Walmart's role in taking on poultry giants
Story Date: 7/16/2019

 

Source: POLITICO'S MORNING AGRICULTURE, 7/15/19

The Arkansas-based retail titan is among dozens of plaintiffs in separate cases alleging that big poultry processors conspired over eight years to underpay suppliers and overcharge restaurants, retailers and wholesalers, writes POLITICO's Arren Kimbel-Sannit this morning.

The alliance is a case of strange bedfellows: Walmart is a dominant corporate giant not afraid to buy up competitors and stake out turf in new markets. But legal experts say Walmart's involvement adds heft to the lawsuits, now moving through an Illinois district court.

"You have to be one of the big dogs to get any reaction," said former Missouri Lieutenant Gov. Joe Maxwell, a hog farmer and executive director of the Organization for Competitive Markets, which represents independent farmers and ranchers.

How we got here: Foodservice distributor Maplevale Farms, Inc. filed a suit in 2016 against Tyson Foods, Sanderson, Koch Foods and other processors that represent nearly the entire market. Several large distributors including Sysco, US Foods and Walmart joined Maplevale. But in 2018, the companies started filing separate cases against the poultry giants — a move that antitrust experts see as a sign of confidence in their claims.

— Caveat: Walmart, one of Tyson's biggest accounts, didn't name Tyson in its individual suit. The processors have denied any anti-competitive behavior.

Now the Justice Department appears to be involved. DOJ issued subpoenas in the Maplevale case earlier this year and directed the Illinois court to stop discovery — an indication that the government could be preparing legal charges.

Front and center this week: Agricultural antitrust issues have already received significant attention among Democratic presidential contenders. On Tuesday, the debate is likely to come up at a House Ag hearing on the livestock and poultry sectors. And family farmer advocates will host a news conference and Capitol Hill briefing to address "widespread abuse at the hands of the nation's largest meat companies," also on Tuesday.


























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