Egg Producers Ordered to Pay $53 Million in Damages Following Conspiracy to Limit Supply

INDIANAPOLIS, Indiana – A federal jury in Illinois has awarded $17.7 million in damages, which has tripled to more than $53 million under federal law, to several food manufacturing companies who had filed a lawsuit against major egg producers. The lawsuit alleged that the egg producers conspired to limit the egg supply in the United States.

The jury’s ruling, which came last week, found that the egg producers used various methods to restrict the domestic supply of eggs in order to drive up prices from 2004 to 2008. The defendants in the case, however, have denied these claims.

The damages verdict was delivered in the Northern District of Illinois. While court documents detailing the verdict were not available, statements from the manufacturers’ attorney and one of the egg producers confirmed the total damages awarded at approximately $17.7 million.

“We are extremely grateful for the jury’s service and findings,” said Brandon Fox, the attorney representing the food manufacturers. “This was an important case for many reasons, and the jury’s award recognizes its significance.”

The four egg suppliers named in the lawsuit include Cal-Maine Foods, Inc., United Egg Producers, Inc., United States Egg Marketers, Inc., and Rose Acre Farms, Inc., the latter being a southern Indiana-based company whose former Chair, John Rust, is currently running for the U.S. Senate.

The jury’s findings revealed that the egg suppliers exported eggs to reduce the overall supply in the domestic market and employed tactics such as limiting the number of chickens through cage space, early slaughter, and flock reduction.

The food manufacturers that joined as plaintiffs in the lawsuit are Kraft Foods Global, Inc., The Kellogg Company, General Mills, Inc., and Nestle USA, Inc.

This verdict has sparked controversy, with the egg suppliers expressing their disagreement. Rose Acre Farms, which identifies itself as the second-largest egg producer in the U.S., released a statement denying any involvement in an anti-competitive egg price-fixing conspiracy. They further stated that they will explore all legal options, including post-trial relief and appeal.

Cal-Maine Foods, Inc. also expressed disappointment with the verdict, believing that the company had done nothing wrong. They have petitioned the court to rule in their favor and will evaluate their options, including filing an appeal if necessary.

The damages awarded by the jury may be relatively modest compared to the amount sought, but the decision has far-reaching implications for the industry. This outcome will likely prompt further examination of practices within the egg production sector, and it sets a precedent for potential future cases.

In summary, a federal jury in Illinois has ordered major egg producers to pay $17.7 million in damages for conspiring to limit the supply of eggs in the United States between 2004 and 2008. The jury’s ruling has tripled the damages to over $53 million. The egg suppliers involved in the case have denied the allegations and have expressed plans to appeal the verdict. This decision is expected to have significant implications for the egg production industry and may lead to further scrutiny of its practices.