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Federal appeals court throws out $6.1 million judgment for egg producer

Associate Press
June 30, 2004
Hope Yen


WASHINGTON (AP) - A federal appeals court on Wednesday threw out a $6.2 million judgment for an egg producer in a 14 year dispute with the Agriculture Department. The court said it was not convinced that food safety regulations unduly hurt the bottom line at Rose Acre Farms of Seymour, Ind.

A claims court had said government restrictions on the sale of contaminated eggs were not narrow enough and thus amounted to an unconstitutional "taking" of private property under the Fifth Amendment.

The U.S. Court of Appeals for the Federal Circuit disagreed and ordered the lower court to re examine whether the damage suffered by Rose Acre outweighed the Agriculture Department's interest in safeguarding the public.

A woman who answered the telephone Wednesday evening at Rose Acre said no one was immediately available to comment on the ruling.

The department adopted the emergency regulations in 1990 after salmonella poisoning outbreaks in Kentucky, Illinois and Tennessee. Authorities said they traced the outbreaks to eggs from three of Rose Acre's Indiana farms.

Regulators refused to allow Rose Acre to sell eggs in the shell from the three farms and required expensive wet cleaning of hen houses that damaged the structures' electrical wiring. Rose Acre said it was forced to sell at a loss 700 million eggs that were diverted into low priced markets for eggs.

The company contended that federal officials acted rashly in imposing the restrictions without testing any of Rose Acre's eggs for salmonella to determine whether the bacteria might have been introduced later due to improper handling.

But the appeals court sided with federal officials, saying that testing of eggs was not a feasible method at the time.

An environmental safety rights group, Community Rights Counsel, praised the decision for giving federal officials the "flexibility to enact strong protections" to reduce public safety risks. The group had filed a friend of the court brief in the case.

On the Net:

Appeals court opinion: http://www.fedcir.gov/opinions/03 5103.doc

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