated conduct caused a collapse in fed cattle prices in 2015, which in turn caused
the prices of feeder cattle to collapse. (Am. Compl. 141 1, 4.) Plaintiffs newly allege that
Defendants’ prices for fed cattle have a direct impact on the prices that they receive for
feeder cattle. (/d. 7 3.) In support, they provide the following chart comparing the CME
Feeder Cattle Index to fed cattle prices. (/d. 4 3, Fig. 1.)
Weekly CME Feeder Cattle Index and
Deferred Live Cattle Contract (Adapted from CME)
4-year averages:
deferred live cattle = $114, CME feeder cattle index = $144
170
183
155
150
13
513
& 125
120
ie
103
100
38
se re A A x A 2 2 2
“—=CME Feeder Cattle Index Deferred Live Cattle
-4-
As the chart illustrates, Plaintiffs claim there was a correlation between fed cattle
prices and feeder cattle prices between 2016 and 2020 that demonstrates the causal
relationship between those prices. (Id. ¶ 3.)
Plaintiffs bring two putative classes for each claim type: a nationwide class and an
upstream nationwide class. (See id. ¶ 316.) The putative nationwide classes include
Plaintiffs who sold cattle to natural persons or entities who in turn sold to Defendants, so
are two links removed from Defendants’ conduct. (Id.) The putative upstream
nationwide classes include Plaintiffs who sold cattle to intermediaries who in turn sold to
another intermediary or a member of the nationwide classes, so are multiple links
removed from Defendants’ conduct. (Id.)
II. PROCEDURAL HISTORY
As with the factual history, the Court does not find it necessary to repeat the entire
procedural history of this case, so it will only summarize the relevant history here. See In
re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *2–3. The Court granted
Defendants’ motion to dismiss Plaintiffs’ original complaint without prejudice after
finding that Plaintiffs failed to establish antitrust standing. Id. at *12. Plaintiffs filed the
Amended Complaint with leave of the Court. (See generally Am. Compl.) Named Plaintiffs
James Specht, Jerry Kelsey, Richard Settlemyer, and David Hyatt own and operate farms
or ranches that raise and sell cattle at auctions, barn sales, or, for Mr. Hyatt, sometimes
directly to a feedlot. (Am. Compl. ¶¶ 24–27.) Plaintiffs re-allege nationwide claims based
on market allocation and price-fixing in violation of the Sherman Act (Count I) and the
Packers and Stockyards Act (Count II). (Id. ¶¶ 319–33.) They also re-allege state law
claims based on violations of antitrust laws (Count III) and consumer protection laws
(Count IV). (Id. ¶¶ 334–40.) Defendants moved to dismiss Plaintiffs’ Amended Complaint.
(Joint Mot. Dismiss, Nov. 21, 2023, Docket No. 453.)
DISCUSSION
I. STANDARD OF REVIEW
In reviewing a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the
Court considers all facts alleged in the complaint as true to determine if the complaint
states a “claim to relief that is plausible on its face.” Braden v. Wal-Mart Stores, Inc., 588
F.3d 585, 594(8th Cir. 2009) (quoting Ashcroft v. Iqbal,556 U.S. 662, 678
(2009)). At the motion to dismiss stage, the Court may consider the allegations in the complaint as well as “those materials that are necessarily embraced by the pleadings.” Schriener v. Quicken Loans, Inc.,774 F.3d 442, 444
(8th Cir. 2014).
“A claim has facial plausibility when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant is liable for the misconduct
alleged.” Iqbal, 556 U.S. at 678. The Court construes the complaint in the light most favorable to the plaintiff, drawing all inferences in the plaintiff’s favor. Ashley Cnty. v. Pfizer, Inc.,552 F.3d 659, 665
(8th Cir. 2009). Although the Court accepts the complaint's factual allegations as true and construes the complaint in a light most favorable to the plaintiff, it is “not bound to accept as true a legal conclusion couched as a factual allegation.” Papasan v. Allain,478 U.S. 265, 286
(1986). In other words, a complaint “does not need detailed factual allegations” but must include more “than labels and conclusions, and a formulaic recitation of the elements” to meet the plausibility standard. Bell Atl. Corp. v. Twombly,550 U.S. 544, 555
(2007).
II. ANALYSIS
Defendants argue that the Amended Complaint still fails to adequately establish
antitrust standing as is required for many of Plaintiffs’ claims under Associated General
Contractors of California, Inc. v. California State Council of Carpenters (“AGC”), 459 U.S.
519 (1983). They also claim that Plaintiffs’ remaining state law claims should be
dismissed. The Court will address each issue in turn.
A. Antitrust Standing
The Amended Complaint brings antitrust claims under the Sherman Act and the
antitrust laws of 30 states.2 It also brings consumer protection claims under the laws of
12 states.3 The Court previously found that Plaintiffs must show antitrust standing not
only for their claims under the Sherman Act and many of the state antitrust laws, but also
for their claims under the Packers and Stockyards Act (“PSA”) and many of the state
2 Plaintiffs bring antitrust claims on behalf of state law damages classes in Alabama,
Arizona, Arkansas, California, Connecticut, District of Columbia, Hawaii, Illinois, Iowa, Kansas,
Maine, Maryland, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, New
Mexico, New York, North Carolina, North Dakota, Oregon, Rhode Island, South Dakota,
Tennessee, Utah, Vermont, West Virginia, and Wisconsin. (Am. Compl. ¶ 335.)
3 Plaintiffs bring state consumer protection claims on behalf of state law damages classes
in Arizona, California, Colorado, Florida, Illinois, Nevada, New Mexico, New York, North Carolina,
Oregon, Tennessee, and Wisconsin. (Am. Compl. ¶ 339.)
consumer protection laws. In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *4,
8–9.
