Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 1 of 92 PageID# 2122
`
`UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF VIRGINIA
`Norfolk Division
`
`
`
`IN RE PEANUT FARMERS
`ANTITRUST LITIGATION
`
`
`
`Civil Action No. 2:19-cv-00463
`
`
`
`Honorable Raymond A. Jackson
`Honorable Lawrence R. Leonard
`
`
`
`
`
`
`
`GOLDEN PEANUT COMPANY, LLC’S ANSWER TO PLAINTIFFS’ SECOND
`AMENDED CLASS ACTION COMPLAINT AND DEMAND FOR JURY TRIAL
`
`
`Defendant Golden Peanut Company, LLC (“Golden Peanut”) is a limited liability
`
`corporation headquartered in Alpharetta, Georgia. Golden Peanut is a peanut shelling company,
`
`meaning it buys peanuts from farmers, removes their shells, and resells them to a variety of
`
`customers that make products like peanut butter, snacks, and candy. For years, by unilaterally and
`
`persistently enhancing procurement strategies, expanding shelling capacity, increasing processing
`
`efficiencies, and deepening relationships with buying points and farmers alike, Golden Peanut’s
`
`business strategy has been simple: compete for the highest quality peanuts and sell a high quality
`
`product to its customers.
`
`Plaintiffs’ Second Amended Complaint alleges that three Defendant shellers agreed to and
`
`engaged in anticompetitive price suppression for runner peanuts (one variety of peanuts), and
`
`agreed to and submitted inaccurate price and inventory data to the USDA. Plaintiffs are wrong.
`
`The crux of Plaintiffs’ theory is that, during the relevant period, Defendants coordinated to over-
`
`report runner peanut inventory numbers and under-report runner peanut prices to the USDA, and
`
`on the prices they would offer to peanut farmers, to deflate the prices they paid to runner peanut
`
`farmers. Not so for Golden Peanut, which focused on independently obtaining quality product at
`
`
`
`1
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 2 of 92 PageID# 2123
`
`a competitive price, and which consistently strove to provide price and inventory submissions to
`
`the USDA that were accurate and compliant with the USDA’s submission requirements. The
`
`prices Golden Peanut paid for runner peanuts were not the result of any allegedly anticompetitive
`
`conduct by Golden Peanut.
`
`Golden Peanut answers and sets forth its affirmative defenses to Plaintiffs’ Second
`
`Amended Complaint as follows. It denies each and every allegation in Plaintiffs’ Second
`
`Amended Complaint except as expressly admitted below.
`
`Complaint:
`
`Plaintiffs bring this action on behalf of themselves individually and on behalf of a plaintiff
`class (the “Class”) consisting of Peanut farmers in the United States who sold raw, harvested
`Runner Peanuts to Peanut shelling companies from at least January 1, 2014 through the present
`(the “Class Period”). Plaintiffs bring this action for treble damages under the antitrust laws of the
`United States against Defendants, and demand a trial by jury.
`
`Answer:
`
`Golden Peanut admits that Plaintiffs purport to bring this action under the antitrust laws of
`
`the United States, but denies that Plaintiffs can state a claim under those laws and/or that Plaintiffs
`
`are entitled to any of the requested relief. Golden Peanut denies the remaining allegations in this
`
`Paragraph.
`
`Complaint:
`
`I.
`
`NATURE OF ACTION1
`
`Peanut shelling companies (or shellers) play a vital role in the peanut production
`1.
`process. The majority of Peanut crops are processed in some manner prior to reaching customers.
`Once Peanut farmers harvest their crops, approximately 90% of the Peanuts are usually moved to
`a buying point and sold to a shelling plant. Inside the shelling plant, the Peanuts are processed and
`packaged into sacks for shipment or storage. The Peanut shellers are responsible for marketing
`and selling the shelled product to food companies or other manufacturers.
`
`
`1 The headings and titles in Plaintiffs’ Second Amended Complaint are not factual allegations to which a response
`is required. To the extent that a response is deemed required, Golden Peanut denies any allegation in Plaintiffs’
`headings and titles.
`
`
`
`2
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 3 of 92 PageID# 2124
`
`Answer:
`
`Golden Peanut admits that shelling companies play a role in the peanut processing process.
