Ex-Bumble Bee CEO Convicted in Canned Tuna Price-Fixing Conspiracy

December 04, 2019 Admin 0 Comments

Plus, coffee in cars takes on new meaning, and more news to start your day

A conclusion to a criminal conspiracy that rocked the canned tuna world

The former CEO and president of Bumble Bee Foods was convicted on Tuesday for his role in a canned tuna price-fixing conspiracy involving the top three companies in the industry, bringing to a close a yearslong scandal that “shook the packaged seafood industry,” as Bloomberg puts it.

According to federal prosecutors, during his time at Bumble Bee, chief executive Christopher Lischewski conspired with rival companies StarKist and Chicken of the Sea to raise and set the prices for packaged seafood across the board from November 2010 until December 2013. Faced with falling consumption of canned tuna over the years — per U.S. Department of Agriculture data, a drop of more than 42 percent per capita from the last 30 years through 2016, CNBC reports — the triad of companies had already made the joint decisions to downsize cans to five ounces and to participate in an industry-wide promotional campaign extolling the virtues of canned tuna, even before the agreement to fix prices.

The criminal scheme came to light around 2014 to 2015, when the government expressed concerns about a proposed $1.5 billion merger between Bumble Bee and Chicken of the Sea on the grounds that it “would have created a canned tuna giant commanding nearly half of the U.S. market,” Michael Hiltzik writes for the LA Times. Sensing that the Department of Justice had already cottoned on to the price-fixing scheme, Chicken of the Sea turned on its co-conspirators and cooperated with federal investigators in exchange for protection from criminal prosecution. While Chicken of the Sea was rewarded for its snitchery by not having to pay any fines, StarKist was ordered to pay $100 million, and Bumble Bee $25 million. Bumble Bee’s reduced figure was because the company claimed that a larger fine would result in bankruptcy — an outcome that happened anyway in late November, with Taiwan-based FCF Fishery agreeing to purchase Bumble Bee’s assets for $925 million.

Lischewski, whose legal fate was sealed in part after Bumble Bee and Chicken of the Sea executives testified at his four-week trial, faces up to 10 years in prison and a fine of $1 million. Crime, even of the canned tuna variety, doesn’t pay.

And in other news…

• McDonald’s and Ford are teaming up to turn the fast-food chain’s coffee bean waste into vehicle parts. [NRN]
• Nestle adds a plant-based twist to two of its legacy frozen offerings with new Digiorno pizza and Stouffer’s lasagna made with Sweet Earth alternative beef. [Food Business News]
• Speaking of Nestle, the food producer’s trademarking of the phrase “vegan butcher” for the Sweet Earth brand is being contested by the first vegan butcher shop in the U.S., which applied for and was rejected for a trademark on “vegan butcher” before Nestle swooped in. [Vice]
• Some experts are now saying consumers should not be panicking about a possible French fry shortage due to poor potato harvests. Which one is it, please, the American public needs to know. [NYT]
• German balsamic makers are officially allowed to make balsamic under the name Modena makers use. [Bloomberg]
• Alain Ducasse opens his first restaurant in Thailand. [PR Newswire]
• Are flat bottles the future of wine packaging? [Forbes]
• For diners who can’t get enough of in-flight meals (I assume there has to be at least one of you out there), AirAsia is opening its own airplane food restaurant in Kuala Lumpur. [CNN]
• Against single-serving ketchup packets. [The Outline]
• Feel the force … of Flavortown:

• All AM Intel Coverage [E]