Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 1 of 86
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`UNITED STATES DISTRICT COURT
`DISTRICT OF CONNECTICUT
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`Case No.: 21-cv-00869
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`SUBWAY PROTEIN LITIGATION CORP., AS
`LITIGATION TRUSTEE OF THE SUBWAY®
`PROTEIN LITIGATION TRUST,
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`Plaintiff,
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`v.
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`AGRI STATS, INC., CLEMENS FOOD
`GROUP, LLC, THE CLEMENS FAMILY
`CORPORATION, HORMEL FOODS
`CORPORATION, HORMEL FOODS, LLC,
`JBS USA FOOD COMPANY, SEABOARD
`FOODS LLC, SMITHFIELD FOODS, INC.,
`TRIUMPH FOODS, LLC, TYSON FOODS,
`INC., TYSON PREPARED FOODS, INC., AND
`TYSON FRESH MEATS, INC.,
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`Defendants.
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`COMPLAINT AND DEMAND FOR JURY TRIAL
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 2 of 86
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`I.
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`II.
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`Table of Contents
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`NATURE OF ACTION .................................................................................................. 1
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`JURISDICTION AND VENUE ..................................................................................... 4
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`III.
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`PARTIES ........................................................................................................................ 5
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`A. Plaintiff ............................................................................................................................... 5
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`B. Defendants .......................................................................................................................... 6
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`(i)
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`(ii)
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`Agri Stats ..................................................................................................................... 6
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`Clemens ....................................................................................................................... 6
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`(iii) Hormel ......................................................................................................................... 7
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`(iv)
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`JBS ............................................................................................................................... 8
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`(v)
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`Seaboard ...................................................................................................................... 8
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`(vi)
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`Smithfield .................................................................................................................... 9
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`(vii) Triumph ....................................................................................................................... 9
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`(viii) Tyson ........................................................................................................................... 9
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`C. Co-Conspirators ................................................................................................................ 10
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`IV.
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`FACTUAL ALLEGATIONS ....................................................................................... 11
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`A. Agri Stats’ central role in collusion in the Broiler industry. ............................................. 12
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`B. Agri Stats markets its collusive scheme to Defendants. ................................................... 13
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`C. Agri Stats provided the Other Defendants the unique ability to monitor pricing and
`production and discipline co-conspirators that did not comply with the anticompetitive
`agreement. ................................................................................................................................. 16
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`D. Defendants controlled the supply and production of pork in the United States, which
`allowed the scheme to succeed. ................................................................................................ 26
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`E. The level of concentration in the pork industry was optimal for Defendants’ collusive
`scheme....................................................................................................................................... 31
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`F. The inelastic demand for, and homogeneity of, pork products facilitated collusion. ....... 36
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`G. Defendants took advantage of numerous opportunities to collude. .................................. 37
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`H. Defendants implemented capacity and supply restraints during the Relevant Period. ..... 45
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`I. Abnormal pricing during the Relevant Period demonstrates the success of the collusive
`scheme....................................................................................................................................... 65
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`J. Overcharges due to the cartel were reflected in higher pork prices than what they would
`have been absent the conspiratorial activity. ............................................................................ 68
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`K. The results of the DOJ’s criminal investigation in the Broilers industry support an
`inference of the existence of a similar conspiracy in the pork industry. ................................... 72
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`ii
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`L. Plaintiff’s claims are timely. ............................................................................................. 73
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`V.
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`VI.
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`ANTITRUST IMPACT ................................................................................................ 78
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`COUNT I: VIOLATION OF SECTION 1 OF THE SHERMAN ACT ..................... 80
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`VII.
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`REQUEST FOR RELIEF ............................................................................................. 81
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`VIII.
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`JURY TRIAL DEMANDED ....................................................................................... 82
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`iii
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 4 of 86
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`Plaintiff1 Subway Protein Litigation Corp., as litigation trustee of the Subway® Protein
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`Litigation Trust, brings this action against the Defendants identified below, for their illegal
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`conspiracy, which increased the prices of pork sold in the United States beginning at least as early
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`as 2009 and continuing through the present. Plaintiff brings this action for treble damages and
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`injunctive relief under Section 1 of the Sherman Act.
