Smithfield Foods Faces Antitrust Lawsuit
RICHMOND, Va. - The Justice Department sued meatpacking giant Smithfield Foods on Friday, accusing the Virginia company of breaking antitrust laws by failing to report stock acquisitions, The Associated Press reports.
The lawsuit seeks $5.4 million, the maximum allowed, for what it alleges was Smithfield's failure to file premerger federal notification documents with the Justice Department and Federal Trade Commission before it bought stock of competitor IBP Inc.
Smithfield released a statement Friday saying it believes it complied with notification retirements and that the suit has no merit. The company rejected the possibility of an out-of-court settlement.
Smithfield is the nation's largest hog producer and pork processor. IBP was the country's No. 2 pork packer and now is a subsidiary of Springdale, Ark.-based Tyson Foods Inc.
The Justice Department said Smithfield bought IBP stock as a step toward a merger, requiring it to file the acquisition documents under the Hart-Scott-Rodino Act. Smithfield lost the bidding war over IBP to Tyson.
The department said the Smithfield, Va.-based company violated the act over 97 days in 1997 and 401 days from 1999 to 2001.
The lawsuit seeks $5.4 million, the maximum allowed, for what it alleges was Smithfield's failure to file premerger federal notification documents with the Justice Department and Federal Trade Commission before it bought stock of competitor IBP Inc.
Smithfield released a statement Friday saying it believes it complied with notification retirements and that the suit has no merit. The company rejected the possibility of an out-of-court settlement.
Smithfield is the nation's largest hog producer and pork processor. IBP was the country's No. 2 pork packer and now is a subsidiary of Springdale, Ark.-based Tyson Foods Inc.
The Justice Department said Smithfield bought IBP stock as a step toward a merger, requiring it to file the acquisition documents under the Hart-Scott-Rodino Act. Smithfield lost the bidding war over IBP to Tyson.
The department said the Smithfield, Va.-based company violated the act over 97 days in 1997 and 401 days from 1999 to 2001.