Corporate Farming Challenge

Ag Groups on Opposing Sides in Lawsuit Over ND Corporate Farming Law

Todd Neeley , DTN Staff Reporter
North Dakota voters rejected a proposal in the June primary election to loosen the state's corporate farming law for pork and dairy farmers. (DTN file photo)

OMAHA (DTN) -- Two North Dakota farm groups now stand on opposite sides of a lawsuit challenging the state's corporate farming law. The North Dakota Farmers Union filed a motion Wednesday to intervene in a North Dakota Farm Bureau lawsuit that seeks to end the law.

Voters rejected a proposal in the June primary election to loosen North Dakota's corporate farming law for pork and dairy farmers. The Great Depression-era law forbids non-family farm corporations or limited liability corporations from owning farmland or engaging in agriculture production.

On Wednesday, the North Dakota Farmers Union sought to defend the law in a motion to intervene filed in the U.S. District Court for the District of North Dakota in Fargo. Intervenor status would allow NDFU to be directly involved in the litigation, rather than be a bystander.

The lawsuit names a number of farmers both in North Dakota and in other states, such as Wisconsin, as plaintiffs in the case who have been harmed by the law. The lawsuit outlines how the plaintiffs have been barred from making ownership decisions about their farming operations because of the law.

According to court documents filed this week, the state is not objecting to the North Dakota Farmers Union's motion to intervene.

One of the plaintiffs mentioned in the lawsuit, Wisconsin-based Breeze Dairy Group, LLC, claims it has been limited by the law in attempting to expand its operation. That's because the company is not a domestic dairy as defined by the North Dakota law.

"...The five individual families which comprise Breeze Dairy are unrelated and therefore do not meet the kinship requirements contained in Chapter 10-06.1...," the lawsuit said. "Breeze Dairy is precluded from expanding in North Dakota."

In a news release statement Wednesday, the North Dakota Farmers Union said it helped draft the original law to protect farmers in the state.

"Farmers Union led the fight that created our corporate farming law back in the '30s, and we've defended it, repeatedly, ever since," said NDFU President Mark Watne. "As a result, we have a strong family farm and ranch culture that is the envy of other states and the backbone of our economy."

Watne said voters made it clear where they stand, as the June ballot measure did not pass in a single county.

"It is clear that North Dakotans want family farms as their primary business structure and system of agricultural production," he said. "Allowing corporate farming here in North Dakota is a step in the wrong direction. We will continue to work for the interests of family farmers and our rural communities."

In its motion to intervene, the North Dakota Farmers Union said it is not confident the state will defend its interests in whole.

"Because NDFU invested money and other resources into defending the corporate farm law before, during and after the 2015-16 referendum, it has a concrete economic interest in this litigation that differs from the state's broad public interests," the group said in the motion.

"The policy and legislative positions of state officials and agencies regarding the corporate farm law often differ, and at times directly contradict, the positions of NDFU. In 2015 and 2016, for example, the governor and commissioner of agriculture were generally supportive of the corporate hog and dairy exemption amendments, to which NDFU was vigorously opposed.

"During this same time, the attorney general was largely silent on the issue. He did not publicly oppose the amendments, indicating that the attorney general's office either agreed with the positions of the governor and agriculture commissioner, or acquiesced to them, or had no position."

Corporate farming laws have been eliminated in a number of states in recent years. Last year the Nebraska Legislature voted to overturn its ban on packer ownership of hogs.

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Todd Neeley