AGC establishes six factors to determine whether a plaintiff has antitrust standing:
(1) The causal connection between the alleged antitrust
violation and the harm to the plaintiff; (2) Improper motive;
(3) Whether the injury was of a type that Congress sought to
redress with the antitrust laws; (4) The directness between
the injury and the market restraint; (5) The speculative nature
of the damages; (6) The risk of duplicate recoveries or
complex damage apportionment.
Midwest Commc’ns v. Minn. Twins, Inc., 779 F.2d 444, 450 n.6 (8th Cir. 1985). This inquiry essentially results in a determination of whether “the plaintiff [is] the target of the anticompetitive activity, not one who has merely suffered indirect, secondary, or remote injury.”Id. at 451
(citation and internal quotations omitted). The Court will analyze each
factor in turn.
1. Causal Connection
The Court must first consider the “causal connection between the alleged antitrust
violation and the harm to the plaintiff.” McDonald v. Johnson & Johnson, 722 F.2d 1370,
1374(8th Cir. 1983). The Court previously found this factor weighed against antitrust standing because Plaintiffs failed to allege how manipulating fed cattle prices impacted cow-calf prices. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *4–5. Plaintiffs,
relabeled as producers of feeder cattle, newly allege that Defendants’ conduct directly
impacts the price of feeder cattle, as demonstrated by the chart comparing the CME
Feeder Cattle Index to fed cattle prices. Plaintiffs also point to statements by industry
experts who claim that “[t]he most important factor influencing feeder cattle prices is the
price of the animal when finished,” and that “[f]eeder cattle markets are expectation
markets that are primarily driven by two things: (1) the expected value of fed cattle in the
future and (2) the cost of getting those feeder cattle to that point.” (Am. Compl. ¶¶ 236,
239.)
While Plaintiffs have alleged that feeder cattle prices are determined—at least in
part—by fed cattle prices, their allegations depend on one key fact: whether Plaintiffs are
producers of feeder cattle as that term is understood by the industry. If they are not,
then they have failed to establish a causal connection, because the CME Feeder Cattle
Index and industry data on which they newly rely pertain to feeder cattle.
The industry appears to define feeder cattle as cattle that are put onto feedlots for
slaughter that are of a certain weight and frame type.4 Most notably, the CME Feeder
Cattle Index, upon which Plaintiffs rely substantially in alleging a relationship between
feeder cattle and fed cattle, refers to feeder cattle as medium and large frame cattle
“being placed on feed at the feedlot” that are between 700 to 899 pounds.5 This
4 See Hedging with the CME Feeder Cattle Index (Dec. 21, 2018),
https://www.cmegroup.com/education/articles-and-reports/hedging-with-the-cme-feeder-
cattle-index-white-paper.html.
5 Compare Hedging with the CME Feeder Cattle Index, and CME Rulebook Chapter 102,
Feeder Cattle Futures, Section 10203.A, available at
https://www.cmegroup.com/content/dam/cmegroup/rulebook/CME/II/100/102/102.pdf (“The
CME Feeder Cattle Index™ is based upon a sample of transactions from these weight/frame score
categories: 700 to 899 pound Medium and Large Frame #1 feeder steers, and 700 to 899 pound
definition of feeder cattle is far narrower than the one Plaintiffs are using and indicates
that only Plaintiffs who sell cattle directly to feedlots of a certain weight and frame type
are producers of feeder cattle as that term is understood by the CME Feeder Cattle Index
and the industry at large. And only one named plaintiff, Hyatt, has alleged that he sold
cattle directly to a feedlot, although his allegations fail to specify the weight or frame type
of the cattle he allegedly sold. What’s more, Hyatt only claims to have sold “one or two
loads of feeder cattle directly to a feedlot,” and only “[f]or the past two years.” (Am.
Compl. ¶ 27.) Thus, the causal connection between Defendants’ conduct and Plaintiffs’
harm is still attenuated, as only one named Plaintiff could conceivably qualify as a
producer of feeder cattle, and even that characterization is a stretch. More substantial
allegations regarding Plaintiffs’ direct-to-feedlot sales could be sufficient, but based on
the allegations in the Amended Complaint the Court finds that Plaintiffs have not clearly
demonstrated that they are producers of feeder cattle.
Moreover, Plaintiffs have still not clearly alleged that they were the target of the
alleged conspiracy as required for antitrust standing. Minn. Twins, 779 F.2d at 451. It is insufficient for Plaintiffs to have “merely suffered indirect, secondary, or remote injury.”Id.
(quotation omitted). Plaintiffs assert that they were the target of the alleged conspiracy because they are producers of feeder cattle, which is in the same market as Medium and Large Frame #1-2 feeder steers.”), with (Am. Compl. ¶ 3, Fig. 1 (citing to CME Feeder Cattle Index).). the fed cattle. However, the Court previously determined that “the calves that Plaintiffs raise are inherently different than the full-grown cattle that Defendants process,” and that Plaintiffs failed to demonstrate that they are in the same market as Defendants. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *6. Furthermore, Plaintiffs continue to rely on inferences about the market generally, which the Court previously found insufficient. Seeid.
at *5 (citing McDonald,722 F.2d at 1374
). This factor therefore
continues to weigh against antitrust standing.
2. Improper Motive
The next factor is whether there was any improper motive on the part of the
Defendants. McDonald, 722 F.2d at 1374. The Court previously held that “[w]hile motivation to increase profits is not inherently improper, this factor weighs in favor of antitrust standing given the broader context of Plaintiffs’ price-fixing allegations.” In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *5. Because the allegations upon
which the Court reached that conclusion are substantially re-alleged in the Amended
Complaint, this factor again weighs in favor of antitrust standing.
