America’s largest beef packers, JBS SA, Tyson Foods Inc., Cargill Inc., and National Beef Packing Co. must face antitrust litigation over an alleged industry-wide scheme to widen the margin between the cost of live cattle and the price of processed beef, a federal judge in Minneapolis ruled Tuesday.
Judge John R. Tunheim denied the defendants' motion to dismiss the class-action antitrust suit filed in April 2019 by R-CALF USA.
The case may move forward in the U.S. District Court for the District of Minnesota, where the four meatpackers are accused of forcing the cost of cattle down, and the price of beef up, through cartel tactics such as coordinated procurement and slaughter restraint.
The lawsuit alleges the four packers violated the Sherman Antitrust Act of 1890 by engaging in a price-fixing conspiracy, and alleges the packers violated the Packers and Stockyards Act as well as the Commodity Exchange Act.
Tunheim’s order allows the antitrust case to proceed to discovery so plaintiffs may test their claims.
The suit alleges that from at least January 1, 2015, through the present, the four packers conspired to depress the price of fed cattle they purchased from American ranchers, thereby inflating their own margins and profits.
The complaint, which plaintiffs claim is supported by witness accounts, including a former employee of one of the packers, trade records, and economic evidence, alleges that the packers conspired to artificially depress fed cattle prices through various means.