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House of Raeford to pay $460k to Washington state attorney general

Payment resolves lawsuit alleging poultry price-fixing.

Krissa Welshans

January 4, 2024

3 Min Read
Getty Images/ iStockphoto

Washington state Attorney General Bob Ferguson announced this week that House of Raeford Farms will pay $460,000 to the attorney general’s office as a result of his lawsuit that alleged the company, as well as several other companies, fixed prices on chicken products.

The resolution leaves only two of the 19 companies named in the antitrust lawsuit facing an October 2024 trial in King County Superior Court. Sanderson Farms and Wayne Farms, named separately in the original lawsuit, merged after the attorney general’s office filed the lawsuit.

The attorney general’s office alleges that House of Raeford Farms and the other chicken producers drove up the price of chicken starting in at least 2008, causing consumers to overpay by millions of dollars. The lawsuit asserts a widespread illegal conspiracy to inflate and manipulate prices, rig contract bids, illegally exchange information and coordinate industry supply reductions to maximize profits.

“As a result of corporate greed and illegal price-fixing, Washingtonians paid more for chicken without realizing it,” Ferguson said. “We are holding accountable those responsible, and getting money back to Washington families who were most harmed. We will continue to serve as a force for economic justice for Washingtonians.”

The $35.5 million recovered from the first 15 alleged conspirators is already on its way to Washingtonians. After Ferguson’s lawsuit against all remaining alleged co-conspirators is complete, the attorney general’s office said it will decide where to allocate the recoveries — prioritizing consumer restitution, cost and fee recovery and supporting future enforcement efforts. If the case against the last two companies — Foster Farms and Wayne-Sanderson Farms — is resolved at trial, the judge will direct how those funds are used.

All of the companies that signed resolutions so far will cooperate with the attorney general’s office to produce information and documentation relevant to the case against the other alleged co-conspirators. Moreover, the companies entered into legally binding agreements to conduct internal training and certify that they have corporate policies that ensure the companies follow state and federal antitrust laws. Under the terms of the consent decrees, if any of them engage in price-fixing or other anticompetitive conduct in the next five years, the attorney general’s office can go to court to seek civil penalties.

Broiler chicken lawsuits

The 19 broiler chicken producers named in Ferguson’s 2021 lawsuit account for approximately 95% of the “broiler” chickens sold in the United States.

The attorney general’s office said its investigation found a coordinated, industry-wide effort to restrain production through the exchange of competitively sensitive information, signals during investor calls and direct coordination between players in the industry. Ferguson asserts their conduct violated Washington state antitrust laws.

A trial against the remaining co-conspirators, Foster Farms and Wayne-Sanderson Farms, is scheduled for October 2024. Foster Farms has a large production facility inside Washington state and the attorney general’s office estimates that it maintains a significant market share in Washington state. The Wayne-Sanderson Farms merger increased their respective market shares.

Tens of millions of dollars sent across Washington state

In December, Ferguson began mailing checks to Washingtonians as restitution from earlier resolutions with chicken and tuna companies. The attorney general’s office had $35.5 million from resolutions in the chicken producer lawsuit and $5.1 million from similar tuna price-fixing lawsuits.

The $40.6 million in financial restitution will go to every Washington state household whose income is at or below 175% of the federal poverty level. Approximately 402,200 Washington households will receive checks. More than 1.2 million Washingtonians, or approximately 15% of the state population, reside in households receiving checks. As of the end of December, most of the checks went to those households.

About the Author(s)

Krissa Welshans

Livestock Editor

Krissa Welshans grew up on a crop farm and cow-calf operation in Marlette, Michigan. Welshans earned a bachelor’s degree in animal science from Michigan State University and master’s degree in public policy from New England College. She and her husband Brock run a show cattle operation in Henrietta, Texas, where they reside with their son, Wynn.

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