Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 1 of 55 PageID #:320433
`
`UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
`
`
`
`IN RE BROILER CHICKEN ANTITRUST
`LITIGATION
`
`
`
`No. 16 C 8637
`
`Judge Thomas M. Durkin
`
`
`
`
`
`
`
`
`
`
`MEMORANDUM OPINION AND ORDER
`
`Purchasers of chicken meat (a product known as “Broilers”) allege that Broiler
`
`producers conspired to raise prices in violation of the Sherman Act. At the outset of
`
`the case, the Court appointed interim class counsel for three classes of purchasers:
`
`(1) direct purchasers (the “Directs”); (2) commercial and institutional indirect
`
`purchasers (the “Indirects”); and (3) end-user consumers (the “End Users”; and all
`
`three classes together, the “Plaintiffs”). Each class has moved for certification
`
`pursuant to Federal Rule of Civil Procedure 23. Plaintiffs rely on expert opinions to
`
`support their motions, and Defendants have moved to exclude those experts pursuant
`
`to Federal Rule of Evidence 702 and Daubert. Defendants also produced an expert
`
`witness, but Plaintiffs have not moved to exclude his testimony. The Court held a
`
`two-day hearing on May 10-11, 2022, and heard testimony from the parties’ experts.
`
`See R. 5624; R. 5625.1 This opinion addresses all three classes’ motions for
`
`
`1 The Directs’ expert is Dr. Colin A. Carter. He has degrees from the University of
`California at Berkeley and is a Professor of Agricultural and Resource Economics at
`the University of California. The Indirects’ expert is Dr. Russell W. Mangum III. He
`earned masters and doctoral degrees from the University of Southern California and
`is a Senior Vice President at Nathan Associates, Inc., an economic consulting firm.
`The End Users’ expert is Dr. David L. Sunding. He has degrees from the University
`of California at Berkeley and is President of The Brattle Group. Defendants’ expert
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 2 of 55 PageID #:320434
`
`certification and Defendants’ corresponding Daubert motions. For the following
`
`reasons, Defendants’ Daubert motions are denied, and Plaintiffs’ motions for class
`
`certification are granted.
`
`Analysis
`
`
`
`The Court may certify a class of plaintiffs pursuant to Federal Rule of Civil
`
`Procedure 23(a) if:
`
`(1) the class is so numerous that joinder of all members is
`impracticable;
`(2) there are questions of law or fact common to the class;
`(3) the claims or defenses of the representative parties are
`typical of the claims or defenses of the class; and
`(4) the representative parties will fairly and adequately
`protect the interests of the class.
`
`Additionally, Plaintiffs in this case seek certification under Rule 23(b)(3), which
`
`requires them to demonstrate that: (1) “the questions of law or fact common to class
`
`members predominate over any questions affecting only individual members”; and
`
`(2) “that a class action is superior to other available methods for fairly and efficiently
`
`adjudicating the controversy.”
`
`
`Plaintiffs bear the burden of satisfying Rule 23, which is not “a mere pleading
`
`standard.” Comcast Corp. v. Behrend, 569 U.S. 27, 33 (2013). To meet this burden,
`
`Plaintiffs must “satisfy through evidentiary proof” each of Rule 23’s elements. Id. In
`
`
`is Dr. John H. Johnson, IV. He has a Ph.D. in economics from the Massachusetts
`Institute of Technology and is CEO of Edgeworth Economics, LLC. The experts
`prepared the following reports: Carter’s report, R. 3990-122; Carter’s rebuttal report,
`R. 4505; Mangum’s report, R. 3985-8; Mangum’s rebuttal report, R. 4493-3; Sunding’s
`report, R. 3971-4; Sunding’s rebuttal report, R. 4487-3; Johnson’s report, R. 4209-1,
`R. 4234-2, R. 4213-4; Johnson’s rebuttal report R. 4275-9.
