Lewis, a dairyman, was a member of the Mountain Empire Dairymen’s Association (MEDA). MEDA was…

Lewis, a dairyman, was a member of the Mountain Empire Dairymen’s Association (MEDA). MEDA was the exclusive agent for marketing Lewis’s dairy products. Lewis borrowed $194,850 from MidStates Sales and secured the loan with certain of his cattle and their products. Lewis assigned his right to receive some of the proceeds from the sale of hismilk each month to Mid-States, and notified MEDA of the assignment. After paying Mid-States for over a year under this agreement, MEDA received notice from Lewis that he was canceling his membership in MEDA. MEDA notified Mid-States and other assignees of Lewis that Lewis was canceling his membership, and asked them to sign a release of assignment. The other assignees signed the releases, but Mid-States did not. MEDA made the last payout on the milk it sold for Lewis directly to Lewis rather than to Mid-States. After Lewis filed for bankruptcy, Mid-States sued MEDA for the payment. Will it prevail?

 

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