Cattlemen affected by Plainville bankruptcy likely in for long wait


By Christina Janney, Hays Post (KS)

April 13, 2019


The Cattlemen affected by the bankruptcy of the Plainville Livestock Commission should receive most of their money back, but it could be months more before they see any of their money.


In early February, the Plainville Livestock Commission issued checks to more than 40 producers for sale of their cattle.


On Feb. 12, Almena Bank froze two of Plainville Livestock Commission’s bank accounts. When the bank froze the accounts, tens of thousands of dollars worth of checks owner Tyler Gillum had written to area ranchers who had recently sold cattle at the Plainville Livestock Commission bounced.


On March 1, the Plainville Livestock Commission filed for bankruptcy.


The Rooks-Phillips County Extension hosted Roger McEowen, Kansas Farm Bureau professor of law and taxation at the Washburn School of Law, Friday in Stockton to talk about the process of recovering funds for cattlemen after the bankruptcy of a livestock market agent.


The cattlemen’s money is protected under the Packers and Stockyards Act.


The market agency is supposed to hold funds from the sale of cattle in a custodial account until all the sellers are paid. Someone allegedly transferred the money in the custodial account into the Plainville Livestock Commission’s general operating account, according to court records.


At that time, the bank holding the funds, Almena Bank, froze the Livestock Commission’s accounts.


McEowen said in a bankruptcy filing the unpaid cattlemen’s claims take priority over other creditors in accordance with the Packers and Stockyards Act.


There are deadlines to file claims under the Packers and Stockyards Act. Cattlemen can bring a reparation proceeding within 90 days of the sale. They need to file the proceedings with Secretary of Agriculture through the Grain Inspection Packers and Stockyards Administration, which is within the USDA’s Ag Marketing Service. There are specific forms available through the GIPSA to file the action.


“This is a process that is going to take months,” he said.


GIPSA does not have enforcement authority. If GIPSA finds a cattleman is owed money, the cattleman has to have the payment enforced by federal court or a district court that has jurisdiction within a year.


“The point is, if you understand the process, you are going to understand how long this is going to take to shake out,” McEowen said. “The cattlemen will get paid, maybe not 100 percent of their claim. They will be paid something, but it is not going to be tonight. It is not going to be tomorrow or next week. It is going to take some time.”


The impact on the community is going to be great. For every dollar that the cattlemen are owed in this case, that equals $3 to $4 that is not available to be cycled through the local economy, he said.


In this case, it equals millions of dollars.


“We don’t want the cattlemen to fail. They are going to get paid. We want them to get back on their feet at some point in time,” McEowen said. “Probably...