Missouri Agricultural Nuisance Case: Court Affirms $11 Million Jury Award

The Missouri Court of Appeals today affirmed a jury award of over $11 million dollars against a hog operator in John Owens v. ContiGroup Companies, Inc.  In the case, fifteen plaintiffs sued ContiGroup and Premium Standard Farms alleging that these operations created a "nuisance" in Gentry County, Missouri.  At the trial court, a jury awarded thirteen of the plaintiffs $825,000 each, one plaintiff $250,000 and one plaintiff $75,000.

The Court of Appeals found that there was substantial evidence to support the jury's verdict that there was a nuisance:

There was substantial testimony that both ill odors from gasses and chemicals released from PSF's hog operation and other emissions (such as hog effluent), which cause ill odors, traveled from PSF's land onto the Respondents' properties. Each Respondent's property was in close proximity to PSF's extensive hog operations and each testified that he or she experienced great distress as a result of odor coming onto his or her property.

On appeal, the hog operator argued that the jury's verdict was excessive, since it compensated the plaintiffs for more than the diminution (or reduction) in value of their homes.  The Court of Appeals rejected this argument:

An action for temporary nuisance includes, as was asserted in this case, non-economic damages, including inconvenience, discomfort and loss of quality of life. See e.g., Brown v. Cedar Creek Rod & Gun Club, 298 S.W.3d 14, 21 (Mo. App. W.D. 2009); Peters, 292 S.W.3d at 385 (Mo. App. W.D. 2009). There is no authority for the proposition that a damage award is excessive if damages for the loss of the use and enjoyment of property exceed the actual market value of that property. Further, our legislature has recognized that there is an inherent additional value in a homestead that exceeds the fair market value of the property. 

The court affirmed the award because it found that the hog operator had failed to argue before the jury that the damages sought were excessive, instead choosing to focus on whether the farm operations created any liability at all.

No doubt that this case will raise a concern for many Indiana livestock producers--should I be worried about my farm being sued for nuisance?  There is no easy answer, of course, as nuisance suits are factually complex and turn on a number of factors that vary from case to case.  Fortunately, Indiana has a very strong Right to Farm Act, which was passed to protect farmers from nuisance suits like the Owens case.  Look for more discussion of the Right to Farm Act and agricultural nuisance in future posts.    

The complete opinion can be found here.

Disclaimer:  I am not licensed to practice in Missouri and was not involved in litigating this case.  This post is meant to be informative only and not offered as legal advice. 

About this website

The following article appeared in the Indiana Agri-News on April 21, 2011.

Indiana attorney keeps agricultural law blog

INDIANAPOLIS — Todd Janzen, an Indianapolis agricultural attorney, is the author of [Janzen Ag Law], an Indiana agricultural law blog for producers and organizations.

He began the project this year as a way to both inform and entertain the ag community on important issues. Already, the blog is chock-full of useful data and commentary, ranging from the challenges facing Dutch dairy farmers to an agricultural nuisance case, in which he played an important representative hand.

“I found that in my spare time, as part of some of the cases I handled, I have to be up on agricultural issues going on across the country,” Janzen explained. “I thought, ‘Why not put that information out there in the World Wide Web in a way that farmers and livestock producers can access?’”

“They can visit the blog if they’re worried about a certain issue or if they want to see what a local Indiana lawyer says,” he added.

Janzen grew up on a farm in Newton, Kan., where his family raised beef cattle, hogs, wheat, sorghum, alfalfa and other hay crops, including the natural prairie hays abundant in the Sunflower State.

He attended Bethel College in Kansas, working on the farm each summer he grew up and also throughout college, he said.
“Our farm ran a custom hay cutting and baling business, so I worked for a number of farmers,” Janzen said. “I married my wife, Sarah, who is from Indianapolis, and ended up going to law school at the Indiana University School of Law in Indianapolis.”