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`I.
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`NATURE OF ACTION
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`1.
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`Defendants—other than Agri Stats—are the leading suppliers of pork in an industry
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`with more than $20 billion in annual sales. The United States pork industry is highly concentrated,
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`with a small number of large companies controlling supply. Together with their co-conspirators,
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`Defendants collectively control approximately 80% of the wholesale pork market.
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`2.
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`Defendant Agri Stats, Inc. (“Agri Stats”) is a specialized information-sharing
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`service that, among other things, obtains data from participating industry producers and develops
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`comprehensive reports based on that data. Agri Stats provides its reports and findings to the
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`participating industry producers.
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`3.
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`Defendants Clemens Food Group, LLC, The Clemens Family Corporation
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`(“Clemens”); Hormel Foods Corporation and Hormel Foods, LLC (“Hormel”); JBS USA Food
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`Company (“JBS”); Seaboard Foods LLC (“Seaboard”); Smithfield Foods, Inc. (“Smithfield”);
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`Triumph Foods, LLC (“Triumph”); and Tyson Foods, Inc., Tyson Prepared Foods, Inc., and Tyson
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`Fresh Meats, Inc. (“Tyson”) (collectively referred to at times as “pork integrator Defendants”) and
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`Agri Stats entered into a conspiracy from at least 2009 through the present (the “Relevant Period”)
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`to fix, raise, maintain, and stabilize the price of pork.2 Defendants implemented their conspiracy
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`1 “Plaintiff”, as used herein, shall include Assignors identified in Paragraph 15 where appropriate.
`2 For purposes of this complaint, “pork” includes meat from hogs or domestic swine, fresh or
`frozen, smoked ham, sausage, and bacon.
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`1
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 5 of 86
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`by, among other things, coordinating with each other to restrict output and limit production, with
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`the intended purpose and expected result of increasing and stabilizing pork prices in the United
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`States. In furtherance of the conspiracy, Defendants exchanged detailed, competitively sensitive,
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`and closely guarded non-public information about prices, capacity, sales volume, and demand,
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`including through their co-conspirator, Defendant Agri Stats.
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`4.
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`Beginning at least as early as 2009 through present, Agri Stats began providing
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`highly sensitive benchmarking reports to the pork integrator Defendants. Benchmarking allows
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`competitors to compare their profits or performance against that of other companies. However,
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`Agri Stats reports are unlike those of other lawful industry reports. Agri Stats gathers detailed
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`financial and production data from each of the pork integrator Defendants and their Co-Conspirator
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`Indiana Packers, standardizes this information, and produces customized reports and graphs for
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`the conspirators. The type of information available in these reports is not the type of information
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`that competitors would provide to one another in a normal, competitive market.
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`5.
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`Agri Stats collected the pork integrator Defendants’ competitively sensitive supply
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`and pricing data and intentionally shared that information through the detailed reports it provided
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`them. On at least a monthly basis, and often far more frequently (e.g., weekly or every other week),
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`Agri Stats provides the pork integrator Defendants with current and forward-looking sensitive
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`information (such as profits, costs, prices, and slaughter information), and regularly provides the
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`keys to deciphering which data belongs to which participant. The effect of this information
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`exchange allowed Defendants to coordinate their anticompetitive conduct, monitor each other’s
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`production, and thereby control pork supply and price in furtherance of their anticompetitive
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`scheme.
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`2
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`6.
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`The data exchanged through Agri Stats is a classic enforcement and implementation
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`mechanism of a price-fixing scheme. First, the data is current and forward-looking, which courts
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`have consistently held has “the greatest potential for generating anti-competitive effects.”3 Second,
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`the information contained in Agri Stats reports is specific to pork producers, including information
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`on profits, prices, costs, and production levels—instead of being aggregated as industry averages,
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`which provides transactional specificity and the easy identification of individual producers. Third,
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`none of the Agri Stats information was publicly available. Agri Stats is a subscription service that
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`required the pork integrator Defendants and the Co-Conspirators to pay millions of dollars over
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`the Relevant Period—far in excess of any other pricing and production indices. Agri Stats ensured
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`that its detailed, sensitive business information was available only to the pork integrator
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`Defendants and the Co-Conspirators and not to any buyers in the market. Defendants utilized the
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`information exchanged through Agri Stats in furtherance of their conspiracy to fix, raise, stabilize,
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`and maintain artificially inflated prices for pork sold in the United States.
