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14 CapitalPress.com
August 14, 2015
Lawsuit raises questions
about landlord liability
Responsibilities
of farm operators,
landowners at
center of case
By MATEUSZ PERKOWSKI
Capital Press
Tim Hearden/Capital Press
Grower Tyler Christensen operates a machine that loads freshly harvested prunes onto flats at the Mill Race Dryer in Red Bluff, Calif., on
Aug. 11. The harvest of a diminished prune crop has begun in California.
Calif. prune harvest begins as
growers expect lighter crop
By TIM HEARDEN
Capital Press
RED BLUFF, Calif. —
Growers have started the har-
vest of what is expected to be
a diminished prune crop in
California because of heat and
a decline in acreage.
While fresh plums have
been in stores and farmers’
markets since May, growers
in the Yuba City area started
harvesting prune varieties last
week, according to the Nation-
al Agricultural Statistics Ser-
vice in Sacramento.
In the northern Sacramento
Valley, prunes began to arrive at
dryers around Aug. 10 as some
growers said their yields may be
a little lighter than expected.
“The heat’s really taken its
toll on all the trees, but it’s still
a very good crop,” said Tyler
Christensen, who owns a dryer
on the outskirts of Red Bluff
and farms more than 400 acres
of prunes as well as almonds
and walnuts. “The sugar is go-
ing to be really good.”
Michael Vasey, manager of
Lindauer River Ranch in Red
Bluff, said he’s just getting a
sense of how his orchards are
doing. The ranch includes a
dryer and 600 acres of prunes,
walnuts and wheat.
“It’s a good crop,” said Va-
sey, president of the Tehama
County Farm Bureau. “What
I’m trying to determine is if
it’s as good as we thought or
not as good as we thought …
I’ve heard from others that it
may be a little lighter than they
expected.”
The warm early-spring
weather in California this year
was already expected to cause
prune tonnage to be slightly be-
low last year’s.
Based on a survey of grow-
ers, the National Agricultural
Statistics Service in Sacra-
mento predicted a 100,000-ton
prune crop for this summer and
fall, down 4 percent from the
104,000 tons pulled from dryers
in 2014.
While the prune set appeared
to be good, the warm and early
spring may have increased the
amount of smaller fruit, NASS
explained.
In addition, several stretch-
es of triple-digit afternoons
in the valley in late June and
July led to a few cases of blue
prune, a malady in which fruit
tissue tries to open prematurely
and the fruit falls off the tree,
growers said.
However, the fruit that’s
survived has been free of de-
fects, Vasey said.
“You can have fungus or …
insect damage, but everything
I’ve seen come through our
dryer is looking really clean,”
he said. “The size of the fruit
is quite varied. Some are really
big and some are small, and they
could be from the same tree.”
California’s prune produc-
tion has dropped considerably
in the last decade as a global glut
of prunes pushed down prices
and prompted some growers
to switch to more profitable
commodities such as walnuts
and almonds. But prices paid
to farmers have rebounded in
recent years, reaching as much
as $2,500 a ton last year.
This year’s total bearing
acreage for prunes statewide
was expected to be 48,000,
which is equal to last year, ac-
cording to NASS.
Should landlords be held le-
gally responsible for the hiring
activities of farm operators who
lease their land?
That question is headed to
the Washington Supreme Court
as part of a lawsuit that pits
farm workers against two farm
management firms and an or-
chard owner.
The landlord in this case is
the John Hancock Life Insur-
ance Co., which owns sever-
al apple orchards in Yakima
County, Wash.
Those properties are leased
to two companies — Farmland
Management Services and NW
Management and Realty Ser-
vices — that cultivate the land
for a fee but turn the profits
over to the owner.
In 2013, a federal judge
ruled that all three companies
owed more than $1 million to
722 farm workers because the
on-the-ground orchard operator
failed to register as a farm labor
contractor as legally required.
U.S. District Judge Thom-
as Rice reasoned that since the
farm operator provided labor
for a fee, it qualified as a labor
contractor.
The defendants claimed the
farm operator is effectively the
direct employer in this case and
doesn’t act as a traditional labor
contractor, but the judge reject-
ed this argument.
As the penalty for not regis-
tering, he ordered the company
to pay each worker $500 per
year worked, which amounted
to $1,004,000.
The ruling was challenged
before the 9th U.S. Circuit
Court of Appeals, which has
now referred the case to the
Washington Supreme Court.
Specifically, the 9th Circuit
wants the state’s highest court
to answer two legal questions:
Under Washington law, does
an operator who manages “all
aspects of farming” count as a
labor contractor? And if so, can
the landowner be held liable for
unknowingly hiring an unregis-
tered labor contractor?