When Janzen began working for Plews Shadley Racher and Braun LLP in Indy straight out of law school in 2002, he handled a steady stream of cases related to regulatory problems that livestock producers faced in dealing with the Indiana Department of Environmental Management and the Indiana Department of Natural Resources.

His background in farming led him to volunteer to work on those cases.

“I really liked working with the farmers and helping them with their legal issues,” Janzen said.

“One of the things that surprised me the most here in Indiana was the misunderstanding of agriculture by state officials, particularly at IDEM,” the lawyer said. “In the early days of the confined feeding operations program, the farm inspections were done by the same people who inspected landfills. There’s quite a big difference between a hog farm and a landfill.”

“I think that IDEM has done a lot to help educate its inspectors on agriculture, but there is still a learning curve there,” he added.

He said the level of regulation in agriculture is more drastic today than when he was growing up on a farm.

“Fortunately, I’m well equipped to deal with these issues since I am an attorney,” he said.

Janzen is the sole agricultural lawyer at his firm. He served as the chair of the Agricultural Law Section of the Indiana State Bar Association, which he and several other attorneys created in 2004.

He also worked on Lt. Gov. Becky Skillman’s Agriculture Regulatory Structure Task Force, where he met many other agricultural industry leaders.

The highlight of his legal career has been the Lindsey v. DeGroot Dairy case addressed by the Indiana Court of Appeals in 2009. In the suit, neighbors of a dairy farm challenged the Indiana Right to Farm Act, complaining of nuisance resulting from unpleasant smells, noise and flies on their property.

“The case resulted in a really significant extension of the Indiana Right to Farm Act, which protects farmers from nuisance suits,” he said.

[The Janzen Ag Law Blog] has evolved from his work in agriculture, and it’s written in a general way to welcome visitors new and old.

Janzen said he has found there is no substitute for farmers being able to talk about particular legal issues with their attorney.

“Every situation is actually unique, and there is no one-size-fits-all legal solution,” he acknowledged.

The lawyer said he tries to add a new story to his blog each week and hopes to expand his reach to a new audience.

“It’s quite fun to watch people visit the blog — every time I post a news story, I see dozens of hits almost immediately,” he laughed. “It grows every single day, and that’s what’s so neat to see. I don’t know what the top is, but I hope to find it.”

As far-reaching as legal gossip can be, Janzen abstains from posting specific information about a case or any attorney-client privileged information.

His blog is independent of any people or organizations he represents, though he represents livestock producers, farmers and other agribusinesses at his firm and serves as the general counsel for the Indiana Professional Dairy Producers, a trade organization that serves the needs of Hoosier dairy farmers.

Author:  Katie Nickas, Indiana Agri-News, April 21, 2011.

How does the National Pork v. EPA case impact Hoosier farmers?

On March 15, 2011, the 5^th Circuit Court of Appeals, sitting in New Orleans, Louisiana, issued a ruling in the case titled: National Pork Producers Council v. U.S. E.P.A.  Although there are a number of holdings in the decision, one in particular has generated a lot of interest in agricultural circles—the EPA cannot require a CAFO that “proposes” to discharge to obtain a NPDES (or CAFO) permit.  Only those CAFOs that actually discharge manure into navigable waters must apply for CAFO permits.  Likewise, a CAFO operator that does not discharge faces no liability for his or her “failure to apply” for a CAFO permit.

What does this mean for CAFOs in Indiana?  Not much.  At least not yet.  In Indiana, the EPA typically does not regulate CAFOs, Indiana’s largest livestock producers. (Although I have been present for EPA inspections of Indiana farms).  Instead, the EPA has delegated that authority to Indiana.  Indiana has statutes and regulations implementing the federal CAFO rule. Though the federal CAFO rule my be partially struck down, Indiana’s CAFO rule remains on the books unless and until an Indiana court similarly strikes down the equivalent provisions.  That has not happened.  Thus, for the time being, Indiana’s farms that meet the threshold livestock numbers for entry into the CAFO program must apply for a CAFO permit, even if they do not propose to discharge.  Stay tuned.  

