FOR IMMEDIATE RELEASE:
October 14, 2020
Pilgrim’s Pride Admits to Colluding to Suppress Competition in the Chicken Industry
The guilty plea signifies a tremendous win for advocates of a more just food system.
WASHINGTON—In a major win for advocates fighting corporate concentration, on October 13 Pilgrim’s Pride became the first major corporation in a broad investigation into the chicken industry to admit to colluding to suppress competition in the industry by artificially raising the price of chicken over a seven-year period. The Department of Justice initially charged executives of Pilgrim’s Pride in June with price-fixing and bid-rigging, along with executives at Tyson Foods, Perdue Farms, Koch Foods, and others. Pilgrim’s Pride now faces a $110.5 million dollar fine. For the DOJ to secure a guilty plea against a major meat corporation is not only rare, it is a tremendous win for advocates of a more just food system, including our Food Integrity Campaign and partners in this work.
The core of the allegations brought by the DOJ is that executives at these companies have maintained an inappropriately “cozy” relationship: calling each other before cutting deals with fast-food and retail buyers, coordinating prices, and encouraging each other to raise the cost of chicken, thus eliminating free competition in the industry. While this case proves that executives conspired to fix prices and boost profits on the sales side, it also highlights that the companies have almost uniformly utilized mechanisms like “tournament payment” to calculate farmer pay, ensuring that company profits never make it to farmers’ paychecks.
Corporate concentration, like what we see in the poultry industry, eliminates the bargaining power of individual farmers, limits the ability of the communities to hold companies accountable, and enables companies to increasingly get away with exploitative practices. While the substance of the current charges from DOJ does not directly address concentration on the supply side, the guilty plea from Pilgrim’s Pride is a major step forward for farmers, as well as for our work at FIC and for our fellow advocates who have fought for decades against unchecked concentration of corporate power that has been a defining factor in this industry.
Government Accountability Project’s Food Integrity Campaign Director Amanda Hitt commented:
“This is a major win for contract growers and their advocates. For decades we have fought an uphill battle to bring attention to the exploitative practices of the poultry industry. We are hopeful that this move by the DOJ will only be the beginning of delivering justice to America’s farmers.”
Contact: Andrew Harman, Director of Communications
Phone: (202) 457-0034 x156
Government Accountability Project
Government Accountability Project is the nation’s leading whistleblower protection organization. Through litigating whistleblower cases, publicizing concerns and developing legal reforms, Government Accountability Project’s mission is to protect the public interest by promoting government and corporate accountability. Founded in 1977, Government Accountability Project is a nonprofit, nonpartisan advocacy organization based in Washington, D.C.