Naperville Business Law Attorney on the Class-Action Antitrust Suit Filed Against Poultry Producers

antitrust, Naperville business law attorneyFrom the moment a student begins learning about the subject of economics, he or she is taught that one of the most basic elements of business is the balance between supply and demand. Supply and demand are driving factors in everything from production, market strength, and, of course, prices. Since prices directly affect a company’s profit, a shift in the supply and demand can be helpful or harmful to individual businesses and the industry as a whole.

As an experienced business law attorney, I understand the importance of working within the law to improve a company’s bottom line. An individual company can and often does take action to facilitate an increase in demand—advertising and educational campaigns attempt to push prospective customers to suddenly “need” a particular product. When several companies—particularly industry leaders—work together in manipulating the balance of supply and demand, antitrust lawsuits often follow.

Filing in Federal Court

Earlier this month, a leading food service provider, Maplevale Farms filed an antitrust lawsuit in U.S. District Court for the Northern District of Illinois, Eastern Division, naming 14 poultry producers as primary defendants. The New York-based supplier’s complaint says that the defendants—which include household brand names such as Tyson Foods, Perdue Farms, Koch Foods, and Pilgrim’s Pride—colluded to artificially restrict the supply of consumer chicken so as to drive up prices. According to the lawsuit, the producers used an insider information-sharing resource to work together in their effort to keep prices robust.

While short-term adjustments to the chicken supply are not out of the ordinary, Maplevale claims that the large production companies took “unprecedented” steps to reduce their “breeder flocks,” by destroying egg-laying hens and limiting the number of young chickens being raised. As a result, the lawsuit claims, the price of chicken increased by about 50 percent in the last eight years, despite the prices of corn and soybeans—primary ingredients of chicken feed—falling by at least 20 percent during the same period.

Several of the producers have issued statements disputing Maplevale’s claims, while others have refused to comment on pending litigation.

Antitrust Action

Antitrust laws exist in this country to protect consumers and smaller companies from larger companies’ efforts in controlling a particular industry. Such actions, if left unchecked, can make open-market competition nearly impossible. If a leader emerges through hard work and by offering superior products, the playing field must remain level so that other companies can do the same.

If you believe that your industry has been affected by large businesses looking to artificially manipulate the market, contact an experienced Naperville business law attorney to discuss your options. Call The Gierach Law Firm today to get the help you need to take action and protect your business interests.

 

Sources:

Cook County Record

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