Grocers Settle Price-Fixing Suit Against Chicken of the Sea

12/17/2020

Grocers Settle Price-Fixing Suit Against Chicken of the Sea Antitrust Kroger Hy-Vee Albertsons H-E-B

Price-fixing allegations against shelf-stable tuna provider Chicken of the Sea and its chief competitors, Bumble Bee and StarKist, first surfaced in 2015.

The Kroger Co., Hy-Vee, Albertsons and H-E-B are among the food retailers that have settled a class action filed against Chicken of the Sea regarding price-fixing allegations in the shelf-stable tuna category that first surfaced in 2015, according to a published report.

Seafood Source reported that San Diego-based Chicken of the Sea International, a division of Thai Union, was a whistleblower in the long-running scandal, which led to a U.S. Department of Justice investigation that ensnared chief competitors StarKist and Bumble Bee Foods, both of which pleaded guilty to charges of price-fixing and were hit with multimillion-dollar fines. Chicken of the Sea received immunity for helping the DOJ with the case, but it remains open to civil litigation because of its own admitted involvement in the price-fixing scheme.

In a Dec. 3 filing with the U.S. District Court for the Southern District of California, the food retailers requested that their claims for damages be dismissed “pursuant to a stipulation between the parties.” The settlement amount hasn’t been publicly disclosed. The plaintiffs originally filed suit against Chicken of the Sea back in 2016, and 33 came to a settlement with Pittsburgh-based StarKist in March 2019. At San Diego-based Bumble Bee, meanwhile, former CEO Christopher Lischewski was convicted for his role in the price-fixing conspiracy and sentenced to 40 months in prison.

In 2018, Walmart Inc. and Chicken reached an agreement resolving antitrust claims in relation to the price-fixing scheme affecting shelf-stable tuna, of which Walmart is the largest U.S. retailer. Under the terms of the multi-pronged agreement, Chicken of the Sea paid a cash settlement and the two companies agreed to take part in a series of joint programs and new product promotions in Walmart stores, including the launch of new products across the chain.

In early 2019, Chicken of the Sea settled with 29 grocery retailers and distributors resolving their antitrust claims: Affiliated Foods Inc.; Affiliated Foods Midwest Cooperative Inc.; Alex Lee Inc.; Associated Food Stores Inc., Associated Grocers of New England Inc., Bashas’ Inc., Big Y Foods Inc., Brookshire Brothers Inc., Brookshire Grocery Co., Certco Inc., Dollar Tree Distribution Inc., Greenbrier International Inc., Family Dollar Stores Inc., Family Dollar Services LLC, Fareway Stores Inc., The Golub Corp., Giant Eagle Inc., Kmart Corp., K-VA-T Food Stores Inc., Marc Glassman Inc., McLane Co. Inc., Meadowbrook Meat Co. Inc., Merchants Distributors LLC, Schnuck Markets Inc., SpartanNash Co., URM Stores Inc., Western Family Foods Inc., Woodman’s Food Market Inc., 99 Cents Only Stores LLC and all of their affiliates. Under the terms of the agreement, Chicken of the Sea paid a cash settlement and worked with the companies to promote its products.

Cincinnati-based Kroger employs nearly half a million associates who serve 9 million-plus customers daily through a seamless digital shopping experience and 2,800 retail food stores under a variety of banner names. The company is No. 3 on The PG 100, Progressive Grocer’s 2020 list of the top food and consumables retailers in North America, while Boise, Idaho-based Albertsons; and San Antonio-based H-E-B; and West Des Moines, Iowa-based Hy-Vee are Nos. 8, 17 and 33, respectively, on PG’s list.