Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 1 of 8 PageID #:1
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`UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
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`Case No.
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`COMPLAINT FOR VIOLATIONS OF
`THE FEDERAL ANTITRUST LAWS
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`Jury Trial Demanded
`(Related to In re Broiler Chicken Antitrust
`Litigation, Case No. 1:16-CV-08637)
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`SUPPLY MANAGEMENT SERVICES, INC.,
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`Plaintiff,
`v.
`INC.; JCG FOODS OF
`KOCH FOODS,
`ALABAMA, LLC; JCG FOODS OF GEORGIA,
`LLC; KOCH MEAT CO., INC.; NORMAN W.
`FRIES, INC., d/b/a CLAXTON POULTRY
`FARMS;
`FIELDALE
`FARMS
`CORPORATION; FOSTER FARMS, LLC;
`GEORGE’S, INC.; GEORGE’S FARMS, INC.;
`HARRISON POULTRY, INC.; HOUSE OF
`RAEFORD FARMS,
`INC.; KEYSTONE
`FOODS LLC; EQUITY GROUP EUFAULA
`DIVISION LLC; EQUITY GROUP-GEORGIA
`DIVISION
`LLC;
`EQUITY
`GROUP
`KENTUCKY DIVISION LLC; MAR-JAC
`POULTRY,
`INC.; MOUNTAIRE FARMS,
`INC.; MOUNTAIRE
`FARMS,
`LLC;
`MOUNTAIRE FARMS OF DELAWARE, INC.;
`O.K. FOODS, INC.; O.K. FARMS, INC.; O.K.
`INDUSTRIES, INC.; PECO FOODS, INC.;
`PERDUE FARMS, INC.; PERDUE FOODS,
`LLC; PILGRIM’S PRIDE CORPORATION;
`SANDERSON FARMS, INC.; SANDERSON
`FARMS,
`INC.
`(FOOD
`DIVISION);
`SANDERSON FARMS, INC. (PRODUCTION
`DIVISION); SANDERSON FARMS,
`INC.
`(PROCESSING
`DIVISION);
`SIMMONS
`FOODS, INC.; TYSON FOODS, INC.; TYSON
`CHICKEN, INC.; TYSON BREEDERS, INC.;
`TYSON POULTRY, INC.; WAYNE FARMS,
`LLC; AMICK FARMS, LLC; CASE FOODS,
`INC.; CASE FARMS, LLC; CASE FARMS
`PROCESSING, INC.; and AGRI STATS, INC.,
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`Defendants.
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`

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`Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 2 of 8 PageID #:2
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`Plaintiff Supply Management Services, Inc. (“SMS” or “Plaintiff”), brings this action for
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`treble damages under the federal antitrust laws against the Defendants.
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`1.
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`SMS is a Georgia non-profit corporation headquartered in Atlanta, Georgia. SMS
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`is a cooperative purchasing agent for its members, which are Popeye’s Restaurants® and Popeye’s
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`Louisiana Kitchen® (together “Popeye’s”) owners. Popeye’s passion for its Louisiana heritage
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`and flavorful authentic food has allowed it to become one of the world’s largest chicken quick
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`service restaurants with over 3,100 restaurants in the U.S. and around the world.
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`2.
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`Throughout the relevant period, SMS contracted with Defendants for the
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`production and supply of Broilers to its members. In some instances the broilers were delivered
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`directly to individual stores. For the remainder, SMS contracted with distributors to supply its
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`members with Broilers purchased pursuant to the above-referenced contracts with Defendants.
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`3.
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`SMS brings this action regarding Broilers purchased for its members on its own
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`behalf; as assignee of those individual stores receiving direct shipments; and as assignee of certain
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`distributors, and their affiliates, that have assigned their claims to SMS for Broiler purchases that
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`SMS coordinated (collectively, “Assignors”). The references in this Complaint to “SMS” and
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`“Plaintiff” include SMS’s Assignors.
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`4.
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`During the relevant period, SMS or its Assignors purchased chicken at artificially
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`inflated prices directly from one or more of the Defendants and Co-Conspirators, and suffered
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`injury to its business or property as a direct or proximate result of Defendants’ and Co-
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`Conspirators’ wrongful conduct.
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`5.
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`SMS brings this action under the federal antitrust laws against the Defendants
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`identified below and incorporates by reference the factual allegations and reservations of rights
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`contained in the Direct Action Plaintiffs’ Amended Consolidated Complaint and Demand for Jury
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`1
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`Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 3 of 8 PageID #:3
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`Trial, filed in In re Broiler Antitrust Litigation, No. 1:16-CV-08637 on January 29, 2021.1 [ECF
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`No. 4244].
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`6.
