A federal jury has ruled an Ohio farm cooperative must repay a group of
Nebraska families $15 million lost in what the FBI has said was the biggest
cattle fraud case in U.S. history.
Jurors found Monday that United Producers Inc. of Columbus breached contracts
with the families, converted the money to its own use and did not uphold
its financial duty to the families.
The families actually lost more than $50 million in the scheme carried
out by Missouri cattle buyers already convicted in the case, said David
Domina, an attorney for the Nebraska families. Cattle buyers George Young
and Kathleen McConnell defrauded investors by using their money to pay
off business debts instead of buying cattle, authorities said.
The lawsuit involved $15 million in checks that the families wrote to United
Producers during a four-month period in 2001. Later that year, Young and
McConnell's business collapsed. Instead of buying cattle with the
investors' money, they had used it to pay off other investors and
to pay bills.
The cooperative did not defraud the families, Domina argued after a five-day
trial, but accepted the $15 million in checks knowing that the money was
supposed to be used to buy cattle. When the cattle were not bought, he
said, the cooperative was responsible.
Thomas Hamill, an attorney representing United Producers, had argued that
the cooperative had made a loan to another corporation that Young and
McConnell operated, but which was 75 percent owned by the cooperative.
The checks written to United Producers were to repay the loan, not to buy
cattle, Hamill said.
Federal District Judge Lyle E. Strom delayed completion of the case pending
a ruling on several motions. The amount of money involved in the case
was not in dispute, Strom said. The money will go to members of and businesses
owned by the Eggerling family of northeast Nebraska, the Curry family
of southeast Nebraska and Loren and Mary Eckert of Pilger, Neb. Hamill
has said the cooperative would consider an appeal if the jury ruled against it.