In damning opinion, federal appeals court rules against Murphy-Brown in hog nuisance suits

Photos taken inside one of the hog barns at Kinlaw Farms and presented to the jury in the case of McKiver vs. Smithfield Hog Production Division (Photos from court filings)

Punitive damages will be recalculated, but court sides with plaintiffs on all other arguments 

This is a developing story.

Update 6:25 p.m.: Smithfield issued a statement saying they have “resolved these cases through a settlement that will take into account the divided decision of the court. Information about the terms of the settlement will not be disclosed.”

Murphy-Brown lost nearly every legal argument it posed before the Fourth Circuit Court of Appeals, which, in a damning opinion issued this afternoon reaffirmed a jury verdict awarding monetary damages to 10 neighbors who had filed nuisance suits against the world’s largest pork producer.

After 10 months since the oral arguments, the Fourth Circuit affirmed a decision issued by the District Court that Murphy-Brown’s operation of its industrialized hog operations — open lagoon and spray field systems, “dead boxes” and all-hours truck traffic — unduly harmed neighbors’ quality of life. The only point that Murphy-Brown prevailed on was the role of executive salaries and parent company profits in calculating punitive damages.

The case centered on neighbors of the Kinlaw Farm in Bladen County, a contract grower for Murphy-Brown/Smithfield Foods. However, the suit was filed in 2018 against Murphy-Brown, which controls every aspect of the farm, from the type and amount of feed, to the number of hogs raised, to the lagoon-and-sprayfield waste management systems.

After more than two weeks of hearing testimony, a jury awarded each plaintiff  $75,000 each in compensatory damages, plus another $5 million apiece for punitive damages. The total: Upward of $50 million, an historic amount.

Punitive damages can be awarded if a jury finds a defendant “committed fraud,”  “acted in malice” or in “wanton neglect.”

There will be no new trial, the appellate court ruled, only a rehearing on the amount of punitive damages that can be awarded to neighbors without considering the parent company or executives’ financial information. Compensatory damages are unaffected.

At the district court level, the neighbors were represented by Wallace & Graham, based in Salisbury, who had hired Michael Kaeske of Texas to argue the case. McGuireWoods in Richmond, Va., represented Murphy-Brown.

In the 144-page opinion, appeals court judges disarmed Murphy-Brown’s many defenses, including its major points:

  • Murphy-Brown had tried to reel in Kinlaw Farms as a responsible party, even though the pork producer dictates the terms of the operation. Had Murphy-Brown succeeded in its argument, the company could have further buttressed its claim that the nuisances suits, of which there are dozens, harmed family farmers. In fact, Murphy-Brown is responsible for the damages.
  • The company had claimed that the Right to Farm Act of 2017, which sharply limited the amount of damages neighbors could recover in case they won in court, was retroactive. (Gov. Cooper vetoed the bill, but lawmakers overrode it.) By the time that legislation was enacted, dozens of nuisance suits had been filed in federal court against the company. Even though the text of the bill said it would be effective when it “became law and after that date,” Murphy-Brown and several lawmakers said it merely “clarified” previous farm acts and should apply retroactively.
    Original bill language did say it should apply retroactively, but was removed over concerns it could not pass constitutional muster.
    The appellate court disagreed, saying “we have nothing to conclude that the 2017 Right to Farm Act amendments should apply retroactively. … If made retroactive it would reward powerful defendants who faced with a possible judgment against them could escape responsibility by raising a specter of doubt about something the state’s courts have long made available.”
  • Murphy-Brown also lost its claim that the expert testimony of Shane Rogers should be struck. Rogers is an environmental engineer who testified that hog feces had been found on neighbors’ homes. He based these findings on Pig2Bac, a technology that can determine the fingerprint of fecal material. Although the technology had not been peer-reviewed, the court said that fact was only one consideration of its reliability.

The court also found that Murphy-Brown knew that its farms were causing problems for the neighbors, even without formal complaints. “Murphy-Brown’s own collection of media articles reporting conditions associated with its farming practices and policies, as well as its knowledge of studies detailing the effects of lagoon and spray field operations and types of effective remediation,” showed that the company was fully aware of the odor, flies, buzzards and truck traffic. “Yet despite this knowledge,” the court wrote, Murphy-Brown “persisted in practices it knew were reasonably likely to result in injury to neighboring properties.”

