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Smithfield Foods Settles Pork Price-Fixing Lawsuit for $42M – Austin Daily Herald

Omaha, Neb. – Smithfield Foods will pay $42 million to restaurants and caterers to settle a lawsuit that accused the giant meat producer of conspiring to drive up pork prices, raising concerns about how a lack of competition in the industry affects meat prices.

Lawyers began notifying companies affected by this latest settlement on Tuesday. Previously, Smithfield settled with a different group of pork buyers for $83 million, and JBS agreed to pay restaurants and caterers $12.75 million in a pork lawsuit.

Earlier this year, JBS said it would pay $52.5 million to settle a similar beef price-fixing lawsuit. Neither Smithfield nor JBS admitted any wrongdoing as part of those settlements, and officials at Smithfield’s headquarters in Virginia declined to comment on the details of the settlement.

Additional price fixing cases have also been filed against poultry producers. About $200 million in settlements have been approved in those chicken cases.

The sued restaurant companies accuse the meat processors, who control more than 70% of pork production, of coordinating efforts to limit the supply of hogs and raise prices between 2009 and this year.

A lawsuit is pending against other major pork producers, including Hormel, Tyson Foods, Seaboard Foods and Triumph Foods, and the agri statistics database the company allegedly used to share confidential information about price, capacity and demand.

Private information in those reports allowed competitors to compare their profits and helped them control the supply and price of pork, the lawsuit says.

The meat industry argues that supply and demand factors drive up prices, not competitive behavior, but the industry’s practices have been questioned by the White House, Congress and several prominent members of trade groups.

The Biden administration has announced several efforts to increase competition in the industry to help lower food prices, including a $1 billion plan to expand independent slaughterhouses.

The US Department of Justice and Agriculture also created a website earlier this year to make it easier for farmers and ranchers to report any concerns about anticompetitive behavior in the industry.

A federal judge is scheduled to hold a hearing in October to consider whether to approve the Smithfield deal, but they already gave preliminary approval in April.

“We look forward to moving toward final approval of our settlement with Smithfield and continuing litigation with the remaining defendants,” said Blaine Finley, an attorney for the plaintiffs.

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