Premium Standard Farms Responds to Attorney General's Memorandum in Opposition

PRINCETON, Mo., July 30 /PRNewswire/ -- Premium Standard Farms (PSF) received a copy of the Attorney General's Memorandum in Opposition from media sources today. The company is yet to receive a copy of that pleading from the Attorney General's office directly. However, the company did receive a letter yesterday from the Attorney General's office indicating that they would not take any action before September 1, 2010 in light of continuing negotiations.

Although the company has only just received the Memorandum in Opposition, it has identified multiple factual misstatements and many misleading characterizations of facts in its initial review. For example, the Attorney General's discussion of biofilters omits a key fact. The expert panel, the Court-appointed panel whose determinations govern what, if any, technology must be implemented on PSF farms, made a specific finding that there was no biofilter that met the standards that the panel established for barn odor control. The fact remains that the only technology that has been approved by the panel that actually has been proved through independent testing to be functional is the barn scraper technology. As the company's previous report to the court stated, it started work on implementation of that technology and has been doing so since it was approved in May of this year.

The Attorney General's filing expresses concern that PSF's Whitetail farm will reopen without installation of barn scrapers. That has never been proposed by PSF and the Attorney General's office knows it. The company has previously informed the Attorney General's office that scrapers would be installed at Whitetail before it would be repopulated. This is a facility that currently is closed. PSF was hoping to reopen it in attempt to save jobs and improve the local economy.

The Attorney General suggests that sanctions should be imposed for failure to install technology that did not exist – this makes no sense. You cannot install what does not exist. The timelines set forth in the original consent judgment assumed the existence of technology that would meet the expert panel's standards. The Attorney General's statement that PSF had the sole responsibility to propose technology ignores the statements by panel member Mike Williams that the process has been a collaborative one and that at PSF's Missouri farms you "see commercial application of animal waste technology that exceeds anything that you will see . . . in any other state in the U.S."

Additionally, the Attorney General suggests that financial resources exist to pay $16.5 million for additional technologies on three PSF farms in addition to another $7.5 million that will be spent on barn scraper technology. This ignores economic realities and paints a very misleading picture for the Court. PSF is an independent operating company. The last three years have been the worst ever in the hog industry. PSF has lost millions of dollars during that time, seriously jeopardizing jobs and even threatening the company's existence. The Attorney General also fails to note that PSF has already paid nearly $40 million in this consent judgment process and that PSF's environmental costs are 3 1/2 times its competitors' costs – facts they are very aware of.

While PSF stands ready to continue its negotiations with the Attorney General, this filing jeopardizes those talks, as well as the thousands of jobs that PSF provides and supports in north Missouri. The company cannot allow misstatements and mischaracterizations to go unchallenged. If the negotiations are not successful, PSF looks forward to a full hearing on these issues.

Editor's note: Above is attributable to Jean Paul Bradshaw, outside counsel for PSF at Lathrop & Gage LLP.

SOURCE Premium Standard Farms