3. Type of Injury
The Court must next consider if “the injury was of a type that Congress sought to
redress with antitrust laws.” McDonald, 722 F.2d at 1374. A party can show that they have suffered the type of injury that Congress sought to protect if their injury is “inextricably intertwined with the injury the conspiracies sought to inflict on . . . the [relevant] market.” Blue Shield of Virginia v. McCready,457 U.S. 465, 484
(1982). The Court previously found this factor was neutral. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *6.
The Court reaches the same conclusion here. On the one hand, Plaintiffs re-allege
the same injuries which the Court previously found suggest the type of injury that
Congress sought to redress. Id. For example, they contend that they were injured by
Defendants’ anticompetitive conduct, deprived of fair price competition at the top of the
supply chain, and that consumers were overcharged at the bottom of the supply chain.
(Am. Compl. ¶¶ 3, 6.) But on the other hand, the new allegations do not clearly
demonstrate that Plaintiffs are in the same relevant market as the alleged conspiracy.
Although Plaintiffs newly allege that all cattle are inherently the same product,
even though the ownership of the cattle may pass through several hands from birth to
slaughter, the calves that Plaintiffs raise are inherently different than the full-grown cattle
that Defendants process. See In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *6. That said, the markets for products and for sub-products contained in the product may be “inextricably linked.” E.g., In re TFT-LCD (Flat Panel) Antitrust Litig.,586 F. Supp. 2d 1109, 1123
(N.D. Cal. 2008). So, producers of feeder cattle may be in the relevant market because feeder cattle are raised to be fed cattle and the Plaintiffs have alleged a relationship between those markets. But whether Plaintiffs are producers of feeder cattle is not supported by the facts alleged in the Amended Complaint. Plaintiffs have not clearly established that they are producers of feeder cattle as that term is understood by the industry. There are still too many chains in the link between Plaintiffs and Defendants that make Plaintiffs’ alleged injury too remote. See Southwest Suburban Bd. of Realtors, Inc. v. Beverly Area Plan. Ass’n,830 F.2d 1374, 1379
(7th Cir. 1987) (“[A]s a general rule
suppliers of an injured customer may not seek recovery under the antitrust laws because
their injuries are too ‘indirect, secondary, or remote.’”). Accordingly, this factor is again
neutral.
4. Directness
The Court must next consider the directness between the injury and the market
restraint, which requires consideration of the “chain of causation.” McDonald, 722 F.2d
at 1374; AGC,459 U.S. at 540
. The Court previously found this factor weighs against antitrust standing because Plaintiffs failed to explain how their decreased profits are traceable to the Defendants’ conduct. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *6. Plaintiffs relied on inferences about the market, which the Court found to be unsupported by sufficient factual allegations.Id.
Here, Plaintiffs allege they are several steps removed from Defendants’ alleged
market manipulation, but that the relationship between the feeder cattle and fed cattle
markets demonstrates a direct chain of causation between Defendants’ conduct and
Plaintiffs’ harm. An indirect plaintiff’s injury may be adequately traceable through the
product distribution chain to show directness. E.g., In re Cattle and Beef Antitrust Litig.,
No. 19-1129, 2021 WL 7757881, at *11 (D. Minn. Sept. 14, 2021); In re Broiler Chicken Antitrust Litig.,290 F. Supp. 3d 772, 814
(N.D. Ill. 2017). But Plaintiffs still must establish directness that is not “too remote.” In re Dynamic Random Access Memory Antitrust Litig.,516 F. Supp. 2d 1072, 1092
(N.D. Cal. 2007).
While Plaintiffs have provided more substantial allegations regarding the
traceability of Defendants’ conduct to the feeder cattle market, the chain of causation
depends on whether Plaintiffs are producers of feeder cattle. And, as explained above,
Plaintiffs have not clearly demonstrated that they are such producers. Without that
necessary fact, Plaintiffs’ allegations are largely the same as before. This factor therefore
weighs against standing.
5. Speculative Nature of Damages
The fifth factor is the speculative nature of the damages. McDonald, 722 F.2d at
1374. The Court previously found this factor neutral because even though other factors may affect cow-calf prices, similar meat packing antitrust cases have considered the speculative nature of damages and determined that there are means and methods for economic analysts to pinpoint prices that would have been paid but for the conspiracy. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *7. Similarly, here, the fact that
multiple other factors may affect the prices of the cattle Plaintiffs produce in addition to
Defendants’ conduct is not dispositive.
Defendants argue that Plaintiffs fail to account for certain complexities inherent in
the new proposed classes, such as the fact that harm to one sector may benefit another.
For example, if cow-calf prices drop, cow-calf ranchers are harmed, but backgrounders or
stockers could be better off as their input costs to acquire calves decreases. But
regression analysis may be used to narrow down various supply and demand factors to
pinpoint the damages exclusively caused by any alleged market manipulation, regardless
of the complexities that the new proposed classes may bring. See In re Pork Antitrust
Litig., 665 F. Supp. 3d 967, 991–92 (D. Minn. 2023). This factor is therefore neutral.
6. Risk of Duplicative Recovery
The last factor is the “risk of duplicative recoveries or complex damage
apportionment.” McDonald, 722 F.2d at 1343. The Court previously found this factor weighed in favor of antitrust standing, unconvinced that it would be difficult for the parties to conduct economic analysis to ascertain an appropriate damages amount. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *7. The Court reaches the same
conclusion here. Though Defendants argue that the expansion of Plaintiffs to include all
indirect sellers makes apportionment more complex and creates a risk of duplicative
recoveries, economic analyses are capable of ascertaining Plaintiffs’ injuries to avoid
duplicative recovery. Therefore, this factor continues to favor antitrust standing.
