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Chick-fil-A and Target sue chicken processors over alleged price fixing

By Danielle Wiener-Bronner, CNN Business

Mon December 7, 2020

Chick-fil-A and Target are accusing meat processors of fixing prices for the chicken they buy.

The two chains filed separate lawsuits in court on Friday. Each suit names over a dozen chicken sellers. A number of them, including Tyson (TSN), Perdue and Pilgrim's Pride, appear in both cases.

Chick-fil-A said in its lawsuit that after a 2014 commitment to serve antibiotics-free chicken, meat processors colluded on prices to bid for the new business.

Chick-fil-A paid "artificially inflated prices for chicken" because of the alleged illegal price fixing, the company said in its complaint. The lawsuit says that Chick-fil-A has joined a 2016 class action suit also alleging price fixing among chicken processors. It is asking the court for an unspecified amount in damages as part of that judgment, among other things.

Target's suit didn't go into much detail, but also stated that Target (TGT) has joined the 2016 class action and seeks unspecified damages.

Allegations of price-fixing have been plaguing the chicken industry for some time.

In June, executives, including Pilgrim Pride's then-CEO, were indicted for allegedly conspiring to fix prices and rig bids on "broiler chickens," which are sold to grocery stores and restaurants.

Tyson wasn't named in that indictment, but the company said at the time that it was served with a grand jury subpoena from the Department of Justice's Antitrust Division in April of last year.

With regard to Friday's lawsuits, a Tyson (TSN) spokesperson said that "follow-on complaints like these are common in antitrust litigation," adding that such complaints don't alter Tyson's position that price-fixing claims are "unfounded," and that "we will continue to vigorously defend our company."

Perdue issued a similar statement with regards to both lawsuits, saying "we believe these claims are unfounded and plan to contest the merits."

Pilgrim's Pride did not immediately respond to a request for comment.

Chicken is big business in the United States. The chicken sandwich has fueled sales at restaurants in recent years. America's taste for chicken has helped Chick-fil-A's incredible growth over the years.

--CNN's Clare Duffy contributed to this report