The direct purchaser plaintiffs (DPPs) in an antitrust class action accusing pork processors of engaging in a conspiracy to fix, raise, and stabilize the price of pork nationwide have reached a settlement with defendant JBS USA Food Company on Tuesday in the District of Minnesota. The memorandum in support of the motion for preliminary approval claims that the agreement is both an “‘ice-breaker’” settlement and one that provides the class with “significant and substantial relief,” including JBS’s cooperation.
According to the filing, the DPPs allege that the four top pork “integrators” market share increased from 34% in 1988 to just under 70% by 2015. While no single market player has the ability to control supply and increase profits unilaterally, in 2009, the defendants began to share competitive information and accomplished just that, the filing states. The DPPs aver that “after years of increasing production prior to the onset of the conspiracy, the Pork industry cut production in a coordinated fashion and, as Defendants intended, an unprecedented upswing in prices followed.”
The settlement comes after the court in large part denied the defendants’ motion to dismiss in late October. Presently, the filing states, the DPPs “are pressing to set the parameters for discovery.”
In support of their request for settlement approval, the DPPs allege that the agreement represents a meaningful resolution for class members reached through fair and extensive negotiation. The filing also notes that unlike many other antitrust conspiracies, the private plaintiffs in this suit pursued it “without the benefit of a formal antitrust investigation by the U.S. Department of Justice.”
The settlement fund is to be distributed to a class of all people who purchased pork directly from any of the defendants or co-conspirators since Jan. 1, 2009, the proposed order states. The terms of JBS’s cooperation are reportedly set forth in a confidential letter agreement.