Third Annual Mid-South Agricultural and Environmental Law Conference, April 21-22

Posted February 18, 2016

Agriculture in the Mid-South is uniquely impacted by changes and developments in state, federal, and international laws and policies. Hosted by the Agricultural & Food Law Consortium, the Third Annual Mid-South Agricultural and Environmental Law Conference, April 21-22 in Memphis, TN, is part of a long-term effort to provide relevant and timely agricultural and environmental legal research and information to attorneys, lenders, accountants, tax consultants, students and other agricultural professionals involved in the agriculture and aquaculture industries in the southern U.S.   

Conference highlights and panel discussions include:

- Agricultural & Environmental Law Updates

- Managing Risk in a Faltering Ag Economy

- Handling an Ag Bankruptcy

- Navigating Wetlands Issues

- Legal Issues & Liability in Agricultural Nutrient Management

This year's program is approved for six hours of CLE credit in Alabama, Mississippi, and Tennessee, including one hour of ethics. Further, it has been submitted for CLE credit in Arkansas and for real estate continuing education in Arkansas.

The conference kicks off Thursday, April 21, with a “BBQ & Beer” reception at Memphis' famous Rendezvous barbecue restaurant. 

To register for the conference, please click here. 

Allens Vegetable Canning Company Files for Bankruptcy

Posted October 30, 2013

Allens Inc., a company that makes canned and frozen vegetables, filed a Chapter 11 petition for bankruptcy in Fayetteville, Arkansas on Monday, according to a Bloomberg article available here.

The family-owned business, Allens Inc., began as Allen Canning Co. near Siloam Springs, Arkansas in 1926.   The Chapter 11 petition lists more than $100 million in debt and assets, seeking to sell some divisions and reorganize a new company. 

The company intends to keep operating its canned vegetable business while reorganizing.  In a statement, the company said it wanted to become a stronger and more competitive business, according to an article by the Associated Press available here. It is seeking a buyer for its frozen vegetables operations in Montezuma, Georgia.

Josh Allen, President of Allens Inc. said, “We remain firmly committed to serving our customers and providing consumers with great-tasting affordable and high-quality vegetables…We appreciate the support of our suppliers and the ongoing dedication of our employees, whose hard work is critical to the future of our business.”

For more information on bankruptcy law, please visit the National Agricultural Law Center’s website here.

Upcoming: American Agricultural Law Association Annual Meeting

Posted:  July 24, 2013

The 34th Annual Conference of the American Agricultural Law Association will be held October 31 - November 2, 2013 at the Concourse Hotel in Madison, Wisconsin.  The AALA annual conference is an excellent opportunity for students, attorneys, policymakers, government employees, and other professionals to network and learn about new and emerging issues in agricultural and food law. 

This three-day event is recognized as one of the best opportunities for relevant agricultural law continuing education.  The AALA's symposia have featured presentations by national and international experts providing extensive and relevant information on agricultural and food law.  Attendees include national academic, governmental, corporate, and private practitioner experts in many areas of agricultural law.  For registration, or to learn more about AALA, visit the AALA at www.aglaw-assn.org. 

Becoming a member of AALA is very easy, and new members and AALA welcomes new and student members. For information about joining AALA, visit the AALA site here. If you have any questions about AALA, joining, and/or membership benefits, please contact AALA Executive Director Robert Achenbach at RobertA@aglaw-assn.org.

Upcoming: 33rd Annual Meeting of the American Agricultural Law Association

The 33rd Annual Meeting of the American Agricultural Law Association will be held October 18-20, 2012 at the downtown Sheraton Hotel 2012 in Nashville, Tennessee. If you are interested in networking with attorneys and other professionals who work in agriculture and food throughout the U.S. and the world, AALA is the organization for you.

As described on the AALA website:

"The American Agricultural Law Association (AALA) is the only national professional organization focusing on the legal needs of the agricultural community. Crossing traditional barriers, it offers an independent forum for investigation of innovative and workable solutions to complex agricultural law problems. This role has taken on greater importance in the midst of the current international and environmental issues, reshaping agriculture and the impending technological advances which promise equally dramatic changes."

