United Potato’s bright start shines less brightly

01/06/2012 08:48:00 AM
Andy Nelson

In the first week of December, Jerry Wright, United Potato’s first chief executive officer, returned to the top job, succeeding Lee Frankel. 

The circumstances of Frankel’s departure remain murky. Dave Warsh, United Potato’s board chairman, praised Frankel but said “I don’t know to characterize” the terms of his departure.

A nondisclosure agreement prevents Frankel from commenting.

Meanwhile, on the very day Wright took the reins from Frankel, a judge in Idaho dealt a potentially serious blow to United Potato’s very existence.

In a midtrial ruling in a case involving United Potato and several of its member companies, U.S. District Court judge Lynn Winmill ruled that the Capper-Volstead Act does not protect United Potato Growers of America from charges it illegally reduced the supply of potatoes in order to raise prices.

United Potato has argued that its practice of limiting U.S. potato acreage in order to strengthen markets is protected under the Capper-Volstead Act, which provides agricultural cooperatives limited exemption from federal antitrust laws.

Wright and Randon Wilson, a Salt Lake City-based attorney who has helped found several agricultural co-ops, including United Potato, and who provides outside counsel to the co-op, were quick to point out that Winmill’s opinion did not settle the case, but only came in response to United Potato’s motion to dismiss.

They were confident the judge’s mind would be changed on the issue before trial’s end.

That remains to be seen. What isn’t in doubt is that United Potato, which got off to such a great start after its creation in 2005, faces a much less certain future.


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