`
`As the term “vital” in the first sentence of Paragraph 1 is imprecise, Golden Peanut is unable to
`
`form a belief as to the truth of the remaining allegations contained in that sentence and on this
`
`basis denies those allegations. Golden Peanut admits that it purchases inshell, farmerstock peanuts
`
`from farmers, that buying points can be involved in these transactions, that it shells peanuts, and
`
`that it markets and sells shelled peanuts (also referred to as kernels) and inshell peanuts to end-
`
`customers. To the extent the allegations in Paragraph 1 relate to other Defendants and/or third
`
`parties, Golden Peanut is without information sufficient to form a belief as to the truth of those
`
`allegations and therefore denies those allegations. Golden Peanut denies the remaining allegations
`
`in Paragraph 1.
`
`Complaint:
`
`As used in this Complaint, “Peanut” or “Peanuts” refers to all peanuts that are raw
`2.
`and harvested and ready to be sold to shellers. “Peanuts” includes all four of the major types of
`peanuts: runner, Spanish, Valencia, and Virginia.
`
`Answer:
`
`Paragraph 2 contains Plaintiffs’ explanation of a defined term used in their Second
`
`Amended Complaint, to which no response is required. To the extent that sentence is deemed to
`
`require a response, Golden Peanut admits that Plaintiffs have defined “Peanut” or “Peanuts” as
`
`described in Paragraph 2. Golden Peanut denies any remaining allegations in Paragraph 2.
`
`Complaint:
`
`As used in this Complaint, “Runner,” “Runners,” or “Runner Peanuts” refers to the
`3.
`runner type of peanuts that are raw and harvested and ready to be sold to shellers.
`
`
`
`3
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 4 of 92 PageID# 2125
`
`Answer:
`
`Paragraph 3 contains Plaintiffs’ explanation of a defined term used in their Second
`
`Amended Complaint, to which no response is required. To the extent that sentence is deemed to
`
`require a response, Golden Peanut admits that Plaintiffs have defined “Runner,” “Runners,” or
`
`“Runner Peanuts” as described in Paragraph 3. Golden Peanut denies any remaining allegations
`
`in Paragraph 3.
`
`Complaint:
`
`Defendants Birdsong Corporation (“Birdsong”) and Golden Peanut Company, LLC
`4.
`(“Golden Peanut”) are the two largest players in the shelling industry in the United States and
`together hold 80-90% of the total Peanut shelling market share. Defendant Olam Peanut Shelling
`Company, Inc., f/k/a McCleskey Mills, Inc. (“Olam” and together with Birdsong and Golden
`Peanut, “Defendants”), is the third largest participant in the United States Peanut shelling industry
`and holds at least 10% of the total Peanut Shelling market share.
`
`Answer:
`
`Golden Peanut admits that it shells peanuts. Golden Peanut denies the allegations
`
`regarding and characterization of its market share. To the extent the allegations in Paragraph 4
`
`relate to other Defendants and/or third parties, Golden Peanut is without information sufficient to
`
`form a belief as to the truth of those allegations and therefore denies those allegations. Golden
`
`Peanut denies the remaining allegations in Paragraph 4.
`
`Complaint:
`
`Since January 2014, the prices paid by shellers to Peanut farmers for Runners have
`5.
`remained remarkably flat and unchanged, despite significant supply disruptions such as Hurricane
`Michael, a Category 5 hurricane that hit a significant amount of Peanut crops in the Florida
`panhandle/southern Georgia and Alabama area in 2018.
`
`Answer:
`
`Golden Peanut admits that a hurricane, sometimes identified as “Hurricane Michael,”
`
`occurred in 2018. To the extent the allegations in Paragraph 5 relate to other Defendants and/or
`
`third parties, Golden Peanut is without information sufficient to form a belief as to the truth of
`
`
`
`4
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 5 of 92 PageID# 2126
`
`those allegations and therefore denies those allegations. Golden Peanut denies the remaining
`
`allegations in Paragraph 5.
`
`Complaint:
`
`From 2011 to 2013, the Peanut industry experienced drastic weather-related price
`6.
