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Tuesday, March 30, 2021

JBS USA agrees to $20M settlement in pork price-fixing lawsuit - Meat & Poultry

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MINNEAPOLIS – JBS USA, a subsidiary of JBS S.A., agreed to pay $20 million to settle a consumer class- action lawsuit alleging the company conspired to fix prices for pork from at least 2009 to the present. However, the settlement, which requires the judge’s approval, does not cover claims made against the company by seven other plaintiffs that did not sign on to the agreement.

The settlement agreement states that JBS will pay $20 million into a settlement fund that will be used to compensate the consumer class and cover litigation fees and expenses, including the cost of notifying class members and administering the settlement.

The law firm of Hagens Berman filed a class-action lawsuit on behalf of a group of consumers in the US District Court for the District of Minnesota on June 28, 2018 claiming a price-fixing scheme by food companies to collectively raise pork prices “…through the exchange of detailed, competitively sensitive information through Agri Stats,” according to the complaint.

“Agri Stats would collect the sensitive information from the pork defendants and disseminate it back to them in detailed weekly and monthly reports, standardizing the information across the defendants into an ‘apples to apples’ comparison,” the complaint stated. “Through these reports, defendants were able to decipher which data belonged to which defendant, allowing them to monitor production and price levels in the industry.

“In addition, Plaintiffs allege that defendants carried out the conspiracy through public statements, aimed at one another, regarding the need to cut production. Defendants then took individual action to cut supply or limit supply increases that would otherwise not have occurred,” according to the court document.

The settlement amount is based on publicly available information, according to the court document. JBS controls approximately 20% of the market for consumer pork products. The $20 million “…represents $1 million for each point of market share – putting the value of this case well over $100 million at this stage in the litigation. This is an outstanding result.

“In addition to the financial compensation, the cooperation that consumer IPPs have secured from the settlement will bolster consumer IPPs’ (Indirect Purchaser Plaintiffs) claims against the seven non-settling defendants,” according to the settlement agreement.

JBS and the plaintiff’s attorneys first discussed a settlement in September 2020. The initial discussions were unsuccessful, but after motions to dismiss the case were denied, the parties resumed talks in early 2021. A mediation was held before Professor Eric Green, a mediator with Resolutions, LLC. A settlement agreement was reached on March 9, 2021, and the settlement agreement was signed by both parties on March 12, 2021.

“Unlike many other civil antitrust actions, this case was developed and brought without the benefit of a formal antitrust investigation by the US Department of Justice or the assistance of a leniency applicant under the DOJ’s Corporate Leniency Program,” the court document said. “Rather, the conspiracy was identified by consumer IPPs through the use of investigators and economists, leading to the first complaint filed – the consumer IPP complaint.”

The Link Lonk


March 30, 2021 at 11:50PM
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JBS USA agrees to $20M settlement in pork price-fixing lawsuit - Meat & Poultry

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