Justice Department Expands Poultry Price-Fixing Investigation, Charges Six More
The Justice Department announced the release of a superseding indictment October 7 expanding on existing charges issued in June that executives of Pilgrim’s Pride conspired with executives from Claxton Poultry to fix prices for broiler chickens. The latest indictment adds charges against six more individuals with connections to more chicken suppliers.
The newly charged individuals include William Lovette, a former CEO of Pilgrim’s Pride Corp.; Timothy Mulrenin, who was CEO at Tyson Foods Inc. when the alleged charges occurred; William Kantola and Jimmie Little, sales executives at Pilgrim’s Pride; Rickie Blake, an employee of chicken supplier George’s Inc.; and Gary Roberts, an employee of an unidentified supplier headquartered in North Carolina.
The defendants were all allegedly part of a conspiracy to fix prices for broiler chicken products across chicken supplier companies. The scheme to fix prices for the broiler chickens, sold directly to restaurants and to consumers via grocery stores, allegedly took place between 2012 and 2019 and involved corporate executives from the different chicken suppliers negotiating raised prices via text messages and phone calls.
The latest wave of indictments adds on to previously-issued charges released in June against Jayson Penn and Roger Austin, the CEO and VP of Pilgrim’s Pride, and Mikell Fries and Scott Brady, President and VP of Claxton Poultry. In September, Pilgrim’s Pride announced Penn, who has plead not guilty to the charges, would be replaced as the head of the company by CFO Fabio Sandri.
The investigation, which the Justice Department says is still ongoing, was spurred on by a lawsuit filed by grocers and retails alleging that Pilgrim’s Pride and Tyson Foods, among other chicken suppliers, were coordinating to raise broiler chicken prices.
Shortly after the first wave of charges were unsealed, Tyson Foods announced it would cooperate with the Justice Department in exchange for corporate leniency, which lends the company and its employees immunity from criminal fines or jail time. Mulrenin, who was CEO of Tyson Foods when the scheme allegedly took place, is not covered by this immunity since he is no longer with the company.
The investigation is currently being conducted by officials from the Department of Justice’s Antitrust Division, the FBI, the Department of Commerce, and the U.S. Department of Agriculture.
“The division will not tolerate collusion that inflates prices American shoppers and diners pay for food,” said Assistant Attorney General Makan Delrahim of the Justice Department’s antitrust division.
The defendants’ alleged activities would constitute violations of the Sherman Antitrust Act, which, according to the Department of Justice, can lead to up to a maximum fine of $1 million or more, depending on the amount of money illegally gained or lost by victims, and up to 10 years in prison.
In addition, Little has been charged on one count each of lying to federal law enforcement agents and obstructing justice: the first carries a maximum penalty of 5 years in prison and a $250,000 fine, the second, 20 years and another $250,000 fine.
