On March 22, 2021, the Honorable Thomas M. Durkin for the United States District Court for the Northern District of Illinois granted preliminary approval to a $104 million settlement with four poultry producers, Tyson Foods, Fieldale Farms, Peco Foods and George's Inc., to resolve consumer claims that the broiler producers, including Tyson Foods. Inc., Pilgrim’s Pride Corporation, Sanderson Farms, Inc., Perdue Farms, Inc., Koch Foods, Inc. conspired to inflate the price of chicken, and that Agri Stats, Inc.— a third party vendor for the broiler producers — knowingly facilitated their unlawful scheme.
Consumers who purchased broiler chickens (i.e., chickens raised, processed and sold for meat consumption) further allege that as a result of the defendants’ conduct, broiler prices increased significantly since 2008. The scheme resulted in record profits for the defendants at the consumers’ expense.
Litigation continues against other defendants.
The defendants control nearly 90% of broiler chicken market, which was valued at $28.7 billion in 2015. The complaint alleges that, at least as early as January 1, 2008, the defendants conspired to reduce the supply of broiler chickens, in part by reducing the size of their breeder flocks (which lay the eggs that are raised into broiler chickens). The defendants also conspired to manipulate the Georgia Dock Broiler Price Index, which was published by the Georgia Department of Agriculture.
Agri Stats helped the broiler-producer defendants coordinate their supply restriction conspiracy and enforce their unlawful agreement. Agri-Stats provided vast amounts of competitively sensitive pricing and production information from the Defendants on a weekly and/or monthly basis. While Agri Stats ostensibly used this data to produce a report describing general trends in the broiler industry, the Agri Stats reports provided such detailed information about the broiler producers’ businesses and facilities that the broiler producers could easily identify one another’s costs and prices. The Agri Stats reports thereby allowed the broiler-producer defendants to monitor one another and make sure that they were sticking to their agreement to restrict broiler supply and raise prices.
On September 16, 2016, Cohen Milstein filed a putative class action antitrust complaint on behalf of consumers who purchased broiler chickens (i.e., chickens raised, processed and sold for meat consumption). Cohen Milstein filed an amended complaint with lead counsel on February 7, 2018.
On June 21, 2019, the U.S. Department of Justice filed a motion to intervene and stay discovery for six months in order to protect a grand jury’s investigation. The Court granted a partial stay of nine months. Later in June, the DOJ announced the indictment of four poultry executives, including the sitting president and CEO of Pilgrim's Pride and the president of Claxton Poultry, followed in October by the indictment of six more individuals. Pilgrim's Pride Corp. entered a guilty plea and in February 2020, was sentenced to pay a criminal fine of over $100 million. As of May 2021, the DOJ has indicted 10 total defendants. Pilgrim's Pride then entered a plea agreement with the DOJ, saying it would pay a penalty of more than $110.5 million and co-operate with the investigation. The criminal case is U.S. v. Penn et al., No. 1:20-cr-00152, U.S. District Court for the District of Colorado.
The civil case name is: In re Broiler Chicken Antitrust Litigation, Case No. 1:16-cv-08637 TMD, U.S. District Court, District of Illinois, Eastern Division.