* * *
Weighing the six AGC factors, the Court finds that Plaintiffs failed to establish
antitrust standing under AGC. Because Plaintiffs have not clearly demonstrated that they
are producers of feeder cattle as understood by the CME Feeder Cattle Index and beef
production industry at large, the Amended Complaint’s allegations regarding the
relationship between the fed cattle and the feeder cattle markets do not support
Plaintiffs’ antitrust standing. Without more substantial allegations that Plaintiffs are
producers of feeder cattle, they have not plausibly alleged a causal relationship between
Defendants’ conduct and their injury, or that their injury and damages are directly
traceable to Defendants’ conduct.
Because Plaintiffs have not established antitrust standing, the Court will dismiss
Plaintiffs’ Sherman Act, PSA, and state antitrust and consumer protection claims in the
states that apply AGC. See id. at *7 n.5 (listing states). The Court will also dismiss the only
remaining state antitrust law claim that does not apply AGC, which arises under
Minnesota law. Even though Minnesota does not explicitly apply AGC, it similarly
considers proximate causation and directness, which Plaintiffs failed to establish. See id.
at *7.
B. Remaining State Law Claims
The only remaining claims are Plaintiffs’ consumer protection claims arising under
Florida and Colorado law, which the Court previously dismissed for lack of proximate
causation or insufficient pleading of specific harm. Id. at *9–10. Because Plaintiffs have
again failed to establish proximate causation, the Court will dismiss the Florida consumer
protection claim. Defendants argue that Plaintiffs’ Colorado consumer protection claim
fails because Plaintiffs failed to allege that they were injured by Defendants’
misrepresentations, as required by Colorado law. See id. at *9. Though Plaintiffs allege
they were unable to discern how Defendants’ misrepresentations specifically injured
them because of Defendants’ fraudulent concealment, the Court previously found such
these allegations were insufficient. See id. at *9. Thus, Plaintiffs have again failed to
demonstrate how Defendants’ misrepresentations specifically injured Plaintiffs. The
Court will therefore dismiss Plaintiffs’ Florida and Colorado consumer protection claims.
CONCLUSION
The Court will dismiss Plaintiffs’ Sherman Act, PSA, and state antitrust and
consumer protection claims for lack of antitrust standing under AGC. Though the
Amended Complaint alleges a relationship between the prices and markets of feeder
cattle and fed cattle, Plaintiffs have not clearly established that they are producers of
feeder cattle, so these new allegations are insufficient to establish proximate causation
and directness. The Court will also dismiss the remaining state law claims arising under
Minnesota, Colorado, and Florida laws.
ORDER
Based on the foregoing, and all the files, records, and proceedings herein, IT IS
HEREBY ORDERED that:
1. Defendants’ Motion to Dismiss the Amended Specht Complaint [Docket No.
453] is GRANTED; and
2. Plaintiffs’ Amended Complaint [Docket No. 371] is DISMISSED without
prejudice.
LET JUDGMENT BE ENTERED ACCORDINGLY.
DATED: May 24, 2024 Otay | table
at Minneapolis, Minnesota. JOHN R. TUNHEIM
United States District Judge
-18- Trial Court Opinion
UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
IN RE CATTLE AND BEEF ANTITRUST
LITIGATION
MDL No. 22-3031 (JRT/JFD)
This Document Relates To: MEMORANDUM OPINION AND ORDER
GRANTING DEFENDANTS’ MOTION TO
THE INDIRECT SELLER ACTION (“Specht DISMISS THE SPECHT AMENDED
Case”), Civil No. 22-2903 COMPLAINT
Richard M. Paul, III, PAUL LLP, 601 Walnut Street, Suite 300, Kansas City,
MO 64106; Michael Montaño, GUERRA LLP, 875 East Ashby Place, Suite
1200, San Antonio, TX 78212, for Plaintiffs.
Kosta S. Stojilkovic, WILKINSON STEKLOFF LLP, 2001 M Street, Northwest,
10th Floor, Washington, D.C. 20036, for Defendants Cargill, Incorporated
and Cargill Meat Solutions Corporation.
Chelsea A. Bollman, JONES DAY, 90 South Seventh Street, Suite 4950,
Minneapolis, MN 55402, for Defendant National Beef Packing Company,
LLC.
Jon B. Jacobs, PERKINS COIE LLP, 700 13th Street, Northwest, Suite 800,
Washington, D.C., 20005, for Defendants Tyson Foods, Inc., and Tyson Fresh
Meats, Inc.
Jessica J. Nelson, SPENCER FANE, 100 South Fifth Street, Suite 2500,
Minneapolis, MN 55402, for Defendants JBS USA Food Company, JBS
Packerland, Inc., Swift Beef Company, and JBS S.A.
The putative Specht Class Members (“Plaintiffs”) filed an Amended Complaint on
behalf of producers of feeder cattle who indirectly sell cows and calves to one or more
Defendants in this action. Defendants now move to dismiss Plaintiffs’ Amended
Complaint.
Because Plaintiffs have not clearly demonstrated that they are producers of feeder
cattle as that term is understood by the CME Feeder Cattle Index and beef production
industry at large, their new allegations fail to establish causation and a direct injury as
would be necessary for antitrust standing. The Court will therefore dismiss Plaintiffs’
Sherman Act, Packers and Stockyards Act, and state antitrust and consumer protection
claims for lack of antitrust standing under Associated General Contractors of California,
Inc. v. California State Council of Carpenters, 459 U.S. 519 (1983). The Court will also
dismiss the remaining state law claims arising under Colorado and Florida laws.
BACKGROUND
I. FACTS
The Plaintiffs’ factual allegations remain largely the same as those outlined in the
Court’s prior order. See In re Cattle and Beef Antitrust Litig., No. 22-3031, 2023 WL
5310905, at *1–2 (D. Minn. Aug. 17, 2023). As such, the Court will only summarize and
address newly alleged facts relevant to the current motion.