Update March 25, 2011:  I understand that IDEM is currently reviewing this case and determining how it should impact the upcoming revised CAFO regulations.  

The complete ruling from the 5^th Circuit can be found at:

http://www.ca5.uscourts.gov/opinions/pub/08/08-61093-CV0.wpd.pdf

EPA Administrator Testifies Before U.S. House Committee on Agriculture: No need to cry over spilled milk.

E.P.A. Administrator Lisa Jackson recently testified before the U.S. House Committee on Agriculture.  One of the interesting points of her testimony is that the EPA does not intend to treat "spilled milk" like "spilled oil."  This should cause Indiana dairy farmers to breathe a sigh of relief.  Hopefully, the Indiana Department of Environmental Management will follow suit.  Administrator Jackson's testimony is below (bold material highlights the "spilled milk" passage: 

Chairman Lucas, Ranking Member Peterson and Members of this committee, thank you for inviting me to testify.  I’m pleased to be here today.

I have great respect for the oversight role of Congress and believe that this ongoing dialogue is central to the commitment I have made to the American people to conduct EPA’s business transparently and with accountability. 

I also believe an important part of that commitment is to dispel certain myths about EPA’s work and its impact on agriculture.  These mischaracterizations are more than simple distractions; they prevent real dialogue to address our greatest problems.  And so, today, I would like to spend a few minutes addressing some of them directly.

Let me begin, though, with one simple fact that I proudly embrace: farmers and ranchers are an essential part of our economy.  They give us food, fiber, and fuel.  The innovators in American agriculture deserve great credit for the significant steps they’ve taken to protect the environment while feeding millions of people.

With that recognition in mind, my direction to EPA has been to establish a consistent dialogue with the agriculture community, which is crucial to our work.  

This is why I would like to take a moment today to address some of the mischaracterizations that have been, at times, unaddressed, or that need to be addressed again. As I’m sure you would agree, Mr. Chairman, facts matter and we all have a responsibility to ensure that the American people have facts and the truth in front of them, particularly when fictions are pushed by special interests with an investment in the outcome.

Let me give you five examples:

One is the notion that EPA intends to regulate the emissions from cows – what is commonly referred to as a “Cow Tax.”  This myth was started in 2008 by a lobbyist and –quickly de-bunked by the non-partisan, independent group fact-check.org – it still lives on.  The truth is - EPA is proposing to reduce greenhouse gas emissions in a responsible, careful manner and we have even exempted agricultural sources from regulation.

Another mischaracterization is the claim that EPA is attempting to expand regulation of dust from farms. We have no plans to do so, but let me be clear, the Clean Air Act passed by Congress mandates that the Agency routinely review the science of various pollutants, including Particulate Matter, which is directly responsible for heart attacks and premature deaths.  EPA’s independent science panel is currently reviewing that science, and at my direction EPA staff is conducting meetings to engage with and listen to farmers and ranchers well before we even propose any rule.

Another example involves spray drift. While no one supports pesticides wafting into our schools and communities, EPA does not support a “no-spray drift policy.” EPA has been on the record numerous times saying this, but the incorrect belief that EPA desires to regulate all spray drift persists. We have reached out to National Association of State Departments of Agriculture and other key stakeholders. Working with them, we have been able to identify critical issues and we will continue our efforts to resolve them. 

Yet another mischaracterization is the false notion that EPA is planning on mandating Federal numeric nutrient limits on various States.  Again, let me be clear: EPA is not working on any federal numeric nutrient limits.  We will soon be releasing a framework memo to our regional offices that makes it clear that addressing nitrogen and phosphorus pollution – which is a major problem - is best addressed by the States, through numerous tools, including proven conservation practices.  The case of Florida is unique – the last Administration made a determination that federal numeric nutrient standards were necessary in Florida, requiring EPA to develop such standards.

