US Foods, Sysco, Target resolve price-fixing lawsuit against Chicken of the Sea
Broadline foodservice distributors US Foods and Sysco and retailer Target have resolved litigation with Thai Union and its subsidiary Chicken of the Sea over allegations of fixing the price of canned tuna.
In separate motions filed on 21 March in the U.S. District Court for the Southern District of California, US Foods, Sysco, and Target each said they had reached out-of-court settlements with Chicken of the Sea and asked that their lawsuits be dismissed.
None of the filings listed settlement terms, and none had been released publicly as of Friday, 22 March. Each court filing requested that all documents filed under seal remain sealed following the dismissal of the lawsuits.
"We continue to be encouraged at the progress we have made with our valued retail and food service partners in developing pragmatic resolutions to this matter," Christianna Reed, Chicken of the Sea International, vice president and general counsel, told SeafoodSource in an email. "It has definitely been an advantage for us to drive the framework for these agreements, resolving these cases with both financial and commercial programs."
America’s largest food distributors, Sysco, and US Foods, sued Chicken of the Sea, Starkist, and Bumble Bee and their parent companies in January 2018. The companies, which filed separate suits, alleged the tuna manufacturers recognized that their products were used interchangeably by U.S. consumers, so no one company could raise prices above its peers without the risk of customers abandoning its product. Target had previously sued, making similar allegations, in July 2017.
Chicken of the Sea, which is operated by Tri-Union Seafoods, which in turn is owned by Thai Union, avoided criminal penalties in the case by blowing the whistle on the price-fixing scheme, which also included competitors Bumble Bee Foods and StarKist. A U.S. Department of Justice investigation and prosecution resulted in guilty pleas from both Bumble Bee and StarKist and their paying millions of dollars in fines.
While absolved of criminal wrongdoing, Chicken of the Sea was still liable for civil damages. However, thus far, the company has avoided going to trial with any litigants, having previously settled with 30 other retailers, including Walmart.