Brazil: damages from alleged orange juice cartel

Giants of Brazil’s orange juice trade are defendants in a class action lawsuit seeking billions in damages for alleged price fixing between 1999 and 2006.

Federal prosecutor Karen Kahn said the São Paulo Court of Justice would hear the lawsuits against companies such as Citrosuco, Cutrale, and Louis Dreyfus Co (LDC), which account for most of the world’s orange juice production, according to a Reuters report.

The alleged cartel harmed citrus producers and was investigated by Brazil’s antitrust agency, Cade.

In 2016, the regulator and the companies agreed to pay R$301 million to settle the case.

The prosecutor’s office filed the class action lawsuit in March, more than 20 years after the initial allegations.

The prosecution is seeking R$12.7 billion (US$2.51 billion) in damages, which exceed US$1.62 billion in annual revenue from orange juice exports in the 2021/2022 season.

The lawsuit seeks compensation from the companies that, according to the prosecutor’s office, control nearly 80% of domestic orange juice production, excluding about 75% of small and medium-sized companies in this segment in the state of São Paulo alone.

In the complaint, prosecutors allege that the cartel’s goal was to cause a sharp drop in fruit prices and inflict losses on farmers and consumers.

Louis Dreyfus Co. said it had not been officially notified of the lawsuit and denied wrongdoing, saying it complies with all applicable laws and regulations in its operating countries.

Citrosuco and Cutrale did not immediately comment.

Cargill declined to comment at this time.

According to prosecutors, Cargill, which sold to Cutrale and Citrosuco in 2004, and Citrovita, which merged with Citrosuco in 2011, are also implicated in the suit.