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`SMS joins Section II of the Direct Action Plaintiffs’ Amended Consolidated
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`Complaint and Demand for Jury Trial, adding the following to specify SMS’s causes of action and
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`the named Defendants and Co-Conspirators in the SMS action:
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`Named Defendants2
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`Named Co-Conspirators
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`Causes of Action
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`Allen Harim; Marshall Durbin
`Amick; George’s; Peco
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`Agri Stats; Case, Claxton;
`Fieldale;
`Foster
`Farms;
`Harrison; House of Raeford;
`Keystone Foods, Koch; Mar-
`Jac; Mountaire; O.K. Foods;
`Perdue;
`Pilgrim’s
`Pride;
`Sanderson; Simmons; Tyson;
`Wayne; Amick; George’s; Peco
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`Count I (Sherman Act Claim for
`all Anticompetitive Conduct);
`Count II (Sherman Act Claim for
`Output Restriction, Pled in the
`Alternative to Count I); Count III
`(Sherman Act Claim for GA
`Dock Manipulation, Pled in the
`Alternative to Count I);
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`Plaintiff
`Name
`Supply
`Management
`Services, Inc.
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`1 Pursuant to the Court’s Orders in In re Broiler Chicken Antitrust Litig., 1:16-cv-08637, [ECF
`Nos. 3778, 3652, 3525], the Direct Action Plaintiffs filed an amended consolidated complaint
`containing “all the allegations the Direct-Action Plaintiffs make against all Defendants” on
`January 29, 2021 [ECF No. 4244]. In an effort to promote efficiency given the Court’s
`recent reference to similar abbreviated Complaints as helpful to the Court [ECF No. 4139],
`Plaintiff files this abbreviated pleading that incorporates by reference and adopts the allegations
`set forth in Direct Action Plaintiffs’ Amended Consolidated Complaint and Demand for Jury Trial.
`If the Court prefers a different form or process, Plaintiff will withdraw this pleading and proceed
`according to the Court’s direction.
`2 The Defendants named in this Complaint include the entire Defendant family of each listed
`Defendant, identified in Section IV.B. of ECF 4244. Certain of SMS’s Assignors opted out of
`prior class settlements and, therefore, Defendants that entered into such settlements are listed as
`both Named Defendants and Named Co-Conspirators. For example, Assignor McLane Company,
`Inc. and its affiliates opted out of the Direct Purchaser class settlements with Fieldale Farms,
`George’s, Amick, and Peco, and subsequently assigned to SMS those claim rights arising out of
`purchases for SMS. Similarly, Assignor Performance Food Group, Inc. and its affiliates opted out
`of the Direct Purchaser class settlement with Fieldale Farms, and subsequently assigned to SMS
`those claim rights arising out of purchases for SMS.
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`2
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`Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 4 of 8 PageID #:4
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`7.
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`In addition to the above information, SMS adds the following additional Count to
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`the Direct Action Plaintiffs’ Amended Consolidated Complaint and Demand for Jury Trial. [ECF
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`No. 4244].
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`COUNT LVIII
`VIOLATION OF 15 USC § 1 (AGAINST CLAXTON, KOCH, MAR-JAC, PILGRIM’S
`PRIDE, GEORGE’S, AND TYSON-PLED IN THE ALTERNATIVE TO COUNT I)
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`SMS incorporates by reference and adopts the allegations set forth in the Direct
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`8.
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`Action Plaintiffs’ Amended Consolidated Complaint and Demand for Jury Trial [ECF No. 4244];
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`the allegations in the superseding indictment returned by the grand jury in United States v. Jayson
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`Jeffery Penn, et al. No. 20-cm-152 (D. Colo.) (“the Colorado Criminal Case”) [ECF No. 101] on
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`October 6, 2020 (“Superseding Indictment”); and the admissions of Pilgrim’s Pride’s allocution
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`and plea agreement in the Colorado Criminal Case.
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`9.
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`The Superseding Indictment describes bid rigging conduct that was specifically
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`directed toward a victim identified in the Superseding indictment as “Cooperative-2,” which was
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`“a centralized buying cooperative” that negotiated with suppliers on behalf of a nationwide
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`restaurant franchise referred to as “QSR-2.” SMS is the victim in the Superseding Indictment
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`referred to as “Cooperative-2.”
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`10.
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`Like other Quick Service Restaurant (“QSR”) purchasing cooperatives, SMS
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`negotiated and contracted directly with Defendants for the supply of chicken to its member
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`restaurants throughout the United States. These negotiations and contracts governed, inter alia,
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`the price at which chicken would be supplied to SMS member restaurants.
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`11.
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`As part of this process, SMS expected its suppliers to engage in a competitive
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`bidding process. According to the Superseding Indictment, Defendants did not engage in a
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`competitive bidding process. Rather, Defendants routinely exchanged confidential information
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`3
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`Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 5 of 8 PageID #:5
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`with each other regarding bids they were submitting, or intended to submit, so that their supposedly
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`competitive bids were aligned. Defendants utilized phone calls, text messages, and e-mail
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`communications to carry out this exchange of confidential information. These actions were
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`inherently anticompetitive and undermined SMS’s purpose of securing competitive pricing from
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`its suppliers.
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`12.
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`Indeed, the Superseding Indictment specifically details how certain Defendant
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`employees would communicate with each other immediately following a request from SMS for
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`bids.
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`13.
