Travis Mims v. Cagle's Inc.

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
FILED
No. 04-11570 U.S. COURT OF APPEALS
________________________ ELEVENTH CIRCUIT
JUNE 15, 2005
THOMAS K. KAHN
D. C. Docket No. 01-00130 CV-2-WLS-1
CLERK
TRAVIS MIMS, Plaintiff-Counter-
Defendant-Appellant,
versus
CAGLE FOODS JV, LLC,
d.b.a. Cagle-Keystone Foods, Defendant-Counter-
Claimant-Appellee.
.
________________________
Appeal from the United States District Court
for the Middle District of Georgia
_________________________
(June 15, 2005)
Before ANDERSON and WILSON, Circuit Judges, and JORDAN*, District Judge.
_______________
* Honorable Adalberto Jordan, United States Judge for the Southern District of Florida,
sitting by designation.
PER CURIAM:
In this case, chicken grower Travis Mims alleges that Cagle Foods JV
(“Cagle”), a chicken processing company, violated the Packers & Stockyards Act
(“PSA”), 7 U.S.C. § 181 et seq., the Agricultural Fair Practices Act, 7 U.S.C. §
2301 et. seq., and the Georgia Racketeer Influenced & Corrupt Organizations Act,
O.C.G.A. § 16-14-4 (2004), in a variety of ways. Mims also alleges claims for
breach of contract, fraud, fraud in the inducement, and promissory estoppel. The
district court granted summary judgment to Cagle on all claims, holding that Mims
produced insufficient evidence to create a genuine issue of material fact with
respect to his claims. After oral argument and careful consideration, we agree that
Mims has not produced sufficient evidence to create a genuine issue of material
fact. Accordingly, we affirm.
I. FACTS
Cagle provides growers with baby chicks (known as "broilers") along with
the necessary feed and medication, and, in return, the growers provide care and
oversight for the broilers during the chicks’ "grow-out." At the end of the
grow-out, Cagle takes the broilers to its processing plants, weighs the truck full of
birds, deducts the weight of the crates and the truck, and determines the weight of
the broilers. The grower is compensated by a formula that compares his cost per
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pound against similarly situated growers during the relevant time period. In order
for the settlement to be correct, the number of birds must be accurately stated, the
feed must be accurately accounted for, and the weight of the finished birds must be
true and accurate. "Feed conversion," how much feed it takes to produce the
chicken, is the most important factor in the determination of the pay formula.
Mims worked as a grower for Cagle, raising chickens on his own farm from
1994 through 2001, and for another owner, James Tyson, from 1999 through 2001.
In 1994, Mims entered into a contract with Cagle to build four chicken houses.
The agreement enumerated Cagle's obligations, but contained no reference to the
specific numbers of birds to be placed, the numbers of flocks per year, the types of
birds, or income or expense figures. The contract contained the merger clause:
This Agreement constitutes the entire agreement between
the parties and includes all promises and representations,
express or implied, made by the Company and the
Producer and by either of them. Any prior oral or written
representations not expressly set forth in this Agreement
are hereby cancelled and are no longer of any force or
effect. This Agreement may not be altered in any manner
except by a written instrument signed by both parties.
Mims’ houses were completed and he received his first flock in August
1994. In the summer of 1997, Mims’ flock placements were cut from 25,000 per
house to 22,500 per house because Cagle had decided to use larger birds. At the
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same time that Cagle reduced its flock placement, it increased grower pay from 4.3
cents per pound to 4.5 cents per pound.
In 1998, Mims became active in the United Poultry Growers Association
("UPGA"). In May 1999, Cagle offered all growers an option to enter into a new
contract at a higher payment rate in exchange for an agreement to arbitrate all
disputes. Mims refused to sign the new contract, and opted to forego the raise and
to continue his relationship with Cagle under the existing contract.
In 1999, Mims began managing a six house farm owned by James Tyson
pursuant to an agreement between Mims and Tyson. Cagle concluded that Mims’
performance was sub-par. Cagle began to provide copies of Service Reports to
Tyson. Mims was aware the Service Reports were being forwarded, saw copies of
all reports, had an opportunity to respond, but did not.
Mims decided to put his own farm on the market in the fall of 2000, but
planned to continue working for Tyson. On October 16, 2000, Mims told a Cagle
employee that he wanted to put his farm on the market, and that he did not want to
continue to grow chickens. Mims subsequently changed his mind. When Mims’
flock was picked up in November of 2000, he was told that he was not on the
placement schedule to receive another flock, so he requested that his flock
supervisor put him on the schedule. Cagle agreed to place another flock after
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Mims made some repairs. Cagle placed Mims’ next flock on January 15, 2001.
