The Santa Barbara Certified Farmers Market Association is considering a temporary fee hike for vendors in order to pay lawyer’s fees resulting from a complaint filed by two members and one ex-member. Currently, members fork over 5 percent of their gross sales for operating costs. The market grossed about $10 million last year.
The antitrust lawsuit alleges breach of contract, price-fixing, and restraints of trade. It was first brought by Jeff and Roxanne Hendrickson of Santa Rita Flower Farm and then joined by the owners of Wellington Farm and Dey Dey’s Best Beef Ever. They contend that the market favors larger out-of-town sellers, does not keep transparent waiting lists, and does not follow its own bylaws.
In a tentative ruling, Santa Barbara Superior Court Judge Thomas Anderle said that the plaintiffs’ lawyer must better define the market relevant to the suit. That definition is likely the key determinant to whether the case goes to trial.
Plaintiffs’ counselor Matthew Da Vega (who recently left Christman Kelley and Clarke to cofound Da Vega & Fisher) said in his amended complaint that the Farmers Market so dominates the “direct-to-retail” agricultural market in Santa Barbara County that no other option could provide his clients “fair and equal access.”
In his demurrer, the Farmers Market attorney Tim Trager said this definition of a market is “unsustainable.” Direct-to-retail, he said, is a method of sale rather than a marketplace. The borders of Santa Barbara County are arbitrary, and the designation of “agricultural products” is overly broad. The plaintiffs have many other venues for the sale of their products, the document says, and furthermore, they take advantage of them. More relevant is whether consumers have options. California’s Cartwright Act, an antitrust law that plaintiffs contend the Farmers Market violated, is designed to protect consumers rather than sellers.
“We originally sent them a letter asking that they deal with it privately, and they told us to go jump in a lake.”
In a memo to the Farmers Market board distributed on May 23, Trager exhorted members not to speak publicly about the suit. “The facts and arguments which we are confident will demonstrate the plaintiffs’ claims lack merit will be made in court,” he wrote. Vendors contacted by The Santa Barbara Independent have followed that advice, but some — not perfectly content with the market’s administration — privately worry that the lawsuit could bankrupt the market and/or put it out of operation. Da Vega, however, said he wants to fix the market, not destroy it. He did not file the lawsuit precipitously, he said. “We originally sent them a letter asking that they deal with it privately, and they told us to go jump in a lake.”
As far as the allegation that the market has breached a contract in breaking its own rules, Trager argues that even if rules were broken, the rules do not form the basis of a contract. According to him, the tenor of the lawsuit suggests that the plaintiffs want to protect themselves from competition, not the consumer from a lack of competition — the standard by which an antitrust case gains merit. Furthermore, he wrote, “It’s not membership in SBFM [Santa Barbara Farmers Market] that plaintiffs are interested in; it’s the ‘pick of the litter’ of the market locations.”
Trager has declined to speak on the record himself, but his demurrer is chock-full of colorful language. He referred to “an apparent epiphany” on the part of the plaintiffs that led to them adding five boardmembers to their amended complaint. [editor’s note: Elizabeth Poett, a member of the Farmers Market’s Board of Directors who is named in the lawsuit, is the daughter of this paper’s editor in chief, Marianne Partridge. Attorney Trager represents Partridge in her legal issues with publisher Randy Campbell.] Trager also wrote that “this case has nothing to do with that [sic] magic-word phrases,” and stated that the “plaintiffs’ bald allegation in the SAC that defendants compete against them are words of wind held aloft only by an implausible definition.”
“We’re not arguing that everyone who applies should get in. It’s a balance,” said Da Vega. Consumers deserve “access to organically grown, straight-from-the-producer, agricultural stuff,” he said. As for his complaint, he is asking for “threefold the damages determined to have been sustained” by his clients, attorney’s fees, “disgorgement of ill-gotten gains,” and an injunction against said alleged conspiratorial practices.
- Farmers Grab Their Pitchforks: File Antitrust Lawsuit Against Farmers Market [ December 20, 2012 ]
- Farmers Market Harvests Discontent: New Plaintiffs Join Antitrust Suit [ January 31, 2013 ]
- More Defendants in Farmers Market Lawsuit [ May 16, 2013 ]