“Hot Goods” lawsuits update
We have posted about the recent hot goods court case from Oregon over the last year, which can be found here and here. There have been a couple of updates we wanted to share.
As we noted in the earlier posts, the U.S. Department of Labor claimed that Pan-American Berry Growers and B&G Ditchen paid pickers less than minimum wage and used the “hot goods” provision to block any shipments of the perishable blue berries, unless the farms agreed to pay around $220,000 and waive any rights to appeal the DOL’s findings. These deals were later found unlawfully coercive by a federal judge.
Since that point, the farmers have demanded their money back plus damages of around $150,000. The DOL has said they cannot pay the money back as it has already been disbursed to workers, refused to pay any damage amounts, and has also attempted to bring more complaints against the farms attempting to add more defendants to the lawsuit and going back further in time.
The latest in the story is the DOL and the farms are in negotiations for resolution of all charges and the DOL has asked US Magistrate Judge Thomas Coffin to postpone any hearings until January 13, 2015, who was set to hear oral arguments on the DOL’s motion to broaden the charges against the farms on December 3, 2014 and to accept court briefs regarding the payment of damages to the farmers.
As with most lawsuits, this has been a long and expensive process. While the overall methods used by the DOL have been a hot topic of discussion whether they were fair or not (in the least, the DOL should have allowed for the sale of the goods and had the money put in escrow), including methods to determine the workers were not paid minimum wage, this is yet another example of why it is absolutely imperative to not only ensure you are paying workers minimum wage but have documentation that proves just that without any doubt.
Special thanks to David Enquist for this post
Paul Neiffer is a certified public accountant and business advisor specializing in income taxation, accounting services, and succession planning for farmers and agribusiness processors. Paul is a principal with CliftonLarsonAllen in Walla Walla, Washington, as well as a regular speaker at national conferences and contributor at agweb.com. Raised on a farm in central Washington, he has been immersed in the ag industry his entire life, including the last 30 years professionally. Paul and his wife purchase an 180 acre ranch in 2016 and enjoy keeping it full of animals.
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