Antitrust Lawsuit Says Producers Used Shared Platform to Conspire to Fix Egg Prices, Using Avian Flu as Pretext

New to ClassAction.org? Read our Newswire Disclaimer

A proposed antitrust class action lawsuit alleges that several major egg producers used a shared analysis platform to conspire to artificially fix, raise, maintain, and stabilize the price and supply of eggs, all while claiming the increase in prices was due to the Avian Flu.

Get class action lawsuit and class action settlement news sent to your inbox – sign up for ClassAction.org’s free weekly newsletter.

The 66-page antitrust lawsuit claims that the operator of the Urner Barry benchmark analysis platform, now known as Expana, and five of the largest egg producers in the United States—Cal-Maine Foods, Daybreak Foods, Hillandale Farms Corporation, Opal Foods and Rose Acre Farms—as well as the trade group Egg Farmers of America, an alleged co-conspirator, violated the federal Sherman Act by conspiring since at least February 2022 to unreasonably restrict trade, namely by agreeing to regularly exchange “detailed, timely, competitively sensitive information which is non-public and is about their operations.”

According to the complaint, the egg producer defendants collectively control more than 90 percent of the eggs produced nationwide, and during the relevant time period, the price of eggs “soared from under $2 per dozen to as high as $6.22 per dozen” in March of this year.

“Indeed, each Egg producer defendant furnished competitively sensitive information with the understand [sic] it would be reciprocated,” the suit summarizes. “Urner Barry and/or Expana enforced this understanding by requiring Defendants to share data in order to receive comparable data.”

The class action lawsuit charges that the defendants used the Avian Flu as a cover for the alleged price-fixing conspiracy. Ultimately, the case says, the egg producers’ apparent scheme allowed them to artificially inflate their prices without worrying that competitors would undercut those prices, as all major egg producers were held to the same pricing standard. Without the alleged conspiracy, consumers who have paid less for eggs than they did during the relevant time period, the lawsuit says.

“While [egg producers] coordinate prices in lockstep through the exchange of price quotations, supply statistics and output forecasts by using Urner Barry as a middleman, [egg producers] have hidden behind pretexts, including Avian Flu, as reasons why the price of Eggs continues to skyrocket,” the lawsuit argues.

Most major egg producers base prices on recommendations made by Urner Barry, the lawsuit states. According to the filing, one large egg producer could theoretically manipulate the entire egg industry by strategically altering the sales and pricing information it provides to the platform.

Though the filing admits that egg prices have fluctuated significantly over the past few years, it points to a lack of adherence to economic standards to explain the current price of eggs. The case cites Jayson Lusk, an economist who posited that a one-percent decrease in egg supply should lead to a six-percent increase in price. Although this principle held true during the 2015 outbreak of Avian Flu, the lawsuit says, the current market shows a one percent decrease in egg supply and a 17-33 percent increase in prices.

“Meanwhile, in context and during the class period, egg producers like Cal-Maine increased egg prices by as much as 270% in 2023 despite having zero Avian Flu outbreaks in their egg laying hen layers on Cal-Maine affiliated farms,” the case states.

Moreover, the antitrust lawsuit accuses Urner Barry not only of allowing price fixing but also of facilitating opportunities to collude. The suit argues that Urner Barry uses its platform, quarterly reports, and annual conferences to scheme with egg producers and increase egg prices.

The case observes that “[e]gg producers are recidivist antitrust actors, having been sued numerous times before for similar price fixing conduct and even losing at trial for this type of conduct as recently as 2023.”

Likewise, the antitrust class action lawsuit argues that it is difficult for new egg producers to enter the market due to significant barriers to entry. As a result, it is exceedingly difficult for new egg producers to get their footing and contribute to a larger share of the egg supply, the case contends.

Smaller egg producers are “baffled” by price increases and can’t explain the increase in their competitors' pricing, the suit claims.

This lawsuit seeks to cover all individuals, business entities and corporations in the United States who indirectly purchased the defendants’ or co-conspirators' eggs or egg products at any time from February 1, 2022 to the present.

Check out ClassAction.org’s free legal resources to learn how to start a class action lawsuit.