Becoming a member of AALA is very easy, and new members are welcomed and greatly appreciated. For information about joining AALA, visit the AALA site here. If you have any questions about AALA, joining, and/or membership benefits, please contact AALA Executive Director Robert Achenbach at RobertA@aglaw-assn.org. Also, you can contact AALA Membership Committee Chair Harrison Pittman at hmpittm@uark.edu. 

Free Ag Law Webinar on Aug. 30 to Help Farmers Deal With 2012 Drought

On August 30 at 11-12 Central, a free webinar will be provided by the National Agricultural Law Center to help farmers deal with the drought that has significantly impacted the agricultural sector.  The webinar is sponsored by the Banks Law Firm, PLLC as part of generous gift designed to provide an educational series for agricultural producers and to help publicize the 25th Anniversary of the National Agricultural Law Center. 

For full information about the webinar, visit the National Agricultural Law Center website here.  Anyone is welcome to attend, and the presentation will be designed for audience of producers and extension agents and others nationwide who work with producers.  Presenters for the webinar will be Grant Ballard, Center Research Consultant and attorney with the Banks Law Firm, PLLC and Harrison Pittman, Center Director. 

The National Agricultural Law Center at the University of Arkansas is the nation's leading source of agricultural and food law research and information.  Located in Fayetteville, Arkansas, the Center is a unit of the University of Arkansas System Division of Agriculture. 

June 21 Webinar on Crop Insurance for Southern Agriculture

On June 21, the National Agricultural Law Center will provide a webinar titled, Crop Insurance and Southern Agriculture:  What You Need to Know.  The webinar is free-of-charge and is tailored to extension personnel and southern agricultural producers, but is applicable to anyone seeking to learn more about federal crop insurance. 

The webinar will cover the basics of the federal crop insurance program, a brief update on the crop insurance debate in the farm bill debate, key terminology and resources, and discussion of key legal issues of which producers and extension agents should be aware.  The webinar will also include a question and answer session for the webinar presenters.

The webinar will be broadcast on June 21 at 12-1 p.m. EST. For full information about the webinar, including sign-on instructions, please visit the National Agricultural Law Center here.  For questions regarding any aspect of the webinar, please contact Center Director Harrison Pittman at hmpittm@uark.edu or 479-575-7640.


The June 21 webinar presentation is part of the Legal Issues for Southern Agricultural Producers, sponsored by the National Agricultural Law Center and made possible by generous support provided by the Banks Law Firm, PLLC. The gift was provided by the Banks Law Firm, PLLC to to create a premier legal education series focused on southern agricultural producers and to help promote the 25th anniversary of the National Agricultural Law Center. 

 

Deadlines approaching in Native American Farmer lawsuit

Though it has been over ten years since they initially filed their claim, Native American farmers are still waiting for some relief for the US Department of Agriculture's (USDA) alleged discrimination in the disbursement of farm loans.

The Native American farmers claim in Keepseagle v. Vilsack, named for plaintiff George Keepseagle, that the USDA routinely denied them access to the same loans they regularly gave white farmers. According to Marcia Coyle's report in the National Law Journal, the Native American farmers allege this discrimination "caused the loss of billions of dollars in credit over a 25-year period." Additionally, the suit claims the USDA failed to investigate civil rights complaints filed by the Native American farmers and ranchers.

According to Coyle, the class action includes all Native Americans who farmed or ranched in the time period between 1981 and 1999, if during that period they applied to participate in some farm program "and filed a discrimination complaint with the department during that time period."

Several important deadlines are approaching in the case. In December, 2009 USDA Secretary Vilsack and the plaintiffs sought a stay in the class action case to work further on negotiating a settlement to the case. The stay was granted by US District Court for the District of Columbia Judge Emmet Sullivan, as was an extension, but now the stay expires on April 21, 2010, and a status report on how the negotiations are proceeding is due on April 15, 2010.

