A federal grand jury in Colorado has indicted four men for their role in a five-year conspiracy to fix prices and rig bids for broiler chickens.
According to a Department of Justice press release, the indictments are the first stemming from “an ongoing criminal investigation into price fixing and bid rigging involving broiler chickens.” An indictment names four men: Jayson Penn, Mikell Fries, Scott Brady, and Roger Austin. Penn is listed online as the president and CEO of poultry company Pilgrim’s, where Austin is a former vice president; Fries is the president and Brady is the vice president of national accounts for Georgia-based Claxton Poultry Farms.
“Executives who cheat American consumers, restauranteurs, and grocers, and compromise the integrity of our food supply, will be held responsible for their actions,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division.
The indictment says between 2012 and 2017, the four men “participated in a continuing network of suppliers and co-conspirators, an understood purpose of which was to suppress and eliminate competition.” That network was used to reach agreements on similar prices for birds and to discuss “nonpublic information such as bids, prices, and price-related terms, including discount levels, for broiler chicken products sold in the United States” with the intention to “rig bids and to fix, maintain, stabilize, and raise prices and other price-related terms, including discount levels, for broiler chicken products sold in the United States.”
A spokesperson for Pilgrim’s did not respond to a request for comment, nor did an attorney for Claxton Poultry Farms.
The poultry industry, which features more aspects of vertical integration than other protein value chains, has been criticized for its pricing practices for years. Growers have long complained about factors like tournament pricing, retaliatory action by poultry integrators, and mandatory facility improvements, to name a few. Last year, DOJ asked to intervene in a separate price fixing case.
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“Ensuring the integrity of competition in agricultural markets in order for producers to receive competitive prices for their products, and to prevent consumers from being cheated, is of the utmost importance to USDA OIG, and we will continue to dedicate resources to the investigation of matters involving such potential of competitive harms,” Bethanne Dinkins, special agent in charge of the Department of Agriculture’s Office of Inspector General, said in a statement.
The charges carry a statutory maximum penalty of 10 years in prison and a $1 million fine, which may be increased based on gain derived or loss suffered by victims.
Investigations into the pricing practices of other proteins remain ongoing; the Department of Agriculture has expanded an investigation into beef pricing margins following an August 2019 fire at a Kansas packing plant to also include similar issues observed during the COVID-19 pandemic. President Donald Trump has said he's also asked DOJ to investigate the matter.
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