Kentucky tobacco farmers file class action against purchaser for breach of contract

Posted on: April 29th, 2011 by Steve Larson

Several Kentucky farmers have filed a class-action lawsuit against a leading tobacco merchant they say failed to honor contracts to purchase burley tobacco from them at the end of the 2010 crop year.  The lawsuit, which was filed against Universal Leaf North America last week in Harrison Circuit Court, says hundreds of farmers have lost what amounts to millions.

Universal Corporation, which is based in Richmond, Va., is the world’s leading tobacco merchant and processor, the lawsuit said. Universal Corporation is the parent company of ULNA, which is based in Nashville, N.C., and registered to do business in Kentucky.

The complaint alleges that Universal Leaf unilaterally decided to forgo the inspection process and almost universally rejected the tobacco that it had contracted tobacco producers to deliver to the Cynthiana, Kentucky receiving station.