U.S. District Court Judge James Lawrence King has recused himself from a class-action lawsuit alleging price-fixing among Norwegian salmon producers, according to a 25 April notification.
The case, filed on 23 April by Euclid Fish Company, has been reassigned to U.S. District Court Judge Cecilia M. Altonaga, also of the U.S. District Court in the Southern District of Florida’s Miami Division.
Altonaga has scheduled an initial status conference has been set for 1 May at 11 a.m., which parties may attend by phone.
Separately, a second party has joined the suit – Bagels and Baguettes, a bagel and sandwich shop in Washington D.C. – making a separate, but identical filing on 25 April. The case was initially assigned to King, but is likely to be reassigned to Altonaga.
Arthur Bailey of Hausfeld LLP, the firm handling the Euclid suit, told SeafoodSource other similar suits will continue to be filed containing similar allegations, including by Schneider's Seafood and Meats of Cheektowaga, New York, and by Euro USA Inc. of Cleveland, Ohio. Within the next month, the cases will be combined into one larger class-action suit including all direct purchasers of Norwegian farmed salmon, Bailey said.
Michael P. Lehmann, also with Hausfeld LLP, said the firm chose to file its suit in the Southern District of Florida because while the numerous defendants have North American operations spread throughout the United States and Canada, the largest defendant by size, Mowi, has its North American operations in the Miami area.
“We wanted to pick a venue associated with the claims in question,” he told SeafoodSource.
Lehmann said the lawsuit is based primarily on the reports that are publicly available regarding an ongoing investigation by the European Commission into suspected anti-competitive practices in the farmed Atlantic salmon sector in Europe, first made public in February 2019.
“That is what alerted us to the cause of action, followed by other [media reports] referencing the tendency of certain of these Norwegian suppliers to manipulate the spot market [for fresh salmon] in Europe,” he said.
The lawsuit hinges on the establishment that the “law of one price” applies to the fresh salmon market. The “law of one price” is an economic term meaning that the price of a given commodity should be the same no matter where it is sold, taking into account currency conversions, transportation costs, and other costs not related directly the product itself.
“We feel that, given the independent assessments of the market outlined [in the suit], the effect of price-fixing in Europe would likely spread to price of salmon sold in the U.S.,” Lehmann said.
Lehmann and the Hausfeld law firm are also involved in the ongoing class-action lawsuit against Chicken of the Sea, Bumble Bee Foods, and StarKist, which alleges price-fixing in the canned tuna sector. Bumble Bee and StarKist both pleaded guilty in the criminal cases against them, which were led by the U.S. Department of Justice’s Antitrust Division.
So far, there has been no notification from the DOJ that it is investigating price-fixing in the U.S. fresh salmon trade. Lehmann said he wasn’t aware of any U.S.-based investigation, and refrained from making any further connections between the two suits.
“They have some similarities in the sense that [they’re both] price-fixing cases, but obviously they concern different products,” he said. “Fresh farmed salmon has a short shelf-life. It has to be refrigerated and transported quickly – it’s perishable. Also, the entities involved in the farmed salmon case are a group of foreign entities that have to a great degree us subsidiaries selling products in the U.S., while in the tuna case, while those companies are all owned by foreign companies now, they in some degree or another started out as U.S. entities.”
Lehmann said while it may be unusual to two price-fixing suits filed in the same industry, albeit in different sectors, in such a short period of time, there was no evidence that price-fixing is a larger problem in the industry.
“It’s hard to tell what’s going on,” he said. “The collusion we’ve alleged with the farmed salmon is distinct from the allegations around tuna. I have no knowledge that anybody in the farmed salmon industry was talking with anybody in the canned tuna industry [about this]. My honest answer is that I have no information one way or another that these two conspiracies are in any way linked.”
In a statement sent to SeafoodSource, Grieg Seafood Global Communications Manager Kristina Furnes said her company is “aware of the lawsuit.”
“It is based on the E.U. Commission’s investigation that started in February, where they are exploring potential anti-competitive behavior in the salmon industry,” she said. “We are not aware of any anti-competitive behavior, neither in Norway, the E.U., or the U.S.A. We are fully cooperating with the E.U. Commission in this case.”
