Settlement Comes to Roost at Tyson Foods

Snacks

Tyson Foods has agreed to pay over $221.5 million to poultry buyers who accused the group of fixing prices in a settlement, effectively ending a four-year legal battle between the billion-dollar poultry industry and its customers.

Tyson’s settlement responds to a class-action antitrust lawsuit arguing that poultry companies have been participating in cost-fixing practices since 2008. Claims against Tyson came from food service providers, restaurants, grocery stores, and consumer advocacy groups.

According to Tyson’s Jan. 20 SEC filing, payments will be reflected in its first-quarter financial statements. The settlement does not include liability.

“(Tyson Foods) believes that the settlements were in the best interests of the company and its shareholders in order to avoid the uncertainty, risk, expense, and distraction of protracted litigation,” said the company in their SEC filing.

Over 15 other poultry processors were named as defendants in the class-action lawsuit. Many have already reached agreements with plaintiffs, such as Amick Farms, Fieldale Farms, George’s, and Peco Foods.

Most recently, Colorado-based Pilgrim’s Pride settled for  $11 million on Jan. 11 while not admitting liability as part of its settlement.

Tyson still faces lawsuits from many of its largest customers, including fast-food chain Chick-Fil-A, supermarkets Walmart and Kroger, and food distributors Sysco and U.S. Food Holdings Corp.

Antitrust pressure has grown for the meat industry as the industry experienced significant consolidation in recent decades. Beyond lingering questions on the Biden administration’s antitrust approach, leaders raised eyebrows at the Justice Department subpoenaing beef processors last year over their buying practices.

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