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Lawsuit alleges pork cartel conspired in price-fixing conspiracy

Illustration for article titled Lawsuit alleges pork cartel conspired in price-fixing conspiracy
Photo: Joe Raedle (Getty Images)

A class-action group of a dozen shoppers in Minnesota is suing some of the country’s major pork producers, claiming the companies teamed up to beef up the price of their bacon and sausages. CBS News reports the 98-page complaint outlines a conspiracy between brands like Hormel, Smithfield, Jennie-O, Jimmy Dean, Nathan’s Famous, and Tyson, who colluded to force customers to pay higher prices.

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According to the lawsuit, the companies did so by sharing “detailed, competitively sensitive and closed guarded non-public information” through an outside monitoring company called AgriStats. The information allegedly helped pork producers artificially manipulate supply and demand of bacon, lunch meat, hot dogs, and sausage to keep prices high. The companies named in the antitrust suit comprise about 80 percent of the American pork market; lawyers representing the class-action suit say pork-industry consolidation helped the companies collude.

The plaintiffs present as evidence that pork prices saw “abnormal” patterns that coincided with the start of the conspiracy. “Average annual prices for the hog market were at or below $50 every year between 1998 and 2009 before surging to $76.30 in 2015, an increase of more than 50 percent,” CBS News reports.

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“Hardworking families across the nation strive to put food on the table, but little do they know, the game is rigged from the beginning: the largest food companies are secretly ensuring their dollar doesn’t go as far at the supermarket as it should,” Steve Berman, managing partner of Hagens Berman, said in a statement. His law firm is representing consumers in the lawsuit against the pork industry, seeking in excess of $5 million in damages which will be distributed as refunds to customers forced to pay more for pork.

“We’re seeking to hold Tyson, Hormel and others accountable for this nearly decade-long scheme to hog their share of profits.”

Kate Bernot is a freelance writer and a certified beer judge. She was previously managing editor at The Takeout.

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DISCUSSION

therevanchist
TheRevanchist

I took a look at what they put together to show the collusion claim. Well, there isn’t any definitive proof. So, as a reasonability check, I checked a CPI calculator to see what the price increase should be from a 1998 price to a current price.

Seems reasonable from a high level.