Chicken Class Action Says Producers Artificially Inflated Prices

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A new class action lawsuit claims dozens of chicken producers have been conspiring to keep chicken prices artificially high.

The plaintiffs are four individuals from different states across the country, all alleging they purchased consumer chicken indirectly from the defendants in each of their home states.

They claim the defendant chicken companies have been conspiring for years to jack up the price of consumer chicken by scaling back production, in violation of federal and state antitrust laws.

They name as defendants more than two dozen companies – including famous names like Tyson and Sanderson Farms – all of whom allegedly produce or sell chicken in interstate commerce.

Plaintiffs say the defendants are the leading producers of broilers, defined as chickens raised for meat consumption and slaughtered before the age of 13 weeks.

They say broilers constitute about 98 percent of the consumer chicken sold in the U.S.

The named defendants allegedly control 90 percent of the U.S. market for broilers, they claim.

According to this chicken antitrust class action lawsuit, in 2007 defendants Pilgrim’s Pride and Tyson tried to increase the price of chicken industry-wide by reducing their own production. That attempt allegedly failed because other producers increased production at the same time.

Undaunted, Pilgrim’s and Tyson attempted to get broader cooperation from others in the chicken industry, the plaintiffs claim. Following those companies’ lead, the other defendants allegedly cut production by destroying breeder hens – committing themselves to a production cut that would last at least 18 months.

Plaintiffs say the defendants engaged in additional rounds of hen kill-offs in 2011 and 2012. They further limited the U.S. broiler supply by destroying eggs, relying on each other’s production to meet customer demand, and exporting excess broilers to Mexico, the chicken antitrust class action lawsuit claims.

The plaintiffs say these coordinated production cuts caused a 50 percent increase in the wholesale price of broilers. They claim to have each paid artificially-inflated prices for chicken in excess of what they would have paid had the market been truly competitive.

Their chicken antitrust class action lawsuit raises claims under the federal Sherman Act, several states’ antitrust and consumer protection statutes, and state common law.

This claim comes only days after a similar chicken antitrust class action lawsuit was filed by commercial plaintiff Maplevale Farms Inc., a major foodservice provider. Like the consumer plaintiffs in the more recent claim, Maplevale Farms alleges it paid too much for broilers due to anticompetitive activity within the industry.

In the new chicken antitrust lawsuit, the four plaintiffs propose to represent a nationwide Class consisting of all persons who purchased consumer chicken for end consumption indirectly from the defendants or their related companies during the class period – from Jan. 1, 2008 through whatever time the alleged anticompetitive effect of the defendants’ conduct ends.

They seek a damage award including treble damages, restitution and disgorgement of profits, and reimbursement of court costs and attorneys’ fees, all with pre- and post-judgment interest.

The plaintiffs are represented by attorneys Theodore B. Bell, Carl V. Malmstrom, Fred T. Isquith, Sr., and Thomas H. Burt of Wolf Haldenstein Adler Freeman & Herz LLP.

The Chicken Antitrust Class Action Lawsuit is Drucker, et al. v. Koch Foods Inc., et al., Case No. 1:16-cv-08874, in the U.S. District Court for the Northern District of Illinois.