JBS reaches preliminary settlement of beef price-fixing claims

(Reuters) — JBS SA agreed to pay $52.5 million to settle litigation accusing meat-packing companies of conspiring to limit supply in the $63 billion-a-year U.S. beef market in order to inflate prices and boost profit.

The preliminary settlement by the Brazilian company and its U.S. units with so-called direct purchasers was disclosed Tuesday and is the first in nationwide antitrust litigation over beef price-fixing.

Lawyers for the purchasers called the accord an “icebreaker” and an excellent recovery, citing JBS’ $24.5 million settlement in 2020 of price-fixing claims by pork purchasers.

In a statement, JBS said it did not admit liability but that settling was in its best interest. It also said it will defend against beef price-fixing claims by other plaintiffs.

The accord requires approval by Chief Judge John Tunheim of the federal court in Minneapolis. Other defendants include Cargill Inc., National Beef Packing Co. and Tyson Foods Inc.

JBS settled one month after President Joe Biden announced a plan for new rules to bolster competition and stop “exploitation” in the meat sector.

In their lawsuit, direct purchasers accused the defendants, which controlled an estimated 80% of U.S. fresh and frozen beef supply, of conspiring since 2015 to reduce slaughter volumes, creating a shortfall that smaller companies could not make up.

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