Cow-calf operations are the first step in the beef supply market. (Am. Compl. ¶ 62,
Oct. 18, 2023, Docket No. 371.)1; see also In re Cattle and Beef Antitrust Litig., 2023 WL
5310905, at *1 (depicting diagram of beef production market). Cow-calf entities retain
1 Unless otherwise noted, all citations are to Case No. 22-3031.
cattle for the gestation period and then raise the calves until they are weaned from their
mothers. (Am. Compl. ¶¶ 62–63.); In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *1. After the cattle are weaned, they are raised until they are large enough for finishing at the feedlots—generally, when they are between 600 to 800 pounds. (Am. Compl. ¶ 63.) Ranchers can raise the cattle until they are large enough for finishing and sell directly to a feedlot or, if the cattle are too small or light to enter the feedlot, to stockers or backgrounders, who will raise the cattle until they are large enough for finishing. (Id.); In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *1. Feedlots or finishing
operations are the final phase of the beef production system, wherein the cattle are fed
to harvest weight. (Am. Compl. ¶ 64.) Once cattle reach between 950 and 1,500 pounds,
they become fed cattle. (Id.) The finishing process generally takes less than 6 months.
(Id.) Fed cattle are sold and slaughtered at packing plants operated by packers like
Defendants. (Id. ¶ 66.) The entire cattle production cycle from birth to slaughter is
typically 15 to 24 months. (Id. ¶ 68.)
In their Amended Complaint, Plaintiffs relabel themselves as producers of feeder
cattle who indirectly sell cattle to one or more Defendants in this case. (Id. ¶ 2.) Feeder
cattle are ultimately sold as “fat” or “fed” cattle. (Id. ¶ 7.) Plaintiffs define feeder cattle
as “calves, steers, or heifers raised by cow-calf-entities, ranchers, or backgrounders in the
United States, which feedlots use to produce fed cattle.” (Id. ¶ 1 n.1.) This expansion of
Plaintiffs from cow-calf ranchers to producers of feeder cattle in effect expands to include
all indirect sellers, including cow-calf-entities, ranchers, and backgrounders. (Compare
No. 22-2903, Class Action Compl. 4 1, Oct. 31, 2022, Docket No. 1, with Am. Compl. 4] 2.)
Plaintiffs reassert the same price-fixing conspiracy by Defendants as in their
original complaint. See In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *2.
They assert that Defendants conspired to suppress the price of fed cattle, and that their
coordinated conduct caused a collapse in fed cattle prices in 2015, which in turn caused
the prices of feeder cattle to collapse. (Am. Compl. 141 1, 4.) Plaintiffs newly allege that
Defendants’ prices for fed cattle have a direct impact on the prices that they receive for
feeder cattle. (/d. 7 3.) In support, they provide the following chart comparing the CME
Feeder Cattle Index to fed cattle prices. (/d. 4 3, Fig. 1.)
Weekly CME Feeder Cattle Index and
Deferred Live Cattle Contract (Adapted from CME)
4-year averages:
deferred live cattle = $114, CME feeder cattle index = $144
170
183
155
150
13
513
& 125
120
ie
103
100
38
se re A A x A 2 2 2
“—=CME Feeder Cattle Index Deferred Live Cattle
-4-
As the chart illustrates, Plaintiffs claim there was a correlation between fed cattle
prices and feeder cattle prices between 2016 and 2020 that demonstrates the causal
relationship between those prices. (Id. ¶ 3.)
Plaintiffs bring two putative classes for each claim type: a nationwide class and an
upstream nationwide class. (See id. ¶ 316.) The putative nationwide classes include
Plaintiffs who sold cattle to natural persons or entities who in turn sold to Defendants, so
are two links removed from Defendants’ conduct. (Id.) The putative upstream
nationwide classes include Plaintiffs who sold cattle to intermediaries who in turn sold to
another intermediary or a member of the nationwide classes, so are multiple links
removed from Defendants’ conduct. (Id.)
II. PROCEDURAL HISTORY
As with the factual history, the Court does not find it necessary to repeat the entire
procedural history of this case, so it will only summarize the relevant history here. See In
re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *2–3. The Court granted
Defendants’ motion to dismiss Plaintiffs’ original complaint without prejudice after
finding that Plaintiffs failed to establish antitrust standing. Id. at *12. Plaintiffs filed the
Amended Complaint with leave of the Court. (See generally Am. Compl.) Named Plaintiffs
James Specht, Jerry Kelsey, Richard Settlemyer, and David Hyatt own and operate farms
or ranches that raise and sell cattle at auctions, barn sales, or, for Mr. Hyatt, sometimes
directly to a feedlot. (Am. Compl. ¶¶ 24–27.) Plaintiffs re-allege nationwide claims based
on market allocation and price-fixing in violation of the Sherman Act (Count I) and the
Packers and Stockyards Act (Count II). (Id. ¶¶ 319–33.) They also re-allege state law
claims based on violations of antitrust laws (Count III) and consumer protection laws
(Count IV). (Id. ¶¶ 334–40.) Defendants moved to dismiss Plaintiffs’ Amended Complaint.
(Joint Mot. Dismiss, Nov. 21, 2023, Docket No. 453.)
DISCUSSION
I. STANDARD OF REVIEW
In reviewing a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the
Court considers all facts alleged in the complaint as true to determine if the complaint
states a “claim to relief that is plausible on its face.” Braden v. Wal-Mart Stores, Inc., 588
F.3d 585, 594(8th Cir. 2009) (quoting Ashcroft v. Iqbal,556 U.S. 662, 678
(2009)). At the motion to dismiss stage, the Court may consider the allegations in the complaint as well as “those materials that are necessarily embraced by the pleadings.” Schriener v. Quicken Loans, Inc.,774 F.3d 442, 444
(8th Cir. 2014).
