Bumble Bee officially pleads guilty to price-fixing

Published on
August 4, 2017

Bumble Bee Foods formally entered its guilty plea for violations of the Sherman Act on Wednesday, 2 August, admitting that it had played a leading role in a conspiracy to fix the prices of canned tuna sold in the United States from 2011 to 2013.

The company, which struck a deal with the U.S. Department of Justice to lower the amount it will pay to the government due to the potential it could make the company insolvent, will pay USD 25 million (EUR 22.8 million) in criminal fines. 

Court filings indicate Bumble Bee made almost USD 1.4 billion (EUR 1.2 billion) from tuna sold during the time it conspired to inflate prices.

 U.S. District Judge Edward M. Chen signed off on the deal between prosecutors and Bumble Bee, noting at the hearing that rejecting the deal "could lead to worse things, including no collection at all by the government,” according to Law360.

"I think it is incumbent upon the court to scrutinize a settlement such as this one, which is significantly lower than what the recommendation is. But in this case, I'm satisfied the double reduction was justified," he said. 

Chen said he signed off on the agreement to lower Bumble Bee's criminal fine in order to leave the company with enough reserves so that litigants in the numerous civil antitrust suits brought against Bumble Bee over the price-fixing might be able to collect damages if their cases succeed.

"If I don't approve of this quickly, or at all, it could affect not only the company, but others' ability to collect on the civil side of things, as well as creditors,” Chen said. “It also appears it's important to Bumble Bee to get some certainty in this process sooner rather than later."

At the 2 August hearing, trial attorney Leslie Wulff of the DOJ's Antitrust Division, said the company had been helpful to the government in learning more about the conspiracy and in coming to terms on a deal to reduce its fine.

"The resolution presented to Your Honor is the best possible solution, given the timeliness of that cooperation while also taking into account the particulars of Bumble Bee's financial situation," she said.

According to Law360, Judge Chen then asked how Bumble Bee's involvement in the scheme ranked compared to the other alleged price-fixing conspirators, Chicken of the Sea and Starkist.

"Is it the smallest fish, if you will," he asked.

"In light of the fact the grand jury investigation is ongoing, the government does not feel it can discuss the ratio in terms of how Bumble Bee fits into the conspiracy," Wulff responded.

No charges have yet been filed against Starkist or Chicken of the Sea, though a Starkist executive, Stephen Hodge, pleaded guilty in June for playing a role in the conspiracy.

Two Bumble Bee executives have also pleaded guilty to conspiracy and are awaiting sentencing, as is Hodge.

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