`2
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 3 of 55 PageID #:320435
`
`deciding a class certification motion, the Court must conduct a “rigorous analysis”
`
`before it can determine whether Plaintiffs have satisfied Rule 23’s requirements. Id.
`
`This often means that a Court must resolve issues that also bear on the merits of the
`
`claim, but only if those issues “overlap” with class certification issues. Id. at 33-34.
`
`Despite the need for rigorous analysis, “the court should not turn the class
`
`certification proceedings into a dress rehearsal for a trial on the merits.” Messner v.
`
`Northshore Univ. HealthSystem, 669 F.3d 802, 811 (7th Cir. 2012). Instead, the Court
`
`need only consider the evidence submitted by the parties and determine whether
`
`Plaintiffs have proven each of Rule 23’s elements by a preponderance of the evidence.
`
`Id.
`
`
`
`The proposed class definitions are as follows. For the Directs:
`
`All persons who purchased raw Broilers [directly] from any
`of the Defendants or their respective subsidiaries or
`affiliates either fresh or frozen, in the form of: whole birds
`(with or without giblets), whole cut-up birds, or parts
`(boneless or bone in) derived from the front half of the
`whole bird, for use or delivery in the United States from
`December 1, 2008 until July 31, 2019.
`
`R. 3990 at 26. For the Indirects:
`
`All entities that purchased Broilers indirectly from a
`Defendant or named co-conspirator
`in an Indirect
`Purchaser State2 for their own use in commercial food
`preparation from January 1, 2009, until July 31, 2019.
`
`
`2 The “Indirect Purchaser States” are: Arizona, California, the District of Columbia,
`Florida, Hawaii, Iowa, Illinois, Kansas, Massachusetts, Maine, Michigan, Minnesota,
`Missouri, Mississippi, Montana, North Carolina, North Dakota, Nebraska, New
`Hampshire, New Mexico, Nevada, New York, Oregon, Rhode Island, South Carolina,
`South Dakota, Tennessee, Utah, Vermont, Wisconsin, or West Virginia. The Indirects
`seek damages for this class under the respective state laws. The Indirects also seek
`certification of a class for nationwide injunctive relief under federal law.
`3
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 4 of 55 PageID #:320436
`
`
`Excluded from the [Indirect] class are: Natural persons
`who purchased Broilers for their personal use and not for
`commercial food preparation; purchases of Broilers directly
`from Defendants; purchases of Broilers for resale in
`unaltered
`form; purchases or Broilers
`from an
`intermediary who has further processed the Broiler; the
`Defendants; the officers, directors or employees of any
`Defendant; any entity in which any Defendant has a
`controlling interest; and any affiliate, legal representative,
`heir or assign of any Defendant; any federal, state
`governmental entities, any judicial officer presiding over
`this action and the members of her/her immediate family
`and judicial staff, any juror assigned to this action; and any
`co-conspirator identified in this action.
`
`R. 3968 at 2-3. And for the End Users:
`
`All persons and entities who indirectly purchased the
`following types [of] raw chicken, whether fresh or frozen:
`whole birds (with or without giblets), whole cut-up birds
`purchased within a package, breast cuts or tenderloin cuts,
`but excluding chicken that is marketed as halal, kosher,
`free range, organic, diced, minced, ground, seasoned,
`flavored or breaded—from defendants or co-conspirators
`for personal consumption in the Repealer Jurisdictions3
`from January 1, 2012 to July 31, 2019.
`
`R. 3971 at 6.4
`
`
`3 The “Repealer Jurisdictions” are: California, District of Columbia, Florida, Hawaii,
`Illinois, Iowa, Kansas, Maine, Massachusetts, Michigan, Minnesota, Missouri,
`Nebraska, Nevada, New Hampshire, New Mexico, New York, North Carolina,
`Oregon, Rhode Island, South Carolina, South Dakota, Tennessee, Utah, and
`Wisconsin. The End Users seek damages for this class under the respective state
`laws.
