CASE 0:18-Cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 1 of 83
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CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 1 of 83 UNITED STATES DISTRICT COURT DISTRICT OF MINNESOTA MAPLEVALE FARMS, INC., Case No. 0:18-cv-1803-PJS-SER Plaintiff, DIRECT PURCHASER PLAINTIFFS’ v. FIRST AMENDED AND CONSOLIDATED CLASS ACTION AGRI STATS, INC., CLEMENS FOOD COMPLAINT GROUP, LLC, THE CLEMENS FAMILY CORPORATION, HORMEL FOODS DEMAND FOR JURY TRIAL CORPORATION, HORMEL FOODS, LLC, INDIANA PACKERS CORPORATION, MITSUBISHI CORPORATION (AMERICAS), JBS USA FOOD COMPANY, JBS USA FOOD COMPANY HOLDINGS, SEABOARD FOODS, LLC, SEABOARD CORPORATION, SMITHFIELD FOODS, INC., TRIUMPH FOODS, LLC, TYSON FOODS, INC., TYSON PREPARED FOODS, INC., AND TYSON FRESH MEATS, INC. Defendants. ___________________________________ JOHN GROSS AND COMPANY, INC., Case No. 0:18-cv-1810-JNE-TNL individually and on behalf of all those similarly situated, DIRECT PURCHASER PLAINTIFFS’ FIRST AMENDED AND Plaintiff, CONSOLIDATED CLASS ACTION v. COMPLAINT AGRI STATS, INC., CLEMENS FOOD DEMAND FOR JURY TRIAL GROUP, LLC, THE CLEMENS FAMILY CORPORATION, HORMEL FOODS CORPORATION, HORMEL FOODS, LLC, INDIANA PACKERS CORPORATION, MITSUBISHI CORPORATION (AMERICAS), JBS USA FOOD COMPANY, JBS USA FOOD COMPANY HOLDINGS, SEABOARD FOODS, LLC, SEABOARD 530484 CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 2 of 83 CORPORATION, SMITHFIELD FOODS, INC., TRIUMPH FOODS, LLC, TYSON FOODS, INC., TYSON PREPARED FOODS, INC., AND TYSON FRESH MEATS, INC. Defendants. ___________________________________ FERRARO FOODS, INC. AND Case No. 0:18-cv-1946-WMW-SER FERRARO FOODS OF NORTH CAROLINA, LLC, DIRECT PURCHASER PLAINTIFFS’ FIRST AMENDED AND Plaintiffs, CONSOLIDATED CLASS ACTION v. COMPLAINT AGRI STATS, INC., CLEMENS FOOD DEMAND FOR JURY TRIAL GROUP, LLC, THE CLEMENS FAMILY CORPORATION, HORMEL FOODS CORPORATION, HORMEL FOODS, LLC, INDIANA PACKERS CORPORATION, MITSUBISHI CORPORATION (AMERICAS), JBS USA FOOD COMPANY, JBS USA FOOD COMPANY HOLDINGS, SEABOARD FOODS, LLC, SEABOARD CORPORATION, SMITHFIELD FOODS, INC., TRIUMPH FOODS, LLC, TYSON FOODS, INC., TYSON PREPARED FOODS, INC., AND TYSON FRESH MEATS, INC. Defendants. ___________________________________ OLEAN WHOLESALE GROCERY Case No. 0:18-cv-2058-PJS-BRT COOPERATIVE, INC., DIRECT PURCHASER PLAINTIFFS’ Plaintiff, FIRST AMENDED AND v. CONSOLIDATED CLASS ACTION COMPLAINT AGRI STATS, INC., CLEMENS FOOD GROUP, LLC, THE CLEMENS FAMILY DEMAND FOR JURY TRIAL CORPORATION, HORMEL FOODS CORPORATION, HORMEL FOODS, LLC, INDIANA PACKERS CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 3 of 83 CORPORATION, MITSUBISHI CORPORATION (AMERICAS), JBS USA FOOD COMPANY, JBS USA FOOD COMPANY HOLDINGS, SEABOARD FOODS, LLC, SEABOARD CORPORATION, SMITHFIELD FOODS, INC., TRIUMPH FOODS, LLC, TYSON FOODS, INC., TYSON PREPARED FOODS, INC., AND TYSON FRESH MEATS, INC. Defendants. ___________________________________ PHIL’S BBQ, INC., individually and on Case No. 0:18-cv-2390-SRN-SER behalf of all others similarly situated, DIRECT PURCHASER PLAINTIFFS’ Plaintiff, FIRST AMENDED AND v. CONSOLIDATED CLASS ACTION COMPLAINT AGRI STATS, INC., CLEMENS FOOD GROUP, LLC, THE CLEMENS FAMILY DEMAND FOR JURY TRIAL CORPORATION, HORMEL FOODS CORPORATION, HORMEL FOODS, LLC, INDIANA PACKERS CORPORATION, MITSUBISHI CORPORATION (AMERICAS), JBS USA FOOD COMPANY, JBS USA FOOD COMPANY HOLDINGS, SEABOARD FOODS, LLC, SEABOARD CORPORATION, SMITHFIELD FOODS, INC., TRIUMPH FOODS, LLC, TYSON FOODS, INC., TYSON PREPARED FOODS, INC., AND TYSON FRESH MEATS, INC. Defendants. ___________________________________ JOE CHRISTIANA FOOD Case No. 0:18-cv-2405-SRN-HB DISTRIBUTORS, INC., individually and on behalf of all other similarly situated, DIRECT PURCHASER PLAINTIFFS’ FIRST AMENDED AND Plaintiff, CONSOLIDATED CLASS ACTION COMPLAINT CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 4 of 83 v. DEMAND FOR JURY TRIAL AGRI STATS, INC., CLEMENS FOOD GROUP, LLC, THE CLEMENS FAMILY CORPORATION, HORMEL FOODS CORPORATION, HORMEL FOODS, LLC, INDIANA PACKERS CORPORATION, MITSUBISHI CORPORATION (AMERICAS), JBS USA FOOD COMPANY, JBS USA FOOD COMPANY HOLDINGS, SEABOARD FOODS, LLC, SEABOARD CORPORATION, SMITHFIELD FOODS, INC., TRIUMPH FOODS, LLC, TYSON FOODS, INC., TYSON PREPARED FOODS, INC., AND TYSON FRESH MEATS, INC. Defendants. CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 5 of 83 TABLE OF CONTENTS Page I. NATURE OF ACTION...........................................................................................1 II. JURISDICTION AND VENUE..............................................................................4 III. PARTIES.................................................................................................................6 A. Plaintiffs .......................................................................................................6 B. Defendants....................................................................................................7 IV. FACTUAL ALLEGATIONS................................................................................12 A. Defendants’ anticompetitive scheme started from Agri Stats’ central role in collusion in the Broiler industry..........................................12 B. After success in the Broiler industry, Agri Stats began marketing its collusive scheme to the swine integrators. ............................................14 C. Agri Stats provided pork integrators the unparalleled ability to monitor pricing and production, and to discipline co-conspirators for not complying with the collusive agreement........................................16 D. Defendants controlled the supply and production of pork in the United States, which allowed the scheme to succeed. ...............................23 E. The level of concentration in the pork industry was optimal for Defendants’ collusive scheme....................................................................26 F. Defendants took advantage of numerous opportunities to collude. ...........31 G. Defendants implemented capacity and supply restraints during the Class Period................................................................................................39 H. Abnormal pricing during the Class Period demonstrates the success of the collusive scheme. .............................................................................51 I. Overcharges due to the cartel were reflected in higher pork prices...........53 J. Defendants actively concealed the conspiracy and Plaintiffs did not and could not have discovered Defendants’ anticompetitive conduct.......57 V. CLASS ACTION ALLEGATIONS......................................................................62 VI. ANTITRUST INJURY..........................................................................................65 VII. VIOLATION OF SECTION 1 OF THE SHERMAN ACT .................................66 530484 i CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 6 of 83 VIII. REQUEST FOR RELIEF......................................................................................68 IX. JURY TRIAL DEMANDED ................................................................................69 530484 ii CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 7 of 83 Direct Purchaser Plaintiffs (“Plaintiffs”)1 bring this action on behalf of themselves individually and on behalf of a plaintiff class consisting of all persons and entities who purchased pork directly from a Defendant or co-conspirator named in this Amended and Consolidated Class Action Complaint in the United States from at least January 1, 2009 until the present (Class Period). Plaintiffs bring this action against Defendants for injunctive relief and treble damages under the antitrust laws of the United States, and demand a trial by jury. I. NATURE OF ACTION 1. The pork integrator Defendants are the leading suppliers of pork in an industry with approximately $20 billion in annual commerce. The United States pork industry is highly concentrated, with a small number of large companies controlling the supply. Defendants and their co-conspirators collectively control over 80 percent of the wholesale pork integration market. 2. Defendants, Agri Stats, Inc. (“Agri Stats”), Clemens Food Group, LLC, The Clemens Family Corporation (“Clemens”), Hormel Foods Corporation, Hormel Foods, LLC (“Hormel”), Indiana Packers Corporation, Mitsubishi Corporation (Americas) (“Indiana Packers”), JBS USA Food Company, JBS USA Food Company Holdings (“JBS” or “JBS USA”), Seaboard Foods LLC, Seaboard Corporation (“Seaboard”), Smithfield Foods, Inc. (“Smithfield”), Triumph Foods, LLC (“Triumph”), Tyson Foods, Inc., Tyson Prepared Foods, Inc., and Tyson Fresh Meats, Inc. (“Tyson”), entered into a conspiracy 1 Plaintiffs refers collectively to each of the named plaintiffs identified in Section III(A) of this complaint. 530484 1 CASE 0:18-cv-01803-PJS-SER Document 83 Filed 08/17/18 Page 8 of 83 from at least 2009 to the present to fix, raise, maintain, and stabilize the price of pork.2 The principal (but not exclusive) method by which Defendants implemented and executed their conspiracy was by coordinating output and limiting production with the intent and expected result of increasing pork prices in the United States. In furtherance of their conspiracy, Defendants exchanged detailed, competitively sensitive, and closely guarded non-public information about prices, capacity, sales volume, and demand through their co-conspirator, Defendant Agri Stats. 3. Beginning in at least 2009, Agri Stats began providing highly sensitive “benchmarking” reports to the majority