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STATE OF SOUTH DAKOTA ) IN CIRCUIT COURT :SS COUNTY OF UNION ) FIRST JUDICIAL CIRCUIT BEEF PRODUCTS, INC., BPI ) CIV# 12 - _______ TECHNOLOGY, INC. and FREEZING ) MACHINES, INC., ) ) Plaintiffs ) ) vs. ) COMPLAINT AND JURY DEMAND ) AMERICAN BROADCASTING ) COMPANIES, INC., ABC NEWS, INC., ) DIANE SAWYER, JIM AVILA, ) DAVID KERLEY, GERALD ) ZIRNSTEIN, CARL CUSTER, and KIT ) FOSHEE, ) ) Defendants ) TABLE OF CONTENTS Page NATURE OF THE ACTION ..........................................................................................................1 PARTIES .......................................................................................................................................10 I. Background Regarding Plaintiffs ...........................................................................10 II. Background Regarding Defendants .......................................................................11 JURISDICTION & VENUE ..........................................................................................................13 ALLEGATIONS ............................................................................................................................14 I. Background on Ground Beef and LFTB ................................................................15 A. The Process of Making Ground Beef before LFTB...................................15 B. The Process of Producing LFTB for Ground Beef ....................................16 C. LFTB as a Lean Beef Source for Ground Beef ..........................................19 D. The USDA’s Approval of LFTB and BPI’s Process .................................20 1. The USDA’s 1991 Approval of Fat Reduced Beef .......................20 2. The USDA’s 1993 Approval of Lean Finely Textured Beef .........21 3. The USDA’s 2001 Approval of the Ammonium Hydroxide Process ...........................................................................................23 E. BPI’s Commitment to Producing a Safe and Nutritious Lean Beef ..........24 II. BPI’s Success Prior To Defendants’ Disinformation Campaign And Interference ............................................................................................................26 A. High Demand Fuels BPI’s Expansion .......................................................27 B. Additional Benefits of LFTB for the Environment and Consumers ..........27 III. ABC’s Opening Attack Against BPI and LFTB ....................................................28 A. April 2011 “Food Revolution” Episode on LFTB .....................................28 B. AMI Informs ABC of False and Defamatory Statements ..........................30 C. ABC’s Reaction to its Broadcasting of False and Defamatory Statements ..................................................................................................31 i IV. Overview of Defendants’ Disinformation Campaign Against BPI and LFTB ......................................................................................................................32 A. Defendants Convinced Consumers They Were Providing “Facts” About BPI and LFTB .................................................................................32 1. ABC Defendants Promoted Themselves as Reporters of “Facts”............................................................................................32 2. ABC Defendants Promoted Their “Sources” as Providers of “Facts”............................................................................................34 3. ABC Defendants Proclaimed They Reported “Facts” About BPI and LFTB ................................................................................35 B. Duration and Scope of Defendants’ Disinformation Campaign ................36 C. Primary Themes of Defendants’ Disinformation Campaign .....................36 D. Overview of Consumer Reaction to Defendants’ Disinformation Campaign ...................................................................................................38 E. Overview of Defendants’ Actual Malice ...................................................40 1. Information Provided or Made Available to the Defendants .........40 2. Other Facts Demonstrating Defendants Knowingly or Recklessly Published False Statements .........................................48 3. Defendants’ Actions Before, During, and After the Disinformation Campaign Demonstrate Their Intent to Injure BPI and LFTB .....................................................................52 V. Defendants Intentionally Maligned BPI and LFTB by Describing LFTB as “Pink Slime” ..........................................................................................................53 A. Defendants’ Campaign to Recast and Rename LFTB as “Pink Slime” ........................................................................................................53 B. Defendants’ False Statements Were Intended to Create a Consumer Backlash .....................................................................................................58 C. Defendants’ Statements Were False and Defendants Acted with Actual Malice .............................................................................................59 VI. Defendants Falsely Stated and Implied that LFTB Was Not Meat or Beef ...........62 A. Defendants’ Campaign to Convince Consumers LFTB Was Not Meat or Beef ..............................................................................................62 ii B. Defendants’ False Statements Were Intended to Create a Consumer Backlash .....................................................................................................66 C. Defendants’ Statements Were False and Defendants Acted with Actual Malice .............................................................................................67 1. Defendants Knew LFTB Is Beef and Meat....................................67 2. Defendants Knew LFTB Was Not a Filler or Substitute ...............69 3. Defendants Knew LFTB Was Not A Gelatin Made From Connective Tissues ........................................................................71 VII. Defendants Falsely Stated and Implied that LFTB Was Not Safe for Public Consumption ..........................................................................................................72 A. Defendants’ Campaign to Convince Consumers that LFTB Was Not Safe for Consumption .........................................................................73 B. Defendants Falsely Claimed LFTB Was Not Safe for Consumption to Create Consumer Backlash ....................................................................77 C. Defendants’ Statements Were False and Defendants Acted with Actual Malice .............................................................................................78 1. Defendants Knew LFTB Was a Safe Product................................78 2. Defendants Knew BPI’s Beef Trimmings Were Safe ....................81 3. Defendants Knew BPI’s Ammonium Hydroxide Process Was Safe ........................................................................................85 4. Defendants Knew BPI Did Not “Simmer” or “Cook” Beef Trimmings ......................................................................................88 VIII. Defendants Falsely Stated and Implied that LFTB Was Not Nutritious ...............90 A. Defendants’ Campaign to Convince Consumers LFTB Was Not Nutritious ...................................................................................................90 B. Defendants Falsely Claimed LFTB Was Not Nutritious to Create Consumer Backlash ...................................................................................95 C. Defendants’ Statements Were False and Defendants Acted with Actual Malice .............................................................................................96 IX. Defendants Falsely Stated and Implied that BPI Engaged in Improper Conduct with the USDA ......................................................................................100 A. Defendants’ Campaign to Convince Consumers that BPI Improperly Influenced the USDA ............................................................100 iii B. Defendants’ False Statements Were Intended to Create a Consumer Backlash ...................................................................................................102 C. Defendants’ Statements Were False and Defendants Acted with Actual Malice ...........................................................................................103 X. Defendants’ Disinformation Campaign Misled Consumers and Created Unwarranted Backlash Against BPI and LFTB ...................................................106 XI. The ABC Defendants Tortiously Interfered with BPI’s Business Relationships with Its Customers.........................................................................112 A. BPI Had Business Relationships with Grocery Store Chains and Ground Beef Processors ...........................................................................113 B. The ABC Defendants’ Interference with BPI’s Business Relationships ............................................................................................115 C. The ABC Defendants’ Conduct Destroyed Many of BPI’s Business Relationships with Grocery Store Chains and Ground Beef Processors ................................................................................................121 1. The ABC Defendants’ Interference with BPI’s Business Relationships with Grocery Store Chains ....................................121

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