A U.S. District Court judge in Arkansas on Wednesday dismissed a shareholders lawsuit against Tyson Foods Inc. that sprang from allegations of a massive price-fixing conspiracy involving the Springdale meat producer and other chicken companies.
Between October and November 2016, shareholders who alleged they lost money on Tyson stock as a result of the antitrust allegations had filed four lawsuits in U.S. District Courts against Tyson Foods. Those lawsuits were consolidated into one on Jan. 25 in U.S. District Court in Fayetteville front Judge Timothy Brooks.
Before Tyson filed an answer in the case, it asked that the lawsuit be dismissed. A hearing was held June 30 and Brooks agreed.
"The Complaint fails to plausibly allege that Tyson entered into an agreement with its industry competitors to suppress the domestic supply of chickens in order to increase prices," Brooks said in the 62-page ruling. "This means that the falsity element of Lead Plaintiffs' … claim based on the alleged underlying conspiracy to suppress supply lacks plausibility."
But Brooks said that there may be "meaningful differences between" the shareholder case and the one pending in U.S. District Court in Illinois that involves the allegations of the price-fixing.
The shareholders' case was dismissed without prejudice, meaning plaintiffs could file another lawsuit based on similar allegations.
Still, Tyson said Thursday it was pleased with the ruling.
"The judge found the plaintiffs' allegations against Tyson Foods regarding a price fixing conspiracy are not plausible," Tyson spokesman Gary Mickelson said in an email to Arkansas Business. "We have steadfastly denied those allegations of wrongdoing since the first lawsuit was filed. We look forward to continuing to defend our company in the remaining cases."
