OPINION: Courts need to end Big Meat data sharing

It was quite the news when Pilgrim’s Pride admitted earlier this year that it was guilty of colluding with other Big-Meat companies to rip off wholesalers and retailers. Pilgrim’s fixed chicken prices and rigged bids for years with other Big Meat companies. And, oh did that revelation reverberate around agricultural and national publications:

Forbes: “Pilgrim’s Pride First to Plead Guilty in Chicken Price-Fixing Scheme”
Drovers: “Pilgrim’s Pride Agrees to Price-Fixing Fine”
ComplianceWeek: “Pilgrim’s Pride Pays $108 Million in Price-Fixing Scandal”
Successful Farming: “Pilgrim’s Pride Pleads Guilty to Price-Fixing in Chicken”
Reuters: “Pilgrim’s Pride Pleads Guilty to Chicken Price-Fixing Charge, to pay $107.9 million fine”

What do all the articles have in common? That big fat $107.9 million fine.

But here is the overlooked, elephant in the room, the you-can’t-believe-it-thing. Because Pilgrim’s Pride said “yup we did it,” the case never went to court. And because the Department of Justice did not drag Pilgrim’s Pride executives to the witness stand, there was no ruling on HOW Pilgrim’s Pride colluded with other Big Meat firms and whether or not that process was legal.

You might say Pilgrim’s Pride took one for the team, keeping in place the infrastructure to continue to fix and rig chicken prices.

Big Meat’s secret weapon is a company called Agri Stats. Every week a bunch of Big Meat companies send Agri Stats a raft load of internal sales documents that Agri Stats merges into an industry wide sales report and sends back to subscribers. Agri Stats and those reports are at the heart of numerous lawsuits alleging that the reporting system allows Big Meat to participate in illegal anticompetitive activity.

According to Docket Alarm, Agri Stats is the second most sued company in the Big Meat world, just behind Tyson Foods. In the past two years alone, AgriStats has been the subject of 47 antitrust lawsuits. Twenty-eight of those cases reside in the Illinois Northern District, with most of those in front of Judge Thomas Durkin. And in those 47 cases thus far, there has not been a single verdict.

Agri Stats started operations about 36 years ago and the Department of Justice has been looking at various aspects of the company’s operation, including those weekly price reports for more than a decade. Agri Stats has, for years, maintained that its reports don’t violate antitrust laws, in part because the information provided is historical (if you can say week-old data is historical). And Agri Stats says the data does not reveal the names of the companies, although that claim is up, Up, UP for debate among opponents to the data sharing.

Now the state of Alaska has filed its own lawsuit against Big Meat, essentially saying 21 companies involved in the poultry industry operated a cartel that illegally fixed chicken prices. And at the core of the lawsuit is … you guessed it … Agri Stats:

“Throughout the relevant time period the Producer Defendants used Agri Stats as a primary means of communicating their conspiracy to restrain production and inflate prices of Boilers, confirming their unlawful agreement to the common purpose and design of the conspiracy, and monitoring co-conspirators’ actions and conduct, including by verifying pricing and production actions, in order to enforce and ensure compliance with the terms of the cartel’s conspiracy.”

Alaska wants a boatload of cash, up to $50 million in civil penalties from each defendant, as well as damages, restitution, attorney fees and costs.

Of course, Agri Stats will do everything in its power to keep the case from reaching a verdict. And that’s the rub. The public needs the courts to rule specifically on whether or not what Agri Stats provides is legal or whether it is a mechanism for defrauding meat businesses and the public at large. A court verdict in any one of what is now at least 48 cases against Agri State can’t come soon enough.

About Dave Dickey

Dickey spent nearly 30 years at University of Illinois at Urbana-Champaign’s NPR member station WILL-AM 580 where he won a dozen Associated Press awards for his reporting. For 13 years, he directed Illinois Public Media’s agriculture programming. His weekly column for the Midwest Center covers agriculture and related issues including politics, government, environment and labor. His opinions are his own and do not reflect the Midwest Center for Investigative Reporting. Email him at dave.dickey@investigatemidwest.org.