Nor did the court buy the company’s argument that the Kinlaw farm operated legally and with required permits, and thus should not be found liable for nuisance. “This is beside the point,” the court wrote. “Lawful enterprises can constitute a nuisance ….”

During the trial, Murphy-Brown executives testified that the company had taken steps to reduce impacts on neighbors. This included changing the type of feed to decrease odors from the manure. However, the court determined that these steps “were motivated by profit or efficiency of operations as oppose to concern for neighbors. … The fact that Murphy-Brown policies expressly encouraged growers to avoid spraying at times neighbors were known to be outside demonstrates that [the company] knew its spray field operation was still likely to interfere with use and enjoyment of their property.”

The neighbors, wrote the court, “presented clear and convincing  evidence that Murphy-Brown knew about the likely harms, denied their existence and fought for them not to come to light.”

Farmworkers’ wages threatened by Trump administration’s inaction 

The middle of a pandemic is a particularly challenging time for low-wage workers to take a pay cut, but the 205,000 farmworkers across the country could face that dire situation next year. 

The U.S. Department of Agriculture abruptly decided to cancel its annual survey of farmworker wages, throwing 2021 wage rates for both H-2A temporary foreign workers and their U.S. counterparts into uncertainty — and farmworkers and advocates are scrambling.  The survey is used to set what is called the Adverse Effect Wage Rate, or AEWR, that growers must pay to the  H-2A workers and to any U.S. workers performing the same job. 

The Adverse Effect Wage Rate is designed to prevent agricultural employers from being incentivized to hire foreign labor at lower wages, to the detriment of local workers. Te AEWR is set annually for each state based on the USDA survey. North Carolina’s hourly rate is $12.67 — ranking 34th among all states. (The rates for the Southeast and Deep South are much lower than much of the US; North Carolina is first among those states, tied with Virginia.) 

 Over the years, there have been many attempts, legislative and administrative, to reduce the AEWR or allow growers to pay lower wages in some other way. It’s possible that H-2A workers could see their pay cut to the federal minimum wage of just $7.25 an hour; North Carolina’s minimum is the same as the federal rate.

Scuttling the wage survey is the latest maneuver to placate the agricultural industry at the expense of the workers who put food on our tables. 

DEQ levies largest fine in eight years on Sampson County hog farm

B&L Farms, an industrialized swine operation near Spivey’s Corner in Sampson County, was fined more than $87,698 by state regulators today for a waste lagoon breach that spilled 3 million gallons of feces and urine into nearby waterways and wetlands, killing at least 1,000 fish.

The spill occurred on June 12. DEQ investigators found that Bryan McLamb, who is permitted to raises 2,580 hogs at the farm, had allowed the level of waste to reach the top of the lagoon berm “for a prolonged period of time.” McLamb also failed to keep accurate spraying records and did not regularly inspect the lagoon levels.

McLamb is a contract grower for Smithfield Foods.

After the spill, testing by DEQ showed extremely high levels of fecal coliform bacteria — at least 3,000 times higher than water quality standards — downstream.

“The egregious nature of the violations and the severity of the environmental harm in this case require a serious penalty that holds the owner accountable for not operating in compliance with their permit conditions and the laws of North Carolina,” said DEQ Secretary Michael S. Regan in a prepared statement.

The B&L fine is the largest assessed on any concentrated animal feeding operation since at least 2012. In 2018, DEQ penalized Lanier Farms of Jones County $64,000 for an extensive history of noncompliance resulting in a 1 million gallon spill into the Trent River. Lanier also was a Smithfield contract grower. Facing Clean Water Act violations, the company later removed its hogs from Lanier’s operation.

State ag officials: Dicamba also contaminated compost, but original source remains unknown

Anastasia Maddox’s tomato plants curled as the result of herbicide poisoning of compost she had used on her garden. (Photo filed by Maddox with her public comments to the EPA)

A state Department of Agriculture investigation found powerful herbicides Dicamba — now banned — and Clopyralid in several compost samples that killed and damaged plants in dozens of gardens and small farms in North Carolina. However, investigators could not identify the original source of contamination.

Policy Watch reported last month that McGill Environmental in Chatham County unknowingly sold the tainted compost under the name “Certified Soilbuilder” to garden shops in the Triad and Triangle, where people purchased the product.

McGill officials speculated some of the contamination came from yard waste that had been sprayed with pesticides. That waste was then collected by municipalities and delivered to McGill to be used as feedstock to make the compost.