“A claim has facial plausibility when the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the defendant is liable for the misconduct
alleged.” Iqbal, 556 U.S. at 678. The Court construes the complaint in the light most favorable to the plaintiff, drawing all inferences in the plaintiff’s favor. Ashley Cnty. v. Pfizer, Inc.,552 F.3d 659, 665
(8th Cir. 2009). Although the Court accepts the complaint's factual allegations as true and construes the complaint in a light most favorable to the plaintiff, it is “not bound to accept as true a legal conclusion couched as a factual allegation.” Papasan v. Allain,478 U.S. 265, 286
(1986). In other words, a complaint “does not need detailed factual allegations” but must include more “than labels and conclusions, and a formulaic recitation of the elements” to meet the plausibility standard. Bell Atl. Corp. v. Twombly,550 U.S. 544, 555
(2007).
II. ANALYSIS
Defendants argue that the Amended Complaint still fails to adequately establish
antitrust standing as is required for many of Plaintiffs’ claims under Associated General
Contractors of California, Inc. v. California State Council of Carpenters (“AGC”), 459 U.S.
519 (1983). They also claim that Plaintiffs’ remaining state law claims should be
dismissed. The Court will address each issue in turn.
A. Antitrust Standing
The Amended Complaint brings antitrust claims under the Sherman Act and the
antitrust laws of 30 states.2 It also brings consumer protection claims under the laws of
12 states.3 The Court previously found that Plaintiffs must show antitrust standing not
only for their claims under the Sherman Act and many of the state antitrust laws, but also
for their claims under the Packers and Stockyards Act (“PSA”) and many of the state
2 Plaintiffs bring antitrust claims on behalf of state law damages classes in Alabama,
Arizona, Arkansas, California, Connecticut, District of Columbia, Hawaii, Illinois, Iowa, Kansas,
Maine, Maryland, Michigan, Minnesota, Mississippi, Nebraska, Nevada, New Hampshire, New
Mexico, New York, North Carolina, North Dakota, Oregon, Rhode Island, South Dakota,
Tennessee, Utah, Vermont, West Virginia, and Wisconsin. (Am. Compl. ¶ 335.)
3 Plaintiffs bring state consumer protection claims on behalf of state law damages classes
in Arizona, California, Colorado, Florida, Illinois, Nevada, New Mexico, New York, North Carolina,
Oregon, Tennessee, and Wisconsin. (Am. Compl. ¶ 339.)
consumer protection laws. In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *4,
8–9.
AGC establishes six factors to determine whether a plaintiff has antitrust standing:
(1) The causal connection between the alleged antitrust
violation and the harm to the plaintiff; (2) Improper motive;
(3) Whether the injury was of a type that Congress sought to
redress with the antitrust laws; (4) The directness between
the injury and the market restraint; (5) The speculative nature
of the damages; (6) The risk of duplicate recoveries or
complex damage apportionment.
Midwest Commc’ns v. Minn. Twins, Inc., 779 F.2d 444, 450 n.6 (8th Cir. 1985). This inquiry essentially results in a determination of whether “the plaintiff [is] the target of the anticompetitive activity, not one who has merely suffered indirect, secondary, or remote injury.”Id. at 451
(citation and internal quotations omitted). The Court will analyze each
factor in turn.
1. Causal Connection
The Court must first consider the “causal connection between the alleged antitrust
violation and the harm to the plaintiff.” McDonald v. Johnson & Johnson, 722 F.2d 1370,
1374(8th Cir. 1983). The Court previously found this factor weighed against antitrust standing because Plaintiffs failed to allege how manipulating fed cattle prices impacted cow-calf prices. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *4–5. Plaintiffs,
relabeled as producers of feeder cattle, newly allege that Defendants’ conduct directly
impacts the price of feeder cattle, as demonstrated by the chart comparing the CME
Feeder Cattle Index to fed cattle prices. Plaintiffs also point to statements by industry
experts who claim that “[t]he most important factor influencing feeder cattle prices is the
price of the animal when finished,” and that “[f]eeder cattle markets are expectation
markets that are primarily driven by two things: (1) the expected value of fed cattle in the
future and (2) the cost of getting those feeder cattle to that point.” (Am. Compl. ¶¶ 236,
239.)
While Plaintiffs have alleged that feeder cattle prices are determined—at least in
part—by fed cattle prices, their allegations depend on one key fact: whether Plaintiffs are
producers of feeder cattle as that term is understood by the industry. If they are not,
then they have failed to establish a causal connection, because the CME Feeder Cattle
Index and industry data on which they newly rely pertain to feeder cattle.
The industry appears to define feeder cattle as cattle that are put onto feedlots for
slaughter that are of a certain weight and frame type.4 Most notably, the CME Feeder
Cattle Index, upon which Plaintiffs rely substantially in alleging a relationship between
feeder cattle and fed cattle, refers to feeder cattle as medium and large frame cattle
“being placed on feed at the feedlot” that are between 700 to 899 pounds.5 This
4 See Hedging with the CME Feeder Cattle Index (Dec. 21, 2018),
https://www.cmegroup.com/education/articles-and-reports/hedging-with-the-cme-feeder-
cattle-index-white-paper.html.