`changes that made it difficult for Defendants and McCleskey Mills (now known as Olam) to
`manage risk and plan for production. Upon information and belief, and as alleged in this
`Complaint, Defendants and McCleskey Mills thereafter conspired and colluded with one another
`to stabilize and depress Runner prices. Among other things, during the relevant time period,
`Defendants over-reported Peanut and Runner inventory numbers to the USDA to create the false
`impression of an oversupplied market. Defendants capitalized on the perceived oversupply to offer
`artificially low Runner prices to farmers. Defendants also underreported Peanut and Runner prices
`to the USDA to further suppress prices and keep them low and less volatile.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy in Paragraph 6. Golden Peanut admits
`
`that weather, including, but not limited to, droughts and hurricanes, can impact peanut supply. As
`
`the terms and phrases “drastic weather-related price changes,” “made it difficult,” “manage risk,”
`
`and “plan for production” are imprecise, Golden Peanut is without information sufficient to form
`
`a belief as to the truth of those allegations and therefore denies those allegations. To the extent
`
`the allegations in Paragraph 6 relate to other Defendants and/or third parties, Golden Peanut is
`
`without information sufficient to form a belief as to the truth of those allegations and therefore
`
`denies those allegations. Golden Peanut denies the remaining allegations in Paragraph 6.
`
`Complaint:
`
`In addition, Defendants offered nearly identical shelling contracts, often within the
`7.
`same day of one another, limiting the negotiating power and pricing options for farmers. Upon
`information and belief, these contracts are released following National Peanut Buying Points
`Association conferences, which are sponsored and attended by Golden Peanut, Birdsong, and
`Olam.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy in Paragraph 7. Golden Peanut admits
`
`that the price it will pay for runner peanuts may vary daily and is informed by many factors,
`
`
`
`5
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 6 of 92 PageID# 2127
`
`including, but not limited to, how much customer demand exists at a given time for shelled runner
`
`peanuts; customer-specific requirements for the runner peanuts they will purchase; the prices
`
`customers are willing to pay Golden Peanut for its shelled runner peanuts; Golden Peanut’s costs
`
`to process shelled runner peanuts; whether the contract to purchase peanuts is for the current or
`
`next harvest season; the quality of the farmer’s yield; the historical quality of the farmer’s work
`
`and product; the prices offered to farmers by other shellers in the runner peanut market; and/or the
`
`prices offered to farmers by non-shellers to grow different products, such as, for example, seed
`
`companies buying peanuts to process into seed. Golden Peanut admits that it sponsors, and certain
`
`of its personnel attend, trade association events from time to time, but denies any characterization
`
`of those events. To the extent the allegations in Paragraph 7 relate to other Defendants and/or third
`
`parties, Golden Peanut is without information sufficient to form a belief as to the truth of those
`
`allegations and therefore denies those allegations. Golden Peanut denies the remaining allegations
`
`in Paragraph 7.
`
`Complaint:
`
`The Peanut shelling industry is particularly susceptible to a conspiracy due to a lack
`8.
`of pricing transparency. Unlike other agricultural commodities, there is no futures market for
`Peanuts. Rather, Peanut prices are set through private contracting between shellers and farmers,
`although farmers rarely have negotiating power over contractual terms. As the dominant players
`in this industry, Defendants dictate the prices offered to Plaintiffs and Class members.
`
`Answer:
`
`Golden Peanut denies Plaintiffs’ characterization of the susceptibility of the peanut shelling
`
`industry to a conspiracy. Golden Peanut admits that there is no futures market for peanuts and that
`
`prices are set through contracts negotiated between shellers or buying points and farmers. Golden
`
`Peanut denies that farmers do not have negotiating power over contractual terms. To the extent
`
`the allegations in Paragraph 8 relate to other Defendants and/or third parties, Golden Peanut is
`
`
`
`6
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 7 of 92 PageID# 2128
`
`without information sufficient to form a belief as to the truth of those allegations and therefore
`
`denies those allegations. Golden Peanut denies the remaining allegations in Paragraph 8.
`
`Complaint:
`
`Defendants’ shelling facilities and the buying points they control through various
`9.
`contractual arrangements are scattered throughout key United States Peanut production regions
`and located in close proximity to one another, providing prime opportunities for collusion.
`Defendants are heavily involved in the industry’s top trade associations through which they discuss
`and share exclusive market information.
`
`Answer:
`
`Golden Peanut admits that it owns and operates shelling facilities and buying points.
