Tyson wins nearly $1 million in cattle feeding lawsuit

A judge in Boise rejected a plea filed last week by Hollifield to hold off on payments pending an appeal, ruling that the company, which is operating under Chapter 11 bankruptcy protection, must begin making payments. Plans call for Hollifield to pay Tyson in six payments over three years starting in December.

Tyson’s contract with Double H Cattle Co., now part of Hollifield, started in June 2010. Under the agreement, Hollifield was to source and fatten up cattle for Tyson then deliver them to Tyson’s Pasco, Wash.-based plant for slaughter. The plan was profitable until prices fell, and Hollifield Ranches officials said in court documents that the company lost money. Hollifield filed for bankruptcy protection in December 2010.

Tyson Fresh Meats, a South Dakota-based subsidiary of Tyson Foods, filed the nearly $1 million claim in March 2012. Hollifield quickly filed a counterclaim seeking $1.2 million from Tyson, an amount that changed several times during the court case. US bankruptcy judge Jim Pappas rejected the counterclaim, which contends that Tyson didn’t take the necessary steps to protect Hollifield from market risks as cattle prices changed.

In his Nov. 7 judgment, Pappas ruled that Hollifield breached the contract and “did not prove that Tyson failed to employ reasonable and customary risk management practices.”​ The contract’s wording gave Tyson sole responsibility for management of the risks involved in the cattle transactions, and the approach Tyson chose was “reasonable and customary,”​ the judge wrote.