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Pilgrim’s Pride First To Plead Guilty In Chicken Price-Fixing Scheme

This article is more than 3 years old.

Pilgrim’s Pride, the second-largest chicken processing plant in the nation, has become the first company to plead guilty to charges of price fixing chicken. For its role, the company will pay a $108 million criminal fine as part of a Department of Justice antitrust investigation into the industry.

According to the plea agreement, entered in the U.S. District Court in Denver, the JBS SA-owned company took part in a price-fixing and bid-rigging conspiracy between 2012 and 2017. At least $361 million in Pilgrim’s sales were affected. The company’s largest customers include the wholesaler Costco and the fast-food chain Kentucky Fried Chicken. 

Last June, a federal grand jury returned an indictment against Jayson Penn, then president and CEO of the company, along with former Pilgrim’s Pride Vice President Roger Austin, for their role in a conspiracy to fix prices and rig bids for broiler chickens across the nation.

“Today’s guilty plea demonstrates our unwavering commitment to prosecuting companies that violate the nation’s antitrust laws, especially when it involves something as central to everyday life as the food we eat,” said acting assistant attorney general Richard Powers of the Antitrust Division.

In January, the company said it would pay $75 million to settle a class-action lawsuit by some of its customers. The same month, Tyson Foods said that it would shell out $221.5 million to settle similar claims. If that settlement goes forward, it would be the largest anticompetitive settlement thus far in the series of price-fixing claims. In that agreement, Tyson is allowed to exit the price-fixing lawsuits filed against it.

“Today’s plea is another example of the FBI’s ongoing work to eliminate bid rigging and price fixing and hold those conducting these activities accountable for their actions,” said Steven M. D’Antuono, Assistant Director in Charge of the FBI Washington Field Office. “These criminal acts cheat American workers and consumers while harming competitive markets.”

In accordance with the Sherman Act, a company can be charged a maximum fine of $100 million, but the amount can be increased to up to twice the company’s cane from the conspiracy or twice the victim’s loss if either is greater. 

Ten executives and employees at major broiler chicken producers have also previously been charged, all of which have pled not guilty. The investigation remains ongoing.

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