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4 CapitalPress.com August 10, 2018 Oregon farmers’ radish seed victory upheld 9th Circuit finds bank had no security interest in crop By MATEUSZ PERKOWSKI Capital Press A federal appeals court has upheld a legal victory won by Oregon farmers who prevailed against an out-of-state bank’s lawsuit over their radish seed crop. The 9th U.S. Circuit Court of Ap- peals has ruled that Northwest Bank of Warren, Pa., could not seize 7.4 million pounds of radish seed grown by the farmers as collateral for a loan to a de- funct seed broker. More than 40 growers had produced the seed but were unable to sell it when Cover Crop Solutions, the seed broker, shut down operations in 2015. Then, Northwest Bank filed a com- plaint against the farmers, arguing they had to turn over the seed because it served as collateral for a $7.2 million loan issued to Cover Crop Solutions. A federal judge dismissed that lawsuit in 2016 but the ruling was challenged before the 9th Circuit, which has now agreed that Northwest Bank had no secu- rity interest in the radish seed. Although a licensing deal with the radish cultivar’s breeder said the seed was the property of Cover Crop Solu- tions, that’s irrelevant in the dispute with farmers because “the growers were not a party to that agreement,” the 9th Circuit said. Cover Crop Solutions entered into the licensing agreement before the radish seeds were harvested and then never ac- quired the finished crop, so the broker had no ownership interest in it, the ruling said. Even if the seed broker hadn’t breached its contract with growers by failing to pay them, its licensing agree- ment for the cultivar assigned contract rights to the breeder, the 9th Circuit said. Capital Press was unable to reach at- torneys representing the farmers or the bank. Now that the appeal has ended, it’s likely the farmers will resume their own lawsuit against the bank seeking more than $6.7 million for lost crop value and added storage costs. Last year, a federal judge stayed that litigation until the 9th Circuit had reached a decision in the earlier case. Courtesy U.S. Fish and Wildlife Service Federal agencies say they will “take appropriate additional time to consider and evaluate further stakeholder input” regarding reintroduction of grizzly bears in the North Cascades. More review for North ‘Potential buyer’ found for defunct Oregon beef packer Cascade grizzly plan Bartels Packing shut down earlier this year By DAN WHEAT Capital Press By MATEUSZ PERKOWSKI Capital Press An Oregon beef packing company that shut down ear- lier this year has attracted a “potential buyer” to purchase its facilities and equipment “as a package.” When Bartels Packing of Eugene, Ore., closed in March, the company owed about $4.6 million to cattle suppliers and feedlots and left the local livestock market without a significant buyer. The court-appointed re- ceiver who took over the company’s finances, Richard Hooper of Pivotal Solutions, has since met with four inter- ested parties who toured the slaughterhouse and process- ing plant. Hooper has also been in contact with liquidators, but owner Chris Bartels preferred to sell the equipment “as part of a functioning meat harvest and packing facility” to fetch the highest value, according to court documents. One of those potential buyers has now submitted a “letter of intent” to purchase the packer’s assets as well the Mateusz Perkowski/Capital Press File Chris and Kandi Bartels, who own defunct beef processor Bartels Packing, have been contacted by a potential buyer for the facility. underlying property, which is owned by an affiliated firm. “Hopefully, we will be able to convert that inter- est into a purchase-and-sale agreement,” Hooper said. Possible sale terms and the potential buyer’s identi- ty weren’t disclosed but the chance of a new beef packer operating the facilities is wel- come news for Oregon’s cat- tle industry. “We definitely need an- other packer in the game,” said Tom Elder, manager of the Woodburn Livestock Ex- change, one of the auction yards where Bartels bid for cattle. Though he’d like to see cattle prices go higher, the market has remained “steady” since the company shut down, Elder said. “It didn’t fall apart.” Bartels was an important buyer of organic and grass fed cattle, so finding a replace- ment could boost prices in those niche markets by 10 to 20 percent, said Jerome Rosa, executive director of the Ore- gon Cattlemen’s Association. “Competition should re- ally help to drive that market up,” Rosa said, particularly since cattle shipped to more distant packers are “really getting discounted.” Hopefully, a sale would allow cattle suppliers to be repaid and the facilities to re- start soon, he said. “They’d really modernized it and spent quite a bit of money on the fa- cility.” Upon filing for receiver- ship, owner Chris Bartels ex- pected the company’s roughly $14 million in assets would cover its $8.3 million in debt, which includes the amount owed for cattle. Judge overrules Washington Ecology on water-right change By DON JENKINS Capital Press A new wine grape vineyard in southeast Washington can ir- rigate 89 acres with Columbia River water, a judge has ruled, overturning a decision by the state Department of Ecology. Benton County Superior Court Judge Bruce Spanner signed an order Aug. 2 allowing Columbia East LLC to transfer a portion of its water rights to Loyal Pig LLC for grapes. “This is very high-end pro- duction agriculture,” said Dar- ryll Olsen, board representative of the Columbia-Snake River Irrigators Association, which joined Loyal Pig in the suit against Ecology. “It doesn’t get any better than this.” At issue is whether the ap- plicants provided Ecology with recent enough information for the agency to approve the wa- ter-right transfer. Ecology rejected the ap- th 70 Columbia-Snake River Irrigators Association A vineyard takes shape along the Columbia River in southeast Washington. A judge ruled Aug. 2 that a planned vineyard to the west of this