… asking the court to grant class-action status to growers...
Texas chicken growers allege Pilgrim’s Pride, chicken industry colluded to keep payments to producers down
By Dan Mika, Greeley Tribune (CO)
September 14, 2020
GREELEY — Two chicken growers in Texas previously contracted with Pilgrim’s Pride Corp. (Nasdaq: PPC) have sued the Greeley company and several other large-scale chicken packers in the U.S., alleging that the industry has colluded to artificially keep compensation down.
In a complaint filed in the U.S. District of Colorado Monday, Marc and Karen McEntire claim that Pilgrim’s and other major chicken packers such as Tyson Foods Inc. (NYSE: TSN), Sanderson Farms Inc. (Nasdaq: SAFM) and Perdue Farms Inc. have since 2008 been part of a “no-poach” scheme wherein they would not try to recruit small growers from one another and share compensation data.
The suit argues that the alleged scheme has put small growers in a position where they were effectively stuck with either taking non-competitive prices for their products or face financial ruin due to the high initial costs in setting up chicken grow-out homes to specifications set by the packers themselves.
The McEntires say they began growing chickens for Pilgrim’s in 2004 and took out $120,000 in debt to add improvements based on the company’s demands before quitting the industry a decade later.
They had to work full-time jobs while caring for the Pilgrim’s-bound broiler chickens because they “were barely able to make ends meet with the compensation provided by Pilgrim’s,” according to the suit.
The suit also includes broader price-fixing allegations echoed in previous antitrust lawsuits, such as the complaint filed two weeks ago by a subsidiary of Post Holdings Inc. (NYSE: POST).
The McEntires are asking the court to grant class-action status to growers...