Tyson Foods has said an Alabama jury ruled against the company in a lawsuit that accused the US meat processor’s IBP subsidiary of price fixing.
The complaint had originally been brought against IBP (now known as Tyson Fresh Meats) in 1996 by a small group of cattle producers who alleged the company’s cattle buying practices allowed it to “manipulate and control cattle prices”.
The lawsuit accused Tyson of lowering cattle prices by entering into supply contracts with big producers, rather than buying cattle on the open “cash” market. The plaintiffs said Tyson relied on its supply contracts when prices were high, but dealt in the open market when prices were low, thereby forcing prices down, reported the Financial Times.
Tyson called the verdict “a disappointment”, but said it would ask the judge to set aside the verdict, and if he does not do so, the company intends to appeal against the jury’s decision.
The Alabama jury pointed to US$1.28bn in damages, which Tyson said overstates its potential liability.
“While the jury rendered an “advisory” number on damages which we believe overstates our potential liability, it is not a damage award,” Tyson said.
The company said it does not expect the jury decision to materially impair its liquidity or affect operations.
Separately, Tyson announced it is to reduce its workforce by around 5% and invest in automation. To read more, click here.