`4 The Court notes that the End Users seek certification of a class that is narrower in
`scope, both substantively and temporally, than the classes sought by the Directs and
`Indirects, and narrower than the classes the Court has approved in settlements the
`End Users have reached with certain defendants. The Court ordered a brief
`explaining this change, which the End Users provided. See R. 5569. Bottom line, the
`End Users believe their proof more closely fits a narrower class. See id. at 1.
`4
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 5 of 55 PageID #:320437
`
`I.
`
`
`
`Numerosity, Adequacy, Commonality & Typicality
`
`Other than arguments about certain class representatives and the application
`
`of state laws, Defendants generally do not challenge whether the Plaintiffs have met
`
`their burden to establish the four elements of Rule 23 subsection (a). That is likely
`
`because those elements are easily met in this case.
`
`
`
`
`
`A.
`
`Numerosity
`
`Defendants have produced electronic sales data identifying thousands of direct
`
`purchases of Broilers. See R. 3990-122 at 106 (¶ 173) (the Directs’ expert used a data
`
`set containing 5,918 customers). The Indirects’ class includes nearly every entity in
`
`the United States that serves chicken to individuals, whether for profit or otherwise,
`
`including restaurants, deli-counters, schools, hospitals, airlines, casinos, etc. See R.
`
`3985-8 at 127-29 (¶¶ 230-32). The End User class includes nearly every individual
`
`consumer of chicken in the United States. See R. 3971 at 6. Joinder of this many
`
`plaintiffs would be impractical, and so the numerosity requirement is satisfied here
`
`for all three classes. See Anderson v. Weinert Enterprises, Inc., 986 F.3d 773, 777 (7th
`
`Cir. 2021) (“Our cases have recognized that a forty-member class is often regarded as
`
`sufficient to meet the numerosity requirement.”). Defendants do not dispute this.
`
`
`
`
`
`B.
`
`Adequacy
`
`Adequacy is a two-part test: (i) the class representatives must not have claims
`
`in conflict with other class members, and (ii) the class representatives and proposed
`
`
`Defendants do not argue that this narrowing undermines any of the motions for class
`certification, so the Court has not focused on its significance in addressing them.
`5
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 6 of 55 PageID #:320438
`
`class counsel must be able to litigate the case vigorously and competently on behalf
`
`of named and absent class members alike. See Kohen v. Pac. Inv. Mgmt. Co. LLC, 571
`
`F.3d 672, 679 (7th Cir. 2009).
`
`
`
`Defendants do not challenge the adequacy of class counsel. In approving
`
`several class settlements, the Court has already found that counsel for each class has
`
`more than adequately represented the class and will continue to do so moving
`
`forward. See, e.g., R. 1414 at 2 (Directs); R. 5536 at 3 (Indirects); R. 5304 at 3 (End
`
`Users). Defendants do not argue otherwise.
`
`
`
`Defendants also do not dispute that the class representatives for all three
`
`classes assert claims arising from Defendants’ alleged conspiracy to raise prices. The
`
`class representatives for the Directs and Indirects have submitted declarations
`
`stating that they share with their respective classes a strong interest in establishing
`
`Defendants’ liability and maximizing class-wide damages. See R. 3962-39 ¶¶ 3-5
`
`(Directs); R. 3968-8, -9 (Indirects). It does not appear that similar declarations were
`
`submitted by the representatives for the End User class. But there is no evidence in
`
`the record indicating that the representatives’ interests are not aligned with the class
`
`as a whole for purposes of this litigation. See R. 3971 at 22.
`
`
`
`
`
`
`
`1.