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`7.
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`While Defendants went to great lengths to keep the existence of the conspiracy a
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`secret, they admitted in public calls that they had discussed production cuts at least once and
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`publicly signaled to each other that no supply increases would happen. Furthermore, each
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`Defendant engaged in acts in furtherance of the conspiracy by participating in such supply cuts
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`and by limiting increases in supply that would not have otherwise occurred.
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`8.
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`In addition, there are numerous “plus factors” in the pork industry during the
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`Relevant Period, including, but not limited to, multiple industry characteristics that facilitate
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`collusion, such as vertically integrated operations, high barriers to entry preventing competitors
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`3 Todd v. Exxon Corp., 275 F.3d 191, 2011 (2d Cir. 2001) (Sotomayor, J.) (quoting United States
`v. Gypsum Co., 438 U.S. 422, 441 n.16 (1978)).
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`3
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 7 of 86
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`from coming into the market, high pork industry consolidation and concentration, inelastic supply
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`and demand, and homogeneity of pork products (within each cut type).
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`9.
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`Defendants’ restriction of pork supply had the intended purpose and effect of
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`increasing pork prices for Plaintiff. Beginning in or around 2009, the pork integrator Defendants’
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`earnings began to increase, as they took an increasing amount of the profits available in the pork
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`industry. As a result of Defendants’ unlawful conduct, Plaintiff paid artificially inflated prices for
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`pork during the Relevant Period. Such prices exceeded the amount it would have paid if the price
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`for pork had been determined by a competitive market. Thus, Plaintiff was injured by Defendants’
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`anticompetitive conduct.
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`II.
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`JURISDICTION AND VENUE
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`10.
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`Plaintiff brings this action under Sections 4 and 16 of the Clayton Act, 15 U.S.C.
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`§§ 15 & 26, for injunctive relief and to recover treble damages and the costs of this suit, including
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`reasonable attorneys’ fees, against Defendants for the injuries sustained by Plaintiff by virtue of
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`Defendants’ violations of Section 1 of the Sherman Act, 15 U.S.C. § 1.
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`11.
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`This Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 & 1337,
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`and Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15(a) & 26.
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`12.
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`Venue is appropriate in this District under Sections 4, 12, and 16 of the Clayton
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`Act, 15 U.S.C. §§ 15, 22 & 26 and 28 U.S.C. § 1391(b), (c) & (d), because one or more Defendants
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`resided or transacted business in this District, is licensed to do business or is doing business in this
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`District, or because a substantial portion of the affected interstate commerce described herein was
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`carried out in this District.
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`13.
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`This Court has personal jurisdiction over each Defendant because, inter alia, each
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`Defendant: (a) transacted business throughout the United States, including in this District;
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`(b) manufactured, sold, shipped, and/or delivered substantial quantities of pork throughout the
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`4
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`United States, including this District; (c) had substantial contacts with the United States, including
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`this District; and/or (d) engaged in an antitrust conspiracy that was directed at and had a direct,
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`foreseeable, and intended effect of causing injury to the business or property of persons residing
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`in, located in, or doing business throughout the United States, including this District.
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`14.
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`The activities of the Defendants and all co-conspirators, as described herein, were
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`within the flow of, were intended to, and did have direct, substantial, and reasonably foreseeable
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`effects on the interstate commerce of the United States.
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`III.
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`PARTIES
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`A.
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`Plaintiff
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`15.