While farmers are expect-
ed to ensure labor contractors
follow the law, it’s unusual for
landlords to be held responsi-
ble as well, said Tim Bernasek,
an attorney specializing in ag-
riculture at the Dunn Carney
law firm.
“I’ve not seen that kind of
liability flow up to them,” he
said. “This is a very novel ques-
tion that I don’t know has been
asked before.”
While the type of arrange-
ment between the insurance
company and farm operators
is relatively new in Northwest
agriculture, crop-sharing agree-
ments between landlords and
growers are common, he said.
Regardless of its outcome,
the case highlights the need for
written contracts between land-
lords and farmers that spell out
the tenant’s obligations to abide
by the laws and obtain all nec-
essary registrations, Bernasek
said.
Such agreements should in-
demnify the landlord of liabil-
ity and allow him to audit the
tenant to ensure all applicable
rules are being followed, he
said.
The traditional handshake
agreement between tenants and
landlords is simply too risky if
the farmer is found to violate
environmental or other laws,
Bernasek said.
Dan Fazio, executive direc-
tor of WAFLA, formerly the
Washington Farm Labor As-
sociation, said the Washington
Supreme Court will hopefully
clarify that the farm operator
in this case did not break the
law.
“They didn’t think they had
to be registered as a contractor
because they were the employ-
er,” he said.
Fazio called the $1 mil-
lion judgment “outrageous”
because the workers weren’t
actually harmed by the lack of
registration.
“It’s an absolute miscarriage
of justice,” he said.
Oregon firm gets investment to advance ag biomass market
By ERIC MORTENSON
Capital Press
Pacific Ag, a Hermiston,
Ore.-based business that sells
wheat, corn, grass seed and
other crop residue to biofu-
els plants and other uses, has
received a $7 million funding
boost from Advantage Capital
Agribusiness Partners.
Pacific Ag will use the
investment to continue its
growth in the Northwest and
elsewhere, including Kansas,
North Carolina and North Da-
kota, company CEO Bill Levy
said in a statement.
Levy said the company
is seeing rapid growth in de-
mand for large quantities of
crop residue, and is positioned
to respond to the market.
In addition to providing
cellulosic feedstock to make
ethanol, the company also
sells crop residue as livestock
feed and to make mushroom
compost, erosion control
products to “tree-free” pulp
and paper.
In an April 2015 interview
with the website Biofuels Di-
gest, Levy said his company
partners with 600 growers
across the country and this
year will harvest more than
450,000 tons of biomass. He
said the company owns the
largest fleet of harvesting
equipment and supplies cel-
lulosic refineries operated by
companies such as DuPont
and Abengoa.
The investment is part of a
USDA effort to steer funding
Courtesy of Pacific Ag
Stacks of baled straw await shipment. Harvest residue from wheat, grass seed, corn and other crops
can be used to make biofuels. Pacific Ag, of Hermiston, Ore., is a national leader in supplying biomass
to fuel plants.
into agricultural enterprises.
Advantage Capital Agribusi-
PORTS Act filed in House
By DAN WHEAT
Capital Press
A bill allowing governors
of seaport states and territo-
ries to invoke the Taft-Hartley
Act to order dock workers to
work has been introduced in
the U.S. House by legislators
from Washington, Colorado
and American Samoa.
H.R. 3398, introduced Aug.
5, is a companion measure to S.
1519 introduced June 5 by Sens.
Cory Gardner, R-Colo., and
Lamar Alexander, R-Tenn. The
Senate bill has been referred to
the Committee on Health, Edu-
cation, Labor and Pensions.
The House bill is spon-
sored by Reps. Dan Newhouse
and Dave Reichert, both of
Washington; Mike Coffman,
of Colorado; and Aumua Am-
ata Coleman Radewagen, of
American Samoa. All four are
Republicans.
The House and Senate bills
are known as the Protecting
Orderly and Responsible Tran-
sit of Shipment (PORTS) Act.
They are in reaction to a May
2014 through February 2015
work slowdown at 29 West
Coast ports during contract
negotiations between the Inter-
national Longshore and Ware-
house Union and the Pacific
Maritime Association.
Losses to the U.S. econo-
my from the slowdown cost
up to $2.5 billion per day and
contributed an anemic 0.2 per-
cent annual growth rate in the
first quarter of 2015, Sen. John
Thune, R-S.D., has said.
On May 12, Thune intro-
duced S. 1298 to collect metrics
of port marine terminal produc-
tivity for an early warning sys-
tem to know when terminals are
no longer operating normally.