`
`Indirects’ Class Representatives
`
`Defendants argue that two representatives for the Indirects’ class are
`
`inadequate for reasons specific to their circumstances. First, Defendants argue that
`
`Figaretti’s Restaurant cannot represent the West Virginia class because it never
`
`purchased Broilers in West Virginia, and West Virginia’s antitrust law, according to
`
`
`
`6
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 7 of 55 PageID #:320439
`
`Defendants, requires intrastate commerce. See R. 4234 at 57-58. In support of this
`
`argument, Defendants cite a single sentence from a 40-year-old federal district court
`
`case stating that “West Virginia’s antitrust law is directed towards intrastate
`
`commerce.” See Anziulewicz v. Bluefield Cmty. Hosp., Inc., 531 F. Supp. 49, 53
`
`(S.D.W. Va. 1981). But the court in Anziulewicz was not concerned with applying the
`
`elements of the West Virginia statute to the merits of a claim. Its statement was made
`
`in the context of distinguishing West Virginia law from federal antitrust law in order
`
`to decide whether a claim under the West Virginia statute arose under federal law
`
`for purposes of removal from state court. That court’s statement in dicta is of little
`
`relevance here.
`
`
`
`Furthermore, this Court’s examination of the West Virginia statute finds no
`
`requirement of “intrastate” commerce, or that the conduct alleged occur entirely
`
`within West Virginia. The statute prohibits “restraint of trade or commerce in this
`
`State,” and “a monopoly of trade or commerce, any part of which is within this State.”
`
`W. Va. Code Ann. §§ 47-18-3, -4. Absent more definitive authority from a higher court,
`
`this Court finds the West Virginia statute does not apply solely to conduct taking
`
`place entirely within West Virginia, but also applies to interstate commerce affecting
`
`West Virginia. Defendants do not dispute that Figaretti’s was located in West
`
`Virginia when it purchased Broilers from sellers outside West Virginia and then had
`
`them delivered in West Virginia. Thus, “part” of the commerce was in West Virginia.
`
`
`
`Defendants also argue that Sargent’s is an inadequate class representative
`
`because one of Sargent’s owners testified that Sargent’s was represented not only by
`
`
`
`7
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 8 of 55 PageID #:320440
`
`class counsel, but also by separate individual counsel, who happened to be her son.
`
`Sargent’s owner’s son is not class counsel in this case. There is no evidence before the
`
`Court, including Sargent’s owner’s deposition testimony cited by Defendants, that her
`
`son will share in any recovery in this case. The case law Defendants cite concerns
`
`much more formal agreements between class representatives and related counsel
`
`sharing in the class recovery. The Court finds that Sargent’s owner’s son providing
`
`advice to his parents regarding their business does not raise an analogous appearance
`
`of impropriety necessary to find Sargent’s inadequate as a class representative.
`
`
`
`
`
`
`
`2.
`
`End Users’ Class Representatives
`
`Defendants raise several issues with respect to the adequacy of the End Users’
`
`class representatives. First, Defendants argue that Kansas representatives, Leslie
`
`and David Weidner, are inadequate because they are close friends with attorney
`
`Emily Levens, a partner at Cohen Milstein, co-counsel for the End Users. Levens,
`
`however, has not entered an appearance in this case, and the End Users represent
`
`that she has only worked on the case for one week and does not participate in
`
`settlement negotiations. Considering Levens’s limited participation in this case, and
`
`the fact that the Weidners are two of more than 24 End Users class representatives,
`
`the Court finds that this friendship is not sufficient to raise suspicion that the
`
`Weidners will favor Cohen Milstein’s compensation over the class’s recovery. See
`
`Susman v. Lincoln Am. Corp., 561 F.2d 86, 93-95 (7th Cir. 1977) (it is within the
`
`district court’s discretion to find a class representative inadequate where there is a
`
`“possibility that one so situated will become more interested in maximizing the
`
`
`
`8
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 9 of 55 PageID #:320441
`
`‘return’ to his counsel than in aggressively presenting the proposed class action”); see
`
`also Armes v. Shanta Enter., Inc., 2009 WL 2020781, at *3 (N.D. Ill. July 8, 2009).
