Senior executives from Pilgrim’s Pride and Claxton Poultry – two major US chicken producers – have been charged with conspiring to fix prices and rig bids on chicken sold to grocery stores and restaurants in the US.
A federal grand jury in the US District Court in Denver, Colorado, has indicted that executives from the two companies had conspired to fix prices and rig bids for broiler chicken to “suppress and eliminate competition”.
According to the court, the anti-competitive behaviour was found to begin as early as 2012 and continue to until at least early 2017.
The defendants included Jayson Penn, who was recently promoted to CEO of Pilgrim’s last year, Roger Austin, former VP at Pilgrim’s and Mikell Fries and Scott Brady, president and VP of Claxton Poultry.
The US Department of Justice said this marks the first charges filed in an ongoing investigation into fixing prices of broiler chickens.
According to the US Department of Justice, the offence charged carries a statutory maximum penalty of 10 years in prison and a $1 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than $1 million.
“Particularly in times of global crisis, the division remains committed to prosecuting crimes intended to raise the prices Americans pay for food,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division.
He continued: “Executives who cheat American consumers, restauranteurs, and grocers, and compromise the integrity of our food supply, will be held responsible for their actions.”
Special Agent in Charge Bethanne Dinkins of the USDA, Office of Inspector General, said: “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.”
In response to the recent DOJ action, Pilgrim’s issued the following statement:
“Today, Pilgrim’s was informed of an indictment against a current executive and two former Pilgrim’s employees. We take this matter very seriously. The company is committed to high ethical standards, governance, and free and open competition that benefits both customers and consumers. Pilgrim’s will continue to fully cooperate with the Department of Justice in their investigation.”
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