A federal grand jury in the U.S. District Court in Denver, Colorado, returned an indictment against four executives for their role in a conspiracy to fix prices and rig bids for broiler chickens, the Department of Justice announced in a Wednesday release.
In the indictment, the government alleges that from at least as early as 2012 until at least early 2017, Mikell Fries, president of Claxton Poultry Farms, and Scott Brady, vice president for national accounts at Claxton Poultry Farms, along with Jayson Penn and Roger Austin of Colorado-based Pilgrim’s Pride, conspired to fix prices and rig bids for broiler chickens across the United States.
“Particularly in times of global crisis, the division remains committed to prosecuting crimes intended to raise the prices Americans pay for food,” said Assistant Attorney General Makan Delrahim of the Department of Justice’s Antitrust Division. “Executives who cheat American consumers, restauranteurs and grocers, and compromise the integrity of our food supply, will be held responsible for their actions.”
The one-count indictment charges the senior executives with conspiring to fix prices and rig bids for broiler chickens, which are sold to grocers and restaurants.
According to the Department of Justice press release, Fries, Brady, Penn and Austin are the first to be charged in an ongoing federal antitrust investigation into price fixing, bid rigging, and other anticompetitive conduct in the broiler chicken industry.
The offense charged carries a statutory maximum penalty of 10 years in prison and a $1 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than $1 million.
“The FBI will not stand by as individuals attempt to line their pockets while hard-working Americans and restaurant owners are trying to put food on their tables,” said Timothy R. Slater, assistant director in charge of the FBI’s Washington Field Office. “Today’s announcement shows the FBI’s commitment to investigating allegations of price fixing so that the perpetrators can be held accountable.”
“Rigging bids and fixing prices hurts consumers and undermines our economic system,” said Peggy E. Gustafson, Inspector General of the Department of Commerce. “We are committed to working with our law enforcement partners to root out those who take advantage of the American public’s trust.”
Claxton Poultry is a supplier to leading foodservice and retail brands, including Chick-fil-A, Walmart, Popeye’s, KFC, Zaxby’s and Bojangles’ among others. The company processes more than 2 million birds per week, employs approximately 1,800 workers and 250 contract poultry growers.
Attempts Wednesday afternoon to reach officials with Claxton Poultry were unsuccessful.