`
`
`
`Defendants also contend that some of the End Users’ class representatives are
`
`inadequate because their purchasing habits were atypical. See R. 4213 at 57-59. But
`
`while these individuals may have sometimes made purchases of chicken products
`
`outside the class definition, the End Users have presented evidence that they all also
`
`made purchases that are within the class definition. See R. 4487 at 5-7. Thus, the
`
`Court finds them to be adequate class representatives.5
`
`
`
`
`
`C.
`
`Commonality
`
`Commonality requires plaintiffs to show that resolution of an issue of fact or
`
`law “is central to the validity of each” class member’s claim; “[e]ven a single [common]
`
`question will do.” Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 359 (2011). Here, the
`
`question of whether Defendants illegally conspired to restrict supply and increase the
`
`price of Broilers is common to each class, as are questions about the nature of the
`
`conspiracy, whether the conspiracy caused the price increase, and what is the
`
`appropriate measure of damages. See, e.g., In re Steel Antitrust Litig., 2015 WL
`
`5304629, at *3 (N.D. Ill. Sept. 9, 2015); In re Ready-Mixed Concrete Antitrust Litig.,
`
`
`5 Defendants also argue that their expert has shown that Publix grocery did not suffer
`overcharges, and so any consumer who made purchases at Publix cannot be an
`adequate class representative. See R. 4213 at 57. Defendants similarly argue that the
`Indirects’ class definition is overbroad because it “sweeps” in indirect purchasers who
`were not overcharged according to their expert’s statistical analysis. The Court
`rejects these arguments for reasons discussed below regarding Defendants’
`arguments that Plaintiffs’ experts improperly “pool” transaction data.
`9
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 10 of 55 PageID #:320442
`
`261 F.R.D. 154, 168 (S.D. Ind. 2009). Thus, the element of commonality is present in
`
`this case.
`
`
`
`
`
`D.
`
`Typicality
`
`Finally, the element of typicality is satisfied because Plaintiffs allege that
`
`Defendants engaged in a common scheme relative to all members of the class to
`
`restrict the supply of Broilers. See In re Steel, 2015 WL 5304629, at *4 (“[T]he claims
`
`of each named representative and class members are based on the same legal theory
`
`and arise from the same course of conduct (i.e. conspiring to restrict steel supply);
`
`therefore, typicality is satisfied[.]”); In re Ready-Mixed, 261 F.R.D. at 168 (“Typicality
`
`in the antitrust context will be established by plaintiffs and all class members
`
`alleging the same antitrust violation by the defendants.”).
`
`
`
`Defendants argue that the Indirects fail to demonstrate typicality because the
`
`class representatives have small market shares relative to “the massive chains and
`
`resorts included in the Proposed Class.” R. 4234 at 56. Defendants contend that the
`
`differences in market share create “bargaining power and purchase volume
`
`disparities” such that the class representative’s claims are not typical of the class.
`
`
`
`But Plaintiffs in this case do not allege that Defendants agreed to set a floor
`
`for prices in bargained negotiations. Rather, Plaintiffs allege that Defendants
`
`restricted supply across the market in order to boost prices of a commodity.
`
`Bargaining power is not directly relevant to the claims.
`
`
`
`The cases Defendants cite reveal the faults in their argument concerning
`
`bargaining power. See In re Graphics Processing Units, 253 F.R.D. 478, 489 (N.D. Cal.
`
`
`
`10
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 11 of 55 PageID #:320443
`
`2008); In re Optical Disk Drive, 303 F.R.D. 311, 317 (N.D. Cal. 2014). Both Graphics
`
`Processing and Optical Disk involve allegations that technology manufacturers
`
`agreed to fix prices of both wholesale and direct internet retail sales. The courts in
`
`those cases limited certification to classes of retail customers because those prices
`
`were set unilaterally by the manufacturers on a take-it-or-leave-it basis. By contrast,
`
`the wholesale buyers in those cases negotiated their prices, with the prices ultimately
`
`being a product of the buyers’ purchasing power.
