Last updated on July 11th, 2017 at 11:04 am
A lawsuit stemming from what Beef Products Inc. (BPI) described as a “month-long disinformation campaign” in March 2012 against its lean finely textured beef product was settled on June 28 for an undisclosed sum.
Dakota Dunes, South Dakota-based BPI and the Roth family, who own the company, said in a statement that they are “extraordinarily pleased” to have reached the settlement in the libel and defamation case against ABC News and Jim Avila. Avila is the correspondent who reported on lean finely textured beef and referred to it as “pink slime.” The first story aired on March 7, 2012.
According to Winston & Strawn, the Chicago-based law firm BPI hired to sue for defamation, BPI lost more than 80 percent of its business and laid off more than half of its employees.
BPI said it was forced to suspend operations at three manufacturing facilities in Amarillo, Texas; Garden City, Kansas; and Waterloo, Iowa. Only its Nebraska plant in South Sioux City remained open. More than 650 people were laid off. By early April, BPI’s sales had fallen by two-thirds. In May 2012, BPI announced that plant closures would be permanent, and another 86 employees were let go.
The lawsuit against American Broadcasting Cos., ABC News Anchor Diane Sawyer, Avila and former Department of Agriculture microbiologist Gerald Zirnstein, who named the product “pink slime” in a 2002 e-mail to colleagues, was filed in September 2012 sought $1.9 billion in damages. Under South Dakota’s Agricultural Food Products Disparagement Act, the value could have tripled to $5.7 billion.
In February this year, Judge Cheryle Gering denied ABC and Avila’s motion for summary judgment but did dismiss Sawyer, Zirnstein and several other people as defendants.
The jury trial began on June 5 in Elk Point, South Dakota, and was expected to last as long as eight weeks. Winston & Strawn said the trial “matched the stakes involved” and that it “spent weeks putting witness after witness on the stand to prove to the jury that ABC intentionally and knowingly made nearly 200 hundred false statements about BPI and its product.”
The case was settled on the trial’s 18th day.
“With our team about to put on witnesses and establish the damage caused by ABC’s campaign, the case settled,” Winston & Strawn said. “The settlement vindicates BPI and puts the company on the path to recovery.”
“While this has not been an easy road to travel, it was necessary to begin rectifying the harm we suffered as a result of what we believed to be biased and baseless reporting in 2012,” BPI said in its statement. “Through this process, we have again established what we all know to be true about lean finely textured beef: it is beef, and is safe, wholesome, and nutritious. This agreement provides us with a strong foundation on which to grow the business while allowing us to remain focused on achieving the vision of the Roth and BPI family.”
In a statement, ABC says, “Throughout this case, we have maintained that our reports accurately presented the facts and views of knowledgeable people about this product. Although we concluded that continued litigation of this case is not in the company’s interests, we remain committed to the vigorous pursuit of truth and the consumer’s right to know about the products they purchase.”
The Sioux City Business Journal reports that after the announcement, Avila stood behind his reporting and said he had hoped to tell the jury his side of the story. He also noted that ABC News did not retract the story or apologize for anything.