Authored by Bryan Hyde via American Greatness,
Three major egg producers have reached a $3.3 million settlement to resolve allegations of price fixing after being sued by the Justice Department (DOJ) and 17 U.S. states’ Attorneys General.
Just the News reports that the complaint—filed in Iowa’s Northern District Court—contends that the defendants conspired to artificially inflate the daily price quotations of market reporting company Urner Barry Publications.
According to the DOJ Office of Public Affairs, a civil lawsuit was filed against Cal-Maine Foods Inc. (Cal-Maine); Hickman’s Egg Ranch Inc. (Hickman’s); and Centrum Valley Holdings LLC, Versova Holdings LLC, and Versova Management Cooperative (Versova) for unlawful coordinated manipulation of egg prices.
The Attorneys General of Arizona, California, Colorado, Connecticut, Florida, Hawaii, Iowa, Maryland, Minnesota, New York, North Carolina, Ohio, Pennsylvania, Texas, Utah, Vermont, and Wisconsin joined the Department in the complaint and proposed settlements.
The DOJ also filed proposed settlements that will, if approved by the court, prevent these companies from engaging in such coordinated manipulation in the future.
According to the complaint, the defendants conspired to inflate Urner Barry’s price quotations by agreeing to: submit a lot of bids, submit bids that were unlikely to result in executed trades, cause several defendants to bid to alert Urner Barry that market participants needed to buy eggs and deliver trades at premium prices.
The defendants, along with other egg producers, also bid to obtain eggs on spot markets, including the Egg Clearinghouse, an exchange that helps determine and establish the market value for eggs and egg products.
In the press release, Former Acting Assistant Attorney General Omeed A. Assefi of the Justice Department’s Antitrust Division affirmed:
“Food affordability is a top priority of the Antitrust Division. These settlements resolve years of conduct that dragged on Americans’ finances and their everyday lives. I thank and recognize the dedicated work of the Division’s talented staff and state partners.”
Under the terms of the settlement, producers will pay a combined $3.3 million in monetary recovery to the participating states.
Meanwhile, CBS News reports that, in a unique deal, the companies must donate 53 million eggs to food banks and community organizations in the affected states.
The companies are also barred from communicating with competitors about pricing strategies, bids, or market information for five years, according to the DOJ press release.