As reported on Wednesday, Nov. 20, just ahead of the Thanksgiving holiday, the United States’ four leading producers of frozen spuds are in hot water. A handful of federal lawsuits filed this week accuse the companies of forming a “potato cartel.”
Court documents allege that the potato producers coordinated prices through a third-party data company.
The lawsuits claim Cavendish Farms, McCain Foods, JR Simplot, Lamb Weston and the National Potato Promotion Board conspired to fix and manipulate prices for frozen potatoes in the United States.
Prosecutors say that the companies formed a cartel by having equal “access to each other’s data on pricing and other sensitive information, as well as a direct line of communication to each other.” They added that this allowed the companies to raise prices in a concerted arrangement, which violated U.S. antitrust laws.
The lawsuits assert that the price coordination was made possible through a market data aggregator, which in one of the lawsuits, is alleged to be the research firm Circana.
These companies reportedly control more than 95% of the frozen potato market and attorneys say they used their market dominance to increase prices by nearly 50% in a two-year span.
The lawsuits seek undisclosed monetary damages and a court order ending the alleged price fixing.
A McCain Foods spokesperson denied the allegations that the company broke antitrust laws and vowed to fight all lawsuits leveled against the company. The other companies involved in the lawsuits have yet to respond as of the publishing of this report.