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`Subway Protein Litigation Corp. (“Plaintiff”) or (“SPLC”) is a Delaware
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`corporation operating as the litigation trustee of the Subway® Protein Litigation Trust. Purchasing
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`agents for Subway® restaurants (“Assignors”) have assigned all right, title, and interest in the
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`claims and causes of action arising from the purchase by the Assignors of any pork or pork
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`products that was or were sold to, produced for, manufactured for, purchased for, added value for,
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`or distributed to any Subway® restaurant to Independent Purchasing Cooperative, Inc., which has
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`in turn assigned all aforementioned right, title, and interest to SPLC. The Assignors include Cash-
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`WA Distributing Co. of Kearney, Inc., Gordon Food Service, Inc., Lineage Logistics Holding,
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`LLC, Nicholas & Company, Performance Food Group, Inc., Saladino’s Inc., Shamrock Foods
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`Company, Labatt Food Service LLC, Ed Miniat LLC, and West Liberty Foods, LLC. During the
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`Relevant Period, the Assignors directly purchased pork or pork products on behalf of Subway®
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`restaurants from one or more Defendants, and/or their affiliates, agents, or co-conspirators, and
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`suffered antitrust injury as a result of the violations alleged in this Complaint.
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`5
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`16.
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`SPLC is a “person” with standing to sue Defendants for damages and other relief
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`under Section 1 of the Sherman Act, 15 U.S.C. § 1, and Sections 4 and 16 of the Clayton Act, 15
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`U.S.C. §§ 15(a) & 26.
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`B.
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`(i)
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`Defendants
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`Agri Stats
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`17.
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`Agri Stats, Inc. is an Indiana corporation located in Fort Wayne, Indiana and from
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`2013 until 2018, was a subsidiary of Eli Lilly & Co. Agri Stats is now a wholly owned subsidiary
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`of Agri Stats Omega Holding Co. LP, a limited partnership based in Indiana. Throughout the
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`Relevant Period, Agri Stats acted as a co-conspirator and has knowingly played an important and
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`active role as participant in, and a facilitator of, Defendants’ collusive scheme detailed in this
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`Complaint. Agri Stats has a unique and deep relationship with the pork industry generally, and
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`specifically with each of the Defendants identified below, all of which are Agri Stats’ primary
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`customers. Defendants Clemens, Hormel, JBS USA, Seaboard, Triumph, Smithfield and Tyson,
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`and Co-Conspirator Indiana Packers, are all Agri Stats subscribers and report a wide variety of
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`information to Agri Stats.
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`18.
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`All of Agri Stats’ wrongful actions described in this Complaint are part of, and in
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`furtherance of, the unlawful conduct alleged herein, and were authorized, ordered, or engaged in
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`by Agri Stats’ various officers, agents, employers or other representatives while actively engaged
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`in the management and operation of Agri Stats’ business affairs within the course and scope of
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`their duties and employment, or with Agri Stats’ actual apparent or ostensible authority. Agri Stats
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`used the instrumentalities of interstate commerce to facilitate the conspiracy, and its conduct was
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`within the flow of, was intended to, and did have, a substantial effect on the interstate commerce
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`of the United States, including in this District.
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`(ii)
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`Clemens
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`6
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 10 of 86
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`19.
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`Clemens Food Group, LLC is a limited-liability company headquartered in
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`Hatfield, Pennsylvania. During the Relevant Period, Clemens Food Group, LLC and/or its
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`predecessors, wholly owned or controlled subsidiaries, or affiliates sold pork in interstate
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`commerce, directly or through its wholly owned or controlled affiliates, to purchasers in the United
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`States, including in this District.
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`20.
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`The Clemens Family Corporation is a Pennsylvania corporation headquartered in
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`Hatfield, Pennsylvania and the parent company of Clemens Food Group, LLC. During the
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`Relevant Period, The Clemens Family Corporation and/or its predecessors, wholly owned or
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`controlled subsidiaries, or affiliates sold pork in interstate commerce, directly or through its wholly
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`owned or controlled affiliates, to purchasers in the United States, including in this District.
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`21.
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`The Clemens Food Group, LLC and the Clemens Family Corporation are referred
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`to here collectively as “Clemens.” Clemens reports a wide variety of pork data to Agri Stats,
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`including, without limitation, highly-detailed, confidential information regarding its production
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`and sales of pork.
