Pacific Seafood cancels deal

notforsale

Pacific Seafood Group announced Tuesday it has canceled plans to acquire Ocean Gold Seafoods, citing a legal challenge from commercial fishermen who allege the purchase would expand Pacific Seafood’s monopoly power over the groundfish, whiting and coldwater shrimp markets.

A federal judge granted the fishermen a temporary restraining order to block the acquisition of the Westport, Wash., fish processing plant and scheduled a hearing for early February.

In a motion to dismiss the lawsuit, attorneys for Pacific Seafood told the U.S. District Court in Medford that a proposed stock purchase agreement with Ocean Gold “is dead and gone — it is no more.”

“Given the time-consuming and costly objections being raised by outside parties, we’ve chosen to terminate plans to acquire Ocean Gold,” Daniel Occhipinti, Pacific Seafood’s general counsel and director of government affairs, said in an email. “We want to invest our energy in creating opportunities for our fishermen and local team members — not spending our energy on frivolous, discredited litigation and lawyers.

“Pacific Seafood remains committed to working with our partners and friends at Ocean Gold to grow the seafood industry in the Westport community.”

Michael Haglund, a Portland attorney representing the fishermen, including Dennis Rankin of Rankin Fish in Astoria, said Wednesday that the fishermen would press forward with the lawsuit.

“They’re not willing to stipulate that they won’t acquire Ocean Gold,” he said. “They’re just saying the transaction is terminated for now.

“And we believe that we’re entitled to an injunction against them acquiring Ocean Gold or tying up Ocean Gold in an exclusive contract or any sort of other mechanism that’s designed to maintain the control that they’ve had over them for 15 years, and which expires in February, in just a year.”

Pacific Seafood, a dominant fish processor and distributor based in Clackamas, has an exclusive marketing agreement with Ocean Gold — among the largest fish processors on the West Coast — that runs through February 2016. Frank Dulcich, Pacific Seafood Group’s president and chief executive officer, also has significant stock in Ocean Gold.

“We’re very disappointed that this great opportunity for Ocean Gold, its employees, our community and my family will not proceed,” Mark Rydman, the president of Ocean Gold Seafoods, said in a statement.

“It is disheartening that a Portland law firm and some fishermen that do not deliver to us, most of whom I’ve never heard of, can affect the Ocean Gold family this way. At the end of the day it’s not about big corporations, it’s about the people this directly affects. Ocean Gold will continue to support our fishermen, employees and community as we have the past 20 years.”

Fishermen had filed a previous class-action lawsuit against Pacific Seafood alleging monopoly business practices that ended in a 2012 settlement. Pacific Seafood agreed to take steps to improve competition, which included not extending the exclusive marketing agreement with Ocean Gold beyond February 2016.

Haglund has suggested in the latest federal antitrust challenge that Pacific Seafood would not rebuild a fish processing plant that burned down in Warrenton in 2013 if it acquired Ocean Gold.

But Occhipinti has insisted that Pacific Seafood, which is leasing space from the Port of Astoria at Tongue Point, is committed to rebuilding in Warrenton.

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