Lead counsel for the plaintiffs, Joseph Sellers, of Washington's Cohen Milstein Sellers & Toll, believes the two parties are not close to reaching a settlement. The main concern of the plaintiffs, according to Sellers, is to move the case along to achieve some sort of closure in the matter.

This lawsuit is very similar to the Pigford suit, in which African-American farmers alleged the USDA discriminated against them in disbursing farm loans. Recently, late-claim filing farmers reached an agreement with the government in which they will receive $1.25 billion, but those monies must be funded by Congressional action, and thus far Congress has missed the deadline to act on legislation to provide the funding.

The Keepseagle claims do not need an act of Congress to be settled. In fact, if a settlement was reached between the farmers and the government the claims could be paid from the government's "Treasury Judgment Fund, which does not require congressional action, according to Sellers." This fund was established in the 1950's to pay court judgments and settlement agreements that the Justice Department negotiates for other federal agencies. The fund was made an indefinite appropriation by Congress, reports Coyle.

The Native American farmers do have some allies in Congress. US Reps. Dale Kildee (MI) and Tom Cole (OK), who co-chair the Native American Caucus, sent a letter on March 26, 2010 to Secretary Vilsack urging the secretary to settle the case on terms "comparable" to the settlement negotiated with the African-American farmers in the Pigford suit. The letter states, '"We trust that you will agree that Native American farmers and ranchers should have their claims resolved and be provided comparable relief, since they were victims of the same discrimination committed by the same agency over the same time period, and since they too lost substantial revenue and lands that had been in their families for generations [.]"'

At this point Sellers is unsure whether his clients would be willing to postpone the case once more if the department asks them to in order to continue negotiating. Sellers did state in the Coyle article that he thinks '"our clients remain resolute in their belief that statements by the secretary of Agriculture that he wants to settle [the] case are ones they can rely on."'

To read the Coyle article in the National Law Journal, click here.
To read a previous US Agricultural & Food Law and Policy Blog Post on the case, click here.

Posted: 04/09/10

Indian Farmer Claim could be moving towards a Resolution

Ken Thomas of the Associated Press has a story up on the ABC News website in which US Department of Agriculture (USDA) Secretary Tom Vilsack essentially pledges to move forward with the discrimination lawsuit brought by Indian farmers and ranchers a decade ago. Agriculture Secretary Tom Vilsack told Indian farmers and ranchers during a meeting Thursday that the department was "committed to resolving" litigation involving them.

The Indian farmers have been waiting to hear words to that extent since the class action lawsuit was filed in 1999; it was granted class-action status in 2001 and is named after Fort Yates, ND rancher George Keepseagle. The lawsuit claims the USDA “denied or delayed loans or failed to approve enough money for tribal farmers and ranchers.” The farmers and ranchers also claim “local USDA officials tried to squeeze them out of business by denying them loans that instead went to their white neighbors and by refusing to restructure loans in bad years as done for whites.”

The loans in question are administered by the USDA’s Farm Service Agency. The agency is supposed to issue the loans to farmers and ranchers unable to get credit from commercial lenders. The plaintiffs in the suit are seeking $500 million in economic damages. The Indian farmers claim the discrimination in federal loans went on for over three decades. Today, “Justice Department spokeswoman Melissa Schwartz said the case is expected to be consider[ed] again by the court early next year.”

Schwartz could not commit to whether or not the government will seek to settle with the Indian farmers and ranchers. For their part, the plaintiffs claim they are prepared and ready to go to trial. However, they are not against considering a settlement if the Obama administration offered one similar to the settlement reached between black farmers and the USDA during the Clinton administration in 1999. “The government has paid damages of $980 million in that case even as it has fought the Indian lawsuit in court.”

In addition to damages, the plaintiffs are also seeking to change the way USDA loan programs are administered, “as well as a moratorium on foreclosures against struggling Indian farmers and ranchers.” Following a meeting with the Obama administration and the tribal leaders that lasted all day, Vilsack said the USDA has realized that ‘“we, too, have litigation going on for a considerable period of time involving farmers and we’re committed to resolving this.”

To read the Thomas article click here.

