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August 18, 2020

US eggs giant Cal-Maine wins Covid price-hiking case

A court has ruled in the case brought by the Texas attorney general against US eggs giant Cal-Maine Foods, which it accused of Covid-19-linked price-hikes.

By Leonie Barrie

Cal-Maine Foods, the US eggs producer, has successfully defended itself against a lawsuit issued by the Texas attorney general alleging it has engaged in price-hiking during the Covid-19 pandemic.

The Jackson, Mississippi-based business, which is said to have a 19% share of the US eggs market, saw its motion to dismiss granted on Thursday (13 August) in the District Court of Harris County, Texas.

In a statement issued yesterday (17 August), Cal-Maine said: “We are grateful the court dismissed with prejudice all claims brought by the State of Texas against Cal-Maine Foods. As we demonstrated to the court in our court filings and during oral argument, Cal-Maine Foods has never engaged in price gouging.

“Since 1957, we have strived to operate with honesty and integrity and will continue to do so going forward. We will also continue to do our part to help those affected by Covid-19 by having our employees follow applicable CDC guidelines and supporting the communities we serve through humanitarian efforts.”

The lawsuit was lodged by the Texas Attorney General Ken Paxton on 23 April.

It alleged that Cal-Maine hiked the price of eggs from about US$1.00 per dozen to about $3.00, despite experiencing no disruption to its supply chain.

In response, the company said it had worked hard during this crisis to meet increased consumer demand.

“In doing so, Cal-Maine Foods has not changed its long-standing approach to pricing. Any allegation to the contrary is simply not true,” it said at the time.

It added that there had always been great volatility in the egg pricing market and the Covid-19 pandemic had caused a massive disruption in every sector of the economy, including the egg industry. It said retail demand for eggs reached historically high levels and egg prices increased significantly in line with those demand trends. 

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