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` In one such incident, the Superseding Indictment details how, after SMS’s 2015
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`request for bone-in promotional pricing, the employee of one Defendant called employees at two
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`other Defendants. After making the calls, he sent an internal email stating “I have talked to a
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`couple of company’s and they are thinking of .02lb for September.” Subsequently, that company
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`offered an identical price and employees of multiple Defendants continued their illicit
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`conversations to ensure that no one offered a different, or competitive, price.
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`14.
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`In another incident from August 2017, SMS invited Defendants to bid on 8-piece
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`chicken on-bone pricing for the 2018 and 2019 calendar years. The Superseding Indictment then
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`details the multiple communications between and among defendants regarding how they
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`coordinated and rigged their responses to the request for bids.
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`15.
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`On February 23, 2021, Defendant Pilgrim’s Pride Corporation pleaded guilty in the
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`Colorado Criminal Case, acknowledged its involvement in a criminal antitrust conspiracy. As part
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`of its guilty plea, Pilgrim’s Pride admitted, inter alia, that “[a]t times during the Relevant Period,
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`through at least one of its current and/or former employees, defendant participated in a conspiracy
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`with at least one competitor engaged in the production and sale of broiler chicken products to
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`4
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`Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 6 of 8 PageID #:6
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`suppress and eliminate competition by rigging bids and fixing prices and other price-related terms
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`for certain broiler chicken products sold in the United States.”
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`16.
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`SMS was directly and proximately injured by the bid-rigging conduct described in
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`the Superseding Indictment.
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`17.
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`Defendants’ unlawful contract, combination, or conspiracy had the following
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`direct, substantial, and reasonably foreseeable effects on commerce in the United States: (1) prices
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`charged to, and paid by, SMS for chicken were artificially raised, fixed maintained, or stabilized
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`at supra-competitive levels; (2) SMS was deprived of the benefits of free, open, and unrestricted
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`competition in the United States chicken market; and (3) competition in establishing the prices
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`paid for chicken in the United States was unlawfully restrained, suppressed, or eliminated.
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`18.
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`As a direct and proximate result of Defendants’ above-described anticompetitive
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`conduct, SMS paid artificially high prices for Broilers.
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`19.
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`As a direct and proximate result of Defendants’ above-described anticompetitive
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`conduct, SMS was damaged in its business or property by paying prices for Broilers that were
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`higher than they would have been but for Defendants’ unlawful conduct, which has resulted in an
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`amount of ascertainable damages to be established at trial.
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`20.
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`Defendants’ anticompetitive conduct described in this Complaint constitutes a per
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`se violation of Section 1 of the Sherman Act, 15 U.S.C. § 1. Alternatively, Defendants’ conduct is
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`also unlawful under the Rule of Reason standard of antitrust liability because at all relevant times
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`Defendants possessed significant market power in the market for broilers and their conduct had
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`actual anticompetitive effects with no or insufficient offsetting pro-competitive justifications.
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`5
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`Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 7 of 8 PageID #:7
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`WHEREFORE, Plaintiff respectfully requests that the Court:
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`PRAYER FOR RELIEF
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`A.
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`B.
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`Enter joint and several judgments against all Defendants in favor of Plaintiff;
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`Award Plaintiff’s damages (i.e., three times the overcharges) in an amount to be
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`determined at trial to the maximum extent allowed under the federal antitrust laws;
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`C.
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`Award Plaintiff its post-judgment interest as provided by law, with such interest to
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`be awarded at the highest legal rate;
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`D.
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`Award Plaintiff its attorneys’ fees, litigation expenses, and costs, as provided by
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`law;
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`E.
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`Grant Plaintiff such other and further relief to which Plaintiff is justly entitled.
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`JURY DEMAND
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`Pursuant to Federal Rule of Civil Procedure 38, Plaintiff demands a trial by jury on all
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`issues so triable.
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`6
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`Case: 1:21-cv-01170 Document #: 1 Filed: 03/01/21 Page 8 of 8 PageID #:8
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`Respectfully submitted,
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`Dated: March 1, 2021
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`s/ Jay B. Shapiro
`Jay B. Shapiro
`Samuel O. Patmore
`Carlos J. Canino
`Abigail G. Corbett
`STEARNS WEAVER MILLER WEISSLER
`ALHADEFF & SITTERSON, P.A.
`150 West Flagler Street, Suite 2200
`Miami, Florida 33130
`Tel:
`305.789.3200
`Fax: 305.789.3395
`Email: jshapiro@stearnsweaver.com
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`spatmore@stearnsweaver.com
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`ccanino@stearnsweaver.com
`acorbett@stearnsweaver.com
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`s/ Marvin A. Miller
`Marvin A. Miller
`Andrew Szot
`Miller Law LLC
`115 S. LaSalle Street, Suite 2910
`Chicago, IL 60603
`Tel:
`312.332.3400
`Fax: 312.676.2676
`Email: mmiller@millerlawllc.com
`aszot@millerlawllc.com
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`Counsel for Supply Management Systems, Inc.
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`7
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