Product Liability & Toxics Law News

No Punitive Damages in Latest Hog Farm Odor Lawsuit (1)

Dec. 13, 2018, 2:59 PMUpdated: Dec. 13, 2018, 6:52 PM

The fourth in a series of hog farm nuisance lawsuits being litigated in North Carolina has resulted in a significantly lower monetary damage award than previous verdicts.

Once again, a jury found Smithfield Foods was liable for the ill effects of high-density livestock operations that include odors, fly swarms, noise, and health problems for neighbors. But its verdict in the latest case came with a relatively low compensatory damage award and the judge hearing the matter ruled Dec. 13 that there was insufficient evidence to support punitive damages.

Smithfield was hit with a $475.7 million jury award in August, the third such award in cases brought by people who live near the facilities known as Concentrated Animal Feeding Operations, or CAFOs. With that case, a total of about $550 million in damages have been awarded in the three previous cases litigated, but that amount has been trimmed to about $98 million under North Carolina’s damages cap law.

Here, however, the jury awarded nine plaintiffs compensatory damages ranging from only $100 to $75,000 each after a 17-day trial in the U.S. District Court for the Eastern District of North Carolina. The most recent case involved a 7,184-head hog farm in Sampson County, N.C., operated by Murphy-Brown LLC, a Smithfield subsidiary.

Punitive damages are intended “to punish a defendant for egregiously wrongful acts and to deter the defendant and others from committing similar wrongful acts,” under North Carolina law.

Appeals, Trials in 2019

“While we recognize that the outcome of this trial was far more favorable for our subsidiary Murphy-Brown and our industry than the previous trials, we continue to believe these lawsuits are an abuse of our legal system and an attack on agriculture,” Smithfield said in a Dec. 13 statement. “We will continue to vigorously defend them,” the company said.

Mona Wallace, an attorney with Wallace & Graham PA in Salisbury, N.C., who represented the plaintiffs said that, although they were disappointed in the award, the affected neighbors “are grateful for the jury’s unanimous verdict that found that Smithfield was liable for creating a nuisance.”

Wallace told Bloomberg Law that the judge “made very particular rulings on the evidence and witnesses,” which affected the plaintiffs’ ability to pursue puntive damage claims. “We are reviewing the matter and are likely to appeal the ruling on punitive damages,” she said.

She said in a Dec. 13 statement that the plaintiffs’ team, which includes other attorneys with Wallace & Graham, the Kaeske Law Firm, and Baron & Blue, “look forward to the next trail in January of the new year.”

Twenty-six lawsuits have been filed and are being heard by juries seated at the U.S. District Court for the Eastern District of North Carolina. The first and third lawsuits that went to trial were test cases selected by the plaintiffs and the other two were picked by the defendants.

The first three cases are being consolidated for an appeal that is expected to be heard in the Fourth Circuit next year. Smithfield said in its Dec. 13 statement that its attorneys “are confident we will prevail on appeal.” McGuireWoods LLP and Hawkins Parnell Thackston & Young LLP represented Smithfield.

The case is Gillis v. Murphy-Brown, LLC, E.D.N.C., No. 14-cv-00185, jury verdict 12/12/18.

(Updated with additional reporting on court rejecting punitive damages.)

To contact the reporter on this story: Andrew Ballard in Raleigh, N.C., at aballard@bloomberglaw.com; Steven M. Sellers in Washington at ssellers@bloomberglaw.com

To contact the editors responsible for this story: Jo-el J. Meyer at jmeyer@bloomberglaw.com

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