Back in the 1990s, when Craig Watts was still raising chickens for Perdue, the fourth largest poultry company in the U.S., his contract included a provision that prohibited him from sharing the document with any third party. If he encountered a problem with the company, for example, he couldn’t solicit legal help to understand what options the contract provided to him.
It’s one small example of the many ways that the country’s powerful meat companies have exerted control over the farmers that raise the animals they sell. In the chicken industry, farmers looking for economic opportunities have long been locked into contracts that require them to pay for expensive facilities, compete with other farmers for pay even though the quality of chicks and feed is dependent on the companies, and make costly upgrades whenever companies say so. And as the meat industry has become more consolidated over the last few decades, the companies have continued to gain power over farmers.
In February 2024, after decades of advocacy, the USDA finalized the first of three rules related to the Packers and Stockyards Act, a century-old law that was intended to protect farmers from abuse by meat companies.
However, that contract privacy provision is also an example of something that has recently changed in favor of farmers.
“We had to get that done away with so I could show [the contract] to my accountant, so I could show it to a lawyer, so I could show it to my wife,” Watts, who became a famous poultry industry whistleblower after leaving the business, said. “Technically, I couldn’t even show it to her.”
In February 2024, after decades of advocacy that Watts played a key role in, the U.S. Department of Agriculture (USDA) under President Biden finalized the first of three rules related to the Packers and Stockyards Act, a century-old law that was intended to protect farmers from abuse by meat companies. In addition to requiring that chicken companies disclose much more information with farmers in terms of the income they can expect, the first rule protected the farmer’s right to discuss the terms of the contract with family members and legal and financial advisors.
The other two rules, now also finalized, created enforceable definitions of discrimination, retaliation, and deception and put limits on how much of a farmer’s pay could be based on the competitive ranking system that companies use.
All three rules were historic, because the Packers and Stockyards Act had no enforceable regulations until the Biden administration. Watts, who now works with the Socially Responsible Agriculture Project to help struggling chicken farmers, was “elated” by the progress, but said it’s too early to tell whether the rules will make a big difference; some provisions haven’t even gone into effect yet.
Even so, meat industry trade groups are already working to stop or overturn these rules.
In October, several groups—including the National Chicken Council and the North American Meat Institute, which represents the country’s largest meat companies—sued the USDA to overturn the second rule, called “Inclusive Competition and Market Integrity.” In the initial complaint, the groups claim the rule is unlawful and that it will harm meatpackers by forcing expensive “compliance and recordkeeping obligations” on them and that companies “may be forced to modify contracting practices merely to avoid the possibility of litigation.”
Now, a critical moment in the legal fight has arrived.
Four groups that represent farmer interests—the Alabama Poultry Growers Association, R-CALF, Latino Farmers and Ranchers International, and the Western Organization of Resource Councils—have asked the court to allow them to intervene in the case to defend the rule. They’re doing so at a time when they’re unsure if the USDA itself will choose to fight back, since during Trump’s first administration the USDA worked to weaken and eliminate Packers and Stockyards protections. To date, there has been no indication from the current leadership as to how they’ll approach the issue.
“Some of these groups have been working on improving these rules since the 1990s. It’s literally been decades, and finally, actual rules were finalized that have meaningful protections, and it’s just too precious a fight,” said Tyler Lobdell, an attorney with Food & Water Watch who is representing the farmer groups in their effort to intervene. “It simply makes sense that they’re at the table.”
Adding to the weight of the case is the fact that the industry’s argument challenges a fundamental piece of Packers and Stockyards enforcement across the board—whether every farmer that brings a case against a company should have to prove that not only were they harmed, but that the company’s actions caused broader “harm to competition.” In other words, while the lawsuit only targets one of the rules, the outcome of the case could impact the others as well.
In response to questions from Civil Eats about the lawsuit but also the agency’s broader approach to the rules, a USDA spokesperson said, “We will not comment on matters relating to litigation.”
A Meat Institute spokesperson declined Civil Eats’ request for interviews on behalf of both the Meat Institute and the National Chicken Council, saying “the lawsuit [to overturn the second rule] speaks for itself.”
What’s at Stake—In Court, and On Farms
R-CALF, which represents independent cattle producers, is one of the groups that has spent decades pushing for rules that would enable the USDA to properly enforce the Packers and Stockyards Act. Bill Bullard, R-CALF’s CEO, told Civil Eats they want to intervene in the case to defend the Inclusive Competition Rule because of its particular importance in the highly concentrated beef industry, where four companies now control 85 percent of the market.
“We think that it is essential in order to reduce the abuse of market power,” he said. “There’s a huge disparity in bargaining power between the producers and the meatpackers.” Producers—the farmers and ranchers who are responsible for raising the animals that meatpackers slaughter and bring to market—are also often susceptible to unfair practices, he said.
The rule in question explicitly defines the kind of unfair practices the Packers and Stockyards Act prohibits on three fronts: discrimination, retaliation, and deception. For example, it states that the prohibition on discrimination means a company cannot treat a grower differently based on race, religion, or sex. It says companies cannot retaliate against farmers for participating in associations or for speaking up about their rights under the law. Under “deception,” it prohibits companies from “employing false or misleading statements or omissions of material information” when entering into contracts, ending contracts, or refusing to contract with a farmer.
Among ranchers selling cattle, Bullard said, fear of retaliation is real. Because if a producer complains about a packer and that packer decides to retaliate, alternative buyers are few and far between.