And finally is the notion that EPA intends to treat spilled milk in the same way as spilled oil. This is simply incorrect. Rather, EPA has proposed, and is on the verge of finalizing an exemption for milk and dairy containers. This exemption needed to be finalized because the law passed by Congress was written broadly enough to cover milk containers.  It was our work with the dairy industry that prompted EPA to develop an exemption and make sure the standards of the law are met in a commonsense way.  All of EPA’s actions have been to exempt these containers.  And we expect this to become final very shortly.            

Contrary to the myths is the reality I spoke of earlier. EPA is in close consultation with America’s farmers and ranchers. We have listened to their concerns and made them a part of the work we do.  Let me give just one example that is very important to this committee.

When EPA proposed higher renewable fuels production mandates under RFS 2, we heard – again through extensive public comments and direct conversations – the ethanol industry’s concerns with the analysis of greenhouse gas impacts, which EPA was conducting under a requirement from Congress.  We addressed their concerns, and we now have a rule that encourages vast innovation, respects the needs of agricultural communities, and is expected to create jobs and increase farmers’ incomes by $13 billion annually by 2022.

Mr. Chairman, everyone in this room, has the same desire – to have safe water, air and land for our children – and to do so in a way that maintains our economic strengths.  EPA will continue to work with this committee, as well as our partners in the States and the agricultural community to achieve the goals we have set together, and to serve the values we all share. Thank you.

CAFOs? CFOs? What does Indiana law say?

A couple years ago I wrote an article for the American Bar Association on Indiana's regulatory scheme for permitting animal feeding operations.  The law is still the same today, at least until new CAFO regulations are promulgated.  The notes below are an excerpt from that article.  Email me and I can send you more.

CONCENTRATED ANIMAL FEEDING OPERATIONS – CAFOs

I.  What are CFOs and CAFOs? 

CFOs and CAFOs are Indiana’s largest livestock producers.  CFOs are defined as the “confined feeding” of at least:

·        300 cattle;

·        600 swine or sheep; or

·        30,000 fowl.

327 IAC 16-2-5.  “Confined feeding” means feeding animals in pens, sheds, or buildings for at least forty-five (45) days of any given year.

CAFOs are defined similarly and include three different sizes of livestock operations:    animal feeding operations (“AFOs”); medium CAFOs, and large CAFOs.  Large CAFOs must operate under NPDES permits.  The threshold numbers to be considered a large “CAFO” in Indiana are:

• 700 mature dairy cows
• 1000 veal calves
• 1000 cattle
• 2,500 swine (greater than 55 pounds)
• 10,000 swine (less than 55 pounds)
• 500 horses
• 10,000 sheep
• 55,000 turkeys
• 30,000 hens 
• 5,000 ducks

327 IAC 5-4-3.  IDEM may also designate other livestock operations “CAFOs” depending on site specific conditions, e.g., based on their level of manure discharged into waters of the state.  IDEM deems all Indiana CAFOs to have the “potential” to discharge pollutants into waters of the state and therefore are “point sources” requiring an NPDES permit.

II.   Why are there two permitting schemes?

Prior to 2001, Indiana permitted its CAFOs by issuing CFO approvals—it did not require each operation to obtain separate NPDES permits.  In 2002, an environmental group sued IDEM alleging its CFO regulations failed to adequately enforce the federal Clean Water Act.  See Save the Valley, Inc. v. United State Env. Prot. Agency, 223 F. Supp.2d 997 (S.D. Ind. 2002).  The federal district court agreed and sent IDEM back to the drawing board to come up new livestock operation regulations that adequately addressed the Clean Water Act’s prohibition of discharges into waters of the United States.  The result was the promulgation of IDEM’s CAFO regulation.  IDEM left its CFO regulations on the books, and a dual permitting scheme was born.