Under the Dome

Critics decry NC bill that would limit 26 pending lawsuits against pork producer

Young pigs cluster in a pen on a Duplin County farm.
Young pigs cluster in a pen on a Duplin County farm. cliddy@newsobserver.com

Two prominent Republican lawyers say a bill meant to protect North Carolina’s hog farms from citizen lawsuits would violate private property rights and favor a corporation over local landowners.

They say the main flaw of the legislation is that it’s written to nullify 26 federal lawsuits against a pork producer that are pending in federal court.

“I would submit that this proposed legislation would ... violate the N.C. Constitution in that it is specifically targeted at benefiting a particular industry,” Robert F. Orr, a retired N.C. Supreme Court justice, wrote in his legal opinion for the attorneys suing pork producer Murphy-Brown. “It would appear to attempt by legislative action to favor one litigant over another and deny the plaintiffs the remedies to which they are currently entitled under N.C. law.”

The debate pits Orr and former state Rep. Paul “Skip” Stam, who wrote the opinions, against Republicans from Eastern North Carolina who are the main sponsors of the bill. Rep. Jimmy Dixon, a retired poultry and pork farmer who represents Duplin and Wayne counties, decried the lawsuits as money-makers for lawyers that would imperil family-owned farming businesses that supply the company with hogs.

“This bill is designed to protect 50,000 hardworking North Carolina farmers who are feeding a hungry world,” Dixon said in an email to the N&O. “... Lawyers don’t like that. They want to sue farmers for outrageous sums without having to prove real damages.”

The legislation survived a House committee’s voice vote Wednesday, over some opposition, and is expected to be sent next to the full House. The state Senate has not yet taken up the bill.

 

Wednesday’s discussion in a House judiciary committee focused largely on the legality of the legislation.

The bill would limit the amount of money people could collect in lawsuits filed against agricultural operations for disturbances such as odors and pollution. Under the bill, the person suing could be compensated only for the decrease in rental income the property could generate because of the smells and gases coming from hog farms, as opposed to being compensated more generously for the loss of quality of life as a jury sees fit. The bill would limit financial damages not only on future lawsuits, but also on suits that are pending in court.

The 26 pending lawsuits accuse Murphy-Brown, a hog producing subsidiary of Smithfield Foods, of forcing people to flee indoors when farmers spray fields with hog waste and the wind carries the stench and gases across property lines. The suits were filed by 541 people, many of them African Americans, who live within a mile of hog farms that supply Murphy-Brown.

Orr told lawmakers in his Monday letter that their hog bill is “aimed at drastically limiting the scope of damages that a successful Plaintiff could recover” in such lawsuits.

“If passed into law, it would amount to an inverse condemnation of these property rights, not for a public use, but for the private purposes of a corporation,” Stam wrote. “No matter how well-intentioned, it is not constitutional.”

The bill is endorsed by the N.C. Pork Council, a trade and lobbying group. Andy Curliss, executive director of the Pork Council, said the bill is constitutional and not unique in affecting pending lawsuits. The legislature passed a law in 2001 clarifying North Carolina’s divorce statutes, and that measure applied to divorce cases pending in court at the time that law went into effect.

The question remains whether the new proposal, House Bill 467, merely clarifies existing law or substantially changes it. That distinction is one of the criteria that determines whether legislation can affect pending lawsuits, but in general it is rare for legislation to be written in such a way as to change the rules in the middle of a legal proceeding.

Dixon said the bill’s constitutionality will almost certainly have to be resolved by a court. He said there’s an excellent chance it would be upheld – but that the outcome could go either way.

“It depends on a multiplicity of things,” Dixon said after Wednesday’s hearing. “It could be what side of the bed the judge got out of that morning.”

Dixon said the purpose of the bill is to resolve two problems. One problem is that it’s not clear under state law how to assess financial damages in these kinds of cases. That concern was first expressed by U.S. District Judge W. Earl Britt in a 3-page ruling in 2015 rejecting Murphy-Brown’s motion to dismiss the case.

The second problem, Dixon said, is that any proposal in the state legislature to limit money damages could prompt a spate of lawsuits to beat the bill’s effective date and qualify for bigger damages, so Dixon made his bill retroactive to cover pending lawsuits as well.

Dixon also dismissed remarks that he was helping bail out the Chinese owners of Smithfield Foods. The company was purchased by a Chinese firm in 2013. Dixon said that local hog farmers would suffer from any financial setback inflicted upon the corporation that buys their pigs.

Orr said by phone he was asked by the plaintiffs’ legal team to submit his legal opinion on the bill. He said he was not paid for his legal opinion, but said he would potentially join the plaintiffs’ legal team if the bill became law and was challenged in court. Stam said he was not paid for his letter.

Orr left the state Supreme Court bench in 2004 with six years remaining in his elected term and worked to oppose financial incentives paid by the state to businesses that expand or relocate here. Taxpayer subsidies in the form of financial grants, corporate tax breaks, executive relocation expenses and other perks were approved by the state Supreme Court in 1996, over Orr’s dissenting vote.

Stam is a social conservative from Apex first elected in 2001 who was serving as House speaker pro tem when he opted not to run for re-election last year.

John Murawski: 919-829-8932, @johnmurawski

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