After the flock placed on Mims’ farm in January 2001, Cagle terminated Mims'
contract. In late 2000 a Cagle employee told Tyson that Cagle would not put any
more birds in his houses as long as Mims was the manager.1 Tyson decided to get
out of the business and sold his farm in Spring of 2001.
II. DISCUSSION
A. Packers and Stockyards Act Claims
Mims argues that the district court erred by granting Cagle’s motion for
summary judgment on his Packers & Stockyards Act Claims. Mims argues that
after joining the UPGA and refusing to sign the arbitration contract, his
performance declined. Mims argues that the decline in his performance can be
attributed to Cagles’ retaliation toward Mims for joining the UPGA and refusing to
sign the arbitration contract. Mims argues that he produced evidence creating a
genuine issue of material fact of each of the following: (1) Cagle provided him
with sick and unhealthy birds in retaliation for joining the UPGA in 1998, and for
refusing to sign an arbitration contract in 1999; (2) Cagle delayed feed deliveries in
retaliation; (3) Cagle engaged in various dishonest weighing practices that
1
Cagle disputes this, but for the purpose of summary judgment we take the facts in
the light most favorable to the plaintiff.
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damaged Mims during the entire course of its relationship with Mims; and (4) the
arbitration contract that was offered by Cagle violated the PSA because it was
unconscionable and constituted a "bait and switch."2
The Packers and Stockyards Act prohibits "unfair, unjustly discriminatory, or
deceptive practices or devices with respect to live poultry.” 7 U.S.C. § 192. We
assume arguendo that Mims is entitled to a jury on his PSA claim if he could
produce evidence sufficient to raise a genuine issue with respect to any of his
factual allegations. However, we conclude that Mims has not produced sufficient
evidence such that a rational juror could find in his favor on any of these factual
allegations.
2
Mims also argues that Cagle failed to move for summary judgment on all grounds
that formed the basis for Mims' PSA claim, and therefore the district court inappropriately
granted summary judgment on these claims. Specifically, Mims states that the following
allegations that could support a PSA claim were not addressed by Cagle or the district court: (1)
termination of Mims’ contract without economic justification; (2) Cagle's ceasing to place flocks
with Mims during late 2000 without cause; and (3) Cagle's making of false statements to Mims'
employer Tyson and pressuring him to terminate his relationship with Mims. However, Cagle
discussed each of these issues in the factual statement of its brief in support of summary
judgment, and stated, "An analysis of the ‘evidence' presented by plaintiff makes clear that he has
not proven any of his laundry list of alleged discriminatory acts." Cagle's statement that Mims
has not proven any of his laundry list of alleged discriminatory acts constitutes a motion for
summary judgment on all grounds that could serve as the basis of his PSA claim. We conclude
that the district court properly found that Mims lacked sufficient evidence to support his PSA
claim. There is nothing to indicate that Cagle made false statements to Tyson. Cagle stopped
placing flocks with Mims at Mims’ request. Termination of a contract without economic
justification is insufficient to sustain a claim under the PSA absent a showing of anticompetitive
effect. See London v. Fieldale Farms Corp., __F.3d.__, 2005 WL 1279147 at *5 (11th Cir. June
1, 2005).
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Mims claims that Cagle provided him with sick and unhealthy birds in
retaliation for joining the UPGA in 1998, and for refusing to sign an arbitration
contract in 1999. Mims makes the vague and conclusory statement that “it was
made clear to [him]” that some people had lost farms for being a problem, but
admits that he does not know of any farmers who lost their farm, and he does not
cite any specific instances of coercion, harassment, or discrimination. Mims and
some of his employees provided deposition testimony stating that Mims received a
significant number of “bad looking birds”; however, both Mims and his employees
testified that this occurred both before and after Mims joined the UPGA and
refused to sign the arbitration contract.3 Furthermore, Mims had not recorded any
problem on his chick delivery reports. While Mims provided some weak evidence4
suggesting that Cagle may have had some control over where particular flocks were
placed, he produced no evidence suggesting that Cagle targeted him to receive poor
flocks or even suggesting a likelihood of it. In short, Mims produced insufficient
3
We also note that Mims' own expert produced a regression analysis that
suggested, at best, Mims' membership in the UPGA could explain only 1% of Mims' decreasing
performance.
4
The strongest of this evidence was an affidavit from a former chick bus driver
who worked for Cagle from 1996-97. The driver’s affidavit merely stated that he recalled chick
deliveries being changed from one farm to another and being told that certain houses were not
ready and he needed to take the chicks to another farm. He also noted that most farms would
receive chicks from one to three breeder flocks, but that one particular grower received chicks
from a variety of different breeder flocks and often complained about the chick quality.
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evidence suggesting that he received more bad birds than other growers because of
retaliation.
