Six additional poultry company executives have been indicted by a federal district court in Colorado for their alleged roles in a previously indicted conspiracy to fix prices and rig bids for broiler chicken products from at least 2012 until at least early 2019, the U.S. Department of Justice (DOJ) announced this week. Previously indicted defendants who remain charged in the superseding indictment are former Pilgrim’s Pride chief executive officer and president Jayson Penn, former Pilgrim’s vice president Roger Austin, Mikell Fries and Scott Brady.
The indictment also charges one defendant with making false statements and obstruction of justice and contains additional allegations against the previously charged defendants in the same conspiracy.
The six additional defendants named are Timothy Mulrenin, William Kantola, Jimmie Little, William Lovette, Gary Roberts and Rickie Blake. Lovette was president and CEO at Pilgrim's Pride during the time period but retired in March 2019. Kantola is currently listed as vice president of foodservice at Koch Foods but also worked for Pilgrim’s during the time frame. Little, who is the defendant being charged for making false statements and obstruction of justice, was a sales director at Pilgrim’s. Mulrenin worked for Tyson during the time period of the accusations and is currently director of national account sales at Perdue Farms. Roberts was an employee at a chicken supplier headquartered in North Carolina and a manager and director at a chicken supplier headquartered in Arkansas. Blake was a director and manager at a chicken supplier headquartered in Arkansas. Fries is president and board member at Claxton Poultry Farms headquartered in Georgia, and Brady is vice president of Claxton.
“The division will not tolerate collusion that inflates prices American shoppers and diners pay for food,” said assistant attorney general Makan Delrahim of the DOJ Antitrust Division. “Executives who choose collusion over competition will be held to account for schemes that cheat consumers and corrupt our competitive markets. The division will also continue to charge those who knowingly lie to our law enforcement partners and obstruct our investigations; such conduct undermines our criminal justice system and will be prosecuted to the fullest extent of the law.”
James Dawson, acting assistant director in charge of the Federal Bureau of Investigation's Washington Field Office, said, “The charges in this ongoing investigation show the commitment of the FBI and our partners to work together to uncover these crimes and hold these individuals responsible. To date, there have been 10 individuals charged for their participation in this conspiracy to fix prices and rig bids. The American people and restaurant owners should not be the ones to pay unnecessary rising costs of food while executives and employees line their pockets.”
Assistant inspector general for investigations Scott Kieffer of the U.S. Department of Commerce's Office of Inspector General said efforts will continue to work with law enforcement partners and DOJ “to root out corruption that harms consumers and the competitive market.”
Kieffer added, “The superseding indictment should serve as a deterrent to those who might contemplate similar criminal actions.”
The Sherman Act offense charged carries a statutory maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than $1 million. The false statements offense charged carries a statutory maximum penalty of five years in prison and a $250,000 fine. The obstruction of justice offense charged carries a statutory maximum penalty of 20 years in prison and a $250,000 fine.
The investigation remains ongoing, DOJ said.
Pilgrim’s appoints new CEO
Penn initially took a leave of absence to focus on the trial, but Pilgrim’s announced Sept. 23 that the board of directors had appointed Fabio Sandri as president and CEO of Pilgrim’s, effective immediately. Sandri had been serving as interim president and CEO. At the time, Pilgrim's also announced that Penn was no longer with the company.
Sandri joined Pilgrim’s as chief financial officer in June 2011 and was appointed interim president and CEO on June 15, one day after Penn began a paid leave of absence. The company has initiated a search process to identify a new CFO to replace Sandri in that role.