Monday, December 23, 2013

Chicken board wins partial victory

The Chicken Farmers of Ontario, the Association of Ontario Chicken Processors and several of the biggest chicken processors in the province have won a partial victory over CAMI International Poultry Inc. of Welland.

CAMI has filed a lawsuit against them, claiming a conspiracy among them to deny the company enough chicken supplies to satisfy its customers’ demand for Hong Kong dressed birds.

Justice J.R. Henderson agreed with the chicken board and processors that there is some “confusion about what was taken” from CAMI when Ontario and Quebec marketing boards signed an agreement to ban inter-provincial trade in live chickens.

CAMI had been buying Quebec birds to keep its customers supplied with about 800,000 birds slaughtered each quota period. After the ban went into effect, it could only source about 250,000 birds per quota period.

CAMI argues that the trading ban left the Ontario chicken board with birds that were being exported to Quebec and it divided those birds among Ontario processors, but denied CAMI its share.

That, CAMI claims, violates a number of laws, including the competition act, the federal-provincial agreement on internal traded, and amounts to expropriation without compensation.

Henderson said “there is at least a germ or a scintilla of a chance” CAMI could succeed on this claim that the members of the AOCP ended up with supplies that should have been granted to CAMI.

The chicken board argued that CAMI had no base quota covering the birds it was importing, therefore the chicken board took nothing from CAMI.

Henderson disagreed and said CAMI might succeed with its claim that something of value was taken by the chicken board and distributed to other processors.

Henderson also dismissed the chicken board and processors’ challenge that there has been no violation of the Competition Act. That claim, says Henderson “has a chance of success.”

There were no arguments presented during this court challenge about the federal-provincial agreement on internal trade because the lawyers can’t find a copy of the agreement.

The main court case is scheduled to be heard in Welland early next year.

CAMI has filed another court challenge against the way the federal government and the federal-provincial marketing boards deal with applications for supplementary import permits.

When CAMI applied for a permit to import chickens from the U.S. so it could meet its customers’ demand for Hong Kong dressed birds, the marketing boards said they could find regular chicken to fill the orders. CAMI is arguing that it’s not right to deny a supplementary import permit on this basis because the specialty market is left unfilled.