A long-running fight over the economics of the West Coast Dungeness crab industry is escalating, with commercial fishermen seeking $789 million from Pacific Seafood and other buyers accused of conspiring to suppress prices paid at the dock.
The damages demand is part of an antitrust case alleging that seafood companies coordinated to hold down the price fishermen received for Dungeness crab, according to an Aug. 12 report by Undercurrent News. The litigation targets Pacific Seafood and other companies in a market stretching along the US Pacific coast.
The case underscores an antitrust issue that has simmered for years in the fishing industry: whether consolidation among seafood processors and buyers gives them enough leverage to dictate prices to the independent vessels supplying their plants.
The litigation was brought by commercial fisherman Brand Little and seeks to represent other Dungeness crab fishermen. The complaint alleges Pacific Seafood used its position in the market and arrangements with other buyers to reduce so-called ex-vessel prices — the amount paid to fishermen when they deliver their catch.
Pacific Seafood has disputed the allegations. In earlier reporting on the lawsuit, the company said the claims lacked merit and challenged assertions about both its market share and Little’s standing to sue. Pacific has said it accounts for about 25% of the Dungeness crab market, while Little’s allegations have put its share at more than 50%, according to SeafoodSource.
Little’s case alleges a broader strategy extending beyond coordination among seafood buyers. The complaint has accused Pacific Seafood of using its purchasing power, relationships with other processors and control of parts of the supply chain to pressure competitors and fishermen to adhere to its pricing practices, according to SeafoodSource. The lawsuit also alleges the company retaliated against buyers that departed from those practices by selling crab cheaply into markets in which those companies competed. Pacific has denied wrongdoing.
Related: Judge Dismisses Crab Price-Fixing Claims Against Pacific Seafood
Those allegations center on monopsony, the buyer-side counterpart to monopoly. Rather than alleging that a dominant seller used its position to raise consumer prices, the fishermen contend that market power among purchasers reduced competition for their catch and depressed the income they received.
The dispute has already produced settlements with some defendants. Pacific Dream Seafood and Caito Fisheries agreed in June to pay a combined $2.25 million to resolve claims against them, Bloomberg Law reported. Pacific Dream agreed to pay $1 million and Caito and affiliated parties agreed to pay $1.25 million, according to the report. The agreements were presented as early settlements after roughly three years of litigation.
Undercurrent News reported Aug. 12 that the plaintiffs are now seeking $789 million from Pacific Seafood and other defendants, putting a substantially larger dollar figure on the remaining antitrust claims.
The lawsuit traces its origins to 2023, when Little accused Pacific Seafood of fixing Dungeness crab prices in California, Oregon and Washington. His allegations included claims that the company had amassed influence over both seafood purchasing and fishing operations and used that position to constrain independent crabbers’ bargaining power, according to contemporaneous reporting by SeafoodSource.
Pacific Seafood rejected that characterization. Chief Legal Officer Dan Occhipinti previously called Little’s lawsuit baseless and said the fisherman did not do business with the company, SeafoodSource reported. In later litigation, Pacific argued that the plaintiff had failed to demonstrate anticompetitive conduct and disputed claims about the company’s share of the crab market.
The dispute is not Pacific Seafood’s first encounter with antitrust allegations from fishermen. A previous case brought by Oregon fishermen accused the company of using its position to suppress prices for Dungeness crab and other species. That litigation ultimately settled without Pacific paying damages or divesting businesses, according to reporting on the industry’s history.
Source: Undercurrent News
