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Partial Settlement Reached over Egg Price Fixing

by 5m Editor
9 June 2010, at 11:22p.m.

US - Law firm, Hausfeld LLP, has announced a $25-million partial settlement in an anti-trust class action involving egg suppliers.

Hausfeld LLP, a global plaintiffs’ law firm dedicated to handling complex and class action litigation, today announced a $25 million settlement in In re: Processed Eggs Antitrust Litigation (pending in the Eastern District of Pennsylvania), an antitrust class action brought on behalf of direct purchasers of shell eggs and egg products. The settlement, entered into between the plaintiffs and three of the defendants – Land O'Lakes, Moark and Norco – is the first settlement in this case providing monetary compensation to class members.

The plaintiffs allege a near industry-wide, price-fixing conspiracy among egg farmers which raised the price of shell eggs and egg products in violation of the Sherman Antitrust Act. In particular, the plaintiffs contend that numerous defendants conspired to restrict egg supply through cage space requirements, as well as coordinated molting schedules and hen reductions, and exported eggs at a loss in order to reduce domestic supplies and raise prices. According to the plaintiffs' complaint, the conspiracy was coordinated through several egg trade associations including United Egg Producers and United States Egg Marketers. Plaintiffs previously entered into a non-monetary settlement with Sparboe Farms which provided documents and testimony that plaintiffs used in amending their claims.

The current settlement, which still needs to be approved by the court, would provide compensation to individuals and companies that directly purchased certain shell eggs and egg products from egg producers. In addition, the settling defendants have agreed to provide significant cooperation to the plaintiffs as they pursue their claims against the remaining, non-settling defendants, including Cal-Maine, Michael Foods and Rose Acre Farms. The settling defendants have agreed to provide information and documents that will include further details about meetings and discussions that occurred among the defendants with regard to price-fixing efforts.

Michael Hausfeld, one of the co-lead counsel in this case, said: "This is a significant settlement that, if approved, will provide considerable financial relief to the direct purchasers of shell eggs and egg products. The defendants have also agreed to provide cooperation in the form of documents and testimony that we believe will further enable us to pursue claims against the remaining defendants."

Hausfeld LLP serves as one of the co-lead counsel in this case, along with Bernstein Liebhard LLP, Susman Godfrey LLP, and Weinstein, Kitchenoff & Asher LLC.

United Egg Producers (UEP) statement

United Egg Producers (UEP) has released the following statement:

While Moark denies all allegations of wrong-doing in the case, the agreement states that Moark has decided to settle the case to avoid the risk, expense and distraction of continued litigation. The filing itself acknowledges this case involves a 'lengthy and expensive legal battle' that could in the end fall flat for the plaintiffs.

These documents do not contain any admission of liability or evidence of illegal conduct by any egg producer or United Egg Producers. Nor do they affect in any way the resolve of our industry to show at every turn that the allegations in this case are without merit.

We will continue to vigorously defend against these charges in order to preserve and honour the good name of UEP and America's egg farmers, who work hard every day to produce a nutritious, low-cost food in safe and humane conditions in compliance with all federal and state laws.