A major class action lawsuit targeting two New Brunswick potato giants is moving forward in the United States. A U.S. judge recently ruled that antitrust claims against McCain Foods and Cavendish Farms, along with two American companies, have enough merit to proceed. If you buy frozen french fries or hash browns, this case directly involves the companies supplying your groceries.

According to a report by CBC News, the lawsuit accuses the manufacturers of operating a good ol’ boys network. The plaintiffs, Pennsylvania based grocery chain Redner’s Markets, allege these companies conspired to artificially inflate the prices of frozen potato products.

The four companies named in the suit include Florenceville Bristol based McCain Foods, Dieppe based Cavendish Farms, and Idaho based Lamb Weston and J.R. Simplot. Together, they control a staggering 98 per cent of the U.S. frozen potato market. McCain holds about 30 per cent, while Cavendish controls seven to eight per cent.

How the Alleged Price Fixing Worked

The lawsuit claims the companies began raising prices at nearly identical rates around January 2021. They allegedly achieved this by sharing sensitive pricing data through an industry program called PotatoTrack.

The lawsuit states that because PotatoTrack limited its clients to the four producers and the United States Potato Board, the reports allowed each company to assess critical data from their competitors.

The plaintiffs also argue that new competitors face massive barriers to entry. The four dominant companies hold exclusive, long established relationships with potato growers. Furthermore, executives from these companies frequently interact at industry conferences and share knowledge through outsourced production arrangements.

The Judge’s Decision

The defendants filed a joint motion to dismiss the complaint. Judge Jeffrey I. Cummings of the United States District Court for the Northern District of Illinois denied most of that motion last month.

Cummings noted that exchanging price information among competitors strongly indicates an anticompetitive agreement. He added that while controlling 98 per cent of the market does not prove price fixing on its own, it makes the allegations much more plausible.

Industry Response

Most of the companies remain quiet on the recent ruling. A spokesperson for J.R. Simplot stated the company is committed to competing fairly and with integrity in all markets where they operate. When the lawsuit first launched in 2024, McCain strongly disputed the allegations and promised to vigorously defend itself.

Frequently Asked Questions

Which New Brunswick companies are involved in the lawsuit?

McCain Foods, based in Florenceville Bristol, and Cavendish Farms, based in Dieppe, are both named in the lawsuit.

What exactly does the lawsuit allege?

The lawsuit claims four major potato producers conspired to raise the prices of frozen potato products by sharing sensitive pricing information.

Who filed the lawsuit?

Redner’s Markets, a grocery chain based in Pennsylvania, filed the class action lawsuit in 2024.