Nestlé, Kraft defeat egg producers in price-fixing case

Nestlé, Kraft defeat egg producers in price-fixing case

December 5, 2023

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A unanimous jury ruled that multiple major egg producers conspired to fix the price of the commodity between 2004 and 2008. The decision last month delivered a major victory to food giants such as Kraft Heinz and Nestlé.

In the initial lawsuit filed in the Northern District of Illinois in 2011, numerous food giants including Nestlé, Kraft, General Mills and Kellogg alleged egg producers Cal-Maine Foods and Rose Acre Farms — along with trade groups United Egg Producers and U.S. Egg Marketers — conspired to artificially limit the supply of hens and kill them earlier than normal between 1998 and 2008.

The major food manufacturers, who purchased eggs from the producers, alleged that this scheme caused prices of the eggs to increase, impacting their bottom line. Jurors declared the scheme took place for four years, ending in 2008.

“For the first time, the defendants have been held liable for their antitrust violations,” said attorney Brandon Fox, who represented the food companies in the case, told the Associated Press.

Cal-Maine Foods, the largest egg producer in the U.S., said in a statement it took action 20 years ago to improve the welfare of hens, and that it did not intend to limit supply and impact the price of eggs. The company claimed it was successful in proving that the time frame of the conspiracy did not run for ten years like the initial lawsuit claimed.

“Cal-Maine Foods will vigorously contest plaintiffs’ presentation of purported damages and will continue to assess the decision and options for appeal,” the company said.

The total damages owed by producers to the victorious food companies will be decided by Wednesday, Nov. 29.

The resolution to this lawsuit comes after the industry concentration of major producers came under wide scrutiny early this year, when rising egg prices amid bird flu caused Cal-Maine’s profits to soar to $801 million in the final quarter of 2022.

In a statement to Food Dive, Rose Acre Farms said it cannot comment until the trial is concluded.

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