`
`
`
`Certainly, the Broiler market is also made up of buyers with varying degrees
`
`of bargaining power. But unlike the markets for the technology products at issue in
`
`Graphics Processing and Optical Disk, the Broiler market is heavily influenced by
`
`market price indices. Bargaining power may affect the prices ultimately paid by a
`
`particular plaintiff. But all participants in a commodity market exercise their
`
`bargaining power—regardless of strength—in the context of the market price, which
`
`is viewed by the industry as an objective reflection of value. No such market prices
`
`exist for the technologies at issues in Graphics Processing and Optical Disk. In those
`
`cases and markets, after costs of production, the parties’ negotiations were entirely
`
`determinative of the ultimate price, and the strength of bargaining power was a
`
`significant factor in negotiations. That is why the courts in those cases carved out
`
`classes of retail customers. They, unlike the wholesale buyers, had no opportunity to
`
`negotiate, making the price fixing agreement among the manufacturers the primary
`
`factor setting the price. By contrast, the allegation here is that Defendants fixed a
`
`market price that was the starting point for negotiations across the market,
`
`
`
`11
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 12 of 55 PageID #:320444
`
`regardless of a purchaser’s bargaining power. Thus, differences in bargaining power
`
`do not undermine typicality in this case.
`
`II.
`
`Predominance
`
`
`
`Having found that all three classes satisfy the elements of subsection (a) of
`
`Rule 23, the Court proceeds to address subsection (b). Rule 23(b)(3) requires that
`
`“questions of law or fact common to class members predominate over any questions
`
`affecting only individual members.” “Predominance is satisfied when common
`
`questions represent a significant aspect of a case and . . . can be resolved for all
`
`members of a class in a single adjudication.” Kleen Prod. LLC v. Int’l Paper Co., 831
`
`F.3d 919, 925 (7th Cir. 2016).
`
`
`
`In this case, the two primary common questions are: (1) whether Defendants
`
`engaged in a conspiracy to reduce supply to increase price; and (2) whether this
`
`conspiracy caused Plaintiffs to suffer injury. See Kleen, 831 F.3d at 925 (“[T]he court
`
`evaluated the two central elements of the Purchasers’ case: the alleged violation of
`
`the antitrust laws, and the causal link between that violation and their alleged
`
`injury.”); Messner, 669 F.3d at 815 (“[P]laintiffs [must] prove: (1) that [the defendant]
`
`violated federal antitrust law; and (2) that the antitrust violation caused them some
`
`injury.”). These questions certainly represent “a significant aspect of the case,” and
`
`as discussed, Defendants do not dispute that they are common to the class.
`
`
`
`Further, with respect to the first question regarding liability, Defendants do
`
`not challenge Plaintiffs’ contention that it can be “resolved for all members of [the]
`
`class in a single adjudication,” and that this question predominates over any
`
`
`
`12
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 13 of 55 PageID #:320445
`
`individual issues. Nevertheless, in the interest of completing a “rigorous analysis,”
`
`see Santiago v. City of Chicago, 19 F.4th 1010, 1020 (7th Cir. 2021), the Court reviews
`
`the evidence of liability for a conspiracy.
`
`
`
`
`
`A.
`
`Evidence of Conspiracy
`
`As can be seen in the chart below (taken from the Directs’ expert’s rebuttal
`
`report, R. 4505 at 74 (Figure 12)), prior to 2008, Broiler production had increased at
`
`a relatively consistent rate for many years.6 Then, as the two charts on the next page
`
`show in greater detail, production decreased in 2009 and 2012, and between 2008 and
`
`2019, the rate of production increase decreased significantly, before returning to the
`
`rate that had prevailed prior to 2008. See id. at 74 (Figure 12), 84 (Figure 14). This
`
`unusual decrease in production indicates the presence of a conspiracy among
`
`producers for several reasons. Broilers are all generally of the same quality. This
`
`commodity-like nature, combined with consistent demand, make it difficult for an
`
`
`6 The vertical axis refers to “RTC Broilers,” which means “ready to cook,” which simply means the
`chicken has been slaughtered and prepared for sale as food.
