Dive Brief:
- McDonald’s has filed a lawsuit against four major meat producers – Tyson, JBS, Cargill, and National Beef Packing, accusing them of colluding to raise beef prices through antitrust violations.
- The lawsuit, filed in a New York federal court, alleges that the producers engaged in price-fixing practices by manipulating cattle prices and slowing production to artificially inflate prices for buyers like McDonald’s.
- McDonald’s, as the largest buyer of beef and pork globally, is seeking monetary restitution from the meat companies. The accused companies have not responded to the allegations.
Dive Insight:
Concerns have been raised by industry stakeholders about the disparity between fed cattle and wholesale beef prices, leading to investigations by the USDA and the U.S. Justice Department into potential antitrust violations by the dominant meatpackers.
The ongoing investigations aim to determine if the “Big Four” meatpackers have violated antitrust laws by controlling a significant portion of the U.S. beef market.
This lawsuit is the latest in a series of legal challenges against the meat producers for allegedly restricting supplies to drive up prices since 2015. While some cases have been dismissed, others have resulted in settlements, such as JBS USA agreeing to pay $52.5 million to resolve price-fixing allegations.
According to McDonald’s complaint, the companies held meetings where sensitive information was exchanged to manipulate beef and cattle prices for their benefit.
McDonald’s claims that by underpaying suppliers and reducing beef output, the defendants have increased their profits while maintaining a stronghold on the market.
The fast-food giant has not commented on the lawsuit.