USA- Smithfield Foods has agreed to pay US$75 million to resolve the most recent case of price-fixing, which involved millions of indirect consumer buyers according to a motion filed in Minnesota federal court.
The case was brought by customers who claimed the meat producer and several rivals colluded to raise costs by limiting supply in the US$20 billion-a-year U.S. pork market.
The settlement follows a US$20 million settlement reached by meat giant JBS earlier this month, which was also a settlement to consumers.
The pork producer reached agreements worth US$42 million with restaurant operators and caterers earlier this year and an US$83 million settlement with direct buyers in 2021.
In 2018, several plaintiffs filed a class-action lawsuit against a few pork producers, alleging that they conspired to raise the price of goods including ham and bacon.
According to the lawsuit, they achieved this by coordinating output, regulating production, and sharing confidential data on price, capacity, sales volume, and demand with the aid of agricultural research firm Agri Stats, Inc.
Seven additional pork producers, including Tyson Foods and Hormel, have not consented to settlements.
The Smithfield and JBS agreements, according to the court, will “bolster” consumer claims made against the defendants who refused to pay.
Indirect consumer purchasers who bought pork products from a retailer such as a grocery shop or club store presently make up 17.6 million of the settlement group.
The court predicted that the number would rise if it obtains consumer data from Costco and Sam’s Club.
Each consumer who qualifies for compensation from the settlement will receive a notification via email, and they can submit a claim on the website overchargedforpork.com.
The Biden administration and lawmakers are taking a tougher stance on alleged anticompetitive activities during this period of rising food inflation.
But the issue of potential price fixing and federal government attention to executives is not limited to pork.
There are also pending civil lawsuits about accusations of price fixing in the chicken and beef sectors.
Both have recently come under additional scrutiny as prices have increased and a few major players have dominated the markets.
By agreeing to cooperate with the Justice Department, Tyson and Pilgrim’s Pride were granted immunity from criminal prosecution while Koch Foods and Claxton Poultry are being investigated.
Currently, their trial is slated to take place in April 2023. Additionally, food service businesses, CPG producers, and retailers have brought civil actions accusing chicken companies of manipulating their prices.
The Biden administration and lawmakers are taking a tougher stance on alleged anticompetitive activities during this period of rising food inflation.
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