General Mills, Kraft, Kellogg and Nestle Win Price-Fixing Case Against Egg Producers
In a trial that awkwardly pitted food processors against food producers, General Mills, Kraft Foods, Kellogg and Nestle on Nov. 21 won a guilty verdict in a 12-year-running trial that claimed two of the country’s biggest egg producers and their trade associations conspired to fix the prices of eggs.
A jury in U.S. District Court for the Northern District of Illinois came back with a guilty verdict against Cal-Maine Foods Inc. and Rose Acre Farms Inc., along with two egg-industry trade groups: United Egg Producers and United States Egg Marketers.
The same jury will reconvene Nov. 29 to decide what damages the defendants must pay to the food companies. By law, whatever damages the jury awards will be tripled, though the jury will not be told about that statutory requirement, according to a Bloomberg Law story.
The food processors first brought the case in 2011 alleging the four defendants engaged in a conspiracy to reduce supply in order to increase the price of eggs from October 2004 to December 2008, according to Bloomberg Law. Other large-scale egg buyers—grocery stores and another group of direct purchasers—in two earlier cases were unsuccessful at trial.
The jury found that a conspiracy existed and that the egg companies reduced the nation’s hen population and boosted egg exports to limit the U.S. egg supply. However, the jury did not conclude that every egg producer aligned with the trade associations participated in the conspiracy.
In a statement released this morning, Cal-Maine Foods said the reduction in hens was a response “to demands from consumers and retailers to improve the overall treatment of egg laying hens. These programs were in line with other prevailing animal welfare laws across the protein industry and were not intended to restrict supply and affect prices. The programs were supported by our customers and form the basis of many state laws across the country today.”
