October 10, 2024
McDonald's files lawsuit against major meat producers over alleged beef price fixing
McDonald's has filed a lawsuit against four of the largest global meat producers – Tyson, JBS, Cargill, and National Beef Packing – accusing them of conspiring to artificially raise beef prices, Legal Dive reported.
The lawsuit, filed in a New York federal court, claims that the companies violated US antitrust laws by coordinating lower prices for slaughter-ready cattle and slowing down production at processing plants. These actions allegedly resulted in inflated prices for McDonald's and other beef buyers.
As the largest buyer of beef and pork globally, McDonald's is seeking an undisclosed amount in monetary compensation. The companies named in the lawsuit have yet to respond, although they have previously denied wrongdoing in similar cases.
Concerns about pricing practices in the beef industry have been ongoing. Industry stakeholders have repeatedly raised alarms about the large disparity between fed cattle prices and wholesale beef prices. This issue has prompted separate investigations by the US Department of Agriculture (USDA) and the US Justice Department.
The USDA and Justice Department are currently examining whether the "Big Four" meatpackers, who control about 80% of US beef production, have violated federal antitrust laws and fair competition principles. These investigations are ongoing.
The McDonald's lawsuit follows similar allegations against JBS, Tyson, Cargill, and National Beef. These companies are accused of restricting beef supplies since 2015 to drive up prices. In a related case last year, a Minnesota court dismissed a similar lawsuit filed by a group of ranchers, citing insufficient legal standing.
However, some producers have opted to settle in other cases. In 2022, JBS USA agreed to a US$52.5 million settlement in response to price-fixing allegations brought by grocery stores and wholesalers.
McDonald's 100-page complaint outlines that the meat companies held frequent meetings at industry conferences and trade shows, where it is alleged that executives and employees exchanged sensitive pricing information. According to the lawsuit, these interactions helped maintain control over beef and cattle pricing, enabling the companies to boost their profits.
- Legal Dive