Posted: 11/06/09

Rain Effect Felt in the Midwest and Southeast

If there is one unfortunate thing the Southeast and the Midwest have in common, it is the delays in harvesting that have been caused by the overload of rain recently.

Things have gotten so bad out there that some farmers are contemplating destroying whole fields to get to spots where some viable crops still remain. The effect on farmers expecting to be harvesting is made all too clear by Hartwell Huddleston’s quote in Becky Bohrer’s article on the situation for the Associated Press, ‘"We've had a lot of rainy years, but this one puts those to shame . . . a person's a farmer you start to think, 'Where am I going to sleep? How am I going to feed my children?'"

As Bohrer reports, the effect of late-season rains could ultimately prove devastating to farmers from the “hurricane-ravaged Gulf region” who are facing “disastrous back-to-back years.” Consumers may feel the effects of cotton, corn, and soybean crops staying in the ground this long too. Though, Chad Hart, an extension economist at Iowa State University, feels consumers would only see “slightly higher prices for products” that use those crops.

Bohrer reports that Midwest grain farmers do have a “saving grace” in that their crops (corn and soybeans) “were in relatively good shape.” As soon as farmers got a break in the weather this past week they hit the fields to salvage what they could.

The amount of rain in itself is not necessarily a problem, but it was when the rain fell, during peak harvest time, that is going to make the weather so costly this season. Agronomists at Louisiana State University and Mississippi State University estimate the two states combined will face loses of “more than $120 million on their cotton [.]”

“For all major row crops, Louisiana farmers stand to lose $275 million in revenue and Mississippi farmers, $371 million, according to the early estimates. This would further compound the losses many producers suffered last year due to hurricanes Gustav and Ike.”

Kurt Guidry, author of the Louisiana State report believes the economic impact will be as though a hurricane did hit the region and this will cause serious financial stress for perhaps a majority of producers.

Financing for 2010 remains a concern, and as unpopular as it sounds right now, many producers may need government help unless private sources of financing step up.

To read Bohrer’s article for the AP click here.

Posted: 11/05/09

Pilgrim’s Pride Seals Deal with JBS

It appears as though Pilgrim’s Pride Corp. will be able to pull out of bankruptcy after agreeing to a deal with JBS SA, a Brazilian beef producer. JBS is purchasing a majority stake in Pilgrim’s Pride for $800 million.

According to an Associated Press story on the deal, one of the provisions of the agreement is that Pilgrim’s Pride’s creditors will be paid in full and current stock holders will receive new stock, which, according to the AP, is unusual “for a company in bankruptcy protection.” JBS SA announced another deal today, one that has the company merging with Bertin SA. Bertin SA is one of the largest producers of milk products, beef, and leather in Latin America. The combination of the two deals will make JBS one of the largest meat producers in the world.

JBS says that JBS-Bertin will indeed by the world’s largest meat producer in terms of income. JBS-Bertin expects an annual income of $28.7 billion, which would put it above Tyson Foods Inc. of Springdale, Arkansas. According to Arkansas Business online, Tyson’s revenue for fiscal 2008 was $27 billion.

The details of the deal: 1) Pilgrim’s Pride will sell 64 percent of the reorganized company’s stock to JBS for $800 million in cash; 2) current Pilgrim’s Pride shareholders will “receive shares in the remaining 36 percent of Pilgrim’s Pride valued at $450 million; 3) Pilgrim’s Pride’s debt of $1.5 billion will be paid off. In its entirety the transaction is worth $2.8 billion, according to JBS.

Pilgrim’s Pride filed for bankruptcy protection late last year. Prior to that, the company was the “nation’s largest chicken producer with about 23 percent of the U.S. market [.]” The deal provides JBS with an entry into the US chicken market through Pilgrim’s Pride. With these deals, JBS will now be the “largest beef producing company in Brazil, Australia, Argentina and Italy.”

According to Pilgrim’s Pride, “the deal is subject to antitrust clearance,” and earlier this year U.S. regulators sued to prevent JBS from acquiring a top beef producer. The reason the regulators gave for the suit was pricing concerns for producers and consumers. This caused the deal with National Beef Packing Co. to be dropped. Pilgrim’s Pride creditors holding claims will either be issued a new note or will be paid in cash, and Pilgrim’s Pride believes that if “U.S. bankruptcy court approves the deal, the company could emerge from court protection by December.”

