The Justice Department and Agri Stats have agreed to a settlement to resolve claims that the company illegally shared information on price, output and costs with competing meat processors.
The proposed agreement was filed in a case in federal court in Minnesota. The United States initially sued in September 2023 and the states of California, Minnesota, North Carolina, Tennessee, Texas and Utah joined as plaintiffs shortly afterwards. All the states joined in the settlement.
“The proposed settlement will help lower food prices, undo decades of distorted competition in the broiler chicken market, and ensure that the pork and turkey markets remain free from these anticompetitive practices that harmed American consumers across the country,” DOJ’s press release says.
“A stable and affordable food supply is critical to our country’s well-being,” Acting Attorney General Todd Blanche said in a news release. “This Department of Justice is laser-focused on making everyday life affordable for all Americans.”
Agri Stats is a “data-sharing and consulting company that currently operates in the broiler chicken market and has historically operated in the pork and turkey markets,” DOJ noted. The company collects information “on prices, output, and costs directly from meat processors’ accounting systems, standardizes that data, and redistributes it back to the processors in granular detail through digital and written reports and in-person meetings.”
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Both Agri Stats and the meat processors have refused to make the information available to meat buyers like restaurants, grocery stores and food distributors, DOJ said. “When companies decide certain information is too sensitive to share with the broader market, but not too sensitive to share with their closest competitors, that is a significant red flag that competition is being harmed,” said Acting Assistant Attorney General Omeed A. Assefi.
“We are pleased to put this case with the Department of Justice and six states behind us,” said Eric Scholer, president of Agri Stats and CEO of subsidiary Express Markets Inc. “For more than 40 years, Agri Stats has produced reports that allow chicken producers to benchmark their performances in a host of operating areas and to improve their operations and enhance efficiency. Those reports have helped companies expand their production and drive down their costs significantly, all to the benefit of the American consumer.”
“Contrary to online statements and other reports, Agri Stats has never provided any benchmarking services to companies in the beef industry, and thus the case never had any application to beef prices, cattle ranchers, or any other aspect of the beef industry,” the company’s news release said.
Under the terms of the settlement, which will be published in the Federal Register and subject to a public comment period, DOJ said Agri Stats has agreed to:
- “Stop providing any sales reports or non-public pricing information, which chicken, pork, and turkey processors have systematically used to identify opportunities to increase prices;
- “Stop reporting production, cost, and labor data at either the company or facility level, which enabled competing processors to adjust output, pricing, or both based on near-total visibility into their rivals’ operations;
- “Make the vast majority of information that Agri Stats distributes available to all interested domestic purchasers on reasonable and non-discriminatory terms, eliminating the asymmetry of its prior information sharing and increasing market transparency;
- “Adhere to restrictions on the timeliness of the information that Agri Stats shares;
- “Report to a court-approved monitor selected by the Department of Justice who will be responsible for reporting on and ensuring compliance with the proposed settlement; and
- “Establish an antitrust compliance program to ensure data security, whistleblower protections, and mandatory reporting of any future potential violations of the antitrust laws.”
DOJ said Express Markets Inc. will still be allowed to provide its price reports “in substantially the same manner as it has in the past. Because EMI’s price reports are less detailed and provided to all interested parties, not only meat processors, they were not the focus of the case.”
The fact that Agri Stats can continue to operate rankled some.
“The fact of the matter is there should be no Agri Stats,” said Lee Hepner, senior legal counsel of the American Economic Liberties Project. “It exists because it provides an efficient system of coordination for an oligopoly market. It is laundering the cartel, and it’s unclear to me that this settlement does much to prevent it from continuing to do so.”
The group helps “translate the intellectual victories of the anti-monopoly movement into momentum towards concrete, wide-ranging policy changes that begin to address today’s crisis of concentrated economic power,” according to its website.
Agri Stats reached a settlement in March in cases involving chicken, pork and turkey buyers.
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