Major Sugar Companies Hit with Class Action Lawsuit Over Alleged Price Fixing

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A proposed class action lawsuit alleges several of the country’s largest sugar producers and sellers have illegally conspired to artificially inflate the price of granulated sugar in the United States. 

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The 37-page sugar antitrust lawsuit alleges in particular that ASR Group, American Sugar Refining and subsidiary Domino Foods; Michigan Sugar; United Sugar Producers & Refiners Cooperative; and Commodity Information and principal Richard Wistisen have since at least January 2019 unlawfully exchanged detailed, competitively sensitive, non-public information about granulated sugar prices, capacity, sales, volume supply and demand. The defendants’ alleged price-fixing conspiracy has harmed those who buy granulated sugar—also known as refined, white or table sugar—from the companies directly, including food and beverages makers, retailers, food service companies and distributors, the suit claims.

The goal of the alleged price-fixing conspiracy was for the sugar producers to ensure that they would not undercut each other’s prices for the commodity and cause prices to drop as they would in a truly competitive market, the lawsuit alleges.

According to the filing, United, ASR/Domino and non-party Louisiana Sugar Refining are the only companies in the U.S. that currently produce granulated sugar, the predominant form of sugar sold nationwide, from cane sugar. Michigan Sugar, a cooperative consisting of hundreds of farmers, produces granulated sugar from sugar beets, the case adds. 

The suit shares that 80 percent of all sugar sold nationally is granulated sugar. 

“In the past 20 years, the price of Granulated Sugar has doubled on an indexed basis,” the complaint reads. “There is no economic rationale for the rate of price increases.” 

As the lawsuit tells it, there is also no “economically rational reason” for the sugar production defendants—United, ASR/Domino and Michigan Sugar—to share with each other competitively sensitive, non-public information. Per the filing, the non-anonymized data—including current pricing, crop size, crop yields, future beliefs on pricing and sold positions—was shared between the companies, allegedly facilitated by Commodity Information, for the purpose of enabling them to “effectuate their agreement to artificially affect prices and avoid competing with one another.” 

“Commodity does not gather information through voluntary surveys or periodic polling that it anonymizes,” the suit elaborates. “Instead, the Producing Defendants regularly shared competitively sensitive information about their pricing and sold positions with Commodity, and Commodity in turn contemporaneously shared that competitively sensitive information with the Producing Defendants.” 

The filing notes that “similar conduct” among granulated sugar producers decades ago led to a 1978 consent decree that banned exchanges of information between competitors.  

The case looks to cover all direct buyers of granulated sugar from any of the producing defendants in the U.S., beginning January 1, 2019 to the present.

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