A crab fisherman in the U.S. state of California has sued Pacific Seafood alleging it has “artificially suppressed” the price paid to fishermen for Dungeness crab.
The fisherman, Brad Little, filed the suit in a federal court in San Francisco, California, alleging he and 1,400 other commercial crab fishermen in California, Oregon, and Washington were paid lower prices for crab due to a price-fixing scheme perpetrated by Pacific Seafood. The complaint alleges Pacific Seafood fixed the price of crab through a “multipronged strategy of monopsonization, coercion, dumping, and secret deals.”
“Pacific Seafood simply needs to take its thumb off the scale and let the free market operate. That’s all that we are asking for,” Little said in a release announcing the lawsuit.
Little’s lawsuit claims Pacific Seafood has a “multi-decade” program that has purchased and shut down the company’s processing competitors on the West Coast to artificially keep the price paid to fishermen low. It also claims Pacific has made deals with fish buyers where Pacific mandates a price buyers pay to crabbers, and then the company will buy any oversupply of crab for “a certain amount more” if buyers comply.
The complaint also claims that Pacific punishes fish buyers who are not compliant with this pricing scheme by releasing large amounts of cheap crab in the retail markets that the “non-compliant” buyers participate in. Then, on the supply side, the lawsuit claims Pacific Seafood has been purchasing and operating its own crab boats and “controlling nominally independent boats through illegal tying arrangements” that force boats to sell any fish they catch to Pacific Seafood.
The multi-pronged strategy, the complaint claims, has allowed the company to amass “extraordinary power” over the crab market along the Pacific coast of the U.S., allowing it to artificially suppress the prices paid to crab fishermen, while manipulating the market in ways that allow it to sell more of its crab.
“If Pacific Seafood’s manipulation of the Dungeness crab wholesale-input market is not stopped, independent commercial crabbers like myself and the rest of the class will disappear,” Little said. “Instead, there will be just a set of crabbers working for Pacific Seafood on boats owned by it. There will just be a small group of Pacific Seafood sharecroppers, rather than over a thousand independent businesses. I’m not going to sit back and just watch that happen without a fight."
Little, who is the only plaintiff on the case, is represented by Stuart G. Gross of Gross Klein PC, a law firm that has won cases for the seafood industry such as a recent lawsuit brought by herring fishers against Chevron; and the Joseph Saveri Law Firm, which specializes in antitrust legislation including a recent high-profile case on capacitor price-fixing.
“As alleged in the complaint, Pacific Seafood is singularly focused on taking for itself all of the profits that Dungeness crab fishery generates, leaving the men and women who risk their lives to pull the crab from the sea, with little to nothing to show for their labor,” Gross aid. “This case is about economic fairness and equity, the purposes for which federal and California antitrust laws were enacted.”
In a statement provided to SeafoodSource, Pacific Seafood Chief Legal Officer Dan Occhipinti said the lawsuit is without merit.
“This is a completely baseless lawsuit filed by one fisherman who doesn’t do business with us and doesn’t know our company at all,” Occhipinti said. “We are confident it will be dismissed quickly.”
Photo courtesy of Oregon Department of Fish and Wildlife
