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Tyson Has Tentative Deal to Exit Chicken Farmer Wage-Fixing Suit

June 15, 2021, 5:17 PM

Tyson Foods Inc. has reached an agreement in principle resolving antitrust claims over its alleged role in a scheme to drive down pay for chicken farmers until they’re permanently indebted “modern-day sharecroppers,” according to a federal court filing in Oklahoma.

The farmers leading the lawsuit disclosed late Monday that they’re “working to finalize and document all terms of the class action settlement,” which calls for both unspecified “monetary compensation” and “significant and invaluable cooperation” against the other poultry processors involved in the case.

They’ll seek approval of the deal from Judge Robert J. Shelby “shortly,” according to the settlement notice filed in the U.S. District Court for the Eastern District of Oklahoma.

In addition to Tyson, the multidistrict lawsuit targets affiliates of Koch Foods Inc., Perdue Farms Inc., JBS SA subsidiary Pilgrim’s Pride Corp., and Sanderson Farms Inc.

It’s part of a wave of cartel cases involving livestock and protein, including beef, turkey, pork, tuna, salmon, and eggs. Most of the suits allege price-fixing schemes centering on unlawful exchanges of sensitive information through Agri Stats Inc., which compiles farm sector databases.

The poultry industry has been particularly hard hit. Along with wide-ranging price-fixing litigation and wage-fixing claims by chicken farmers, top processors are accused of a plot to depress pay for their largely immigrant workforce. Some executives are also facing potential prison time.

Tyson has already shelled out nearly $200 million to resolve many of the claims against it, and Pilgrim’s recently became the first poultry processor to plead guilty to criminal antitrust violations following the indictment of its CEO. Pilgrim’s will pay a $110 million fine.

Hausfeld LLP and Berger Montague PC are co-lead counsel for the farmers, who are also represented by 16 other firms. Tyson is represented by Axinn, Veltrop & Harkrider LLP and Whitten Burrage.

Koch is represented by Coffey, Senger & Woodard PLLC. Perdue is represented by Fellers Snider. Pilgrim’s is represented by Weil Gotshal & Manges LLP and Foliart Huff Ottaway & Bottom. Sanderson is represented by Kirkland & Ellis LLP and GableGotwals.

The case is In re Broiler Chicken Grower Antitrust Litig. (No. II), E.D. Okla., No. 20-md-2977, notice of class action settlement filed 6/14/21.

To contact the reporter on this story: Mike Leonard in Washington at mleonard@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Patrick L. Gregory at pgregory@bloomberglaw.com

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