Sydney Ross, pesticide operations specialist with the state Department of Agriculture, said the agency received 85 complaints related to contaminated compost from McGill. Two samples detected Dicamba and another taken  detected trace amounts of Clopyralid; all other samples taken did not detect the presence of any pesticides.

In its own investigation, McGill found Clopyralid in the compost.

Manufactured by Bayer, Dicamba has a troublesome 50-year history. Farmers previously avoided spraying the herbicide during warm, dry weather because it is prone to drifting and can harm crops and yards that weren’t the target of the spray.

Four years ago, the EPA approved an expansion of its use on soybeans that had been genetically modified to be tolerant of the chemical. As a result, millions of acres were sprayed nationwide, while the number of complaints skyrocketed, mostly from farmers and orchard and vineyard owners who said their crops had been damaged or killed by drift.

In June, a federal court ruled that it is no longer legal to sell Dicamba. However, farmers are allowed to use any of their remaining inventory. Some states have implemented restrictions, though, on how and when Dicamba can be sprayed.

Bayer recently allocated $400 million toward a settlement for alleged crop damage in the Midwest, beginning in 2015.

Manufactured by Dow AgroSciences, and now its spinoff company Corteva, Clopyralid is a persistent and powerful herbicide. Some states and municipalities have banned it outright. But in North Carolina, it can legally be applied to alfalfa and turf fields, as well on right-of-ways.

Without knowing the original source of the pesticides, the agriculture department could not determine if there were violations of state pesticide law. The cases are now closed, Ross said.

1,000+ dead fish: DEQ releases more troubling details on hog lagoon spill

Three million gallons of hog feces and urine killed more than 1,000 fish in Wagner Ditch/Plainveiw Pond, a half-mile from B&L Farms. Waste were also found in wetlands near Starlins Swamp, 1.35 miles away.

The breach of a hog lagoon that spilled 3 million gallons of feces and urine into streams, ponds and wetlands in the Cape Fear River Basin killed at least 1,000 fish — and occurred because of neglect and mismanagement.

The NC Department of Environmental Quality released more details yesterday about a June 12 spill at B&L Farms, north of Spivey’s Corner in Sampson County. Investigators found that Bryan McLamb, who raises hogs form Smithfield Foods, had allowed the level of waste to reach the top of the lagoon berm “for a prolonged period of time.”

According to their environmental permits, all farms must keep waste at certain levels below the top of the berm to prevent it from overflowing, especially when it rains. To accomplish this, farms pump the lagoon through spray the waste on their fields.

The day before the breach, it had rained 2 inches at the farm.

But McLamb chronically failed to manage the lagoon, investigators found. The waste levels had been so high and for such a long time that the earthen lagoon berm was saturated and “notably soft” when walked on. Vegetation along the crest of the berm had died because it had been inundated by the feces and urine.

And after the previous rain, McLamb did not inspect the lagoon to ensure it was intact and not overflowing. The lagoon marker had also been installed incorrectly, so the measurements were inaccurate.

As a result, on the morning of June 12, a Smithfield crew that had arrived at the farm to remove some pigs for slaughter, discovered the breach. But there were further delays in notifying the state. The crew relayed information first to Smithfield; at 9:40 a.m. Smithfield then called McLamb, who went to the farm to confirm the breach. McLamb then called the farm’s technical specialist, Curtis Barwick, who called DEQ shortly after 11.

By the time DEQ investigators arrived at the farm at 12:40 p.m. 3 million gallons of feces and urine had “coursed overland into wetlands, and surface waters, including Starlins Swamp, 1.35 miles from the lagoon. Investigators also documented waste and dead fish in the Wagner Pond about a half-mile from the lagoon, where there were “a minimum of one thousand dead fish including brim, catfish, bass, an eel, and other panfish.” Hog feces “were also documented in wetlands.”

Policy Watch reported earlier this week that subsequent testing by DEQ showed extremely high levels of fecal coliform bacteria — at least 3,000 times higher than water quality standards — in waters downstream.

In addition to neglecting the lagoon, McLamb had also failed to keep proper records of lagoon levels and spraying. Nor did he ever notify DEQ that his lagoon was too full, as required, even though McLamb said it had been for several months.

DEQ cited McClamb for multiple violations. He has 20 days to submit additional information and a written response. Afterward, DEQ will determine the fine.