New Price-fixing Suit Aimed at Big 4 Beef Packers

New Price-fixing Suit Aimed at Big 4 Beef Packers

Russell Nemetz
Russell Nemetz
America’s Big 4 packing companies are the target of new price-fixing allegations from a group of small food distributors. Those distributors filed suit Oct. 9 in the U.S. District Court for the Northern District of Illinois, accusing the packers fixed prices for years.

The plaintiffs allege that beginning at least by January 1, 2015, Cargill, JBS USA, Tyson Foods, and National Beef Packing Co., “exploited their market power in this highly concentrated market by conspiring to limit the supply of beef sold to purchasers in the U.S. wholesale market, including Plaintiffs, which resulted in higher prices paid by Plaintiffs.”

The distributors said the alleged scheme caused financial harm at least through the end of 2021.

“As a result, Plaintiffs paid higher prices for beef than they otherwise would have paid in a competitive market,” states the lawsuit, seeking relief under the Sherman Antitrust Act.

Allegations by the four small distributors are similar to other suits filed against the Big 4 that have led to settlements in the tens of millions of dollars and led to scrutiny by the Department of Justice and Congress.

The lawsuit cites beef plant production data and price fluctuations, as well as testimony from two inside witnesses with knowledge of company agreements to help each other manage output.

The distributors are seeking a jury trial for unspecified damages and a permanent injunction.

In August, antitrust claims against the Big 4 by a group of ranchers was dismissed. A federal judge in Minnesota dismissed the claims filed by a putative class of cattle ranchers in a long-running case that alleged an industry-wide scheme to fix prices.

Source: Drovers

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