Pilgrim’s Pride recently decided to settle a price-fixing lawsuit for $75 million.
Pilgrim’s Pride has been at the center of price-fixing lawsuits for years and recently decided to pay about $200 million in settlements and fines. Of that $200 million, $75 million is being set aside for a civil settlement.
According to a press release about the matter, “restaurant chains, including Chik-fil-A, as well as grocery stores, CPG companies and food distributors have filed civil suits making antitrust accusations against chicken processors in recent years.” It’s important to note that this case will not settle every complaint against the company because there are still pending suits filed by restaurant chains and supermarkets. That said, more settlements of this kind are expected in the future.
The price-fixing accusations were originally filed in 2019 and affected the entire industry. Even though the accusations were unveiled in 2019, the complaints went back years. For example, The U.S. Justice Department got involved in a 2016 price-fixing lawsuit “that accused chicken producers — including Pilgrim’s, Perdue Farms, Tyson Foods, and Sanderson Farms — of conspiring to inflate prices.” From there, the DOJ subpoenaed Tyson, Pilgrim’s, Sanderson, and other poultry producers.
Pilgrim’s Pride is the second-largest chicken producer in the country. In agreeing to pays the recent settlements and fines, it is showing that it is willing to work hard to move forward from the accusations. Over the last year, the company was in the news a lot regarding these allegations. Just last year, “the company’s previous two CEOs were among 10 poultry producer officials indicted on price-fixing charges.” Jayson Penn, the most recent CEO, was indicted in June. In September, he was permanently replaced with then CFO Fabio Sandri.
Around the same time, the coronavirus pandemic was raging across the country, causing “hardship among meat companies, many of which had spent hundreds of millions on precautions in plants.” Many are also “facing lawsuits for wrongful death among its workers.” That said, having to shell out money for fines and settlements isn’t ideal, but doing so will help rid the company “of a probe that has continued to haunt it” for years. In fact, the company is hoping it could be the strategic move that allows it to move on without having to admit wrongdoing.
Over the years, antitrust accusations have only escalated. Because of this, other chicken processors and meat processing facilities will likely step forward to offer settlements. It’s important to note that price-fixing lawsuits don’t just affect the chicken industry. In fact, JBS recently agreed to a settlement, ending a lawsuit that accused the company of “fixing pork process for direct purchasers through conspiring with other meat processors.“
Sources:
Pilgrim’s Pride and Tyson submit price-fixing settlements for chicken buyers
Pilgrim’s Pride, Tyson Foods settle some chicken price-fixing litigation
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