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Beef Prods., Inc. v. American Broadcasting Companies, Inc.

United States District Court, D. South Dakota

June 12, 2013

BEEF PRODUCTS, INC.; BPI TECHNOLOGY, INC.; and FREEZING MACHINES, INC., Plaintiffs,
v.
AMERICAN BROADCASTING COMPANIES, INC.; ABC NEWS, INC.; DIANE SAWYER; JIM AVILA; DAVID KERLEY; GERALD ZIRNSTEIN; CARL CUSTER; and KIT FOSHEE, Defendants

For Beef Products, Inc., BPI Technology, Inc., Freezing Machines, Inc., Plaintiffs: Dan K. Webb, PRO HAC VICE, J. Erik Connolly, PRO HAC VICE, Nicole E. Wrigley, PRO HAC VICE, Terry Grimm, PRO HAC VICE, Winston & Strawn, LLP, Chicago, IL; Daniel L. Hartnett, Crary Huff Ringgenberg Hartnett & Storm, P.C., Dakota Dunes, SD.

For American Broadcasting Companies, Inc., ABC News, Inc., Diane Sawyer, Jim Avila, David Kerley, Defendants: Carl Rowan Metz, PRO HAC VICE, Dane Hal Butswinkas, PRO HAC VICE, James Michael McDonald, PRO HAC VICE, Kevin Taylor Baine, PRO HAC VICE, Stephen Joseph Fuzesi, PRO HAC VICE, Williams & Connolly LLP, Washington, DC; Ronald A. Parsons, Jr., Scott N. Heidepriem, Shannon Falon, Johnson, Heidepriem & Abdallah, LLP, Sioux Falls, SD.

For Gerald Zirnstein, Carl Custer, Defendants: Edwin E. Evans, Davenport, Evans, Hurwitz & Smith, Sioux Falls, SD; Elizabeth S. Hertz, Vincent M. Roche, Davenport, Evans, Hurwitz & Smith, LLP, Sioux Falls, SD; William D. Marler, PRO HAC VICE, Marler Clark, LLP, Seattle, WA.

For Kit Foshee, Defendant: Alex M. Hagen, Steven W. Sanford, Cadwell, Sanford, Deibert & Garry, LLP, Sioux Falls, SD; Daniel M. Twetten, PRO HAC VICE, Elizabeth C. Wang, PRO HAC VICE, Loevy & Loevy, Chicago, IL.

OPINION

Page 937

ORDER GRANTING PLAINTIFFS' MOTION TO REMAND

KAREN E. SCHREIER, UNITED STATES DISTRICT JUDGE.

Plaintiffs Beef Products, Inc. (BPI), BPI Technology, Inc. (BPI Tech), and Freezing Machines, Inc. (FMI) (collectively, " plaintiffs" ) originally brought this action on September 13, 2012, in the Circuit Court of Union County, South Dakota. Defendants [1] removed the action to this court on

Page 938

October 24, 2012, on the basis of diversity jurisdiction. Docket 1 at 2. Plaintiffs now move to remand this action back to the Circuit Court of Union County, South Dakota, arguing that diversity jurisdiction does not exist. Defendants resist the motion and simultaneously move to dismiss all claims asserted by BPI Tech and FMI, arguing that they are not real parties in interest. For the following reasons, the court grants plaintiffs' motion to remand.

BACKGROUND

BPI is in the business of producing, distributing, and selling lean beef products and is incorporated in Nebraska. BPI Tech is in the business of developing technology and processing mechanisms for producing meat products from raw materials and provides technological support, sales and marketing services, and administrative services in connection with the sale of lean beef products. BPI Tech is incorporated in Delaware. FMI is in the business of developing equipment, systems, recipes, and processing mechanisms used in the production of meat products and also owns patents on equipment used in preparing lean beef products. FMI is also incorporated in Delaware. All three plaintiffs are involved with the production of lean finely textured beef (LFTB). [2] BPI, BPI Tech, and FMI are all owned by the Roth family.

Of the named defendants in this action, the most relevant for purposes of this motion are American Broadcasting Companies, Inc. and ABC News, Inc. Both of these defendants are in the news business, and both are incorporated in Delaware.

In the spring of 2012, defendants published a series of news reports about LFTB. Plaintiffs claim that these news reports included false and disparaging statements about LFTB as well as false and disparaging statements about each plaintiff. Plaintiffs also claim that they each ...


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