Dec 3, 2024

Lawsuits accuse potato processors of price fixing

A lawsuit accuses four of the largest potato processors in the U.S. of conspiring to fix prices of frozen potato products above competitive levels.

The suit, filed in the U.S. District Court of Northern Illinois by Pennsylvania-headquartered Redner’s Markets, alleges that Lamb Weston, McCain Foods, J.R. Simplot and Cavendish Farms illegally fixed prices for frozen french fries, hash browns, tater tots and other products.

The four companies, along with Potatoes USA, also face the same accusations in a separate consumer class action lawsuit brought by plaintiff Alexander Govea in the same court.

The 47-page complaint (.pdf), which demands a jury trial, includes a graph detailing a 47% spike in frozen potato product prizes from July 2022 to July 2024.

“In 2021 and again in the spring of 2022, while facing increased input costs, Defendants changed their pricing methods to collectively impose ‘strong arm’ price hikes with no worry their customers could defect to competitors,” the complaint reads in part. “ … In contrast to their own sales prices, Defendants’ input costs peaked in 2022 and fell steadily after that.”

The suit, filed Nov. 15, notes that the four companies combined control 97% or more of the $68 billion-per-year frozen potato products market.

“Defendants’ frozen-potato products prices tell a remarkable story because they would not have occurred in a competitive market that was free from defendants’ concerted action,” according to the complaint.

The cases seek unspecified monetary damages and a court order ending the alleged price-fixing.

Spudman has reached out Potatoes USA, a national potato marketing and research organization, for comment.