5 Compare Hedging with the CME Feeder Cattle Index, and CME Rulebook Chapter 102,
Feeder Cattle Futures, Section 10203.A, available at
https://www.cmegroup.com/content/dam/cmegroup/rulebook/CME/II/100/102/102.pdf (“The
CME Feeder Cattle Index™ is based upon a sample of transactions from these weight/frame score
categories: 700 to 899 pound Medium and Large Frame #1 feeder steers, and 700 to 899 pound
definition of feeder cattle is far narrower than the one Plaintiffs are using and indicates
that only Plaintiffs who sell cattle directly to feedlots of a certain weight and frame type
are producers of feeder cattle as that term is understood by the CME Feeder Cattle Index
and the industry at large. And only one named plaintiff, Hyatt, has alleged that he sold
cattle directly to a feedlot, although his allegations fail to specify the weight or frame type
of the cattle he allegedly sold. What’s more, Hyatt only claims to have sold “one or two
loads of feeder cattle directly to a feedlot,” and only “[f]or the past two years.” (Am.
Compl. ¶ 27.) Thus, the causal connection between Defendants’ conduct and Plaintiffs’
harm is still attenuated, as only one named Plaintiff could conceivably qualify as a
producer of feeder cattle, and even that characterization is a stretch. More substantial
allegations regarding Plaintiffs’ direct-to-feedlot sales could be sufficient, but based on
the allegations in the Amended Complaint the Court finds that Plaintiffs have not clearly
demonstrated that they are producers of feeder cattle.
Moreover, Plaintiffs have still not clearly alleged that they were the target of the
alleged conspiracy as required for antitrust standing. Minn. Twins, 779 F.2d at 451. It is insufficient for Plaintiffs to have “merely suffered indirect, secondary, or remote injury.”Id.
(quotation omitted). Plaintiffs assert that they were the target of the alleged conspiracy because they are producers of feeder cattle, which is in the same market as Medium and Large Frame #1-2 feeder steers.”), with (Am. Compl. ¶ 3, Fig. 1 (citing to CME Feeder Cattle Index).). the fed cattle. However, the Court previously determined that “the calves that Plaintiffs raise are inherently different than the full-grown cattle that Defendants process,” and that Plaintiffs failed to demonstrate that they are in the same market as Defendants. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *6. Furthermore, Plaintiffs continue to rely on inferences about the market generally, which the Court previously found insufficient. Seeid.
at *5 (citing McDonald,722 F.2d at 1374
). This factor therefore
continues to weigh against antitrust standing.
2. Improper Motive
The next factor is whether there was any improper motive on the part of the
Defendants. McDonald, 722 F.2d at 1374. The Court previously held that “[w]hile motivation to increase profits is not inherently improper, this factor weighs in favor of antitrust standing given the broader context of Plaintiffs’ price-fixing allegations.” In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *5. Because the allegations upon
which the Court reached that conclusion are substantially re-alleged in the Amended
Complaint, this factor again weighs in favor of antitrust standing.
3. Type of Injury
The Court must next consider if “the injury was of a type that Congress sought to
redress with antitrust laws.” McDonald, 722 F.2d at 1374. A party can show that they have suffered the type of injury that Congress sought to protect if their injury is “inextricably intertwined with the injury the conspiracies sought to inflict on . . . the [relevant] market.” Blue Shield of Virginia v. McCready,457 U.S. 465, 484
(1982). The Court previously found this factor was neutral. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *6.
The Court reaches the same conclusion here. On the one hand, Plaintiffs re-allege
the same injuries which the Court previously found suggest the type of injury that
Congress sought to redress. Id. For example, they contend that they were injured by
Defendants’ anticompetitive conduct, deprived of fair price competition at the top of the
supply chain, and that consumers were overcharged at the bottom of the supply chain.
(Am. Compl. ¶¶ 3, 6.) But on the other hand, the new allegations do not clearly
demonstrate that Plaintiffs are in the same relevant market as the alleged conspiracy.
Although Plaintiffs newly allege that all cattle are inherently the same product,
even though the ownership of the cattle may pass through several hands from birth to
slaughter, the calves that Plaintiffs raise are inherently different than the full-grown cattle
that Defendants process. See In re Cattle and Beef Antitrust Litig., 2023 WL 5310905, at *6. That said, the markets for products and for sub-products contained in the product may be “inextricably linked.” E.g., In re TFT-LCD (Flat Panel) Antitrust Litig.,586 F. Supp. 2d 1109, 1123
(N.D. Cal. 2008). So, producers of feeder cattle may be in the relevant market because feeder cattle are raised to be fed cattle and the Plaintiffs have alleged a relationship between those markets. But whether Plaintiffs are producers of feeder cattle is not supported by the facts alleged in the Amended Complaint. Plaintiffs have not clearly established that they are producers of feeder cattle as that term is understood by the industry. There are still too many chains in the link between Plaintiffs and Defendants that make Plaintiffs’ alleged injury too remote. See Southwest Suburban Bd. of Realtors, Inc. v. Beverly Area Plan. Ass’n,830 F.2d 1374, 1379
(7th Cir. 1987) (“[A]s a general rule
suppliers of an injured customer may not seek recovery under the antitrust laws because
their injuries are too ‘indirect, secondary, or remote.’”). Accordingly, this factor is again
neutral.
4. Directness
The Court must next consider the directness between the injury and the market
restraint, which requires consideration of the “chain of causation.” McDonald, 722 F.2d
at 1374; AGC,459 U.S. at 540
. The Court previously found this factor weighs against antitrust standing because Plaintiffs failed to explain how their decreased profits are traceable to the Defendants’ conduct. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *6. Plaintiffs relied on inferences about the market, which the Court found to be unsupported by sufficient factual allegations.Id.
Here, Plaintiffs allege they are several steps removed from Defendants’ alleged
market manipulation, but that the relationship between the feeder cattle and fed cattle
markets demonstrates a direct chain of causation between Defendants’ conduct and
Plaintiffs’ harm. An indirect plaintiff’s injury may be adequately traceable through the
product distribution chain to show directness. E.g., In re Cattle and Beef Antitrust Litig.,
No. 19-1129, 2021 WL 7757881, at *11 (D. Minn. Sept. 14, 2021); In re Broiler Chicken Antitrust Litig.,290 F. Supp. 3d 772, 814
(N.D. Ill. 2017). But Plaintiffs still must establish directness that is not “too remote.” In re Dynamic Random Access Memory Antitrust Litig.,516 F. Supp. 2d 1072, 1092
(N.D. Cal. 2007).
