Above photo: MDGov Pics.
Emboldened by a recent US Supreme Court decision, Perdue Farms contends the Labor Department’s whistleblower review process is unconstitutional.
Poultry manufacturer Perdue Farms Inc. sued the United States Labor Department and whistleblower Craig Watts, who has pursued litigation through the department’s administrative process for nearly a decade. The corporation now maintains that this administrative process is unconstitutional.
“Their suit could demolish whistleblower protections across issues [including] food safety, railroad and aviation safety, shareholder fraud, and environmental protection,” warned the Government Accountability Project (GAP), which represents Watts, a former Perdue chicken grower.
Administrative proceedings in Watts’ case were previously scheduled to begin on April 14, 2025.
On June 27, the U.S. Supreme Court issued a 6-3 decision against the U.S. Securities and Exchange Commission (SEC) and its regulatory authority to penalize securities fraud. The court held that the SEC’s in-house tribunal violated the Seventh Amendment “right to a trial by jury.”
Justice Sonia Sotomayor wrote the dissenting opinion against the majority, which she said upended “longstanding precedent” by asserting that Congress may not assign “public-rights matters” to agencies for review without coming to the judicial branch.
“[Congress] has enacted more than 200 statutes authorizing dozens of agencies to impose civil penalties for violations of statutory obligations,” Sotomayor recalled. “Congress had no reason to anticipate the chaos today’s majority would unleash after all these years.”
Perdue seized upon the decision by the Supreme Court (known as Jarkesy) and submitted a counter-lawsuit on August 23 in the U.S. District Court for the Eastern District of North Carolina.
In the filing, the poultry manufacturer proclaims that Watts’ claim of whistleblower retaliation under the Food Safety Modernization Act (FSMA) implicates “private rights” and must be “adjudicated” in a U.S. court. “Adjudicating those rights in an Article I tribunal violates Article III and the separation of powers vesting the judicial power exclusively in the judicial branch.”
Perdue further contends that the FSMA violates the “nondelegation doctrine of the constitutional separation of powers” because it grants a whistleblower the right to pursue claims in a U.S. court, even after administrative judges rule against the whistleblower.
The corporation insists that administrative judges are “doubly insulated” from removal by a U.S. president, which is unconstitutional. They believe that their “due process” rights have been violated by a lack of “basic procedural protections, such as the right to subpoena third parties for testimony and mandatory application of the Federal Rules of Evidence.”
GAP executive director Louis Clark responded, “Perdue Farms is trying to destroy a carefully constructed framework designed over decades to provide accessible justice for whistleblowers who almost always lack the resources for expensive lawsuits in federal court.”
“If Perdue’s claim holds, the case will effectively dismantle the administrative process that has long provided accessible justice for whistleblowers under FSMA, the Railroad Safety Act, the Sarbanes-Oxley Act, and over two dozen similar laws,” the Government Accountability Project added.
In 1980, an anti-retaliation provision was added to the Railroad Safety Act to protect railroad workers. The Sarbanes-Oxley Act was passed in 2002 after major corporate criminal scandals involving Enron and WorldCom.
Following a spate of foodborne illnesses in the 2000s, the FSMA was adopted in 2011 and included a section intended to protect employees of companies engaged in “manufacturing, processing, packing, transporting, distributing, receiving, holding, or importing food” from retaliation that may potentially violate agricultural law.
According to GAP, in 2014, Watts was concerned [PDF] that Perdue was growing chickens in “poor conditions” that increased the “chickens’ risk of contamination or infection with salmonella, e-coli, and other bacteria, thereby rendering them a threat to consumers who purchase and eat them.” He allegedly observed “an increase in the number of chicks placed on his farm carrying bacterial infections.”
He further claimed that Perdue failed to control sanitation in the hatcheries to “prevent birds from developing infections” and that the corporation was failing to prevent the “spread of diseases among the flocks placed on his farm.” Plus, Perdue allegedly crowded “too many birds into each house,” which increased the risk of infection.
Watts objected to the “cage free” and “humanely raised” labels that Perdue put on their products and invited a group of individuals affiliated with Compassion in World Farming to record footage of conditions and share video.
After trying to expose Perdue’s practices, the corporation allegedly retaliated by deploying staff to Watts’ farm to complete what GAP’s Food Integrity Campaign described as a “surprise animal welfare audit, the first he had ever received in his 22 years of raising chickens.”
Perdue ramped up unannounced checks of his farm. Watts was forced to go through training before the corporation would send him another flock to raise.
As Watts told the Charlotte Observer in North Carolina, “I was a model grower. Now all of a sudden I was a bad apple.” He quit growing chickens for Perdue about a year later.
Perdue blames Watts for raising chickens in conditions that they helped create. The corporation disingenuously recalls in their counter-lawsuit, “After Perdue learned of the terrible manner in which Watts raised the chicks, it took remedial action to ensure that Watts would take proper care of the chicks entrusted to him.”
Watts has spoken out against what he sees as “price fixing” by Perdue. “There’s a sense of hopelessness among farmers. Half a million dollars worth of debt makes a man very agreeable so they’re not going to rock the boat too much.” (A handful of corporations control 90 percent of the poultry market.)
Should Perdue succeed in unraveling an administrative process for whistleblowers, Clark worries that workers will be stripped of their rights to disclose information that is vital to protecting the public’s health and safety, and it will leave millions of workers even more vulnerable to retaliation.
About a week before the lawsuit, Perdue recalled over 167,000 pounds (75,750 kilograms) of “ready-to-eat chicken breast nugget and tender products.” The U.S. Department of Agriculture’s Food Safety and Inspection Service said there was a “high risk” of a health hazard due to contamination from pieces of metal.