Senior Chairman Lonnie “Bo” Pilgrim made the following statement about the deal, “While the past year has been a difficult time for everyone involved in our restructuring, I take pride in knowing that we have a plan in place to pay back our creditors in full and preserve a great deal of value for our existing stockholders[.]"

To read the AP story click here.
To read the Arkansas Business story click here.

Posted: 09/16/09

Updated: Secretary Vilsack to give Keynote Address at AALA Conference

Those involved in agricultural law may want to consider attending the American Agricultural Law Association’s 2009 Conference later this month in Williamsburg, Virginia. The Conference’s theme is “Food, Fuel, and Farming: The Keys to a Sustainable Urban Society,” and United States Department of Agriculture Secretary Tom Vilsack will deliver the conference’s keynote address.

The conference, which is open to all, starts with pre-conference tours on Thursday, September 24, 2009. The first sessions will begin Friday morning, September 25, 2009. Secretary Vilsack is scheduled to deliver the keynote address on Friday. The conference is being held at the Crowne Plaza Hotel in Williamsburg, Virginia.

The aim of the conference is to provide those engaged in the field of agricultural law, no matter what the capacity, with the latest information on food law, the latest developments involving the 2008 Farm Bill, and valuable practitioner updates in commercial law, environmental law, agricultural bankruptcy, farm estate and business planning, real property legal issues, farm income tax and ethics. The event will also have break-out sessions covering farm and ranch succession planning, competition, water law, organization of agricultural enterprises, seed law, organic foods, animal law, and renewable energy strategies for rural economic development.

All of these topics are prescient considering there is pending legislation in Congress and individual states concerning climate change, renewable energy, food safety, health care, animal welfare, land use, and estate taxation.

Continuing Legal Education Credits can also be received for attending the conference.
Those interested can access the most current schedule of events and registration materials by clicking here.

Posted: 09/02/09

Mixed News on Farm Finance

The Delta Farm Press reported today about the new release of the ABA Center for Agricultural & Rural Banking’s Farm Bank Performance Report, detailing recent trends in the rural banking system.

In 2008, the report said, the U.S. banking industry held $123.5 billion in farm loans, an 8 percent increase over the $114.2 billion in 2007. The 2008 figure for farm banks represents more than 50 percent of the total farm credit outstanding in the United States, according to the American Bankers Association’s Center. The total also included $69.1 billion in small farm loans, of which $26 billion was invested in “very small farm loans.” ABA Center officials said they consider a small farm loan as being one for $500,000 or less. A micro-small farm loan is $100,000 or less. The number of small farm loans in 2008 surpassed 1.2 million with the great majority — almost 1 million — under $100,000.

The Wall Street Journal’s discussion of the report pointed out that, while lending might have increased, farm bank earnings fell “10.3% in 2008 as the global recession seeped into the rural economy.” The discussion of farm income at FarmPolicy.com also cites an article in the Minneapolis Star-Tribune discussing a University of Minnesota survey finding that median profits for farms included in the survey fell 15% in 2008, but that certain agricultural sectors, such as dairy, which fell 38%, felt the dropoff much more severely. The Wall Street Journal also explained that “The problems for farm bankers are beginning to multiply this year, however. The incomes of farmers, which soared to record highs in 2007 and 2008, are projected by the U.S. Agriculture Department to sink 20% this year. Some players in the overbuilt corn-to-ethanol fuel industry are falling behind on loan payments.” The Wisconsin Ag Connection had similar news, saying that, according the latest survey of agricultural lenders in the Seventh Federal Reserve District (which includes portions of Wisconsin, Iowa, Illinois, Michigan and Indiana), “there was a quarterly decrease of six percent in the value of good agricultural land for the first three months of this year, which was the largest quarterly decline since 1985. The year-over-year increase in district farmland values also eroded to just two percent in the first quarter of 2009, [and] the growth in farmland cash rental rates moderated in the district so far in 2009, with an increase of seven percent.”

