Cargill pays $32.5M to settle customer lawsuit alleging turkey price-fixing

Cargill will pay $32.5 million to settle claims the company conspired with other poultry producers to fix the price of turkey and overcharge customers.

The Minnetonka-based agribusiness is the nation’s third-largest turkey purveyor, after Butterball and Jennie-O, according to WATT Poultry, a trade publication. Cargill controls about 20% of the turkey market through brands such as Honeysuckle White and Shady Brook Farms, according to court documents.

Grocery wholesalers, restaurants and other “direct purchasers” accused the nation’s largest turkey companies of sharing “competitively sensitive” data with each other in order to profit from higher turkey prices, according to the lawsuit.

Cargill agreed to the settlement filed in federal court in Illinois last week despite maintaining the claims “are without merit,” and the company would win at trial, the settlement read.

The company could not comment based on the terms of the deal, but in court documents, Cargill said it wanted to “avoid the costs, expenses and uncertainties of this complex litigation, and thereby put this controversy to rest.”

Meat companies have paid out hundreds of millions of dollars in class-action settlements in recent years regarding claims of price-fixing and wage-fixing, including millions of dollars Cargill’s beef division and Hormel Foods have paid. Many of those anti-trust claims revolve around Agri Stats, a data company that allegedly facilitated the flow of information among meatpackers.

Cargill’s most recent settlement joins a $4.6 million deal Tyson reached with the direct purchasers.

Willmar-based Jennie-O Turkey Store, which Hormel owns, remains as a defendant in the case. Jennie-O previously settled a wage-fixing suit for an undisclosed sum.