Next, Mims alleges that Cagle delayed feed and chick deliveries, and
terminated Mims' contract in retaliation for Mims' participation in the UPGA and
for his refusal to sign a contract that included an arbitration clause. The only
evidence Mims offers to support this claim is the affidavit of a former feed mill
manager who stated that, at the request of his managers, he would create feed credit
tickets so as to change weekly settlements, and that he believed that the managers
were “manipulating the growout settlements to help certain growers and hurt other
growers.” The former feed mill manager also stated that managers would discuss
the leaders of the growers’ association during management meetings, and would
have discussions about pressuring growers who would not sign a contract with the
arbitration clause to sign the contract. However, nothing in his affidavit provides
evidence of any retaliation against Mims, and as noted below, there is not other
evidence which might create a jury question.
Mims, however, offers nothing more than his personal belief that his
growout settlements were inaccurate. Mims did not document times that he ran out
of feed, but merely states that it happened often. The one instance that Mims could
recall running out of feed for a significant period of time happened due to a bomb
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threat at the Cagle plant, and occurred in 1995, well before he joined the
association or refused to sign the arbitration contract. Mims only testifies to one
instance in which he was charged for feed he did not receive. The instance
involved confusing circumstances, and Mims offers nothing to suggest that the
charge was anything more than a reasonable mistake. Mims argues that Cagle
delayed flock deliveries in retaliation, but the only delay he cites happened after
Mims had indicated that he did not want a bird placement, subsequently changed
his mind, and Cagle had advised him to make repairs to his farm before it would
place another flock. We simply do not see how a reasonable juror could conclude
that Mims was retaliated against on the basis of this evidence.
Mims states that his flock supervisors issued harsher reviews after Mims
joined the association, but Mims does not point to any false statements on those
reviews, but merely objecting to what he considered to be “nitpicking.” Similarly,
with respect to the termination of Mims’ contract, there is little to indicate that
Cagle terminated Mims’ contract for any reason other than it perceived him to be a
poor manager.
Third, Mims alleges that Cagle engaged in various dishonest weighing
practices that damaged Mims during the entire course of its relationship with him.
Mims states that he is “unable to point to specific instances of improper weighing
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because it was Cagle’s policy and practice to prevent growers from discovering its
fraudulent weighing practices by requiring appointments to observe the weighing
process.” Cagle had a policy that “[a]ny grower wanting to see their birds weighed
must have authorization from management to enter the property” for “proper
security at our operation.” Mims states that requiring appointments to view
weighings violated federal regulation 9 C.F.R. § 201.108-1(e)(4) because it
impeded the “unfettered observation” to which the growers were entitled. §
201.108-1(e)(4) states that growers are entitled to observe balancing, weighing,
and recording procedures, and precludes weighers from denying growers that
opportunity. Mims admitted that he could have scheduled an appointment to watch
his birds being weighed, but that he never did so. Nothing in 9 C.F.R. §201-108-
1(e)(4) suggests that requiring appointments for security purposes is precluded or
even discouraged. As such, this does not constitute evidence that Cagle
misweighed Mims’ birds.
The only other evidence Mims presents with respect to misweighing relates
to procedures at the plant before 1996.5 In 1996, Cagle, working with the Grain
5
We also note that insofar as this evidence could alone support a claim for a
violation of the PSA, such a claim would likely be precluded by the statute of limitations. We
decline to rule on this issue, but we note that other circuits have applied a four year statute of
limitations to PSA claims and this evidence does not create an issue of fact during the four years
prior to 2001, when Mims filed this claim. See Jackson v. Swift, 53 F.3d 1452, 1460 (8th Cir.
1995) (holding that district court did not err by applying Sherman Act's four-year statute of
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Inspection, Packers and Stockyards Administration, modified its problematic
weighing procedures, reimbursed growers who may have been underpaid
(including Mims), and took a loss on growers who were potentially overpaid. Cagle
disclosed the results to growers, and Mims does not produce any evidence
indicating that his compensation was insufficient.
Finally, Mims argues that the district court erred by granting summary
judgment on his PSA claims because the arbitration contract that was offered by
Cagle was unconscionable and constituted a "bait and switch." Mims’ argument is
that he received periodic pay increases in 1994 and 1997 pursuant to the same type
of contract that he was provided initially, but that in order to receive the pay
increase in 1999, he had to sign the contract with the arbitration clause, which he
refused to do. This is hardly a “bait and switch” scheme. Mims’ original contract
did not suggest he would receive periodic pay increases, and there is nothing to
indicate that Cagle knew it might provide the option of the arbitration contract in
1994 when it originally contracted with Mims. Additionally, Mims provides
nothing to suggest that the offer of the contract itself was unconscionable, other
than that he lost the benefit of a pay increase because he refused to sign it.
limitations, rather than two-year limitations period of Agricultural Fair Practices Act (“AFPA”)
to claimed PSA violations).
