In the latest of a series of antitrust lawsuits involving the food industry, a Virginia federal court last week denied a motion to dismiss a class action lawsuit alleging a price-fixing conspiracy in the peanut market.

The class is comprised of peanut farmers and harvesters that sell the raw peanuts to the Defendants, who then process, shell, and sell the final product to food companies or other manufacturers.[1]


Continue Reading Peanut Farmers Successfully Allege Price-Fixing Conspiracy Against Industry Giants

When America’s war on heart disease was kicked into gear by President Eisenhower’s heart attack in 1955, dietary fat was deemed the culprit. In an effort to improve health, people sought low-fat alternatives to their favorite foods. The market reacted and “low fat” products began appearing. But over the last few years, nutritionists have increasingly blamed sugar and carbohydrates, rather than fat, for heart-health issues. Not surprisingly, product labeling and advertising evolved to address consumer perceptions. Products touting “reduced sugar” content or “no sugar added” became almost ubiquitous on supermarket shelves.

Continue Reading Consumers Allege Dishonesty from Honest Tea

U.S. District Judge Edmond E. Chang in the Northern District of Illinois recently granted certification in a wheat market rigging suit filed against Kraft Foods Group Inc. (“Kraft”). The class, comprised of Chicago Board of Trade (“CBT”) wheat market investors, alleges that Kraft artificially manipulated the wheat commodities market by taking sizable futures positions to influence prices.

Specifically, the class of investors alleges that Kraft purchased $90 million (15 million bushels) of December 2011 wheat futures contracts “in order to depress cash market wheat prices and inflate the futures price of wheat”. Plaintiffs claim Kraft’s behavior was suspicious considering Kraft had never before purchased such a substantial quantity of wheat and did not have adequate storage capacity for such a purchase.


Continue Reading Class Certification Granted to Kraft Investors Alleging Wheat Market Rigging

StarKist, the country’s largest producer of canned tuna, was hit with a $100 million fine for its participation in a conspiracy that inflated prices for canned tuna.  The judge handed down the sentence for the maximum fine allowed under the law on September 11, 2019.

StarKist’s sentence brings to a close the prosecution of the nation’s three largest canned tuna producers for their participation in a wide-ranging conspiracy to fix the price of tuna sold in the United States. The collusive conduct was uncovered in the course of a failed merger between the other two major tuna producers—Bumble Bee Foods LLC and Thai Union Group P.C.L., the parent company of Chicken of the Sea. The government’s investigation stemmed from suspicious documents produced by the proposed merger participants in response to a second request issued by the U. S. Department of Justice (DOJ).


Continue Reading StarKist on the Hook for $100M Fine for Tuna Price-Fixing

Chief Judge Tunheim recently dismissed, with leave to amend, the class complaints in In Re Pork Antitrust Litigation.  The Pork case— filed in the District of Minnesota against Tyson, Hormel, JBS and other major pork producers—alleged a conspiracy beginning in 2009 to inflate artificially the price of pork sold in the United States. 

Eager to curb foodborne-illness outbreaks, retail giants like Walmart and Albertsons are turning to blockchain technology [1] to track exactly where their foods are coming from. Blockchain, as compared to the eye-straining, paper-heavy tracking systems before it, allows retailers to trace the supply-chain history for a single food item within seconds.

For example, in a test case using IBM’s blockchain technology, Walmart traced the supply chain for two off-the-shelf mangoes randomly taken from one of its stores. Using conventional source-checking methods, it took them 7 days to do so. Through blockchain, however, they were able to track the entire supply chain in 2.2 seconds!  As a former Walmart executive put it, blockchain “allows us to see the whole chain in seconds! We [could] take a jar of baby food and see where it was manufactured and trace back all the ingredients to the farms!” Before blockchain, that simply would not have been feasible.


Continue Reading Blockchain Will Likely Make a Meaningful Impact on “Big Food” Litigation

beefWhen it rains, it pours—and for the country’s largest protein producers, the downpour is coming in the form of high-profile antitrust lawsuits. Over the past few years, food giants like Tyson and JBS (majority owner of Pilgrim’s Pride) have been named as a defendant in price-fixing cases relating to chicken and pork. Now, Tyson, JBS and Cargill face claims asserted by both consumers and suppliers of beef. According to these new claims, the beef producers conspired to increase their profits by both decreasing the supply-side prices they paid and increasing the prices their customers paid.
Continue Reading Beef Industry Reeks of Collusion, Plaintiffs Allege

Price FixingScott Wagner and Lori Lustrin discuss with Law360 the new wave of antitrust cases emerging in the food and beverage industry.

Price-fixing cases over the past decade have read like a virtual electronics product materials list. Government investigators and civil plaintiffs have pursued actions involving a wide array of electronic parts ranging from passive components

Price FixingWhen people think about this year’s food industry trends, they may envision app-based grocery delivery services, the Keto diet, and restaurants that serve all locally-sourced ingredients.

But inside federal courthouses across the country, the Department of Justice and civil plaintiffs have been highlighting a darker trend within the food business: price fixing.

Under United States antitrust law, price fixing is defined as an agreement among competitors that raises, lowers, or stabilizes prices or competitive terms. The U.S. antitrust laws require that each company establish prices on its own without agreeing with a competitor on a price to charge consumers. The driving force behind our antitrust laws is simple: when competitors agree to restrict competition and inhibit a free market, it results in higher prices. And an agreement to restrict production, sales, or output of a product or service is just as illegal as direct price fixing because reducing the supply of a product or service drives up its price.
Continue Reading Price Fixing in the Food Industry