Sysco Sues Big 4 Packers Alleging Price Fixing

Sysco, the nation’s largest food distributor, filed a federal lawsuit in Texas last month alleging the Big 4 meat packers of price fixing.

Specifically, the lawsuit alleges Tyson Foods, JBS USA, Cargill and National Beef have conspired to suppress the number of cattle slaughtered since 2015 in an effort to drive beef prices higher. The allegations are similar to those filed in lawsuits filed by grocery stores, ranchers and wholesalers that have been pending in Minnesota federal court since 2020.

The suit also cited two unnamed witnesses who used to work in the meat industry who claims there was a conspiracy between the Big 4 packers. In previous price-fixing suits, the packers have defended their actions claiming that supply and demand, and not competition, drive the price of both beef and cattle.

"Defendants' collusive restriction of the beef supply has had the intended effect of artificially inflating beef prices," the lawsuit alleges. "As a result, Plaintiff paid higher prices than it would have paid in a competitive market."

Cargill spokesman Daniel Sullivan told the Washington Post his company “is confident in our efforts to maintain market integrity and conduct ethical business. We believe the claims lack merit and intend to vigorously defend our position.”

Earlier this year JBS paid a $52.5 million settlement in a different lawsuit, though the company did not admit any wrongdoing as part of the deal.

The Sysco lawsuit notes that the Justice Department launched investigations into accusations against the Big 4 for price fixing in 2020, though the government has yet to provide updates on the probe. 

Last week a jury in Denver federal court declared five chicken executives not guilty of price fixing and bid rigging. The verdict came after two previous trials resulted in hung juries.

“Not Guilty” – Chicken Price-Fixing Trial Ends