`13
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 14 of 55 PageID #:320446
`
`individual producer to reduce supply unilaterally. See R. 3990-12 at 30 (¶¶ 40-41),
`
`33-34 n.35 (¶ 49) (Directs’ expert report). Furthermore, the defendant companies own
`
`and operate virtually all of the components of production, including: the breeder
`
`(laying) flocks; hatcheries; feed mills; live broiler inventory; live transportation;
`
`slaughter and other processing plants; and marketing, sales and distribution
`
`activities. This vertical integration makes collusive supply reduction easy to
`
`effectuate. See id. at 75-77 (¶¶ 117-19); Kleen, 831 F.3d at 927. Plaintiffs have also
`
`presented evidence of collusion in the form of the following: communication among
`14
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 15 of 55 PageID #:320447
`
`Defendants about production plans, both public and private, see R. 3990-12 at 52 nn.
`
`98-100 (¶ 80) (citing evidence); sharing of confidential production information
`
`through industry reporter and defendant, Agri Stats, see id. at 53-54 (¶¶ 81-84) (citing
`
`evidence);7 Defendants’ unusual decisions to destroy breeder hens, see id. at 45-47
`
`(¶¶ 69-72); and evidence that the Georgia Dock Price Index was manipulated, see id.
`
`at 55-58 (¶¶ 87-91).
`
`
`
`Defendants do not address this evidence in their briefs opposing any of the
`
`three class motions. This is likely because this “type of alleged conspiracy is the
`
`prototypical example of an issue where common questions predominate, because it is
`
`much more efficient to have a single trial on the alleged conspiracy rather than
`
`thousands of identical trials all alleging identical conspiracies based on identical
`
`evidence.” Kleen Prod. LLC v. Int’l Paper, 306 F.R.D. 585, 594 (N.D. Ill. 2015) (citing
`
`7AA Wright & Miller, Federal Practice & Procedure § 1781 (3d Ed. 2014) (“[W]hether
`
`a conspiracy exists is a common question that is thought to predominate over the
`
`other issues in the case and has the effect of satisfying the prerequisite in Rule
`
`23(b)(3).”)); see also Amchem Prod., Inc. v. Windsor, 521 U.S. 591, 625 (1997)
`
`
`7 Agri Stats reported production information for Broiler producers who subscribed to
`the service. This information was published with producer names redacted. But
`Plaintiffs allege that Agri Stats intended for the information to be easily identified.
`Notably, Plaintiffs have discovered a copy of an Agri Stats report from Pilgrim’s for
`which the numerical identifiers for each producer were over-written by hand with the
`producers’ actual names. See R. 3971-3 at 27 (Figure 2). This evidence indicates
`Pilgrim’s was able to de-anonymize the otherwise proprietary and confidential
`information of its competitors. Moreover, it is alleged that other supposedly
`anonymous data was easily understood by experienced industry players as belonging
`to particular producers because of the nature of the data itself.
`15
`
`
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 16 of 55 PageID #:320448
`
`(“Predominance is a test readily met in certain cases alleging consumer or securities
`
`fraud or violations of the antitrust laws.”). Whether this evidence is sufficient to
`
`survive summary judgment or to demonstrate liability at trial is not at issue in this
`
`motion. But the evidence is sufficient to establish the first element of predominance,
`
`because the issue of liability “can be resolved for all members of a class in a single
`
`adjudication.” Kleen, 831 F.3d at 925.
`
`
`
`
`
`B.
`
`Evidence of Causation
`
`Defendants primarily focus their opposition to class certification on the
`
`question of whether causation and injury can be demonstrated in a common fashion.
`
`See Comcast, 569 U.S. at 30 (“[Plaintiffs must] show (1) that the existence of
`
`individual injury resulting from the alleged antitrust violation (referred to as
`
`antitrust impact) was capable of proof at trial through evidence that [was] common
`
`to the class rather than individual to its members; and (2) that the damages resulting
`
`from that injury were measurable on a class-wide basis through use of a common
`
`methodology.”). Plaintiffs rely on expert opinion evidence to satisfy their burden on
`
`this issue.
