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Jury awards $473.5 million to neighbors who sued Smithfield over hog waste

August 3, 2018

BREAKING: The jury in the lawsuit against Smithfield Foods over the hog waste generated by its North Carolina farms has awarded $473.5 million to the plaintiffs in the case. That is the highest award yet in the 26 lawsuits that have been filed against the world’s largest pork producer.

North Carolina’s cap on punitive damages will limit that verdict to $94 million, and the defendants immediately filed notice that they will challenge the verdict.

After deliberating for three hours, the jury awarded $3 million to $5 million in compensatory damages to each of the six plaintiffs. It awarded $75 million in punitive damages to each plaintiff. The cap applies to punitive damages.

Previously:

The lead attorney for hog farm neighbors suing Smithfield Foods over the pig waste near their homes asked a jury Thursday for $2 million to $4 million per plaintiff in compensatory damages as closing arguments wrapped and the case went to the jury.

The request is significant: Punitive damages in civil lawsuits, which are meant to punish the defendant, are capped in North Carolina, limiting the harm Smithfield suffered in two previous trials, where juries awarded six figures in compensatory damages against the pork giant but tens of millions in punitive awards that largely evaporated due to the cap.

Compensatory damages, which are meant to compensate plaintiffs for the harm they’ve suffered, aren’t capped in the state, while punitive damages are limited to three times the compensatory damages awarded, potentially multiplying the financial hit for the multibillion-dollar company if the jury in this case agrees with attorney Michael Kaeske.

“Speak in the dollars that they understand,” Kaeske told the jury.

Kaeske and his team have tried to put the hog industry on trial in this case and in 25 other lawsuits filed against Smithfield’s pork production division, known as Murphy-Brown. So far, his team is 2-0 against the company, with the juries agreeing the farms unfairly interfered with the neighbors’ ability to enjoy their own property.

The rest of the cases are still queued up.

Smithfield’s team has accused the Texas lawyer and his clients of going for a money grab, suing the company after neighbors lived for decades near these farms without complaint. Kaeske pressed the jury Thursday to force industry changes designed to limit the odors neighbors face, saying that the company, state regulators and the state legislature won’t do it on their own.

James Neale, who represents Smithfield, told the jury during closing arguments that Kaeske has manufactured complaints where none exist. He produced a transcript of the three-week trial, two massive stacks of paper that were color coded, he said, to show the time spent talking about the six plaintiffs in this case versus time focused on the industry in general, on other farms and on events that happened years, even decades before Smithfield bought other pork companies and created Murphy-Brown.

“You can barely see the (colored) paper,” Neale said. “It’s buried in an avalanche of distraction.”

Neale also cast Smithfield as a force for good in the North Carolina hog industry, noting that some of the farm audits used against the company at trial were evidence of vigilance. He reminded the jury of testimony from a doctor in eastern North Carolina, home to so many of North Carolina’s 9 million hogs, who testified that he’s never seen an ill health effect caused by farms in 13 years of treating patients.

The hog industry in North Carolina gathers waste in open lagoons, then sprays it onto fields as fertilizer. Neale called the system “safe and effective and sustainable and natural.”

A jury of 10 women and two men will decide whether those lagoons and spray systems unreasonably burden neighbors’ property rights. In the two previous trials, the verdicts against Smithfield totaled more than $50 million and $25 million, respectively, though once the cap on punitive damages took effect, they came down to about $3 million and $630,000.

Juries aren’t told before their deliberations about the cap on punitive damages.

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