Parent company of StarKist Samoa, StarKist & Co., has tentatively agreed to pay at least $50 million to the US government as a penalty for its participation in the conspiracy to fix canned tuna prices.
But paying the maximum $100 million fine could “bankrupt” the company, its general counsel Scott Meece told San Francisco, California-based federal judge Edward Chen.
Meece was speaking at a Nov. 14 hearing during which StarKist, which is owned by South Korea’s Dongwon Enterprise, pleaded guilty to the price-fixing charge and said that the company’s ability to pay should be factored in when determining the amount of the fine to be paid.
The $100 million maximum was determined using federal sentencing guidelines and an estimated sales volume of $600 million of canned tuna during the 2011-2013 period.
“And really, this is a $50 million hearing. The low end is 50 million, the high is 100 million. This is really about the life or death of our company and its ability to continue as an ongoing concern,” Meece said.
Meece’s statements, revealed in recently released court transcripts, have not been previously reported.
The size of the fine has become an issue in the criminal case because, according to Reece, restitution to victims of StarKist’s price-fixing — the individuals and companies that bought tuna at inflated prices — has “primacy” when the judge determines the amount of the fine.
“Now, we’re not walking away from our responsibility here, your honor. We’re agreeing to pay, at a minimum, $50 million. It’s just simply $100 million will either bankrupt the company or absolutely impair its ability to pay restitution to victims. And so that will be central,” Meece said.
