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Restaurant sues egg producers for alleged price gouging

FALCONER N.Y. A family restaurant in upstate New York has sued a group of egg producers for allegedly conspiring to jack up prices. The suit, filed in a Philadelphia federal court, is seeking class-action status, which would allow other restaurateurs to participate.

The suit seeks unspecified damages and legal fees. It was filed by T.K. Ribbing’s Family Restaurant in Falconer, N.Y., a town south of Buffalo.

The suit accuses the egg farmers of choreographing a drop in the U.S. supply of shell eggs and egg products. Defendants include the Alpharetta, Ga.-based trade group United Egg Producers and suppliers Cal-Maine Foods Inc. in Jackson, Miss.; Hillandale Farms of Pennsylvania in North Versailles, Pa.; Daybreak Foods Inc. in Lake Mills Wis.; Golden Oval Eggs LLC in Renville, Minn.; and Michael Foods Inc. in Minnetonka, Minn. Also named as defendants are Midwest Poultry Services of Mentone, Ind.; Moark LLC in Norco, Calif.; National Food Corp. in Everett, Wash.; Nucal Foods Inc in Ripon, Calif.; Rose Acre Farms Inc. in Seymour, Ind.; and Pilgrim's Pride Corp. in Pittsburg, Texas.

The United Egg Producers and its attorney, Kevin Haley of the Brann & Isaacson law firm in Lewiston, Maine, did not respond to requests for comment by press time.

The suit alleges the defendants decreased egg supply by “reducing the number of hens at laying farms by increasing cage space, agreeing to manipulate the molting of hens to keep egg production low, agreeing to delay or reduce chick hatching, agreeing to reduce inventory and/or not expand operations, agreeing to restrain output in the United States, manipulating the export of eggs to reduce supply and fixing prices through a horizontal agreement to restrain output.”

Certification as a class action would open the suit to “all persons and entities who purchased shell eggs or egg products produced from caged birds directly from any of the defendants É during the period from Jan. 1, 2000, to present,” the court papers stated.

The suit asserts that egg producers last year earned $6.68 billion, a 51-percent jump from their 2006 collective profit of $4.43 billion.

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