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B. Fraud Claim
Mims argues that the district court improperly granted summary judgment
on Mims’ fraud claims because Cagle required appointments to watch the weighing
process, “kept no records of incidents of improper weighing and concealed its
practices by sending false statements to growers.” Mims further argues that Cagle
committed fraud in its feed practices and by decreasing the number of birds placed
on his farm from the number originally promised.
Mims cannot produce evidence that Cagle underpaid him for his flocks
other than his hunch that some flocks weighed more than indicated on the
statement provided by Cagle. Similarly, Mims does not provide evidence
suggesting that his feed settlements were improper such that he can support an
inference of fraud. The only false representation Mims cites to is testimony by
Bennie Morris, who indicated some problems with Cagle’s weighing procedures,
mostly before 1996. Yet Morris expressly testified that Cagle made significant
efforts to stop the problematic weighing procedures and did not authorize them.
Accordingly, Mims did not create a genuine issue of material fact on his fraud
claim and the district court properly granted summary judgment.
C. Georgia RICO Claim
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Mims argues that the district court erred by granting summary judgment to
Cagle on his claim pursuant to the Georgia Racketeer Influenced and Corrupt
Organizations Act (“Georgia RICO Act”). The Georgia RICO Act states that it “is
unlawful for any person, through a pattern of racketeering activity or proceeds
derived therefrom, to acquire or maintain, directly or indirectly, any interest in or
control of any enterprise, real property, or personal property of any nature,
including money.” Ga. Code Ann. § 16-14-4 (2004). Mims produces no evidence
specific to this claim, and he fails to create a genuine issue of material fact for the
same reasons he failed to create an issue in his fraud claims.
D. Promissory Estoppel/Fraud In the Inducement Claim
Mims argues that Cagle engaged in fraud in the inducement in 1994 by
indicating 25,000 birds would be placed in his farm. This claim is wholly
precluded by the merger clause of the contract. In Georgia, “[a]s a matter of law, a
valid merger clause executed by two or more parties in an arm's length transaction
precludes any subsequent claim of deceit based upon pre-contractual
representations.” First Data POS, Inc. v. Willis, 546 S.E.2d 781, 785 (Ga. 2001).
Similarly, Mims cannot maintain a claim for promissory estoppel. The
contract between Mims and Cagle stated:
This Agreement constitutes the entire agreement between
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the parties and includes all promises and representations,
express or implied, made by the Company and the
Producer and by either of them. Any prior oral or written
representations not expressly set forth in this Agreement
are hereby cancelled and are no longer of any force or
effect.
Georgia courts have consistently held that plaintiffs cannot maintain a claim of
promissory estoppel based on pre-contractual promises where the contract
expressly cancels those promises or makes reliance on them unreasonable. See
W.R. Grace & Company-Conn. v. Taco Tico Acquisition Corp., 454 S.E.2d 789,
791 (Ga. App. 1995) (“This court has consistently held that disclaimers in contracts
prevent justifiable reliance on other representations purportedly made by the
parties; we perceive no difference between reasonable reliance in promissory
estoppel cases and justifiable reliance in other cases sufficient to warrant a different
result.” (Internal citations omitted)).
E. Agricultural Fair Practices Act
Next, Mims argues that the district court erred by granting summary
judgment to Cagle on his claim pursuant to the Agricultural Fair Practices Act, 7
U.S.C. § 2301 et. seq (“AFPA”). The AFPA makes it illegal to discriminate
against a grower in a growers’ association, as well as to coerce or intimidate a
grower with respect to an association. 7 U.S.C. § 2303. Similar to his PSA claim,
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Mims failed to produce evidence on this claim creating a genuine issue of material
fact that Cagle discriminated, coerced, or intimidated him with respect to his
membership in a growers’ association.
F. Breach of Contract Claim
Finally, Mims argues that the district court erred by granting summary
judgment to Cagle on his breach of contract claim. Mims does not point to any
specific provision in the contract that was breached. In his deposition, Mims
acknowledged that he understood when he signed the contract that it made no
promises as to specific numbers of birds to be placed, the numbers of flocks per
year, or the types of birds, and that it contained no income or expense figures. In
fact, Cagle increased the payment it paid per pound during the life of the contracts,
and Mims earned near the projected amount during the life of the contracts. Mims
states that if he received bad chickens, that constitutes a breach of contract. He has
failed to show that he received more than his fair share of weaker birds, and thus
has failed to create a genuine issue of fact as to a breach of contract. Mims does
not flesh out what is reasonable to expect, which provisions of the contract were
violated, and which flocks violated the contracts. Therefore, the district court
properly granted summary judgment.
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III. CONCLUSION
For the foregoing reasons, the district court’s grant of summary judgment is
AFFIRMED.
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