In other farm finance news, an amendment to the 'Helping Families Save Their Homes Act,” signed into law last week, will help agricultural borrowers as well. It will require government agencies to make sure that banks use their TARP funds to help farmers in need of financial assistance. According to a pork industry newsletter, “[i]n March, [Senator] Feingold and New York Senator Kristen Gillibrand led a group of colleagues asking USDA and the Treasury Department to require TARP recipients to implement a foreclosure-mitigation program that includes farm loan restructuring, similar to the one in place for homes. Many farm loans include a home as part of the loan or as security against the loan, so extending this provision to farmers and ranchers would help save farms and homes from foreclosure, Fiengold contends.” Another article on the topic is located at the Wisconsin Ag Connection site.

Posted: 5/28/2009

Chicken Growers Make Losing Bet

The international outlook is grim: Russia and China, the chicken industry's two biggest foreign markets, are cutting back on their orders. And the national outlook is even worse. Consumers are cutting back on chicken purchases, and Pilgrim's Pride of Pittsburg, Texas, one of the country's largest chicken companies with $8.5 billion in sales last year, filed for Chapter 11 bankruptcy protection in December, at the same time that fuel prices were surging wildly, driving up the cost of chicken feed. The effect on chicken growers has been harsh and swift. According to the Los Angeles Times,

"Nationally, 800 to 900 chicken farmers have lost contracts since last fall, almost all of them in the South, said Gary McBryde, an economist with the Department of Agriculture. Chicken production is down 7% since April 2008, the National Chicken Council said."

Raising chickens on contract requires that the grower build expensive chicken houses, set to specific company standards In return for the estimated half of the capital that the farmers supply, they earn only 1% to 3% on their investments, versus more than 20% for integrators in boom times, according to the National Contract Poultry Growers Assn. When that contract is cancelled by the integrator, often with little notice, the house is useless. And with even the poultry federation predicting that the market for chickens won't recover until "at least next fall or winter," for many of those farmers, bankruptcy may be the only solution.

Posted: 4/17/09

Discharge of Taxes From Sale of Chapter 12 Property

In a recent bankruptcy decision, In re Uhrenholdt, 2009 Bankr. LEXIS 144 (Bankr. D. Neb. 2009); No. BK06-40787, 2009 WL 198966 (Bankr. D. Neb. Jan. 26, 2009), the Chapter 12 debtor had raised corn in 2005 and retained the corn for use as feed for the debtor’s cattle. The debtor stopped raising corn after 2005. Prior to and after the bankruptcy petition was filed in July 2006, the debtor sold the corn to the debtor’s corporation on request from the lender which held a security interest in the corn.

The sales produced self-employment income to the debtor and the debtor’s Chapter 12 plan treated the taxes as a general unsecured claim under 11 U.S.C. Sec. 1222(a)(2)(A). The debtor and IRS agreed that the taxes were post-petition taxes because the federal tax return reporting the taxes was filed after the bankruptcy petition was filed.

The IRS argued that 11 U.S.C. Sec. 1222(a)(2)(A) did not apply because the corn was not an asset used in the farming operation but was farm produce. The court focused on the fact that the debtor no longer raised crops, used the corn to feed cattle in an on-going farm operation, and did not market the corn for public sale. Therefore, the court held that the proceeds of the corn sale to the debtor’s corporation for continued use in the farm operation was eligible for 11 U.S.C. Sec. 1222(a)(2)(A) treatment as an unsecured claim.

For a regularly updated listing of bankruptcy decisions applicable to the agricultural sector, please visit the Bankruptcy Case Law Index published by the National Agricultural Law Center.

(original blog entry submitted by Robert Achenbach, Executive Director, American Agricultural Law Association)

Bankruptcy

Subject Description: Unfortunately, bankruptcy is traditionally an active area within agricultural law. In fact, Congress provides bankruptcy protection under Chapter 12 specifically applicable to eligible producers. This subject area addresses bankruptcy developments, which commonly implicate federal and state laws.