`
`Golden Peanut admits that it contracts with certain other buying points. Golden Peanut admits that
`
`certain of its personnel attend industry trade association events from time to time, but denies
`
`Plaintiffs’ characterization of such trade associations or events. Golden Peanut also denies that
`
`the proximity of buying points provides “prime opportunities” for collusion. To the extent the
`
`allegations in Paragraph 9 relate to other Defendants and/or third parties, Golden Peanut is without
`
`information sufficient to form a belief as to the truth of those allegations and therefore denies those
`
`allegations. Golden Peanut denies the remaining allegations in Paragraph 9.
`
`Complaint:
`
`Defendants’ wrongful and anticompetitive actions had the intended purpose and
`10.
`effect of artificially fixing, depressing, maintaining, and stabilizing the price of Runners to
`Plaintiffs and Class members in the United States.
`
`Answer:
`
`Golden Peanut denies the allegations in Paragraph 10.
`
`Complaint:
`
`The effect of Defendants’ conspiracy has been devastating to many farmers. Unlike
`11.
`prior to the conspiracy, there are no longer good price years to balance out the now-common bad
`years of Runner prices. This has led numerous farmers to borrow from generations of equity built
`up in their land, relying on that equity to pay themselves and keep their farms running. The
`
`
`
`7
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 8 of 92 PageID# 2129
`
`consequence is smaller farmers being run out of business as they use up the remaining equity in
`their farms.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 11.
`
`To the extent the allegations in Paragraph 11 relate to other Defendants and/or third parties, Golden
`
`Peanut is without information sufficient to form a belief as to the truth of those allegations and
`
`therefore denies those allegations. Golden Peanut denies the remaining allegations in Paragraph
`
`11.
`
`Complaint:
`
`As a result of Defendants’ unlawful conduct, Plaintiffs and the other members of
`12.
`the Class were artificially underpaid for Runners during the Class Period. Such prices were below
`the amount Plaintiffs and the Class would have been paid if the price for Runners had been
`determined by a competitive market. Thus, Plaintiffs and Class members were directly injured by
`Defendants’ conduct.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 12.
`
`To the extent the allegations in Paragraph 12 relate to other Defendants and/or third parties, Golden
`
`Peanut is without information sufficient to form a belief as to the truth of those allegations and
`
`therefore denies those allegations. Golden Peanut denies the remaining allegations in Paragraph
`
`12.
`
`Complaint:
`
`II.
`
`JURISDICTION AND VENUE
`
`Plaintiffs bring this action under Sections 4 and 16 of the Clayton Act (15 U.S.C.
`13.
`§§ 15 and 26), to recover treble damages and the costs of this suit, including reasonable attorneys’
`fees, against Defendants for the injuries sustain by Plaintiffs and the members of the Class by
`virtue of Defendants’ violations of Section 1 of the Sherman Act, 15 U.S.C. § 1, and to enjoin
`further violations.
`
`
`
`8
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 9 of 92 PageID# 2130
`
`Answer:
`
`Golden Peanut admits that Plaintiffs purport to bring this action under Section 4 and 16 of
`
`the Clayton Act (15 U.S.C. §§ 15 and 26) and Section 1 of the Sherman Act (15 U.S.C. § 1) to
`
`attempt to recover treble damages, costs, and attorneys’ fees, but denies that Plaintiffs can state
`
`claims under the Clayton Act or Sherman Act and/or are entitled to any of the relief requested.
`
`Golden Peanut denies the remaining allegations in Paragraph 13.
`
`Complaint:
`
`This Court has jurisdiction under 28 U.S.C. §§ 1331, 1337, and Sections 4 and 16
`14.
`of the Clayton Act, 15 U.S.C. §§ 15(a) and 26.
`
`Answer:
`
`Golden Peanut admits that the Court has subject matter jurisdiction over this action.
`
`Complaint:
`
`Venue is appropriate in this District under Sections 4, 12, and 16 of the Clayton
`15.
`Act, 15 U.S.C. §§ 15, 22, and 26 and 28 U.S.C. § 1391(b), (c), and (d), because one or more
`Defendants resided or transacted business in this District, is licensed to do business or is doing
`business in this District, and because a substantial portion of the affected interstate commerce
`described herein was carried out in this District.
`
`Answer:
`
`Golden Peanut admits that venue properly lies in this District for purposes of this matter
`
`only. Golden Peanut denies the remaining allegations in Paragraph 15.
`
`Complaint:
`
`This Court has personal jurisdiction over each Defendant because, inter alia, each
`16.
