Peanut Price-Fixing Lawsuits Say Farmers Were Ripped Off
Last Updated on November 3, 2020
Attorneys working with ClassAction.org are no longer investigating this matter. The information here is for reference only. A list of open investigations and lawsuits can be viewed here.
- November 3, 2020 – Two Companies Agree to Settle Price-Fixing Claims
- Birdsong Corp. and Olam Peanut Shelling Co. have agreed to pay $50 million and $7.75 million respectively to resolve litigation surrounding the claims detailed on this page. Golden Peanut Co. is the only defendant remaining in the litigation.
Read more about what happens when a lawsuit settles and how a case moves from settlement talks to checks in the mail. You can also sign up for our newsletter for the latest in class action news.
- May 5, 2020 – Investigation Closed
- Attorneys working with ClassAction.org are no longer interested in speaking with peanut farmers, as they have closed their investigation into this matter. If you have questions about your rights, please contact an attorney in your area. Our open list of investigations can be found here.
At A Glance
- This Alert Affects:
- Peanut farmers who sold raw, harvested “runner” peanuts to peanut-shelling companies.
- What’s Going On?
- A class action lawsuit has been filed alleging that two major peanut-shelling companies conspired to depress the price of runner peanuts, which caused farmers to be artificially underpaid for their crops. Attorneys working with ClassAction.org have now launched their own investigation into the allegations and want to speak to peanut farmers to learn more about the alleged conspiracy.
- How Could a Class Action Help?
- A successful case could help farmers recover the difference between what they were paid and what they should have been paid. It could also put an end to any illegal conduct by peanut-shelling companies.
A class action lawsuit has been filed alleging that the two major peanut-shelling companies have conspired to artificially depress the price of runner peanuts, meaning farmers were paid less than they should have been.
Farmers who sold raw, harvested runner peanuts within the last few years may have been affected by the alleged conspiracy.
Why Was a Lawsuit Filed?
The lawsuit was filed in the hopes that peanut farmers could be compensated for the money they lost and that the largest players in the peanut shelling industry would be required to stop any allegedly anticompetitive business practices. The lawsuit claims that since 2014, Birdsong Corporation and Golden Peanut Company – who together hold up to 90% of the market share for peanut shelling – paid runner peanut farmers prices that have remained remarkably flat and unchanged despite significant supply disruptions.
How Did the Companies Supposedly Fix Peanut Prices?
According to the suit, the peanut industry suffered “drastic weather-related price changes” that made it difficult for Birdsong and Golden Peanut to “manage risk” and “plan for production.” In response, the companies allegedly conspired and colluded with each other to stabilize and depress the price of runner peanuts.
They did this, the suit says, by:
- Overreporting peanut inventory numbers to the U.S. Department of Agriculture (USDA) to make it seem like there was a surplus
- Giving farmers artificially low prices for their runner peanuts due to the “perceived oversupply”
- Underreporting peanut prices to the USDA to further suppress prices
Birdsong and Golden Peanut have also been accused of utilizing “nearly identical” contracts, meaning peanut farmers had less power to negotiate for better terms and better prices.
The suit claims that because of the companies’ scheme to artificially fix, depress, maintain and stabilize the price of runner peanuts, farmers have suffered financially, some to the point that they were forced to go out of business. As the complaint puts it, the alleged years-long conspiracy meant there were “no longer good price years to balance out the now-common bad years of runner prices.”
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