9 F.3d 710 (8th Cir. 1993), 92-3112, Pavlik v. Cargill, Inc.

Docket Nº:92-3112.
Citation:9 F.3d 710
Party Name:RICO Bus.Disp.Guide 8450 Jeff PAVLIK, Appellant, v. CARGILL, INC., Appellee.
Case Date:November 18, 1993
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit

Page 710

9 F.3d 710 (8th Cir. 1993)

RICO Bus.Disp.Guide 8450

Jeff PAVLIK, Appellant,

v.

CARGILL, INC., Appellee.

No. 92-3112.

United States Court of Appeals, Eighth Circuit

November 18, 1993

Submitted June 14, 1993.

Page 711

James G. Lingle, Rogers, AR, argued, for appellant.

Thomas A. Mars, Springdle, AR, argued, for appellee.

Before BOWMAN, Circuit Judge, HEANEY, Senior Circuit Judge, and BEAM, Circuit Judge.

BOWMAN, Circuit Judge.

Jeff Pavlik appeals the District Court's 1 entry of judgment as a matter of law for Cargill, Inc., on Pavlik's Racketeer Influenced and Corrupt Organizations (RICO) claims, 18 U.S.C. Secs. 1961-68 (1988 & Supp. III 1991), and the court's entry of judgment on a jury verdict finding in favor of Cargill on Pavlik's claims of violation of the Packers and Stockyards Act, 7 U.S.C. Sec. 192 (1988 & Supp. IV 1992), and on his claims of common law fraud and breach of contract. We affirm.

Pavlik raised turkeys for Cargill from 1985 until 1990 under a series of one-year contracts. Pavlik's turkey farm in Washington County, Arkansas, was a three-stage operation by the time his contract was terminated in 1990, accommodating turkeys at three different ages, in separate buildings, from newly-hatched to market-ready. The farm provided turkeys to Cargill's Springdale, Arkansas, turkey processing plant in an integrated operation: Cargill provided the newly-hatched turkeys, or poults, and brood litter for them; the feed for all turkeys; any necessary medication; delivery of the poults; and pick-up of the market-ready turkeys. Cargill also provided support and technical advice to Pavlik and its other growers through its staff of flock supervisors and growout managers, who visited the farms on a regular basis. Labor and other overhead costs, such as building maintenance and utilities, were Pavlik's responsibility. Pavlik was paid a sum for each turkey delivered to the plant, calculated using a formula that considered final weight; final number of live turkeys delivered to the plant compared with the number of live poults delivered, accounting for condemnation of turkeys that may have arrived live at the plant but could not be processed; and feed and medicine used.

During Pavlik's first two years as a turkey grower for Cargill, Pavlik ranked as one of the better growers in his growers' group (other growers who started poults in the same month). After 1986, his rankings slipped and steadily declined until he was ranked at or near the bottom. By letter dated August 1, 1990, Cargill put Pavlik on probation. In September 1990, Dale Young, Cargill's growout manager overseeing the Pavlik farm, clubbed to death nearly 700 market-ready turkeys that, according to Young, showed the classic signs of botulism. Shortly thereafter, Cargill terminated its contract with Pavlik, stating that Pavlik's bad management practices had resulted in serious disease problems and excessive mortality among Pavlik's turkeys, and overall poor performance of his flocks. As of trial, Pavlik was not growing turkeys for any other company and had been unable to sell his farm.

Pavlik's complaint alleged breach of contract, fraud, breach of fiduciary duty, interference with contractual relations and business expectancy, conversion, engaging in discriminatory or deceptive practices in violation of the Packers and Stockyards Act and conspiring to do so, and engaging in a pattern of racketeering activity (mail and wire fraud) and receiving income from the continuing

Page 712

criminal enterprise (the RICO violations). Pavlik sought common law punitive damages in addition to those available under RICO. Pavlik says Cargill short-counted and underweighed his finished turkeys, and shorted him on feed deliveries. He claims he was given inferior poults because of his complaints about shortages and because of his attempt at a Cargill growers' meeting to get the names and addresses of other growers. Pavlik contends that the retaliation escalated as he continued to complain. Pavlik says he used insurance proceeds to rebuild some of his turkey houses lost in an ice storm in early 1989 only because Cargill encouraged him to do so (although the evidence shows otherwise), even though Cargill knew at the time that it would not renew Pavlik's contract. He also asserts that his turkeys were not diseased in September 1990, or at least not to the extent alleged by Cargill, and that Young maliciously culled the 700 birds without cause. Finally, Pavlik believes that, since the termination of his grower contract, Cargill has conspired with other companies that contract with turkey growers, with real estate agents, and with others to see to it that Pavlik was unable to get another contract to grow turkeys and that he would be...

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