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`(iii) Hormel
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`22.
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`Hormel Foods Corporation is a Delaware corporation headquartered in Austin,
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`Minnesota. During the Relevant Period, Hormel Foods Corporation and/or its predecessors, wholly
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`owned or controlled subsidiaries, or affiliates, including but not limited to Hormel Foods, LLC,
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`sold pork in interstate commerce, directly or through its wholly owned or controlled affiliates, to
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`purchasers in the United States, including in this District.
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`23.
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`Hormel Foods, LLC is a Minnesota corporation headquartered in Austin,
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`Minnesota. Hormel Foods, LLC is a wholly owned subsidiary of Defendant Hormel Foods
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`Corporation. During the Relevant Period, Hormel Foods Corporation and/or its predecessors,
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`wholly owned or controlled subsidiaries, or affiliates sold pork in interstate commerce, directly or
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`7
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`through its wholly owned or controlled affiliates, to purchasers in the United States, including in
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`this District.
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`24.
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`Hormel Foods, LLC and Hormel Foods Corporation are referred to here
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`collectively as “Hormel.” Hormel reports a wide variety of pork data to Agri Stats, including,
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`without limitation, highly-detailed, confidential information regarding its production and sales of
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`pork.
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`(iv)
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`JBS
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`25.
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`JBS USA Food Company is one of the world’s largest beef and pork processing
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`companies and a wholly owned subsidiary of JBS USA Food Company Holdings, which holds a
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`78.5% controlling interest in Pilgrim’s Pride Corporation, one of the largest chicken-producing
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`companies in the world. JBS USA Food Company is a Delaware corporation, headquartered in
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`Greeley, Colorado, and reports a wide variety of pork data to Agri Stats, including, without
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`limitation, highly-detailed, confidential information regarding its production and sales of pork.
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`During the Relevant Period, JBS USA Food Company and/or its predecessors, wholly owned or
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`controlled subsidiaries, or affiliates sold pork in interstate commerce, directly or through its wholly
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`owned or controlled affiliates, to purchasers in the United States, including in this District.
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`(v)
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`Seaboard
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`26.
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`Seaboard Foods LLC is a limited-liability company headquartered in Shawnee
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`Mission, Kansas, and is a wholly owned subsidiary of Seaboard Corporation. During the Relevant
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`Period, Seaboard Foods LLC and/or its predecessors, wholly owned or controlled subsidiaries, or
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`affiliates sold pork in interstate commerce, directly or through its wholly owned or controlled
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`affiliates, to purchasers in the United States, including in this District. Seaboard reports a wide
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`variety of pork data to Agri Stats, including, without limitation, highly-detailed, confidential
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`information regarding its production and sales of pork.
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`8
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`(vi)
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`Smithfield
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`27.
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`Smithfield Foods, Inc. is incorporated in the Commonwealth of Virginia, and an
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`indirect wholly owned subsidiary of WH Group Limited, a Chinese company. Smithfield Foods is
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`headquartered in Smithfield, Virginia, and reports a wide variety of pork data to Agri Stats,
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`including, without limitation, highly-detailed, confidential information regarding its production
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`and sales of pork. During the Relevant Period, Smithfield Foods, Inc. and/or its predecessors,
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`wholly owned or controlled subsidiaries, or affiliates sold pork in interstate commerce, directly or
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`through its wholly owned or controlled affiliates, to purchasers in the United States, including in
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`this District.
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`(vii) Triumph
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`28.
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`Triumph Foods, LLC is a limited-liability company headquartered in St. Joseph,
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`Missouri, and reports a wide variety of pork data to Agri Stats, including, without limitation,
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`highly-detailed, confidential information regarding its production and sales of pork. During the
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`Relevant Period, Triumph Foods, LLC and/or its predecessors, wholly owned or controlled
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`subsidiaries, or affiliates sold pork in interstate commerce, directly or through its wholly owned
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`or controlled affiliates, to purchasers in the United States, including in this District.
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`(viii) Tyson
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`29.