While Plaintiffs have provided more substantial allegations regarding the
traceability of Defendants’ conduct to the feeder cattle market, the chain of causation
depends on whether Plaintiffs are producers of feeder cattle. And, as explained above,
Plaintiffs have not clearly demonstrated that they are such producers. Without that
necessary fact, Plaintiffs’ allegations are largely the same as before. This factor therefore
weighs against standing.
5. Speculative Nature of Damages
The fifth factor is the speculative nature of the damages. McDonald, 722 F.2d at
1374. The Court previously found this factor neutral because even though other factors may affect cow-calf prices, similar meat packing antitrust cases have considered the speculative nature of damages and determined that there are means and methods for economic analysts to pinpoint prices that would have been paid but for the conspiracy. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *7. Similarly, here, the fact that
multiple other factors may affect the prices of the cattle Plaintiffs produce in addition to
Defendants’ conduct is not dispositive.
Defendants argue that Plaintiffs fail to account for certain complexities inherent in
the new proposed classes, such as the fact that harm to one sector may benefit another.
For example, if cow-calf prices drop, cow-calf ranchers are harmed, but backgrounders or
stockers could be better off as their input costs to acquire calves decreases. But
regression analysis may be used to narrow down various supply and demand factors to
pinpoint the damages exclusively caused by any alleged market manipulation, regardless
of the complexities that the new proposed classes may bring. See In re Pork Antitrust
Litig., 665 F. Supp. 3d 967, 991–92 (D. Minn. 2023). This factor is therefore neutral.
6. Risk of Duplicative Recovery
The last factor is the “risk of duplicative recoveries or complex damage
apportionment.” McDonald, 722 F.2d at 1343. The Court previously found this factor weighed in favor of antitrust standing, unconvinced that it would be difficult for the parties to conduct economic analysis to ascertain an appropriate damages amount. In re Cattle and Beef Antitrust Litig.,2023 WL 5310905
, at *7. The Court reaches the same
conclusion here. Though Defendants argue that the expansion of Plaintiffs to include all
indirect sellers makes apportionment more complex and creates a risk of duplicative
recoveries, economic analyses are capable of ascertaining Plaintiffs’ injuries to avoid
duplicative recovery. Therefore, this factor continues to favor antitrust standing.
* * *
Weighing the six AGC factors, the Court finds that Plaintiffs failed to establish
antitrust standing under AGC. Because Plaintiffs have not clearly demonstrated that they
are producers of feeder cattle as understood by the CME Feeder Cattle Index and beef
production industry at large, the Amended Complaint’s allegations regarding the
relationship between the fed cattle and the feeder cattle markets do not support
Plaintiffs’ antitrust standing. Without more substantial allegations that Plaintiffs are
producers of feeder cattle, they have not plausibly alleged a causal relationship between
Defendants’ conduct and their injury, or that their injury and damages are directly
traceable to Defendants’ conduct.
Because Plaintiffs have not established antitrust standing, the Court will dismiss
Plaintiffs’ Sherman Act, PSA, and state antitrust and consumer protection claims in the
states that apply AGC. See id. at *7 n.5 (listing states). The Court will also dismiss the only
remaining state antitrust law claim that does not apply AGC, which arises under
Minnesota law. Even though Minnesota does not explicitly apply AGC, it similarly
considers proximate causation and directness, which Plaintiffs failed to establish. See id.
at *7.
B. Remaining State Law Claims
The only remaining claims are Plaintiffs’ consumer protection claims arising under
Florida and Colorado law, which the Court previously dismissed for lack of proximate
causation or insufficient pleading of specific harm. Id. at *9–10. Because Plaintiffs have
again failed to establish proximate causation, the Court will dismiss the Florida consumer
protection claim. Defendants argue that Plaintiffs’ Colorado consumer protection claim
fails because Plaintiffs failed to allege that they were injured by Defendants’
misrepresentations, as required by Colorado law. See id. at *9. Though Plaintiffs allege
they were unable to discern how Defendants’ misrepresentations specifically injured
them because of Defendants’ fraudulent concealment, the Court previously found such
these allegations were insufficient. See id. at *9. Thus, Plaintiffs have again failed to
demonstrate how Defendants’ misrepresentations specifically injured Plaintiffs. The
Court will therefore dismiss Plaintiffs’ Florida and Colorado consumer protection claims.
CONCLUSION
The Court will dismiss Plaintiffs’ Sherman Act, PSA, and state antitrust and
consumer protection claims for lack of antitrust standing under AGC. Though the
Amended Complaint alleges a relationship between the prices and markets of feeder
cattle and fed cattle, Plaintiffs have not clearly established that they are producers of
feeder cattle, so these new allegations are insufficient to establish proximate causation
and directness. The Court will also dismiss the remaining state law claims arising under
Minnesota, Colorado, and Florida laws.
ORDER
Based on the foregoing, and all the files, records, and proceedings herein, IT IS
HEREBY ORDERED that:
1. Defendants’ Motion to Dismiss the Amended Specht Complaint [Docket No.
453] is GRANTED; and
2. Plaintiffs’ Amended Complaint [Docket No. 371] is DISMISSED without
prejudice.
LET JUDGMENT BE ENTERED ACCORDINGLY.
DATED: May 24, 2024 Otay | table
at Minneapolis, Minnesota. JOHN R. TUNHEIM
United States District Judge
-18- Reference
- Status
- Unknown