site should be allowed to irrigate 89 acres, overturning a decision by the state Department of Ecology. plication in 2017 because the amount of water Columbia East used to irrigate about 300 acres of potatoes, corn, wheat and al- falfa wasn’t figured for the pre- vious three years. Without that information, the agency said it couldn’t de- termine whether granting Loyal Pig 89 acre-feet of water would increase withdrawals from the river. Loyal Pig and the irrigators association have focused on another aspect of water law — “use it or lose it.” Water-right holders risk re- linquishing a portion of their Anniversary OPEN HOUSE rights if they don’t use some of their water for five years. Loy- al Pig argues Ecology should use a 2014 study of Columbia East’s water use because it’s less than five years old. Olsen said Columbia East has been irrigating less over the years as the surrounding area develops. Basing its water right on the years since 2014 would amount to relinquishment in fewer than five years, Olsen said. “All (Ecology) is doing is whittling back water rights. It’s a forced relinquishment,” he said, Ecology is reviewing Span- ner’s decision and has not de- cided whether to take the ruling to the Court of Appeals, agency spokeswoman Brook Beeler said Tuesday. Ecology rejected the wa- ter-right transfer because cur- rent water use wasn’t correctly calculated, she said. “It’s not playing favorites and putting fish over grapes.” Olsen said the irrigators as- sociation also claims Ecology engaged in illegal rule making in denying Loyal Pig’s appli- cation. Spanner has yet to rule on that. The U.S. Department of Interior has announced that the National Park Service and U.S. Fish and Wildlife Ser- vice will take more time to evaluate “further stakeholder input” regarding reintroduc- tion of grizzly bears into the North Cascades of Washing- ton. It is unknown what that does to the agencies’ timeline of choosing a course of action by the end of September and finalizing the decision before year’s end. Rep. Dan Newhouse, R-Wash., who has opposed reintroduction of grizzlies, issued a statement Aug. 3 say- ing he is pleased with a deci- sion by Interior to have NPS and USFWS take more time “to seek further stakeholder input in response to concerns I have raised on behalf of my constituents.” “The communities most affected by plans are stake- holders whose voices must be taken into account and I appreciate the willingness of the involved federal agencies to listen,” Newhouse said. On April 12, Newhouse sent Interior Secretary Ryan Zinke a letter warning of “grave impacts” to northcen- tral Washington residents if grizzlies are brought in and imploring Zinke to “stop ig- noring the local community.” He said his constituents were disrespectfully treated in the previous process and felt their concerns were not taken seriously. At a public forum in Okan- ogan County in March of 2015, “many residents were not allowed to express their concerns and were treated in an unacceptable manner by the federal employees con- ducting the session,” New- house wrote. Zinke’s March 23, 2018, announcement of support of grizzly bear recovery in the North Cascades “flies in the face” of his stated goals of “restoring trust and being a good neighbor,” Newhouse said. The new Department of Interior guidance states the NPS and USFWS “are con- tinuing analysis” of resto- ration plans. “In response to requests from stakeholders, including specific inquiries from Con- gressman Dan Newhouse, the two bureaus are taking appropriate additional time to consider and evaluate further stakeholder input to inform the planning and decision making process. Public input, reliance on the best available science, and coordination with affected communities, agencies and organizations will be critical before any de- cision is made,” the guidance states. Ann Froschauer, spokes- woman for the Washington office of USFWS, said she has no information on wheth- er there will be a new public comment period, how long that may last and whether the agencies will still plan to fi- nalize a decision before year’s end. Heather Swift, Interior De- partment press secretary, and Newhouse’s office also were unable to answer those ques- tions. A Newhouse amendment to an appropriation bill de- funding Interior Department transportation of grizzly bears into the North Cascades passed the House on July 19. Jim DeTro, an Okanogan County commissioner, has said that while some coun- ty residents support grizzly reintroduction, the vast ma- jority of residents including ranchers, back country outfit- ters and recreationists do not. They fear for their safety and safety of their cattle. Ranchers were shocked, baffled and angered by Zin- ke’s position feeling betrayed by the Trump administration which they believed was on their side. The Okanogan County Farm Bureau, the Washington Farm Bureau, several coun- ties, the Washington and Ore- gon cattlemen’s associations, the Public Lands Council, National Cattlemen’s Beef Association and other groups oppose reintroduction. Sarah Ryan, executive director of Washington Cat- tlemen’s Association, said the association is pleased Interior realized the impor- tance of getting comment from local stakeholders who haven’t been adequately con- sulted. Joe Scott, international programs director of Conser- vation Northwest, said North Cascades grizzly recovery “has languished for 30 years and now is not the time for further delay.” Since 2014, NPS and USFWS have led “a fair and inclusive process planning for grizzly bear restoration” including numerous hear- ings, resulting in more than 126,000 public comments, the vast majority of which sup- port restoration, Scott said. Newhouse has “unfairly criticized” the process and “ignores public opinion, he said. Giveaways & Raffle Drawings Bounce house & balloon clown for the kids Food • Beer • Wine FRIDAY AUG 17 2PM-6PM 32-3/106 Jim Grimm, our former owner, will be here to celebrate with us NEW LOCATION 4420 Ridge Drive NE Salem, Oregon 97301 503-585-5550 32-3/106