`Defendant: (a) transacted business throughout the United States, including in this District; (b)
`purchased substantial quantities of Runners and sold the shelled product throughout the United
`States, including in this District; and/or (c) engaged in an antitrust conspiracy that was directed at
`and had a direct, foreseeable, and intended effect of causing injury to the business or property of
`persons residing in, located in, or doing business throughout the United States, including in this
`District.
`
`
`
`9
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 10 of 92 PageID# 2131
`
`Answer:
`
`Golden Peanut admits that the Court has personal jurisdiction over Golden Peanut for
`
`purposes of this matter only. Golden Peanut denies the allegations of conspiracy in Paragraph 16.
`
`To the extent the allegations in Paragraph 16 relate to other Defendants and/or third parties, Golden
`
`Peanut is without information sufficient to form a belief as to the truth of these allegations and
`
`therefore denies those allegations. Golden Peanut denies any remaining allegations in
`
`Paragraph 16.
`
`Complaint:
`
`The activities of the Defendants and their co-conspirators, as described herein, were
`17.
`within the flow of, were intended to, and did have direct, substantial, and reasonably foreseeable
`effects on the interstate commerce of the United States.
`
`Answer:
`
`Paragraph 17 consists of Plaintiffs’ characterization of their claims and/or legal
`
`conclusions, to which no response is required. To the extent the allegations in Paragraph 17 may
`
`be deemed to require a response, Golden Peanut denies the allegations of conspiracy and antitrust
`
`injury in Paragraph 17. Golden Peanut admits that it sells peanuts in interstate commerce of the
`
`United States. To the extent the allegations in Paragraph 17 relate to other Defendants and/or third
`
`parties, Golden Peanut is without information sufficient to form a belief as to the truth of these
`
`allegations and therefore denies those allegations. Golden Peanut denies the remaining allegations
`
`in Paragraph 17.
`
`Complaint:
`
`18.
`this case.
`
`No other forum would be more convenient for the parties and witnesses to litigate
`
`
`
`10
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 11 of 92 PageID# 2132
`
`Answer:
`
`Golden Peanut denies the allegations in Paragraph 18. To the extent the allegations in
`
`Paragraph 18 relate to other Defendants and/or third parties, Golden Peanut is without information
`
`sufficient to form a belief as to the truth of those allegations and therefore denies those allegations.
`
`III.
`
`PARTIES
`
`A.
`
`Plaintiffs
`
`Complaint:
`
`Plaintiff D&M Farms is a Florida partnership that sold Runners to Defendants
`19.
`during the Class Period and suffered antitrust injury as a result of the violations alleged in this
`Complaint.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 19.
`
`Golden Peanut further denies that Plaintiff D&M Farms sold runner peanuts to Golden Peanut
`
`during the alleged Class Period. Golden Peanut is without information sufficient to form a belief
`
`as to the truth of the remaining allegations in Paragraph 19 and therefore denies those allegations.
`
`Complaint:
`
`Plaintiff Mark Hasty is a resident of Florida and citizen of the United States. Mr.
`20.
`Hasty is a Peanut farmer who sold Runners to Defendants during the Class Period and suffered
`antitrust injury as a result of the violations alleged in this Complaint.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 20.
`
`Golden Peanut admits that Plaintiff Mark Hasty sold runner peanuts to Golden Peanut during the
`
`alleged Class Period. Golden Peanut is without information sufficient to form a belief as to the
`
`truth of the remaining allegations in Paragraph 20 and therefore denies those allegations.
`
`
`
`11
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 12 of 92 PageID# 2133
`
`Complaint:
`
`Plaintiff Dustin Land is a resident of Florida and citizen of the United States. Mr.
`21.
`Land is a Peanut farmer who sold Runners to Defendants during the Class Period and suffered
`antitrust injury as a result of the violations alleged in this Complaint.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 21.
`
`Golden Peanut admits that Plaintiff Dustin Land sold runner peanuts to Golden Peanut during the
`
`alleged Class Period. Golden Peanut is without information sufficient to form a belief as to the
`
`truth of the remaining allegations in Paragraph 21 and therefore denies those allegations.
`
`Complaint:
`
`Plaintiff Rocky Creek Peanut Farms, LLC is an Alabama limited liability company
`22.
