Pilgrim’s Pride Lands in Front of SEC Over Its Chicken Claims
The Humane Society urged states and the FTC to investigate the company’s promises. Now it’s looking to securities regulators.
By Deena Shanker, Bloomberg
May 9, 2019
The Humane Society of the United States has tried for months to stop poultry giant Pilgrim’s Pride Corp. from calling its chicken “100% natural” and “humanely” raised, claiming it’s neither.
Following complaints to the U.S. Federal Trade Commission and state attorneys general, the animal welfare group has now filed a 100-page administrative complaint with the Securities and Exchange Commission. Once again, the group is arguing that Pilgrim’s Pride and its parent Brazilian meat processing giant JBS SA are using misleading advertising and marketing to sell its chicken.
This time, though, the group claims the language is hurting investors.
“Pilgrim’s Pride is deceiving stakeholders concerned about the suffering of animals with false assurances of the animals’ living conditions and treatment,” the Humane Society said, according to a copy of the complaint filed Thursday with the regulator. “Poor animal welfare practices are a serious investment risk…that [can] cause negative effects on demand and can cause stock prices to drop.”
The group also took issue with the company’s claims that the chickens are “natural,” citing crowded conditions in feces-filled barns and a slaughter method that sometimes results in birds being “scalded alive.” The alleged misleading statements, Humane Society argued in its filing, are violations of the Securities Exchange Act of 1934 and Commission Rule 10b-5 because they constitute untrue statements of material fact.
Pilgrim’s Pride and the SEC didn’t immediately respond to calls or emails seeking comment.
Cameron Bruett, a spokesman for Pilgrim’s Pride, has previously rejected the Humane Society’s allegations. “Pilgrim’s is committed to the well-being of the poultry under our care,” Bruett wrote in an email in December. “We welcome the opportunity to defend our approach to animal welfare against these false allegations.”
The $6.85 billion company is one of the largest chicken producers in the U.S., and sells its birds all over the world. With revenue close to $11 billion, Pilgrim’s Pride estimates that it produces “nearly 1 out of every 5 chickens” in the country, and has the capacity to process more than 45 million birds each week.
Last month, in response to the Humane Society’s claims, the FTC declined to take formal action against Greeley, Colorado-based Pilgrim’s Pride or JBS. In an April 1 letter to the company, a copy of which was obtained by Bloomberg, the federal agency noted that Pilgrim’s Pride told the FTC that it had removed the claims at issue from its websites as part of a previously planned redesign.
Bruett said at the time that “the website revamp project was unrelated to the complaint.” The Humane Society, however, notes that not all of the claims at issue were taken down.
The Humane Society told the SEC...
more, including links