A federal judge reached a decision that cleared Agri Stats of any allegations of participating in a scheme with top poultry companies to limit the supply and drive up the price of chicken.
In the U.S. District Court for the Northern District of Illinois, Judge Thomas M. Durkin granted Agri Stats’ motion for summary judgment, finding that Agri Stats’ benchmarking reports are not evidence of such a conspiracy as alleged in a series of class-action lawsuits.
The judge's decision, made on June 30, marks an important victory for Agri Stats and the industry’s use of benchmarking reports to reduce costs and improve the efficiency of broiler chicken production in the United States, Agri Stats said in a statement.
“Agri Stats welcomes Judge Durkin’s ruling because it confirms what the industry has known for a long time: Agri Stats benchmarking reports increase competition and benefits consumers,” said Agri Stats President Brian Snyder. “Agri Stats looks forward to the end of the baseless antitrust lawsuits against the company and the industry, so that we can focus on our core mission of helping to improve efficiency in the protein industry for our subscribers.”
How Agri Stats works
Founded in 1985, Agri Stats provides benchmarking reports for the broiler chicken industry, as well as other protein producers. The company aggregates and analyzes data provided by the producers and publishes the data in reports that allow the producers to compare their performance against industry averages and identify areas for improvement.
According to the company, subscribing producers use the reports to identify specific opportunities for cost reduction, productivity enhancement and quality improvement, helping subscribers stay competitive in their protein sectors.
Judge’s opinion
In a 90-page opinion, Durkin rejected plaintiff claims by direct and indirect purchasers that Agri Stats reports are part of any conspiracy to reduce output or increase chicken prices.
He ruled that participation in Agri Stats is not “sufficient to establish an intent to conspire,” and that “despite years of discovery, plaintiffs simply have not produced sufficient evidence for a reasonable jury to find by a preponderance of the evidence that Agri Stats agreed with the producer defendants to restrict supply and increase the price of broilers.”
The judge’s opinion also found that Agri Stats reports include only the production and pricing information of the recipient producer receiving the report, and not information concerning the competitors.
“The lack of production and pricing information in the Agri Stats reports undermines their usefulness for communicating intent to reach agreement to reduce production, as plaintiffs originally alleged,” Durkin wrote.
Durkin also stated that the forecasts and analyses generated by Agri Stats’ subsidiary Express Markets also were not a “conduit for an agreement to reduce supply” because the forecasts and analyses were based on publicly available information, and reflect “mere economic common sense applied to complicated data."
Insufficient evidence against other companies
In the same opinion, Durkin wrote that “there is insufficient evidence for a reasonable jury to find by a preponderance of the evidence” that Perdue Farms, Fieldale Farms, Case Foods, Foster Farms, Claxton Poultry and Wayne Farms joined a conspiracy.
“Although the economic evidence showing opportunity and incentive to conspire applies to these defendants just as it does to the defendants discussed above, there is simply a lack of evidence that these defendants communicated with their competitors, which would permit a reasonable inference of agreement,” Durkin wrote.
More reporting on the ruling regarding these companies will appear on wattpoultry.com in the coming days.