`that sold Runners to one or more Defendants during the Class Period and suffered antitrust injury
`as a result of the violations alleged in this Complaint.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 22.
`
`Golden Peanut admits that Plaintiff Rocky Creek Peanut Farms, LLC sold runner peanuts to
`
`Golden Peanut during the alleged Class Period. Golden Peanut is without information sufficient
`
`to form a belief as to the truth of the remaining allegations in Paragraph 22 and therefore denies
`
`those allegations.
`
`Complaint:
`
`Plaintiff Daniel Howell is a resident of Alabama and Citizen of the United States.
`23.
`Mr. Howell was a Peanut farmer who sold Runners to one or more Defendants during the Class
`Period and suffered antitrust injury as a result of the violations alleged in this Complaint.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 23.
`
`Golden Peanut admits that Plaintiff Daniel Howell sold runner peanuts to Golden Peanut during
`
`
`
`12
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 13 of 92 PageID# 2134
`
`the alleged Class Period. Golden Peanut is without information sufficient to form a belief as to
`
`the truth of the remaining allegations in Paragraph 23 and therefore denies those allegations.
`
`Complaint:
`
`Plaintiff L&K Farms Group, LLC is a Florida limited liability company that sold
`24.
`sold Runners to one or more Defendants during the Class Period and suffered antitrust injury as a
`result of the violations alleged in this Complaint.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 24.
`
`Golden Peanut further denies that Plaintiff L&K Farms Group, LLC sold runner peanuts to Golden
`
`Peanut during the alleged Class Period. Golden Peanut is without information sufficient to form
`
`a belief as to the truth of the remaining allegations in Paragraph 24 and therefore denies those
`
`allegations.
`
`Complaint:
`
`Plaintiff Lonnie Gilbert is a resident of Florida and citizen of the United States. Mr.
`25.
`Gilbert is a Peanut farmer who sold sold Runners to one or more Defendants during the Class
`Period and suffered antitrust injury as a result of the violations alleged in this Complaint.
`
`Answer:
`
`Golden Peanut denies the allegations of conspiracy and antitrust injury in Paragraph 25.
`
`Golden Peanut admits that Plaintiff Lonnie Gilbert sold runner peanuts to Golden Peanut during
`
`the alleged Class Period. Golden Peanut is without information sufficient to form a belief as to
`
`the truth of the remaining allegations in Paragraph 25 and therefore denies those allegations.
`
`B.
`
`Defendants
`
`Complaint:
`
`Defendant Birdsong Corporation is a Virginia corporation headquartered in
`26.
`Suffolk, Virginia. Birdsong purchases Runners directly from farmers, and then cleans, shells, and
`sizes the Runners to sell to food manufacturers. Birdsong operates six shelling plants throughout
`Virginia, Georgia, and Texas. Birdsong also operates eighty-five buying points throughout
`
`
`
`13
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 14 of 92 PageID# 2135
`
`Virginia, North Carolina, South Carolina, Georgia, Florida, Alabama, Mississippi, Arkansas,
`Oklahoma, and Texas.
`
`Answer:
`
`Golden Peanut is without information sufficient to form a belief as to the truth of the
`
`allegations in Paragraph 26 and therefore denies those allegations.
`
`Complaint:
`
`Defendant Golden Peanut Company, LLC is a Georgia limited liability company
`27.
`headquartered in Alpharetta, Georgia and registered to conduct business in Virginia. Golden
`Peanut is a leading Peanuts and tree nuts sheller with shelling plants in Georgia, Texas, and
`internationally. Golden Peanut also maintains more than 100 buying points. Golden Peanut is a
`wholly-owned subsidiary of Archer Daniels Midland Company (“ADM”), a public corporation
`and one of the world’s largest agricultural processors and food ingredient providers. As discussed
`further below, ADM has a history of price-fixing, and paid $100 million (the largest fine ever at
`the time in 1996) for a global conspiracy to eliminate competition in the food and feed additive
`industries.
