KANSAS CITY, MO. – Pilgrim’s Pride entered a guilty plea to charges of price fixing and was ordered to pay a fine of $107 million, the US Department of Justice (DOJ) said. Pilgrim’s is the first company to plead guilty for its role in a conspiracy to fix prices and rig bids for broiler chicken products.
In a statement, Pilgrim’s said, “Yesterday’s proceeding in the US District Court of Colorado formally approves the previously disclosed plea agreement between Pilgrim’s and the US Department of Justice Antitrust Division. The plea agreement involves restraint of competition that affected three contracts for the sale of broiler chicken products by Pilgrim’s to one customer in the United States.
“The agreement provides that the Antitrust Division will bring no further charges against Pilgrim’s in this matter, provided the company complies with the terms and provisions of the agreement.”
Upon announcement of the plea agreement on October 13, 2020, Pilgrim’s CEO, Fabio Sandri stated: “Pilgrim’s is committed to fair and honest competition in compliance with US antitrust laws. We are encouraged that today’s agreement concludes the Antitrust Division’s investigation into Pilgrim’s, providing certainty regarding this matter to our team members, suppliers, customers and shareholders.”
The plea agreement entered in the US District Court in Denver states that from at least as early as 2012 and continuing through at least early 2017, Pilgrim’s “... participated in a conspiracy with at least one competitor engaged in the production and sale of broiler chicken products to suppress and eliminate competition by rigging bids and fixing prices and other price-related terms for certain broiler chicken products sold in the United States” through at least one of the company's current and/or former employees.
“Defendant’s participation in this conspiracy affected sales of broiler chicken products to KFC, including: defendant’s contract for the supply to KFC of dark meat and wings in 2013; defendant’s contract for the supply to KFC of dark meat in 2014; and defendant’s contract for the supply to KFC of 8-piece chicken on the bone in 2015 through 2017,” the plea agreement stated. “Defendant’s affected sales of broiler chicken products totaled at least $361 million.”
The court accepted Pilgrim’s guilty plea and sentenced the company to pay a criminal fine of $107,923,572. Richard Powers, acting Assistant Attorney General of the DOJ’s Antitrust Division, credited the efforts of the agency’s career prosecutors and staff, the FBI, Commerce Office of Inspector General (OIG) and US Department of Agriculture Office OIG for securing the guilty plea.
Steven M. D’Antuono, Assistant Director in Charge of the FBI Washington Field Office said, “Today’s plea is another example of the FBI’s ongoing work to eliminate bid rigging and price fixing and hold those conducting these activities accountable for their actions.
“These criminal acts cheat American workers and consumers while harming competitive markets,” D’Antuono said. “This ongoing investigation has yielded charges against 10 individuals for their efforts to illegally manipulate broiler chicken prices, and the FBI is committed to continuing this important work alongside the Department of Justice and our partners.”
In a separate case, a federal judge in Illinois gave preliminary approval of a settlement between direct purchasers and Pilgrim’s Pride and Tyson Foods Inc.