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Chick-fil-A sues chicken suppliers over price fixing

The chicken sandwich chain identified itself as one of the victims of an alleged bid-rigging scheme.
Photograph: Shutterstock

Chick-fil-A has filed a lawsuit against a group of poultry suppliers, identifying itself as one of the biggest victims in an alleged scheme to fix the prices that restaurants pay for chicken.

The lawsuit, filed late last week, mentions Perdue, Pilgrim’s Price, Tyson and several other poultry suppliers and distributors. Attorneys for the Atlanta-based chain say that it paid prices that were artificially inflated as a result of the alleged scheme.

“CFA Inc. was deprived of the benefits of free, open and unrestricted competition in the United States chicken market,” Chick-fil-A said in its complaint. “Competition in establishing the prices paid for chicken in the United States was unlawfully restrained, suppressed or eliminated.”

Chick-fil-A is the biggest chicken-centric chain in the U.S. It buys “billions” of dollars’ worth of broiler chickens every year.

The company’s lawsuit is based on allegations the federal government has made against poultry producers, suggesting they’re sharing bid prices for important contracts in an effort to keep prices at a certain level.

In February 2014, Chick-fil-A announced plans to serve antibiotic-free chicken in all of its restaurants within five years.

Chick-fil-A, citing an indictment of a half-dozen poultry company executives by the U.S. Dept. of Justice in October, said in its lawsuit that a number of suppliers coordinated biding and price information on that contract by phone or text message.

As a result, Chick-fil-A “paid artificially inflated prices for chicken.”

The federal government has alleged a broad price-fixing conspiracy by the nation’s largest poultry producers in a series of actions dating back years. Ten executives and others from various poultry producers have been indicted over the scheme. Pilgrim’s Pride has also agreed to pay $110 million to settle its charges.

The allegations say that the companies conspired to fix prices for chicken between 2010 and 2019.

The suppliers, however, have largely denied the allegations. “We believe these claims are unfounded and plan to contest the merits,” Diana Souder, director of corporate communications for Perdue Farms, said in an email.

Still, the lawsuit and the ongoing investigation into the alleged price fixing scheme as roiled the industry at a time when chicken has become an increasingly popular part of restaurants’ menus. Several restaurant chains are alleged to have been victims of the plot.

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