Concurrently media reports indicate that Tyson Foods has settled with the direct-claim Plaintiffs for an undisclosed figure. In June 2019 the Company entered into a leniency agreement with the DOJ when it discovered that two employees had apparently participated in anti-competitive activities leading to subsequent criminal indictments.
Pilgrim’s Pride Corp. did not admit any liability for the claims alleged in the broiler antitrust civil litigation. It is obvious that the co-colluding party in the criminal case, Claxton Poultry Farms will be obliged to settle and not risk trial.
In September 2018 Fieldale Farms Corporation settled without admitting wrongdoing and the Company agreed to settle for $2.3 million and to cooperate with Direct Purchaser Plaintiffs in ongoing litigation against the non-settling Defendants
An important aspect of the case is that all of the Defendants had access to cost data circulated by AgriStats® Inc a major U.S. benchmarking system which was at the time owned and operated by Elanco Animal Health a subsidiary of Eli Lilly, a major pharmaceutical company. Plaintiffs allege that by becoming aware of their competitors’ production costs, it would have been possible for Defendants to make decisions concerning volumes of production and pricing. Although this contention will be examined at trial, the cost of defending such an action is immense as experienced previously by the egg industry that faced civil antitrust lawsuits.
The situation relating to other Defendants in the civil case will depend on documentation confirming whether collusion did or did not take place. It would have been injudicious for Pilgrim’s Pride to have defended a civil case given the DOJ settlement and the criminal charges against their CEO and his successor that would have placed he company in jeopardy for punitive damages. Tyson Foods was in a similar predicament given their admissions to the DOJ, a negotiated leniency agreement and also to have had ex-employees under indictment for alleged anti-competitive crimes committed.
The Agreements are subject to court approval.
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