Union Efforts Called Racketeering

A lawsuit filed by Smithfield Foods charges the UFCW with extortion and a smear campaign in the union's efforts to convince the meat processor to agree to voluntarily accept the union without an employee vote. The union says the company has a long history of worker intimidation.

By Joseph A. Slobodzian

It's been used against mobsters, corrupt labor unions and anti-abortion protesters.

Now Smithfield Foods Inc., the Virginia-based meat-processing giant, has joined companies turning to federal racketeering law to try to block a campaign geared to unionization of its employees.

Smithfield Foods' lawyers filed the civil racketeering lawsuit Oct. 17 in federal court in Richmond, Va., the latest development in Smithfield's 14-year fight to prevent the United Food and Commercial Workers from unionizing 4,650 hourly workers at its largest pork-processing plant in Tar Heel, N.C.

The lawsuit contends that the union has resorted to "smear tactics," including trying to undermine the company's stock price by leaking false statements to Wall Street stock analysts.

The lawsuit seeks damages of at least $5.9 million for business losses Smithfield Foods says can be traced to the union campaign, as well as an injunction barring the unions from continuing their activities.

The lawsuit -- Smithfield Food Inc. vs. United Food and Commercial Workers International Union -- has been assigned to U.S. District Judge Robert E. Payne.

UFCW officials issued a statement maintaining that Smithfield has a long history of worker intimidation and calling the lawsuit an attempt by Smithfield to avoid a union vote.

UFCW officials noted that the suit was filed two days after negotiators for the company walked out of talks that were close to setting a mutually agreed-upon process for holding a unionization election at the Tar Heel processing plant.

"It is truly shameful that Smithfield is willing to spend millions of dollars on high-priced lawyers and frivolous lawsuits rather than committing the resources needed to provide basic safety and health improvements for Tar Heel workers," the union statement read.

According to the lawsuit, union members have demonstrated at food stores carrying Smithfield Foods products and at public appearances of celebrity chef Paula Deen to urge her to break her contract with Smithfield. Deen's Food Network cable television program, Paula's Home Cooking, features Smithfield products.

The lawsuit contends that in September 2005, the UFCW's Local 400 "decided to abandon all efforts to convince Smithfield employees of the benefits of union membership in favor of a new plan aimed not at the employees, but at Smithfield itself."

The lawsuit says UFCW decided to "extort" Smithfield's recognition of Local 400 "regardless of the degree of actual employee support for such representation, by injuring Smithfield economically until Smithfield either agreed to [union] demands or was run out of business."

In addition to the UFCW international union, in Washington, and Local 400, the Smithfield lawsuit names three groups and seven individuals it describes as "co-conspirators" with the union.

While the use of the federal racketeering statute in a union-organizing dispute may seem unusual, other companies have turned to the racketeering law, says Lynn C. Outwater, a labor relations lawyer and managing partner of the Pittsburgh office of the law firm Jackson Lewis.

Outwater cited the March ruling by U.S. District Judge Brian M. Cogan, of the Eastern District of New York, allowing a civil-racketeering conspiracy case to proceed against the Laborers' International Union.

The lawsuit by the Asbestos & Lead Removal Corp. contended that Laborers Local 78 and business manager Edison Severino carried out a campaign of violence and extortion designed to force the company to agree to a collective-bargaining agreement with Local 78.

The stakes are high in the protracted unionization struggle between Smithfield and the UFCW. With annual sales of $12 billion, Smithfield Foods calls itself the largest producer of hogs and the "leading processor and marketer of fresh pork and processed meats in the United States."

The Tar Heel plant is the largest meat processing plant of its type, according to Smithfield Farms, and slaughters, processes and packages more than 32,000 hogs per day.

The UFCW, on the other hand, represents 1.4 million workers and Landover, Md.-based Local 400 claims 40,000 members.

Local 400 began trying to organize Smithfield's Tar Heel workers in 1994, two years after the sprawling processing plant opened.

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