Exports of imports of many
commodities through the West
Coast were impacted, includ-
ing agricultural exports of ap-
ples, pears, hay, chilled beef
and pork, frozen and dehy-
drated potato products, frozen
vegetables, forest products,
Christmas trees, citrus fruit,
nuts and rice.
The slowdown ended when
an agreement for a new con-
tract was reached in February.
It took a couple more months
for ports to rebuild normal
flows.
“While the parties ultimate-
ly came to an agreement, the
process took far too long and
the damage to our economy
was far too great,” the spon-
sors of the House bill said.
Under Taft-Hartley, the
president may appoint a board
of inquiry to study disputes of
threatened or actual strikes or
lockouts affecting trade among
states and foreign nations that
if permitted to occur would
imperil national health or safe-
ty. Upon a report by the board,
the president may direct the
attorney general to petition a
court of jurisdiction to end a
strike or lockout.
The PORTS Act expands
that to include slowdowns and
gives the governors of impact-
ed states or territories authority
to appoint boards of inquiry and
petition courts for injunctions if
the president does not act within
10 days of receiving a request.
The House bill directs the
U.S. comptroller general to
study the economic impact of
the recent slowdown, review
attempts at federal mediation,
identify steps that could have
been taken sooner and deter-
mine what legislative changes
would result in more timely
intervention.
ness Partners, based in St.
Louis, is a $154 million fund
licensed as a rural business
investment company by the
USDA. The fund is a joint
venture by Advantage Cap-
ital Partners and nine banks
or other lending organizations
that are federally chartered to
serve ag businesses through
Farm Credit Services.
Pacific Ag, founded in
1998, first focused on provid-
ing crop residue as cattle feed
for domestic and export mar-
kets. In the Biofuels Digest
article, Levy said the compa-
ny recognized about six years
ago that “feedstock supply
for bio-refineries was a huge
market opportunity, and one
that we are uniquely able to
serve.” The company now de-
scribes itself on its website as
the nation’s biggest supplier
of agricultural biomass supply
chain solutions.
Predator control lawsuit resurrected
By MATEUSZ PERKOWSKI
Capital Press
A lawsuit that challenges
the legality of USDA’s preda-
tor control program has been
resurrected by a federal ap-
peals court.
The 9th U.S. Circuit Court
of Appeals has re-opened a
case filed by the Wildearth
Guardians
environmental
group that seeks to stop the
agency’s Wildlife Services di-
vision from killing predators
across the U.S.
The complaint alleges
that USDA’s management of
predators is based on “woe-
fully outdated and inadequate”
studies that were conducted 20
years ago or longer.
The agency’s “indiscrimi-
nate killing methods” affect not
only “majestic animals” like
wolves, coyotes and moun-
tain lions, but also non-target
threatened and endangered
species as well as family pets,
the complaint said.
Research that was used to
justify the predator control
program only focused on 17
species, but the Wildlife Ser-
vices division acknowledges
killing more than 300 species,
the complaint said.
USDA’s spending on pred-
ator control has also increased
roughly five-fold over the past
two-and-half decades, accord-
ing to Wildearth Guardians.
The environmental group
also points to multiple internal
audit reports from USDA’s Of-
fice of Inspector General that
fault the Wildlife Services di-
vision for improperly securing
poisons that could be used in
terrorist attacks.
By refusing to update
its scientific analysis of the
predator control program,
as requested by Wildearth
Guardians, the agency has vi-
olated the National Environ-
mental Policy Act, the com-
plaint alleges.
The complaint sought an
injunction against any “pred-
ator damage management”
by Wildlife Services until
the agency completes a new
study of the program or suffi-
ciently supplements its exist-
ing analysis.
However, in 2013, a federal
judge dismissed the environ-
mental group’s lawsuit with-
out ruling on the merits of the
allegations.
U.S. District Judge Miran-
da Du ruled that the plaintiffs
failed to show they were in-
jured by the predator control
program and thus lacked the
legal standing to oppose it in
federal court.
The 9th Circuit has now
reversed that opinion, finding
that the “reduced recreational
and aesthetic enjoyment” by a
member of Wildearth Guard-
ians is enough of an injury to
establish standing.
Now that the case will be
considered on its merits, the
USDA’s previous court filings
offer a clue as to its likely
defenses against Wildearth
Guardians’ claims.
The agency argued that
it’s authorized by Congress to
control animals that are harass-
ing or killing livestock.
Regardless of its legal
standing, Wildlife Guardians
isn’t eligible to challenge the
predator control program be-
cause the USDA isn’t taking
any new action, according to
the agency.
Legal precedents dictate
that environmental groups
cannot sue to overturn federal
policies unless they’re chal-
lenging a specific “agency ac-
tion,” the USDA said.