CHICAGO – Tyson Foods, Inc. and a group of direct purchasers reached a proposed settlement of a lawsuit accusing the company of conspiring to fix prices for turkey products. Court documents state Tyson will pay $4,625,000 into an escrow account within 14 days of the court granting preliminary approval of the deal. The original complaint was filed at the US District Court for the Northern District of Illinois, Eastern Division in 2019. In April, the court declined a motion by Tyson Foods to dismiss the lawsuit.
In addition to the monetary settlement, Tyson will provide “meaningful cooperation” that will assist the direct purchaser plaintiffs (DPPs) in their claims against the remaining defendants which include Agri Stats Inc., Butterball, Cargill, Cooper Farms, Hormel Foods Corp., Farbest Foods and Foster Farms.
“Tyson’s cooperation includes providing DPPs with (a) documents and data related to Tyson’s sales of turkey during the relevant time period, (b) documents from two mutually agreed-upon document custodians responsive to the parties’ agreed upon search terms, (c) direct communications between competitors relating turkey from two mutually agreed-upon document custodians, (d) any documents it produces to any other party in connection with this litigation, including any documents it produced to a state Attorney General or the US Department of Justice regarding an investigation into the turkey industry, and (e) any information or proffers given to any plaintiff in matters substantially similar to this one,” the court documents said.
“Given Tyson’s roughly 4-5% market share in the turkey market, this settlement represents a payment of approximately $1 million per market share point.”
Kraft Heinz Co. also was named in the complaint, but in granting Kraft Heinz’s motion to dismiss, US District Court Judge Virginia M. Kendall ruled the plaintiffs failed to provide evidence that Kraft Heinz’s behavior had any anti-competitive impact on the output or prices of Kraft’s product. In April, Tyson sought to apply the same reasoning in an attempt to have the lawsuit against the company dismissed. But Kendall declined Tyson’s motion.
The direct purchasers have retained Milwaukee, Wis.-based A.B. Data Ltd., a national class action notice provider and claims administrator, to administer the notice plan.