Ranchers' Price-fixing Suit Against Big 4 Packers Dismissed
Antitrust claims against the nation’s largest beef packers by a group of ranchers has been dismissed.
A federal judge in Minnesota dismissed the claims filed by a putative class of cattle ranchers in a long-running case that alleged an industry-wide scheme to fix prices.
Judge John R. Tunheim of the US District Court for the District of Minnesota ruled Thursday the plaintiffs lacked standing to pursue their central arguments. The ranchers can’t refile their complaint without first gaining court approval on how they plan to amend the claims.
However, Tunheim indicated he was doubtful the ranchers could gain such approval, writing that they “have not shown how they would amend their complaint to establish antitrust standing or otherwise overcome the deficiencies in their first pleading.”
The suit alleged the largest beef packers, JBS SA, Tyson Foods Inc., Cargill Inc., and National Beef Packing Co., conspired in an industrywide scheme to widen the “meat margins” between the cost of live cattle and price of processed beef. Further, the packers were accused of forcing the cost of cattle down, and the price of beef higher, through cartel tactics like coordinated procurement and “slaughter restraint.”
The lawsuit alleged the four packers violated the Sherman Antitrust Act of 1890 by engaging in a price-fixing conspiracy, and that they violated the Packers and Stockyards Act as well as the Commodity Exchange Act.
JBS reached a $52.5 million class action settlement with beef wholesalers in September 2022.
Tunheim wrote in his decision there are too many stages in the beef supply chain and too much time between the ranchers’ sale of cattle and their purchase by meatpackers to adequately establish standing for the Sherman Act and Packers and Stockyards claims.
The brief ruling came about three weeks after Smithfield announced the third agreement, a $75 million pact with consumers. Tunheim, who in January approved the company’s $83 million deal with wholesalers, also scheduled a Nov. 4 hearing on the consumer settlement.
