Meat industry giant Pilgrim’s Pride has agreed to pay $41.5 million (C$59.7 million) to settle a securities class action alleging the company artificially boosted its stock price by making false and misleading statements about chicken industry competition.
The settlement disclosed late on Friday culminated nearly a decade of litigation in federal court in Colorado against Pilgrim’s Pride, one of the largest U.S. poultry processors.
The 2016 lawsuit accused Colorado-based Pilgrim’s Pride of concealing an industry-wide price-fixing scheme to charge artificially high prices for chicken. The shareholders said Pilgrim’s Pride misrepresented that its profitability was based on its product mix, pricing strategy and other factors.
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The settlement covers purchases of stock in the company between February 2014 and November 2016. U.S. District Judge R. Brooke Jackson must approve the deal.
Pilgrim’s Pride, owned mainly by Brazil’s JBS SA, and a lead attorney for the plaintiffs did not immediately respond to requests for comment.
Pilgrim’s Pride has denied the claims and did not admit wrongdoing in agreeing to settle.
The plaintiffs’ lawyers said the estimated average settlement recovery is $0.59 per affected share, before deductions of fees and expenses.
The class attorneys said they would seek up to 33.3 per cent, or about $13.8 million (C$19.8 million), in legal fees from the settlement fund.
Pilgrim’s Pride has earlier faced antitrust lawsuits over pricing and competition.
The company in 2021 pleaded guilty in federal court and was ordered to pay a $107.9 million (C$155.2 million) fine, resolving U.S. charges that it conspired to fix chicken prices.
In 2023, the meat processor agreed to pay $100 million to settle claims that it conspired with rivals to underpay chicken farmers.
—Reporting by Mike Scarcella
