By: Mike Eby, Chairman, National Dairy Producers Organization
The National Dairy Producers Organization, Inc. (NDPO) is the only national dairy farmer organization comprised entirely of dairy farmers with the goal of dairy farmer sustainable profitability.
Today, dairy farmer owned processing co-ops claim to control more than 80% of the milk produced on our nation's dairy farms.
Defendant Dairy Farmers of America, Inc. (DFA) is one of these dairy farmer owned processing co-ops which has contributed to the loss of over 180,000 dairy farms in the U.S. since 1980.
Most NDPO members are like Plaintiffs, to wit, dairy farmers who are owner-members of processing co-ops and/or who pool milk under the Federal orders.
The problems of Plaintiffs and issues being litigated are the same problems and issues that many NDPO members have with their respective processing co-ops that they own and ship milk to.
(a) Management fails to comport themselves as cooperative and fiduciaries existing for the benefit of dairy farmers owner-members but rather operates the dairy farmer owned cooperative processor as a for-profit corporation that benefits management only at dairy farmer's expense.
(b) Management fails to promote dairy farmer profitability and on the contrary actively pursues policies and actions that promote dairy farmer losses.
(c) Management philosophy and strategy is one that promotes unrestrained milk growth which in turn causes a milk supply in excess of profitable demand which in turn results in dairy farmers selling their milk for less than what it costs to make.
(d) Management fails to consider let alone implement a business plan that pays a profitable price for the dairy farmer owner-member's milk.
Obviously, what happens in this case could have a significant impact on the remaining 45,000 dairy farms in this country whether they ship their milk to a public, private, or cooperative processor.
Plaintiffs, in essence, allege and Defendants in essence , admit through their monetary offer of settlement, that Defendant's management has not been operating in the best interest of dairy farmer owner-members of DFA.
As the Court has properly determined, the proposed monetary payment is not sufficient remedy for Defendant's wrong doing.
Rather, more importantly than an adequate monetary payment, the Court should also consider placing Defendant organizations into some type of temporary court supervised receivership until the organization's dairy farmer members can create some new organizational rules and elect new leadership so that the Defendant organizations can be re-created for their original purpose ie, the pursuit of the sustainable profitability of it's dairy farmer members.
5.5.2015