Hagens Berman: Consumers Sue Leading Beef Manufacturers for Massive Antitrust Price-Fixing Scheme

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    Attorneys say $100B beef industry has been bilking consumers since
    2015

    ST. PAUL, Minn.–(BUSINESS WIRE)–lt;a href=”https://twitter.com/search?q=%24JBSAY&src=ctag” target=”_blank”gt;$JBSAYlt;/agt; lt;a href=”https://twitter.com/hashtag/agriculture?src=hash” target=”_blank”gt;#agriculturelt;/agt;–A federal class-action
    lawsuit
    has revealed that a nationwide cartel of leading meatpacking
    manufacturers in the $100 billion beef industry forced consumers to pay
    high prices for steak, hamburgers and other beef products, according to
    the law firm bringing the case, Hagens Berman.

    According to the lawsuit filed Apr. 26, 2019 in the U.S. District Court
    for the District of Minnesota, the price-fixing scheme has been carried
    out by the biggest names in the industry who control approximately 75
    percent of the beef-packing market.

    If
    you purchased any fresh or frozen beef products, you may be entitled to
    reimbursement. Find out your rights to potential compensation and learn
    more about the lawsuit.

    The defendants – Tyson, Cargill, National Beef and JBS – are responsible
    for purchasing beef from ranchers, processing the beef and selling it to
    retail businesses for purchase by consumers, and attorneys say they have
    been bilking consumers since 2015 by artificially limiting the amount of
    beef they purchase, process and sell to retail operations.

    “Our complaint alleges that families nationwide have been overpaying for
    years for beef products they buy routinely, unknowingly paying inflated
    prices fixed by a scheme to limit beef supplies,” said Steve Berman,
    managing partner of Hagens Berman and attorney representing consumers in
    the class-action lawsuit against the meatpacking defendants. “The
    result: this $100 billion industry reaped billions of dollars in extra
    profits while consumers paid far more for beef than they should have. We
    intend to put an end to it.”

    The class action seeks to recover losses consumers faced under the
    price-fixing scheme, as well as injunctive relief from the court to put
    an end to the anticompetitive behavior. The case brings counts of
    violations of federal and state antitrust laws and unfair competition,
    unjust enrichment and consumer protection laws.

    The lawsuit alleges that defendants “entered into a conspiracy to
    extract maximum profits from the distribution channel of beef – by both
    extracting all gains from the ranchers who raised the cattle, as well as
    artificially inflating the price of beef being sold to the consumer.”
    The suit goes on to say that defendants “engaged in a concerted scheme
    to suppress throughput of beef, artificially depressing both the amount
    of cattle they purchased and the amount of processed beef they sold to
    retail operations. The purpose of the scheme was to maximize the margins
    they received from sale of beef – by both underpaying the farmers, and
    simultaneously ensuring an overcharge to the consumer.”

    According to an industry insider quoted in the suit, “meat works like
    the mafia.” Executives at companies in the meatpacking industry all know
    each other, according to the insider, and someone may be a competitor
    but also a customer.

    The defendants colluded on their purchases of cattle from ranchers by
    restricting the amount of cattle they purchased and bid rigging
    practices that depressed the price of cattle that the defendants
    purchased through auctions, attorneys claims. Defendants’ actions
    created an artificial shortage of beef, which harmed consumers by
    elevating the price they paid for beef.

    The lawsuit alleges that prior to the anticompetitive conduct, the price
    of cattle sold to the defendants and the price of beef sold by
    defendants moved in tandem. Following the anticompetitive conduct, the
    price of cattle fell while the price of beef remained elevated.

    “It’s a matter of common sense that the prices of cattle and beef should
    move together because beef is simply processed cattle,” said Berman.
    “But these leading meatpacking manufacturers manipulated the market so
    this natural economic relationship broke down.”

    Agri Stats, an industry forecasting service, assisted the meatpacking
    defendants, the suit states. Agri Stats has played a key role in both
    the poultry and swine industries by aiding and abetting the sharing of
    confidential information that allowed the profits of poultry and pork
    manufacturers to soar.

    Agri Stats’ reports are at the center of other similar price-fixing
    lawsuits in the poultry and pig industries.

    Agri Stats, through its subsidiary, Express Markets, first entered the
    beef industry in 2015. In the beef industry, Express Markets executives
    stated that they provided “supply and demand side analysis and
    forecasting of cattle numbers and beef supplies as well as domestic and
    international trade impacts,” according to the complaint. Prior to the
    entrance of Express Markets into the beef industry, the suit’s
    defendants reported margins for their beef business significantly lower
    than their margins in the chicken and pork businesses where Agri Stats
    was already active. After Express Markets entered the beef business,
    defendants’ profits soared. By 2018, defendants Tyson and JBS reported
    higher margins for their beef business than for their respective chicken
    and pork businesses.

    Hagens Berman has taken the lead in similar cases in the protein
    industry. Hagens Berman is currently interim lead counsel on behalf of
    consumers in cases in the pork
    and poultry
    industries against many of the same defendants. Hagens Berman also
    recovered $52
    million
    for consumers for anticompetitive conduct in the dairy
    industry.

    Find
    out more about the class-action lawsuit against the beef industry on
    behalf of consumers in the U.S.

    About
    Hagens Berman

    Hagens Berman Sobol Shapiro LLP is a consumer-rights class-action law
    firm with nine offices across the country. The firm’s tenacious drive
    for plaintiffs’ rights has earned it numerous national accolades, awards
    and titles of “Most Feared Plaintiff’s Firm,” and MVPs and Trailblazers
    of class-action law. More about the law firm and its successes can be
    found at www.hbsslaw.com.
    Follow the firm for updates and news at @ClassActionLaw.

    Contacts

    Ashley Klann
    [email protected]
    206-268-9363