Sunday, April 28, 2013

ABC: Suit Alleges 'Potato Cartel,' Price Fixing By Idaho Growers

Posted By on Sun, Apr 28, 2013 at 10:06 AM

Alleging that there is a spud conspiracy among what it calls a "potato cartel" led by Idaho growers, the Associated Wholesale Grocers—representing 1.900 retail stores, claims the $25 billion-a-year potato industry is price-fixing.

The complaint, filed in Kansas' U.S. District Court, is claiming that America's potato producers are violating the Sherman Act and the Kansas Restraint of Trade Act. The grocers allege that potato producers in 12 states, which control 80 percent of total U.S. potato acreage, are using an oil cartel as their model.

The complaint reads:

"Defendants analogized their potato cartel to the Organization of Petroleum Exporting Countries ("OPEC")—the notorious petroleum supply-reduction and price-fixing cartel composed of various foreign nations."

ABC News reports that growers in Idaho initially formed a cooperative to fix prices triggering a coordinated campaign that included growers from California, Colorado, Oregon, Washington and Wisconsin.

The complaint states that during a November 2004 industry gathering, including several hundred growers from Idaho and elsewhere, potato producers "gave a standing ovation to their leader when he laid out his price fixing plan."

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