Agri Stats Inc. must face the U.S. Department of Justice and six individual states that have brought antitrust action against the firm for an alleged information-exchange conspiracy with major U.S. broiler chicken, pork and turkey processors. This week U.S. District Judge John Tunheim in Minnesota denied Agri Stat’s motion to transfer to the Northern District of Illinois or to the Northern District of Indiana, and it’s motion to dismiss for lack of subject matter jurisdiction and failure to state a claim.

The civil antitrust lawsuit was filed in September and alleges that Agri Stats violated Section 1 of the Sherman Act by collecting, integrating and distributing competitively sensitive information related to price, cost and output among competing meat processors. The complaint also alleges that Agri Stats has for years produced comprehensive weekly and monthly reports for participating meat processors, which use the data to set prices and output levels.

Agri Stats had argued its place of residence and a substantial part of the events or omissions giving rise to the claim did not occur in Minnesota to support the motion for transfer. Tunheim noted the court did not find this compelling. The convenience of the parties and witnesses and the interests of justice also do not strongly favor transfer, thus the reason the court denied the motion.

As for the motion to dismiss, Agri Stats had challenged the plaintiffs’ claims on different grounds. Agri Stats’ arguments against the pork and turkey claims were based in jurisdiction, and its arguments against the broiler chicken claim were based on stare decisis.

Agri Stats contended its termination of pork and turkey reports in 2019 as evidence that plaintiffs failed to allege an injury-in-fact. Further, Agri Stats argued that the complaint is devoid of any indication that Agri Stats will or even can restart such reports, as they would need to retain subscribers to provide their information to and to purchase any resulting reports. The court disagreed.

“Though Agri Stats is not currently producing pork and turkey reports and declares it ‘has no current plans to resume its production of the turkey and pork-related reports,’ a ‘sparse declaration’ regarding no current plans to resume the challenged conduct and the passage of multiple years since the conduct ceased are insufficient bases for dismissal,” wrote Judge Tunheim.

“Plus, Agri Stats continues to advertise on its website that it ‘service[s] customers in the chicken, turkey, commercial egg, and swine industries.’  

“Additionally, Plaintiffs have provided sufficient expressions of intent by Agri Stats to restart pork and turkey reports in the future. Plaintiffs allege that Agri Stats intends to resume pork and turkey reports once the litigation that spurred the cessation terminates.”

Agri Stats also argued that the broiler chicken claim has already been resolved in prior broiler chicken antitrust litigation on the same evidence alleged in the complaint and should be barred under the doctrine of stare decisis. In September 2023 when the lawsuit was filed, attorney Justin Bernick of Hogan Lovells, which is representing Agri Stats in the DOJ case, said Agri Stats strongly denies the DOJ allegations, and pointed to late June 2023 when those claims were already rejected by U.S. District Court Judge Thomas M. Durkin in In re Broiler Chicken Antitrust Litigation.

Judge Tunheim noted, while the court agreed that uniformity in the law should be encouraged where possible, it declined to dismiss the claim because of the summary judgment ruling in that case.

Additionally, Bernick noted the DOJ investigated Agri Stats a decade ago and closed the investigation after finding no evidence of wrongdoing.

“Agri Stats provides vital benchmarking services that help keep protein production costs and prices low for consumers,” stated Bernick. “Since Agri Stats’ founding, protein production has increased significantly, while prices — like prices for boneless, skinless chicken breast — have plummeted. DOJ’s lawsuit threatens to unwind these benefits and cause further harm to Americans who already are struggling with inflated food costs.”