US meat processors must face workers' wage antitrust claims, judge says

The judge declined to dismiss the lawsuit
calendar icon 29 September 2023
clock icon 2 minute read

Nearly a dozen meat processors including Hormel, National Beef and Smithfield must face a prospective class action alleging they conspired to artificially suppress workers' compensation, Reuters reported, citing the ruling of a federal judge in Colorado on Wednesday.

In a 44-page order, Chief US District Judge Philip Brimmer said the plaintiffs, hourly red meat processing plant workers, had shown enough evidence as a threshold matter to allow their allegations of price-fixing to move forward. Brimmer declined to dismiss the lawsuit.

Brimmer rejected claims from beef and pork processors that the workers had failed to include any direct or circumstantial evidence of a conspiracy.

The judge said the workers' evidence indicating that the meat producers exchanged data on future compensation, rather than just current wages, supported a "plausible inference" of an agreement to fix compensation.

The judge also ruled against the companies' contention that the workers' complaint fell outside of the four-year window in US law to bring an antitrust claim.

Hormel and the other defendants, JBS, Cargill and Tyson Foods, jointly filed a request asking Brimmer to dismiss the claims.

The defendants have denied any liability.

Smithfield in a statement said it "intends to continue to vigorously defend against these claims." Other defendants did not immediately respond to requests for comment on Thursday.

Attorneys for the plaintiffs did not immediately respond to a similar request.

The plaintiffs' lawyers, representing what they said was a class of "hundreds of thousands" of red meat industry employees from 2014 to the present, alleged the conspiracy operated through "information exchanges" that let companies share information about wages.

In a court filing, they argued that the complaint "meticulously documents each facet of the conspiracy" using worker compensation surveys, emails and statements from current and former employees.

Defense attorneys for the processors called the lawsuit a "patchwork of allegations" that did not support a claim of a "nearly-decade-long wage-fixing conspiracy that spanned the continental United States and two distinct protein industries."

The plaintiffs "cannot speculate their way into a viable antitrust claim," lawyers for the defendants told Brimmer.

Several defendants have agreed to settle the workers' claims.

Perdue Farms last year said it would pay $1.25 million and cooperate with the plaintiffs, and Seaboard Foods said it would pay $10 million and also cooperate.

In a filing last month, the workers' lawyers said they pursued the lawsuit after they completed a "comprehensive investigation" that included "assessments of industry wages, interviewing industry witnesses, and extensive research into the red meat processing industry."

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