A judge in the US has ruled turkey product suppliers such as Tyson Foods and Hormel Foods must face claims they conspired with other poultry processors to increase prices.
The claim has been brought by an “indirect purchaser of turkey products”, which alleges illegal exchanges were made of “competitively sensitive” information, in violation of the Sherman Act, between US turkey suppliers and Agri Stats Inc., a data supplier and advisory group in Indiana.
Go deeper with GlobalData
As a result, the plaintiff claims it was forced to pay higher prices for turkey products and has consequently filed antitrust claims, not only against Tyson and Hormel, but also a host of other suppliers and their affiliates: Cargill, Butterball, Foster Farms, Perdue Farms, Kraft Heinz, Cooper Farms, House of Raeford Farms and Farbest Foods.
While the group of defendants has moved to dismiss the claims, a federal judge in Chicago, Virginia Kendall, has denied the joint motion regarding the antitrust claims. Kraft Heinz filed its own separate motion, which has been granted because the food giant does not produce turkey products, and therefore “cannot be a member of the alleged conspiracy”.
“The turkey integrator defendants each entered into an agreement from at least 2010 to January 1, 2017, to exchange sensitive information through Agri Stats regarding their production and sales of turkey,” a court document dated 26 October read.
It continued: “Turkey is the relevant product market and the geographic market is the continental United States. Defendants and co-conspirators collectively controlled approximately 80 percent of the overall market share for turkeys during the Class Period. Each one of the defendants and co-conspirators entered into an agreement to exchange information through Agri Stats, as shown in a 2010 excerpt from an Agri Stats presentation.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalData“The alleged information exchanged by Agri Stats is current and forward-looking, it is specific to the turkey producers, including information on profits, prices, costs and production levels, and none of the information was publicly available.”
Tyson Foods gave a response to just-food via its turkey business Jennie-O Turkey Store.
A spokesperson said: “Jennie-O Turkey Store is one of the most respected companies in the food industry. We are disappointed by the decision and disagree with it, however, we look forward to the opportunity to vigorously defend and prove our case.”
Butterball commented via a spokesperson: “We are aware of the recent ruling, though as a matter of policy we do not comment on active litigation.”
Cargill, meanwhile, said it had nothing to add, while House of Raeford Farms declined to comment. A spokesperson for Perdue Farms said “we do not comment on pending litigation”.
just-food has also contacted the other companies at the centre of the lawsuit for comment.
