Court Folds Large Retailers into Packer Antitrust Suit

Several large retailers and wholesalers (including Sysco, US Foods, Kroger, Hy-Vee, Albertson, Associated Grocers, Subway, SuperValu, and Cheney Brothers) recently filed claims similar to those brought originally in April 2019 by R-CALF USA and National Farmers Union (NFU) against the Big 4 packers. Those claims are that the packers' efforts to jointly manage their slaughter volume and their cattle purchasing practices caused beef prices to rise while also pushing cattle prices lower. In response, the U.S. District Court held a hearing and decided to coordinate these new claims with R-CALF USA and NFU's suit ahead of trial. This does not substantially affect the current case. While the Court may amend the existing schedule to fold these new claims in, fact discovery is already expected to continue across 2023 given that the parties have only just begun document production.

As a continuing update on the consolidated case, the next major event is plaintiffs' motion for class certification, presently due in August 2023. In that motion, R-CALF USA, NFU, and the other named cattle feeder plaintiffs will ask the Court to certify that their claims should proceed on behalf of feeders who sold fat cattle to Tyson, National Beef, Cargill, or JBS from January 1, 2015, to the present (other than on a cost-plus basis), and everyone who traded live cattle futures or options during that period. The Court appointed Scott+Scott Attorneys at Law LLP and Cafferty Clobes Meriwether & Sprengel LLP to act as co-lead counsel, and Robins Kaplan LLP as liaison counsel, on behalf of the proposed class. If the Court grants that motion everyone who did sell fat cattle to one of the Big 4, or traded live cattle, would be included in Plaintiffs' proposed class, without the need to file separate suits or engage separate legal counsel.

"For years we've talked about how the packers have been squeezing ranchers and consumers," said NFU President Rob Larew. "This addition of some of the largest retailers in the nation shows just how widespread the impacts of this rampant consolidation have been on the American economy."

According to R-CALF USA CEO Bill Bullard, "while our original case was filed in early 2019 to address suppressed fed cattle prices, we soon saw consumer beef prices skyrocket to new historical highs in early 2020. That has obviously caused additional focus throughout the entire supply chain."

NFU and R-CALF USA look forward to litigating the case on behalf of all cattle feeders and working to correct years of unfair and suppressed fat cattle prices.