Iowa Select Farms has settled the case of a Sac County nuisance lawsuit, eliminating an estimated $32 million in punitive damages awarded by a jury in October 2002.

“Punitive damages are appropriate only if there is a history of intentional bad faith action. That was obviously not the case here, and this settlement is a testament to that fact,” says Jeff Hansen, Iowa Select Farms’ chief executive officer.

Iowa Select Farms’ settlement with eight Sac County residents who filed the lawsuit occurred as a final court ruling was pending on the company’s post-trial motions. In its motions, the company had asked for a new trial based on its contention that the issue of punitive damages should never have been submitted to the jury in the first place. 

The settlement eliminates punitive damages, which made up the largest part of the damages awarded to the plaintiffs in October 2002 in the odor nuisance lawsuit. An eight-person jury awarded $1 million for actual damages claimed by the plaintiffs and assessed $32 million in punitive damages, intended to punish the company for its decision to build the farms. Both parties agreed not to disclose terms of the settlement beyond the elimination of punitive damages.

The plaintiffs didn’t dispute the fact that Iowa Select followed all laws and rules when locating, building and operating the pork operations in question and that the company has never had an environmental violation at the farms. No reported case in U.S. history has allowed punitive damages to be submitted against a livestock operation absent a history of water quality impacts that directly affected the plaintiffs.

“We always believed the law in Iowa clearly states that an operation in compliance with all laws and regulations cannot be subjected to a punitive damages claim,” says Hansen. “I am pleased that the settlement reflects the clear understanding of all parties that nothing was paid towards the punitive damages verdicts. This settlement supports our beliefs concerning the operation of the farms in question.”

Iowa Select Farms