`
`Answer:
`
`Golden Peanut admits that it is a Georgia limited liability company headquartered in
`
`Alpharetta, Georgia and registered to conduct business in Virginia. Golden Peanut admits that it
`
`shells peanuts and tree nuts and that it operates shelling plants in Georgia, Texas, and
`
`internationally. As the term “maintains” in the third sentence of Paragraph 27 is imprecise, Golden
`
`Peanut is unable to form a belief as to the truth of the allegations contained in that sentence and on
`
`this basis denies those allegations. Golden Peanut admits that it is a wholly-owned subsidiary of
`
`Archer Daniels Midland Company (“ADM”). To the extent the allegations in the last sentence of
`
`Paragraph 27 characterize or describe historical conduct or fines unrelated to this matter that
`
`involved ADM, Golden Peanut notes that such sources speak for themselves and denies any
`
`characterization or description that is inconsistent therewith. To the extent the allegations in
`
`Paragraph 27 relate to other Defendants and/or third parties, Golden Peanut is without information
`
`
`
`14
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 15 of 92 PageID# 2136
`
`sufficient to form a belief as to the truth of these allegations and therefore denies those allegations.
`
`Golden Peanut denies the remaining allegations in Paragraph 27.
`
`Complaint
`
`Defendant Olam Peanut Shelling Company, Inc. is a Georgia corporation
`28.
`headquartered in Fresno, California. Olam is the third largest Peanut sheller in the United States
`with shelling plants in Georgia and Alabama. Olam also maintains roughly two dozen buying
`points. Olam is a wholly-owned subsidiary of Olam International Limited (“OIL”), a leading agri-
`business operating in 60 countries and headquartered and listed in Singapore. On December 5,
`2014 OIL announced that it had signed a purchase agreement to acquire a 100% interest in
`McCleskey Mills, Inc. for $176 million, the third largest peanut sheller headquartered in
`Smithville, Georgia which maintained a 12% market share at the time. On June 9, 2016 OIL
`announced that it acquired a 100% interest in Brooks Peanut Company, LLC for $85 million, the
`sixth largest peanut sheller in the United States at the time based in Samson, Alabama. On
`December 27, 2018, Brooks Peanut Company, LLC and McCleskey Mills, Inc. were merged, and
`the corporate name was changed to Olam Peanut Shelling Company, Inc. Olam is liable for its
`own actions during the Class Period and also for the acts of McCleskey Mills, Inc. and Brooks
`Peanut Company, LLC, its predecessor companies.
`
`Answer
`
`Golden Peanut is without information sufficient to form a belief as to the truth of the
`
`allegations in Paragraph 28 and therefore denies those allegations.
`
`Complaint:
`
`“Defendant” or “Defendants” as used herein includes, in addition to those named
`29.
`specifically above, all of the named Defendants’ predecessors, including peanut shelling
`companies that merged with or were acquired by the named Defendants and each named
`Defendant’s wholly-owned or controlled subsidiaries or affiliates that purchased Runners in
`interstate commerce, directly or through its wholly-owned or controlled affiliates, from peanut
`farmers in the United States during the Class Period.
`
`Answer:
`
`Paragraph 29 contains Plaintiffs’ explanation of a defined term used in their Second
`
`Amended Complaint, to which no response is required. To the extent the allegations in Paragraph
`
`29 may be deemed to require a response, Golden Peanut admits that it purchases runner peanuts,
`
`at times via buying points, from peanut farmers in the United States. To the extent the allegations
`
`in Paragraph 29 relate to other Defendants and/or third parties, Golden Peanut is without
`
`
`
`15
`
`

`

`Case 2:19-cv-00463-RAJ-LRL Document 178 Filed 06/26/20 Page 16 of 92 PageID# 2137
`
`information sufficient to form a belief as to the truth of these allegations and therefore denies those
`
`allegations. Golden Peanut denies the remaining allegations in Paragraph 29.
`
`Complaint:
`
`To the extent that subsidiaries and divisions within each Defendant’s corporate
`30.
`family purchased Runners from Peanut farmers, these subsidiaries played a material role in the
`conspiracy alleged in this Complaint because Defendants wished to ensure that the prices paid for
`such Runners would not undercut the artificially depressed pricing that was the aim and intended
`result of Defendants’ coordinated and collusive behavior as alleged herein. Thus, all such entities
`within the corporate family were active, knowing participants in the conspiracy alleged herein, and
`their conduct in purchasing and pricing with regard to Plaintiffs and members of the Plaintiff Class
`for Runners was known to and approved by their respective corporate parent named as a Defendant
`in this Complaint.
`
`Answer:
`
`Paragraph 30 consists of Plaintiffs’ characterization of their claims, allegations subject to
`
`proof, including by expert testimo