An Idaho meat processor is accused of failing to pay for $2 million worth of culled dairy cows sent to the company for slaughter last year.

A federal lawsuit filed by three dairy farms — Dry Creek Dairies and Idaho Magic Milk of Twin Falls, Idaho, and Washington Agri-Investments of Yakima, Wash. — claims Intermountain Packing of Idaho Falls “dishonored” checks it had issued for the livestock.

The complaint alleges that Intermountain Packing agreed to pay the dairies $1.03-$1.10 per live weight pound of cattle, which were delivered to its facility in six shipments between September and November of 2023.

The meat processor has also refused to buy an additional 528,000 pounds of cattle for $0.33 per pound as previously agreed, resulting in more than $174,000 in lost sales for the dairies, according to the lawsuit.

“Despite repeated demands, Defendants have failed, neglected and refused to pay Plaintiffs for the livestock delivered by Plaintiffs to Defendants or any amount for the damages caused by failing to fulfill its obligations to purchase Plaintiffs’ livestock,” the complaint said.

Intermountain Packing has not responded to several requests for comment on the allegations.

The company was formed in 2020 after several ranchers and investors decided to start their own $20 million cattle and bison slaughterhouse, owing to the limited capacity and rising cost of other processing options. The facility has been inspected by USDA since 2022.

The plaintiffs allege the meat processor’s CEO, David Adams, wrote three “post-dated checks” to pay for the cattle last year but then invalidated them with “stop payment” orders.

“Defendant David Adams knew or should have known his representations were false and that Plaintiffs would rely on his representations to their detriment,” the complaint said.

According to the lawsuit, Adams said the money for cattle payments would become available once members of Intermountain Packing made “capital contributions” to the company, with these “misrepresentations” persuading the dairies to continue shipping livestock.

“Defendant David Adams knew his statements were false and he intended for Plaintiffs to rely on his statements in that he was intentionally trying to delay Plaintiffs seeking remedies under the law,” the complaint said.

The plaintiffs have requested a jury trial in Boise before Senior U.S. District Judge Lynn Winmill, alleging that Intermountain Packing’s actions represent fraud, contract breach and unjust enrichment for which the dairies are owed more than $2 million in compensation and litigation expenses.

The plaintiffs also claim the meat processor violated the Packers and Stockyards Act, a national law meant to protect livestock sellers, by failing to promptly pay for the catlle and not keeping accurate records.

A spokesperson for the USDA said the agency is “aware of producers’ complaints regarding Intermountain Packing” but is “unable to provide additional information or comment on investigative activity.”