A PYMNTS Company

US Farmers Raise Antitrust Concerns Following The Closure Of A Tyson Foods Plant

 |  March 26, 2023

US farmers have raised antitrust concerns following the closure of a Tyson Foods poultry processing plant, reported Reuters.

Tyson Foods issued a two-month notice to its chicken suppliers of their plans to close its processing plant in Virginia come May. Such short notice has drawn criticism from others in the industry as well as legal experts, who’ve been concerned that such action isn’t compliant with antitrust regulations that require 90 days’ advance notice preceding the termination of a contract.

Dozens of Virginia chicken growers face an uncertain future with the closure of a nearby plant, creating a predicament due to the limited number of alternative buyers in the area.

Related: Tyson Settles Chick-fil-A Antitrust Suit

It could also expose Tyson to fines under the century-old Packers and Stockyards Act (PSA), the U.S. antitrust law requiring the minimum advance warning, according to Peter Carstensen, a professor of law emeritus at the University of Wisconsin-Madison Law School who previously served in the antitrust division at the U.S. Department of Justice.

Tyson told Reuters the company is not canceling any farmers’ contracts and instead has committed to paying the growers for the full-term of their remaining contracts, keeping in compliance with federal regulations.