After receiving leave of court, consumer indirect purchaser plaintiffs submitted supplemental authority via a letter in In Re Pork Antitrust Litigation, pending before Chief Judge John R. Tunheim of the District of Minnesota last week. The case is a 2018 class action pursued by several groups of direct and indirect purchaser plaintiffs against major domestic pork processing companies.
The plaintiffs alleged that the defendants, among other things, conspired to fix and maintain prices for pork using reports provided by defendant Agri Stats, Inc., an industry data sharing service. According to the consumer indirect purchaser plaintiffs’ second amended complaint filed in December 2019, Agri Stats was “(k)ey to this conspiracy.”
The complaint explained that Agri Stats provided pork processors with current and prospective information like profits, costs, sale prices, and slaughter information, in addition to “the key to deciphering which data belongs to which producers.” In turn, the complaint alleged, the defendants “relied on Agri Stats as a means to obtain and monitor critical and competitively-sensitive business information regarding each other’s production metrics, thereby serving as a central and critical part of defendants’ price-fixing scheme, resulting in a remarkably stable and successful anticompetitive cartel.”
The Sept. 18 letter to Judge Tunheim directed his attention to an opinion rendered in Jien v. Perdue Farms, Inc., No. 19-cv-2521-SAG (Perdue Farms). Specifically, the plaintiffs pointed to the court’s analysis regarding “whether an Agri Stats-led information exchange agreement is sufficient to support a rule of reason claim.”
In Perdue Farms, a putative class of current and former employee plaintiffs accused fourteen poultry processors, their subsidiaries, and two data consulting companies, including Agri Stats, of violations of Section 1 of the Sherman Antitrust Act. Specifically, they alleged “a conspiracy among Defendants to fix and depress poultry workers’ compensation, and ( ) an unlawful exchange of compensation data.” The employees contended that Agri Stats facilitated the conspiracy by providing competitors with data to enable impermissible information exchange, parallel to its supposed role in In Re Pork Antitrust Litigation.
In the Perdue Farms opinion and order partly granting the defendants’ motion to dismiss, the plaintiffs’ latter contention survived dismissal, based somewhat on the court’s finding regarding Agri Stats. In relevant part, the court held that “Agri Stats’s conduct, while not sufficient to constitute direct or indirect evidence of per se conspiracy, still plausibly constitutes unlawful information sharing because of the breadth of its market coverage and the nature of the data it provided.”
Further, the court noted that “its business model revolves around sharing current wage data, which both the Supreme Court and Department of Justice have noted is particularly sensitive and has ‘the greatest potential for generating anticompetitive effects.’” The court concluded that “(b)y providing comprehensive, real-time, and current wage data to nearly the entire poultry processing industry, Agri Stats’s conduct can plausibly be alleged to constitute unlawful information sharing…”
The consumer indirect purchaser plaintiffs are represented by interim co-lead counsel Gustafson Gluek PLLC, and Hagens Berman Sobol Shapiro LLP, among other firms.
Agri Stats is represented by Hogan Lovells LLP.