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Tyson, Perdue Pay $36 Million to Exit Antitrust Suit by Farmers

Feb. 22, 2022, 6:08 PM

Tyson Foods Inc. and Perdue Farms LLC secured their off-ramp from antitrust litigation over an alleged industrywide scheme to drive down pay for chicken farmers, when a federal judge in Oklahoma approved settlements worth a combined $35.75 million.

Judge Robert J. Shelby signed off Feb. 18 on the two agreements—a $21 million deal with Tyson and a $14.75 million pact with Perdue—which resolve class action claims brought against them on behalf of chicken growers in the U.S. District Court for the Eastern District of Oklahoma.

The settlements call for the companies to refrain from enforcing arbitration clauses or class action waivers for five years, and to cooperate against the other poultry processors named as defendants: affiliates of Koch Foods Inc., JBS SA subsidiary Pilgrim’s Pride Corp., and Sanderson Farms Inc.

Shelby also handed $11.9 million in legal fees and $2.3 million in expense reimbursement to class counsel for the farmers, saying the one-third award “is well within the applicable range” established in similar cases.

The multidistrict lawsuit identifies other companies as co-conspirators, though not as defendants.

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 the main cartel case and the farmer claims, top processors face allegations they conspired to depress pay for their largely immigrant workforce. Some executives are also contending with criminal charges that carry potential prison time.

Tyson has paid more than $200 million to date to settle many of the antitrust claims.

Hausfeld LLP and Berger Montague PC are co-lead counsel for the farmers. Tyson is represented by Axinn, Veltrop & Harkrider LLP and Whitten Burrage. Perdue is represented by Fellers Snider.

Koch is represented by Coffey, Senger & Woodard PLLC. 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, 2/18/22.

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