Two Canadian food companies sued in U.S. over ‘potato cartel’ allegations
Global News
Two proposed class-action lawsuits in the U.S. allege that four companies conspired to fix prices on frozen potato products over the past three years.
Two proposed class-action lawsuits in the United States name two Canadian food companies as alleged members of a “potato cartel” that’s accused of a years-long campaign of fixing prices on frozen products.
The suits, which have yet to be certified, were both filed last week in U.S. District Court in Illinois and name Canada’s McCain Foods Ltd. and Cavendish Farms, a subsidiary of J.D. Irving Ltd., alongside U.S.-based companies Lamb Weston Holdings and J.R. Simplot Co.
The proposed class actions allege that each of the four companies, which are estimated to account for up to 98 per cent of the frozen potato products market, “confirmed to fix the prices” of such products “above competitive levels.”
“Armed with the same access to each other’s data on pricing and other sensitive information, as well as with a direct line of communication to each other, the potato cartel moves prices skyward in lockstep – harming all purchasers of potatoes in the process,” one of the claims alleges.
Products in the alleged scheme include frozen french fries, hash browns and tater tots.
Frozen potato product prices grew 47 per cent between July 2022 and July 2024, according to the suit filed Friday on behalf of supermarket chain Redner’s Markets Inc. At the same time, the four defendants’ input costs “fell steadily,” the suit claims.
“The frozen potato products price hikes in 2021 and 2022 were no accident. Rather, the defendants imposed matching, simultaneous or near-simultaneous price increases on their customers,” the Redner’s suit alleges.
A separate suit was filed Sunday on behalf of Alexander Govea, a consumer living in Virginia. That suit also names marketing group Potatoes USA and analytics firm Circana as part of its proposed class action.