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`Tyson Foods, Inc. is a publicly traded Delaware corporation headquartered in
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`Springdale, Arkansas. During the Relevant Period, Tyson Foods, Inc. and/or its predecessors,
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`wholly owned or controlled subsidiaries, or affiliates sold pork in interstate commerce, directly or
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`through its wholly owned or controlled affiliates, to purchasers in the United States, including in
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`this District.
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`30.
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`Tyson Prepared Foods, Inc. is a Delaware corporation headquartered in Springdale,
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`Arkansas and is a wholly owned subsidiary of Tyson Foods, Inc. During the Relevant Period,
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`9
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`Tyson Prepared Foods, Inc. sold pork in interstate commerce, directly or through its wholly owned
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`or controlled affiliates, to purchasers in the United States, including in this District.
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`31.
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`Tyson Fresh Meats, Inc. is a Delaware corporation headquartered in Springdale,
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`Arkansas and is a wholly owned subsidiary of Tyson Foods, Inc. During the Relevant Period,
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`Tyson Fresh Meats, Inc. sold pork in interstate commerce, directly or through its wholly owned or
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`controlled affiliates, to purchasers in the United States, including in this District.
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`32.
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`Tyson Fresh Meats, Inc., Tyson Prepared Foods, Inc. and Tyson Foods, Inc. are
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`referred to here collectively as "Tyson." Tyson reports a wide variety of pork data to Agri Stats,
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`including, without limitation, highly-detailed, confidential information regarding its production
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`and sales of pork.
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`C.
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`Co-Conspirators
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`33.
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`Co-Conspirator
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`Indiana Packers Corporation
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`is an
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`Indiana corporation
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`headquartered in Delphi, Indiana, and reports a wide variety of pork data to Agri Stats, including,
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`without limitation, highly-detailed, confidential information regarding its production and sales of
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`pork. During the Relevant Period, Indiana Packers Corporation and/or its predecessors, wholly
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`owned or controlled subsidiaries, or affiliates sold pork in interstate commerce, directly or through
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`its wholly owned or controlled affiliates, to purchasers in the United States. Indiana Packers
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`Corporation’s parent companies are Itoham Foods, Inc., Mitsubishi Corporation, and Mitsubishi
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`Corporation (Americas).
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`34.
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`Various other persons, firms, and corporations not named as defendants have
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`performed acts and made statements in furtherance of the conspiracy. Defendants are jointly and
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`severally liable for the acts of their co-conspirators whether or not named as defendants in this
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`complaint. Throughout this Complaint, Indiana Packers Corporation and the other persons, firms,
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`10
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 14 of 86
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`and corporations not named as defendants that performed acts and made statements in furtherance
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`of the conspiracy are collectively referred to as “Co-Conspirators.”
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`IV.
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`FACTUAL ALLEGATIONS
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`35.
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`Starting in at least 2009 and continuing to the present, Defendants conspired to fix,
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`raise, maintain and stabilize pork prices. To effectuate, maintain, and enforce their agreement, the
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`pork integrator Defendants relied on a specialized industry data sharing service provided by Agri
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`Stats, which served a critical role in Defendants’ price-fixing scheme. Defendant Agri Stats
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`provided a means for the pork integrator Defendants to obtain and monitor critical and
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`competitively sensitive business information regarding each other’s production metrics, thereby
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`serving as a central and critical part of Defendants' price-fixing scheme, resulting in a stable and
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`successful anticompetitive cartel.
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`11
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 15 of 86
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`A.
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`Agri Stats’ central role in collusion in the Broiler industry.
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`36.
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`Agri Stats has played a central role in collusion in other industries, including the
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`Broiler chicken (“Broiler”) industry. As alleged in several Complaints in In re Broiler Chicken
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`Antitrust Litigation, No. 16-cv-08637 (N.D. Ill.), the defendants in that action used Agri Stats to
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`facilitate their conspiracy to restrain production and inflate prices of Broilers.
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`37.
