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Egg producer accused of price fixing

Thursday, October 9, 2008 | 9:59 a.m. CDT; updated 1:32 p.m. CDT, Thursday, October 9, 2008

NEOSHO — A southwest Missouri egg-production plant is named in four federal lawsuits claiming it and other companies conspired to fix domestic egg prices.

Moark LLC was among 13 major U.S. egg producers and three egg-trade groups that were sued late last week in Pennsylvania federal court. Moark also is a co-defendant in three other similar suits — two in Pennsylvania and one in Minnesota — filed in late September.

All four suits allege that U.S. egg producers conspired to "artificially control and reduce the supply of eggs" with the intent to create "artificially high, supracompetitive prices for eggs" in recent years.

The suit filed last week claims that egg producers lowered the supply of eggs by reducing the number of hens allowed in a cage, and then not increasing the total number of cages to make up for that. The suit says the change was made in the name of animal welfare but had "absolutely nothing to do with humane practices."

The suit also claims that egg producers exported eggs first to Europe and the Middle East, then to Japan and Iraq, at a level below prevailing U.S. market prices to reduce the domestic supply and trigger a price increase.

Moark is a subsidiary of Land O'Lakes Inc. and is based in Minnesota, with operations in California, Connecticut and Neosho, Mo.

Last month, the U.S. Department of Justice told the Joplin Globe that it was "investigating the possibility of anticompetitive practices in the egg-products industry," but didn't provide any other information.

A Land O'Lakes spokeswoman has said the company was cooperating with a Justice Department request for documents regarding Moark's "pricing, marketing and sales" of egg products between January 2002 and March 2008. Similar documents also have been requested of other defendants in the suits.

Within the past couple of years, Moark has constructed five new confinement houses in response to complaints about odors. The new houses hold a total of 1 million hens, while the company's nine older houses — which are still being used — have a total of 400,000 hens.


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