Discuss as:

'Pink slime' report sparks $1.2 billion lawsuit against ABC News

LINCOLN, Neb. - Beef Products Inc. has filed a defamation lawsuit against ABC News for its coverage of a meat product that critics dubbed "pink slime," alleging the network misled consumers to believe the product is unhealthy and unsafe.

The Dakota Dunes, S.D.-based company is seeking $1.2 billion in damages for roughly 200 "false and misleading and defamatory" statements about the product. The lawsuit, filed in a South Dakota court Thursday, also accuses ABC News of improper interference with the relationships between BPI and its customers.

BPI attorney Dan Webb says the reports led consumers to believe the beef is not meat, but an unhealthy slime unfit for human consumption.
ABC News senior vice president Jeffrey W. Schneider says the lawsuit has no merit. ABC News is owned by The Walt Disney Co.

Beef Products is the largest U.S. producer of a lean ground beef filler made from fatty trimmings. The trimmings are sprayed with ammonia to kill bacteria.

While the filler has long met federal food safety standards, critics have questioned its safety, and companies such as McDonalds Corp and supermarket chain Safeway Inc stopped buying the product.

Beef Products this year shut three of its four plants and eliminated about 650 jobs, blaming the media furor for the cuts.

The Associated Press and Reuters contributed to this report.

More money and business news:

Follow NBCNews.com business on Twitter and Facebook