StarKist agreed to plead guilty on Thursday to one felony charge of price fixing for its role in a broad conspiracy to rig the price of canned and ready-to-eat tuna, the Justice Department said.
Price fixing is setting the price of a product or service, rather than allowing it to be determined naturally through free-market forces. Although this might be a good way for businesses to gain more revenue, it is illegal for them to do this strategy.
The company faces a fine of up to $100 millionfor forcing shoppers to pay inflated pricesfrom at least November 2011 through December 2013, the Justice Department said.
Price fixing on household staples, canned and ready-to-eat tuna, had direct effects on the pocketbooks of American consumers. StarKist’s cheif executive accepted the responsibility and was charged $100 million fine, swear that they will continue to conduct their business with the utmost transparency and integrity.
Thai Union had already swallowed up Chicken of the Sea and expected that the merger with Bumble Bee would propel it past StarKist to become the market leader in the United States.
When raw tuna prices had fallen, canned tuna prices ought to have followed them down but did not. This suggest that the canned seafood industry had already created an oligopolistic structure. The thai Union had already become one of the large firm in this industry, but made an unsuccessful bid to buy Bumble Bee Foods.
which would be turned into “a virtual duopoly” if the planned merger went ahead