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Dairy Farmers, Others File Racketeering Lawsuit Against DFA

A lawsuit was recently filed under the Racketeer-Influenced and Corrupt Organizations (RICO) Act in the US District Court for the Northern District of New York against Dairy Farmers of America (DFA), the nation’s largest dairy cooperative.

Plaintiffs in the case include Susan L. Poole, a shareholder of Dean Foods Company; several dairy farmers; and New York Animal and Farm, LLC., a dairy supply business. Defendants include DFA managers, board members and agents.

Monica Massey, DFA’s executive vice president and chief of staff, called the lawsuit “ridiculous and without merit.”

The lawsuit details three predicate acts of extortion, the first of which is obtaining farmers’ consent to settle antitrust claims.

In June 2014, DFA was facing a jury trial in Vermont on antitrust grounds, the complaint stated. DFA’s attempt to settle the case was struck down by the court after a number of dairy farmers voiced objection via letter and at the court’s Fairness Hearing. A second proposed settlement fared no better.

“When DFA’s leaders arranged a third settlement in 2016, they resorted to extortion to ensure that the dairy farmers would fall squarely on their side of the courtroom,” the lawsuit stated.

Specifically, DFA’s managers sent their FARM (Farmers Assuring Responsible Management) program inspectors and routine milk inspectors to farms with an offer: sign in support of the settlement or lose your market.

DFA inspectors and other employees pressured dairy farmers with threats including that, if these dairy farmers did not sign in support of DFA’s settlement, they should consider switching to organic milk production, they should start looking for new processing plants, they could be dismissed from their cooperatives, and their co-ops could lose access to milk markets controlled by Dairy Marketing Services (DMS), which was created in 1999 by DFA, Dairylea and St. Albans Co-op, the lawsuit said.

“Over 1,200 farmers from DFA, St. Albans, Dairylea, small regional cooperatives which marketed their milk through DMS, and even ‘independent’ dairy farmers selling through DMS to Kraft Heinz Company signed DFA’s form letters, and the suit against DFA was settled and closed,” the lawsuit said.

The second predicate act of extortion detailed in the lawsuit is obtaining a controlling share of the national milk supply.

“Emboldened ...

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