United Potato Cooperative: Flawed from the beginning?

12/13/2011 04:28:00 PM
Tom Karst

Was the founding strategy of the United Potato Growers of America flawed from the beginning? News of an Idaho court ruling against the potato cooperative seems to say so. From The Packer's coverage: 

 In a Dec. 2 ruling, U.S. District Court of Idaho judge Lynn Winmill rejected Salt Lake City-based United Potato’s motion to dismiss a suit brought against it by Jamestown, N.Y.-based Brigiotta’s Farmland Produce and Garden Center Inc.

TK: The crux of the issue, as the judge explained, was the question of whether an agricultural cooperative could both set prices and limit production.  From U.S. District Court Judge Lynn Winmill:

 The Court first notes that there are no cases where a court specifically approved, under the Capper-Volstead Act, a pre-production agricultural output limitation as opposed to a post-production marketing decision such as withholding of product from market. Likewise, there are no cases where a court has concluded that Capper-Volstead immunizes cooperatives and their members who seek to collectively implement production controls in order to raise prices.


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