Home Business Smithfield Foods to pay $83 million to settle pork price-fixing claims

Smithfield Foods to pay $83 million to settle pork price-fixing claims

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Packages of Smithfield Foods Inc. bacon are displayed for sale inside a Kroger Co. grocery store in Louisville, Kentucky.

Luke Sharrett | Bloomberg | Getty Images

Smithfield Foods said on Wednesday it will pay $83 million to settle litigation that accused several companies of conspiring to limit supply in the $20 billion-a-year U.S. pork market to inflate prices and their own profits.

The settlement with Smithfield resolves antitrust claims by “direct” purchasers such as Maplevale Farms that accused the nation’s largest pork companies of having fixed prices beginning in 2009.

Smithfield’s settlement requires approval by Chief Judge John Tunheim of the U.S. District Court in Minneapolis.

Keira Lombardo, Smithfield’s chief administrative officer, said the settlement eliminates a “substantial portion” of the Smithfield, Virginia-based company’s exposure in the litigation.

She also said Smithfield denied liability in agreeing to settle, and believed its conduct was always lawful.

Smithfield’s parent WH Group says it is the world’s largest pork producer.

Clifford Pearson, a lawyer for the direct purchasers, declined to comment.

Hormel Foods, the JBS USA unit of Brazil’s JBS SA, Tyson Foods and data provider Agri Stats are among the other defendants in the litigation.

Smithfield and those companies are also defendants in related price-fixing litigation in Minneapolis by commercial and other “indirect” pork purchasers, such as restaurants and delis.

The litigation is similar to litigation in federal court in Chicago where purchasers accused companies such as Tyson, Perdue Farms and JBS’ majority-owned Pilgrim’s Pride of conspiring to fix broiler chicken prices.

The case is In re Pork Antitrust Litigation, U.S. District Court, District of Minnesota, No. 18-01776.

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