Grassley, NCBA upset about JBS settlement in direct purchaser lawsuit
After JBS, the Brazilian meat company, settled a lawsuit over beef price-fixing, Sen. Chuck Grassley, R-Iowa, and the National Cattlemen’s Beef Association expressed dissatisfaction with the decision.
Bill Bullard, the CEO of R-CALF USA pointed out that the settlement deals with a lawsuit brought by direct purchasers of beef, and does not directly impact the suit brought by R-CALF USA and other cattle producers.
However, he hopes it is a sign that something could be in the works for the R-CALF suit, which is now in the discovery phase. “What this demonstrates is that there is now beginning to be movement in the cases – now that the motions to dismiss have been denied and the cases are now proceeding to discovery, this settlement offer indicates that there is beginning to be movement,” he said.
Bullard said that after R-CALF USA filed their suit, five more similar cattle producer cases were filed, and eventually the judge combined them all into one. But the direct purchaser suit (which JBS is trying to settle) is a separate suit.
The R-CALF suit alleges that finished cattle prices were reduced by an average of 7.9 percent in the three years following January 2015. The two classes in the R-CALF USA lawsuit are those who sold fed cattle to the big four packers in that time frame, and the exchange traders, or people who transacted live cattle futures or options on the CME during that same period.
Bullard said even if JBS settles on the direct purchaser suit, he believes that suit would continue with the other three plaintiffs (Tyson, National Beef/Marfrig and Cargill).
In a statement, JBS said it did not admit liability but that settling was in its best interest. It also said it will defend against beef price-fixing claims by other plaintiffs, Reuters reported.
“If there were any doubt about the shenanigans Big Packers play to line their pockets at the expense of consumers and independent producers, look no further than JBS’ $52.5 million settlement in price-fixing litigation,” Grassley said in a news release. “The other members of the Big Four packers continue to face similar allegations. Although the settlement is a spit in the ocean compared to JBS’ record profit throughout the pandemic, it validates what cattle producers have been telling me when they try to get a fair price in the marketplace. It’s time to put an end to these price fixing schemes once and for all. Congress must pass the Cattle Price Discovery and Transparency Act to bring access and accountability to the meatpacking industry.
“Those who oppose efforts to improve market access for independent producers – especially national organizations who claim to back America’s farmers and ranchers – need to take a serious look at Big Packers’ anticompetitive tactics, and ask themselves whose interests they are really serving,” Grassley said.
Grassley is one of the authors of the Cattle Price Discovery and Transparency Act.
The National Cattlemen’s Beef Association (NCBA), which is holding its annual meeting in Houston, said it finds the settlement “deeply disturbing.”
NCBA said that in August 2019, following a fire at the Tyson plant in Holcomb, Kan., it was the first national organization to request a government investigation of beef markets in 2019. “Now there are settlements occurring without Department of Justice (DOJ) having released findings or even providing cattle producers with an update on progress,” NCBA said.
“America’s cattle producers expect and deserve full transparency on any, and all, information related to the ongoing market investigations. NCBA encourages the government to finalize its investigation so we can fully understand any damage that may have been caused,” said NCBA CEO Colin Woodall. “It is clear from this settlement that cattle producers still don’t have all the information they have demanded and is deserved. The DOJ has an obligation to finish their investigation. Cattle producers do not have years to wait for the government to determine whether there has been wrongdoing. We demand answers now.”
–The Hagstrom Report and Carrie Stadheim reporting
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