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`Specifically, Agri Stats collected and disseminated to the defendants disaggregated
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`financial information (such as monthly operating profit, sales and cost per live pound), production
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`volumes, capacity, slaughter information, inventory levels, and sales data by finished product form
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`and type, amongst other competitively sensitive business information. Agri Stats also provided
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`detailed price reports to the Broiler industry through its subsidiary, Express Markets, Inc. (“EMI”).
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`Agri Stats reports contained line-by-line entries for plants, lines, and yields of various Broiler
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`facilities. Agri Stats relied upon (and the Defendants agreed to) a detailed audit process to verify
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`the accuracy of data from each Broiler producer’s facilities, sometimes directly contacting co-
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`conspirators to verify the data. Agri Stats collected data from the Broiler producers on a weekly
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`basis and provided its reports to Broiler producers on a weekly and monthly basis.
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`38.
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`The detail of these reports ensured that the Broiler producers could decode the
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`information of their competitors. The Broiler complaints allege it was common knowledge among
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`Broiler producers that the detail of the Agri Stats reports allowed any reasonably informed
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`producer to discern the identity of the competitors’ individual Broiler complexes and facilities.
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`The Broiler reports, in parts, contained so few producers participating that the identities were
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`obvious to the other producers. Other reports contained such detailed data that it could be matched
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`with Broiler producers. The complaints allege that Agri Stats purposefully circulated this
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`information to top executives to facilitate agreement on supply, constraints, and price.
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`Case 3:21-cv-00869-CSH Document 1 Filed 06/24/21 Page 16 of 86
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`39.
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`In Broilers, plaintiffs also alleged that Agri Stats – known to its co-conspirators to
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`be a willing and informed conduit for illicit information exchanges – used public and semi-public
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`forums to convey messages to industry participants that furthered the purposes of the conspiracy
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`by reassuring conspirators that production cuts would continue, and by inducing them to continue
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`to act in concert to ensure they did. Agri Stats’ own statements in the Broiler industry facilitated
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`implementation of the agreement to restrict supply.
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`40.
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`At the same time, Broiler producers relied on the purportedly “anonymous” nature
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`of the reports to hide their conspiracy from the public. For example, plaintiffs in the Broiler
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`complaints allege that Sanderson Farms CEO Joe Sanderson claimed, “[w]e use Agri Stats, which
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`some of you are probably familiar with. Agri Stats is a benchmarking service that we submit data
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`to. Almost everyone in our industry does as well. And we get the data back. It’s anonymous – the
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`data is anonymous, so we don’t know whose numbers the numbers belong to, but we can see
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`performance indicators all over the industry.”
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`41.
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`In denying defendants’ motions to dismiss in In re Broiler Chicken Antitrust
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`Litigation, the district court noted that, given the nature of the Agri Stats reports, the co-
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`conspirators were sharing future anticipated production information with each other, which raised
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`significant antitrust concerns.4
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`B.
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`Agri Stats markets its collusive scheme to Defendants.
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`42.
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`Beginning in at least 2008, Agri Stats began to propose a series of benchmarks to
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`the pork integrator Defendants similar to the benchmarks used to restrain competition in the Broiler
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`industry. Benchmarking is the act of comparing practices, methods or performance against those
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`4 In re Broiler Chicken Antitrust Litig., 290 F. Supp. 3d 772, 784 (N.D. Ill. 2017).
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`of other companies.5 Benchmarking of the type undertaken by Agri Stats and the pork integrator
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`Defendants reduces strategic uncertainty in the market and changes the incentives for competitors
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`to compete, thereby enabling companies to coordinate their market strategies and otherwise restrict
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`competition. This is especially true where benchmarking involves the exchange of commercially
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`sensitive and typically proprietary information among competitors.
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`43.
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`In 2008, Greg Bilbrey of Agri Stats wrote in the Advances in Pork Production
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`Journal, benchmarking in the swine industry “could range from simple production comparisons to
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`elaborate and sophisticated total production and financial comparisons. Each and every
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`commercial swine operation is encouraged to participate in some benchmarking effort.”6
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`44.
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`Agri Stats emphasized to pork producers that the goal of the agreement to share
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`information was profitability, not production, and invited them again to participate in the
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`benchma