`
`
`
`For expert opinion to be admissible and sufficient to establish elements of class
`
`certification: (1) the expert must be qualified; (2) the expert must apply a scientifically
`
`reliable methodology; and (3) the proffered testimony must “assist the trier of fact
`
`with a fact at issue.” See Smith v. Ford Motor Co., 215 F.3d 713, 718 (7th Cir. 2000)
`
`(citing Daubert v. Merrell Dow Pharms., Inc., 509 U.S. 579 (1993)). Defendants do not
`
`challenge any experts’ qualifications, and the helpfulness of the opinions will be
`
`
`
`16
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 17 of 55 PageID #:320449
`
`apparent from the following discussion. Defendants’ arguments focus entirely on
`
`whether the opinions are reliable.
`
`
`
`Each class has offered at least one expert report. The reports and the opinions
`
`they contain are of course not identical, but they employ largely similar methodology
`
`and reach many of the same conclusions. Accordingly, because the opinions are
`
`overlapping, and Defendants’ criticisms of each is similar, some of the Court’s
`
`analysis of one expert’s opinions and Defendants’ objections will suffice to address
`
`certain aspects of the other experts’ opinions and how Defendants’ objections apply
`
`to all three.
`
`
`
`The theory of injury in this case for all three classes flows from the initial sales
`
`made by Defendants to the Directs, who then make sales to Indirects and/or End
`
`Users, or other entities that eventually sell to Indirects and/or End Users. In other
`
`words, the nature of the distribution chain in the Broiler market (or any market for
`
`that matter) is such that for the Indirects and End Users to have suffered injury, the
`
`Directs must have been injured first. All three classes offer expert opinion evidence
`
`in an effort to establish this primary injury.
`
`
`
`All three experts’ opinions include two primary steps: first, a method to identify
`
`the period when a conspiracy might have been in effect by identifying significant
`
`decreases in Broiler production; and second, regression analysis to determine
`
`whether factors other than a conspiracy could have caused the supply decrease by
`
`analyzing what Broiler prices would have been “but for” the conspiracy. While they
`
`take somewhat different approaches to both questions, all three experts conclude that
`
`
`
`17
`
`

`

`Case: 1:16-cv-08637 Document #: 5644 Filed: 05/27/22 Page 18 of 55 PageID #:320450
`
`a conspiracy to restrict Broiler supply caused Broiler prices to increase and that this
`
`can be shown by evidence common to the class. The Court will evaluate all three
`
`experts’ opinions to determine the reliability of their methods under Rule 702 and
`
`their sufficiency as evidence of causation and damages for purposes of class
`
`certification. In the end, the Court finds that the testimony of each expert is reliable,
`
`and each independently provides sufficient evidence to show that evidence of
`
`causation and injury is common to their respective classes.
`
`
`
`
`
`
`
`
`
`
`
`1.
`
`
`
`Identifying the Class Period
`
`a.
`
`Structural Break Test – Carter
`
`The Directs’ expert, Dr. Colin A. Carter, used a “structural break test” to
`
`identify the class period.8 According to Carter, the structural break methodology “is
`
`widely accepted in the academic literature and class certification litigation.” R. 4505
`
`at 50-51 (¶¶ 94-96). He explains that a “structural break analysis is an econometrics
`
`methodology used to simultaneously determine whether and when there exists an
`
`unusual break in a long-term statistical relationship.” R. 4505 at 50 (¶ 95). Here,
`
`Carter applied this analysis to identify significant changes in Broiler supply over
`
`time. Id.; see also R. 3990-12 at 106-07 (“The structural break analysis
`
`simultaneously answers two questions: (i) was there a change in the pattern or
`
`
`8 Defendants do not cha