Starkist under ‘direct control’ of Dongwon’s chairman Kim during price-fixing years, lawsuits allege
Dongwon Enterprise chairman Jae-chul Kim, a legend in the tuna sector, directly controlled US subsidiary and tuna brand Starkist Co during the years of the alleged price-fixing conspiracy, a new wave of class-action lawsuits against the big players in the sector claim.
Two lawsuits filed on Aug. 29 by retailers Moran Foods and Dollar General Corporation and a third filed on Aug. 30 from Krasdale Foods are the latest to make allegations that the involvement in a price fixing conspiracy went right to the top at the South Korean firm, which owns US-based Starkist via its Dongwon Industries operation.
As well as Dongwon and its US operation, the former Starkist owner Del Monte Corporation, now known as Big Heart Pet Brands; Thai Union Group and its US subsidiary Tri-Union Seafoods, which sells under the Chicken of the Sea brand, and Bumble Bee Foods are all included as defendants, as with most of the other class-action lawsuits.
All the lawsuits emanate from a separate US Department of Justice (DOJ) probe of alleged price fixing in the sector, which in turn seemingly stemmed from information revealed during a DOJ review of Thai Union’s attempted deal for Bumble Bee. The deal collapsed at the end of 2015, with the DOJ stating the market was not "functioning competitively".
The allegedly hierarchical structure of Dongwon under Kim, who started out as a captain on a tuna seiner and built the group from scratch, is a particular focus of the new lawsuits.
The lawsuits state Dongwon is a “chaebol”, a term for closely-knit business groups in South Korea under the control of a single family or extended family, with key flagship firms that are used as the instruments of control of other firms within the group.
“In other words, as a chaebol, Dongwon does not follow the principles of corporate separateness that are expected of companies incorporated in the United States and instead acts as a single integrated enterprise,” the documents claim.